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How Inflation Drove Apple’s Market Cap To A Trillion Dollars


Via Global Macro Monitor,


Apple’s market cap hit 10^12 dollars yesterday (and just dipped below it this morning)…

Impressive but no pom-poms here at Global Macro Monitor.  We would be more impressed if Apple’s main businesses were doing better and the company was more focused on electrical engineering rather than financial engineering.

Don’t get us long, I mean wrong,  we were The Dallas Cowboy Cheerleaders for Apple’s stock pre-2015.   Check the record.

Just the data, ma’am

The table below illustrates that almost all of Apple’s revenue growth was driven by inflation, that is the price increase for iPhones.  

Unit sales growth for the company’s three major products  – iPhone, iPad, and Mac – were either flatish year over year or negative.  This has been the case now for several years.

If Apple were not able to significantly raise iPhone prices (mainly through the upgrade to the X) and only grow revenues by the device’s unit sales growth of 0.67 percent,  Apple’s total revenues would have been about one third of what was posted, or 6.7 percent versus 17.3 percent.

One thousand dollar smart phones are not a sustainable proposition, in our opinion, folks.  China, or somebody, somewhere, will, or already is producing a quality equivalent smart phone for $250.

Are iPhones Peacock Feathers? 

Yes, yes, and yes, still not a Porsche.   We get it.

Our sense, however, millennials, and the youngers, are not as into conspicuous consumption as the self-absorbed boomers are.

An iPhone is not peacock feathers, folks, at least we don’t think so.

Does owning  an Apple iPhone really signal superior genes to the opposite sex?

Make sure to click on the peacock feathers link to understand what the hell we are talking about!

An Omen Of Coming Inflation?

Furthermore, Apple’s inflation driven earnings may be an omen of a larger inflation coming to

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