rkbabang

Sony walkman didn't have a lock on the cassette format. Nor was there a distribution moat since you couldn't connect to them all via the network. Here's the thing. Apple has 3 big businesses: Computers, iPods, iPhones. The first it owns 3-5% marketshare, the second it dominates, the third it has a lot of smartphone market share, but that's a small small percentage of the total mobile market share. ie. In spite of it's size, there's still room for growth. Apple doesn't have a lock on the mp3 format. I have a creative ZEN mp3 player and I have 1400 songs on it, none of which were purchased from Apple. They certainly don't have any lock on either the hardware nor the music formats. I regularly listen to audiobooks and podcasts on my ZEN without a problem. In fact I don't think I've ever regretted not paying more for an iPod. Especially since buying my kids iPods recently and seeing that they don't do anything my ZEN doesn't. I've owned creative mp3 players for about 5 years now, my current one is my 3rd. Every time I look to buy a new one, they are always cheaper than iPod. As for computers I have the best of both worlds, a dual boot system running Ubuntu Linux and Windows XP. I do almost everything on Linux and I have winXP running on that same machine for when there is something I need windows for. For instance, I prefer photoshop to Gimp and the software my company requires me to use to work from home only runs under Windows (which is strange, because my machine at work that I log in to runs Red Hat Linux). Anyway buying a Mac would mean spending many hundreds more on a machine that would be quite a bit less functional than my current set up. I understand that for some, form>function, and these people are willing to pay more for boutique-type products that look good. That is a legitimate market niche that Apple has taken advantage of. It isn't for everyone though, and they certainly don't have a "lock" on anything. And you represent like what -- 1% of the population? Most people I know aren't using Ubuntu or Zen mp3 players. I'm know for sure that there is a segment of the population that refuses to drink carbonated beverages, does that make Coca-Cola's moat weaker? No, because most people drink some kind of coke product. The fact remains that Apple has leading market shares in mp3 players and smart phones. In addition to that, they pretty much monopolize content distribution for those devices. Yes, you can hack other solutions out, but most people do not do that. That is the big difference between what Apple is doing versus what the Walkman had. The Walkman was purely a music player, they didnt get a cut of the content. Actually I only represent about 0.00000001493% of the population of this planet, as do you. But I was just saying that they have a lot of market share, but they don't have a lock on anything. It is appropriate that you used Coke as an example. No one would say they have a lock on the beverage industry. Like Apple, they have a strong brand with large market share, but that is all, anyone who wishes can drink carbonated beverages their entire lives without ever drinking a Coca-cola product. All it would take to bring it down is a few years of poor management or, in Apple's case more than Coke, a change in technology that the company was late implementing. Steve Jobs isn't going to be around forever, and Apple almost disappeared the last time they lost him. Also, holding on to your brand in the rapidly changing technology sector is a completely different thing to holding on to it in soft drinks. When is the last time you saw an Admiral TV? W.E.B. doesn't invest in tech companies, because of the unpredictability. I'm a digital ASIC design engineer and I don't invest in tech companies either for the same reason, not even the one I work for. --Eric

Sony walkman didn't have a lock on the cassette format. Nor was there a distribution moat since you couldn't connect to them all via the network. Here's the thing. Apple has 3 big businesses: Computers, iPods, iPhones. The first it owns 3-5% marketshare, the second it dominates, the third it has a lot of smartphone market share, but that's a small small percentage of the total mobile market share. ie. In spite of it's size, there's still room for growth. Apple doesn't have a lock on the mp3 format. I have a creative ZEN mp3 player and I have 1400 songs on it, none of which were purchased from Apple. They certainly don't have any lock on either the hardware nor the music formats. I regularly listen to audiobooks and podcasts on my ZEN without a problem. In fact I don't think I've ever regretted not paying more for an iPod. Especially since buying my kids iPods recently and seeing that they don't do anything my ZEN doesn't. I've owned creative mp3 players for about 5 years now, my current one is my 3rd. Every time I look to buy a new one, they are always cheaper than iPod. As for computers I have the best of both worlds, a dual boot system running Ubuntu Linux and Windows XP. I do almost everything on Linux and I have winXP running on that same machine for when there is something I need windows for. For instance, I prefer photoshop to Gimp and the software my company requires me to use to work from home only runs under Windows (which is strange, because my machine at work that I log in to runs Red Hat Linux). Anyway buying a Mac would mean spending many hundreds more on a machine that would be quite a bit less functional than my current set up. I understand that for some, form>function, and these people are willing to pay more for boutique-type products that look good. That is a legitimate market niche that Apple has taken advantage of. It isn't for everyone though, and they certainly don't have a "lock" on anything. --Eric

Cory Doctorow gives his books away for free in electronic form. http://craphound.com/?cat=5 They are all excellent, BTW. Also I just updated my "Nook" to the latest software revision and it now included a nice web-browser that can be used when you are connected to WiFi (not with 3G, however). Nice to read books available in html on the web or long web pages. Or to just look something up quick or check your email if it has a web interface like yahoo mail or gmail. --Eric

I found one. Its called America. In 2009, 47% of Americans paid no income taxes whatsoever. Whats more, the bottom 40% recieve cash & benefits (EETC, unemployment benefits, S-CHIP, Medicaid, housing subsidies, food stamps, welfare, etc.) paid from reciepts of those who paid their share of this 'social contract'. What kind of perverted theory justifies a system where half the nation are freeloaders? "Everyone wants to live at the expense of the state. They forget that the state lives at the expense of everyone" -- Frederic Bastiat.

I'm not saying such a place exists, to my knowledge it doesn't, but that doesn't mean taxation is not theft. There was a time where you'd be hard pressed to find a place in the world that didn't practice chattel slavery, or where you could live without being a surf under some landed aristocracy. That didn't mean these practices were just. It just means most people have been brainwashed into thinking these things are OK and even necessary by the people who benefit from these abominations. Taxation is the same. Humanity will one day look back upon taxation the same way we today look smugly back upon chattel slavery and think we're so morally superior then our ancestors. You have a million reasons in your mind why coercive government is necessary, and they are all false. Just because you personally can't imagine the solutions to these problems you envision doesn't mean there are none. And - I don't beleive this to be so - but if you are correct, and it takes violence and slavery to produce roads and bridges, then I'd rather live without them. Just as, if it took violence and slavery to produce cotton and tobacco, I'd rather live without them. Fortunately it no more takes violence to produce convenient modes of transportation than it does to produce cotton or tobacco. --Eric

"social contract". I'm sorry, but I've never signed nor agreed to your contract, "social" or otherwise. You think you can bind someone to a contract whether they like it or not and enforce that with violence? You Be honest. If there wasn't that implicit social contract out there, most of us would already be dead. You have a much more pessimistic view of humanity than I do. I don't think my neighbors would turn into Ruthless Bloodthirsty Savages, simply because the IRS and other government agencies have stopped stealing from them and they have to find a private company to pick up their trash. --Eric

"social contract". I'm sorry, but I've never signed nor agreed to your contract, "social" or otherwise. You think you can bind someone to a contract whether they like it or not and enforce that with violence? You can't bind someone to a contract he has never signed nor agreed to. If I don't have the option to freely opt-out, then it isn't a contract at all, but an initiation of force against me. See: No Treason, by Lysander Spooner. There is only one social type contract I am willing to sign, it is called the Covenant of Unanimous Consent. You can find it here: http://www.lneilsmith.org/new-cov.html. "parasitic leech". Funny you would use those terms. Those are the very terms I use to describe someone who thinks they have a right to bind others to "social contracts" against their will using deadly force if necessary to extract what those others have produced. As well as those who live off of such violently aquired resources. --Eric

I'm a "taxation is theft" kind of guy, but I do agree that if there is going to be taxation it should be equal for every income type. This way people invest in one thing and not another for market reasons not tax reasons. Taxation, if it exists at all, should be flat and simple and apply equally to everyone and every type of income. The tax codes, in any country I know of anyway, are none of these things right now. They use tax policy to punish some, to reward others, as a social engineering tool to incentivize certain behaviors and disencentivize others, etc. It forces people to do things with their money they wouldn't otherwise have done, which screws up the monetary signals in the economy and reduces economic efficiency and is just one of the many causes of the massive boom-bust cycles we endure. --Eric

If this is out of line for this site, I apologize in advance and feel free to delete this post. Good friends of my wife and I are trying to raise money to fund their next adoption and are holding a raffle for an iPod Touch. You could turn $5 into an iPod Touch not a bad return if you win. It's for a good cause and these are great people and excellent parents. www.LarsonFamilyAdoption.com Thanks, --Eric

You've got a pretty small house. My house is about the size of his gym. Buffett's house is modest compared to the other billionaires, but compared to us regular folk 6000 square feet is quite large. --Eric

I agree Amazon needs to support some open formats. My wife gave me a Barnes & Noble "Nook" for Christmas, and so far I love it. It works like a Kindle with some important differences. You can load it with ePub or PDB formated documents, as well as easily load PDF files onto it. I've got tons of ebooks in PDF format on my computer that I've been wanting to read but I hate reading on a computer screen. Also I've found free epub format books on line as well. I know kindle lets you read pdf files, but you have to email them to get them on the device. The nook simply lets you hook it up to your computer via a USB cable and drag and drop them onto the device. Much easier. It also comes with free G3 mobile Internet like the kindle, but uses my wifi when I'm at home which is faster. Searching through the B&N catalog it seems that they have better pricing then Amazon and even many free choices. All that with the ability to let other Nook users borrow books from your library. Also the color touch screen is a nice touch and easy to use, I think we'll be seeing more of this type of thing in the future on ebook readers instead of Amazons approach with a ton of buttons. I think Amazon needs to make the kindle more open format friendly, make it easier to load it with your own content (get rid of the use of email to load files onto it), and a way to share ebooks is an excellent feature that the Kindle lacks. --Eric

Yep, I just logged into my Fidelity account, which is a retirement account and not eligible for foreign trading and sure enough, I now own FRFHF. --Eric

Kawikaho, absolutely. My wife has a brother-in-law who has never worked. I mean never. When he was a teenager and just married he got a job as a metal worker which lasted about 2 months. He didn't like it so he quit and has been sitting home ever since. He lives rent free in a building his parents own, but other than that his family (him, his wife, and their 2 children) live on his wife's Walmart income. He won't see anywhere near a million dollars in his entire life, yet has managed to do nothing all of his adult life (he's in his mid-30's now), with no signs that the situation will ever change. Some people are lazy. An inheritance makes being lazy a bit more comfortable, but it certainly isn't a requirement. There are many people who inherit money and live productive lives and there are many who don't inherit money and still manage to do nothing. The real question is who should determine what happens to the wealth you've created when you pass on? You or a government? Would the world be a better place if the government took WEB's money after he died? Or should he decided what is to be done with it? I'd much rather it go to charity and his children then to the IRS. People are painting with a pretty wide brush here. Yes, some who inherit money are irresponsible and stupid, but many people are that way even when they have next to nothing. I find it hard to beleive that inheritance ruins people's lives, it is more likely they would have been just as lazy and stupid regardless. --Eric

True. The from a British perspective someone Buffet's age is way too old to be treated, so almost any little health problem could be deadly. It doesn't work that way (yet) in the US. Although even when it does Buffet will have the money to fly to Mexico and pay cash for superior healthcare over the boarder. --Eric

"Nearly every time the Nobel Committee hands its “Peace Prize” to a politician, the hand which accepts it is a hand literally dripping innocent blood. Barack Obama isn’t an exception to that rule — he embodies it." An IgNobel History - http://c4ss.org/content/1234 --Eric

Yes, Bush started these insane wars, O-bomb-a (aka Mr. Peace) just escalated them. "War is Peace" --Nobel Committee, 2009 --Eric

I thought this was a joke when I heard it on the radio this morning. It's completely and utterly inexplicable.

I think what you are basically saying is that some people are good at capital allocation and others at marketing, but the same person is not usually good at both. This could be said about any business. The ones that market themselves the best are not usually the ones with the superior product. --Eric

That is an excellent way to explain it and can also be used to explain the problem with 3 doors. To rephrase what you said and apply it to the 3 door problem: The host will always open the door that doesn't have goats. Therefore, the probability of the car begin behind the other door is 1 - P(it's behind the door you pick). In other words, when you start, there's a 1/3 chance (33.33%) that it's behind your door, so there's 2/3 chance (66.66%) that it's behind one of the other doors. After the other doors are opened (and the host will always open the other door with goats), there's still a 66.66% chance that it's behind one of the other doors. The only other door left is door 3, so there's a 66.66% chance that it's behind that door. So, if you stay with your 1st pick you still have only a 33.33% chance of getting the car, whereas if you switch you have a 66.66% chance of getting the car. --Eric

My Kids are 8 & 9, two years ago, when they were 6 & 7, I started explaining to them about businesses, what they are, how they make money (satisfy a human want or need), and how it is possible to not only start your own business but own some small part of businesses that already exist (stocks). At this time I started giving them allowances for doing work around the house. Every week we give them a certain amount of money and they divide it into 3 cups, 1) The Save Cup, 2) The Spend Cup, 3) The Share Cup. The Save Cup is money they save up to buy stocks. The Spend Cup is money they save up for any other things they want to buy. The Share Cup is money they save up to donate to charity. We put about 45% in the Save cup, 45% in the Spend cup and 10% in the Share Cup. I explained to them that these are the three things you can do with money. Save it, Spend it, Share it. When they each had about $1000 in their save cups (not only from allowances, but birthday and Christmas money etc..) I opened a UTMA brokerage account at firstrade.com for each of them (only $6.95/trade) and discussed what companies they might want to invest their money in and why. I let them pick their own companies out of a list I provided for them. My son picked KO, DIS, MVL. My daughter picked KO, DIS, MAT. (they both also own SNS now also). I show them their accounts occasionally and show them how the dividends are reinvested (and try to explain what a dividend is). You'd be surprised how much a child can understand if you are patient with them, after all ownership is something children just know and understand instinctively. As Frank Zappa said: "In every language, the first word after "Mama!" that every kid learns to say is "Mine!" A system that doesn't allow ownership, that doesn't allow you to say "Mine!" when you grow up, has -- to put it mildly -- a fatal design flaw." At times they get excited about saving or sharing and want to put more money into either their "Save Cups" or "Share cups" and nothing into their Spend Cups. I let them do this, but when they want to buy something and want to put everything into their spend cups I let them put more in their spend cups for a week or two but something always has to go into the other two. As for the Share Cups, once a year in December we decide on a charity and donate the year's worth of Share money to it. The first year it was Toys for Tots, we used the money to buy a toy and donated the toy. Last year we gave the money to a convent who used it to feed hungry children in Haiti. My great-aunt is a Nun in this convent so we know 100% of the money went for food for the children and she went to Haiti personally to distribute it. She sent my kids back pictures of the children they had helped, which was really emotionally satisfying to them. --Eric

If my calculations are correct, yes. I sold all of my Middleby shares and bought OVEN this winter (as well as putting quite a bit of new money into OVEN) which all got converted to MIDD shares after the acquisition plus a good amount of cash. Taking my number of MIDD shares that I now own and dividing it by the sum of the new money I put into OVEN plus the money my original MIDD shares cost me, minus all transaction costs, I get $6.95/share as my cost basis. I know at least one other board member thanked me for posting info about this arbitrage situation on the old board, so I'm not the only one here that made out like a bandit on this deal. --Eric

This is based on the value as of the close yesterday. 21.76% WEST (cost basis $10.83/share) 17.93% MIDD (cost basis $6.97/share) 15.78% ISRG (cost basis $107.95/share, hoping for a good day today, may sell some) 12.80% FFH (cost basis $280.15/share) About 29% in 20 other stocks including some stocks followed on this board such as BRK-B (3.2%), SNS (1.8%), and CCLR.OB (1.7%). About 2% cash. --Eric (Dammit Jim! I'm an engineer, not a investment professional)

Two things that spring to my mind are our complete dependence on oil and war as some sort of solution for anything. Any other thoughts from the sharp minds around here? I think if I had to guess, or rather I had to hope, it will seem absurd that we put our faith in politicians and government to "fix" markets and solve world problems (the slaughter of war being just one of the many absurdities). That in an age where we now have the ability to "speak" for ourselves to the world, we let our "leaders" speak for us as if one man can speak for 300 million. Our complete and utter reliance on, and faith in, a few men wearing funny costumes or holding lofty titles to rule over us will someday seem primitive and humorous to those who will one day speak for and rule only themselves. And the notion that a single human being or any group of human beings can have the wisdom to know enough about the wants and motivations of millions, or even billions, of people and to have the hubris to "set interest rates" or fiddle with the money supply will seem absurd, or decide which businesses are "too X to fail" whether X equals "big", "important", "politically connected", etc. If humanity is lucky the word "Keynesian" will bring the same reaction to the average person as the word "fascism" does today. Of course this is all probably just my wishful thinking. We could be heading into another dark age where we'll let those who rule us stifle progress for another 1000 years just as what happened after Rome collapsed under the weight of its grown-too-big government and its empire it could no longer afford ... until the next renaissance ushers in a new age of increased individualism and freedom once more. I've just laid out the best and worst cases, the reality will probably be somewhere in between. --Eric

No. I joined the original board sometime in 2007 (I think) and have never left, nor have I been involved in any heated arguments on this board like the Eric you are referring to. I read the board frequently but don't post very much. --Eric

Yes, the MSN Board was excruciatingly slow, this board is excellent. Sanjeev has done an excellent job. And if the ads bother someone very much there are ways to avoid them. I can't understand why anyone would surf the web using Microsoft's horrible IE browser anyway. I use Firefox w/ its adblock add-on and haven't seen an ad on the internet in years (on this site or anywhere else). After seeing this thread I turned off adblock just to see what everyone was griping over and I don't think the ads here are very disruptive at all. There are some sites that become unreadable without adblock turned on. I think I'll try to remember to disable my adblock once and a while when visiting this site so I can click on an ad or two, now that I know they are there. --Eric