Re: OT-brother eric
- From: Bruce S <bruce.snell@xxxxxxxxx>
- Date: Thu, 04 Aug 2011 10:52:36 -0700
On 8/4/2011 10:32 AM, Technobarbarian wrote:
"Bruce S" <bruce.snell@xxxxxxxxx> wrote in message
On 8/3/2011 6:51 PM, Technobarbarian wrote:
"Bruce S" <bruce.snell@xxxxxxxxx> wrote in message
On 8/3/2011 3:35 PM, cj wrote:On 8/3/2011 6:21 PM, Bruce S wrote:And, since your understanding of business and banking is obviouslyI'm curious, when a business "pockets much of the saving" where doin a bank?
<<The profits are either reinvested in the corporation (a good thing),
passed on the shareholders (a good thing).>>
lacking, having the business simply put their profits in a bank
account and leave it there is good for everyone too. Where do you
think banks get money to loan if no one puts money into savings. Do
you understand this topic at all? Businesses are not capable of
"Hey, Steve Jobs ... can we get a bailout?
The U.S. Department of Treasury on Monday said it had a total operating
balance of $53.575 billion on Friday (the latest statement available).
That number will get smaller as the debt ceiling approaches, though
lawmakers are scrambling to make their debt-limit deal.
Meanwhile, at the end of June, Apple had a total cash reserve of $75.876
billion, the company said.
That's right: The iPhone and iPad company has more cash on hand than the
Microsoft can nearly boast the same -- at the end of June, the
Redmond-based company had $52.8 billion in cash and short-term
investments. (A proposed $8.5 billion acquisition of Skype is still
Though they own stock in one of the most admired companies in the world,
Apple (Nasdaq: AAPL ) shareholders have one common, and stern,
grievance: Why does the company hold so much cash, and why does it
refuse to pay a dividend?
Conspiracy theories abound. Apple is saving for a massive acquisition.
Management is inept. Steve Jobs is a just a jerk.
In truth, there's a good reason Apple isn't paying a dividend. All you
have to know is this short passage from the company's 10-K annual
As of September 25, 2010 ... $30.8 billion ... of the Company's cash,
cash equivalents and marketable securities were held by foreign
subsidiaries and are generally based in U.S. dollar-denominated
holdings. Amounts held by foreign subsidiaries are generally subject to
U.S. income taxation on repatriation to the U.S.
For perspective, Apple holds around $51 billion in total cash and cash
equivalents. More than 60% of its cash hoard, then, is subject to
repatriation taxes -- 35% -- if it's ever brought back to the U.S. Add
in dividend taxes, and more than 50% of Apple's cash could be devoured
by the IRS if paid out to shareholders.
Steve Jobs isn't a jerk. He can add. And you should thank him for it.
A broken system
U.S. companies have more than $1 trillion in cash abroad. Their options
for this cash are straightforward: Pay a 35% repatriation tax to bring
it home, or keep it abroad. Most wisely choose the latter.
There's an easy solution to this inanity: A repatriation tax holiday
that lets companies bring foreign cash home with minimum penalty. It's
been done before. In 2004, the Homeland Investment Act temporarily cut
repatriation taxes to 5.25%. Roughly $300 billion returned to the U.S.
over the following year, up from an average of $62 billion during the
previous four. It worked, in other words. Quite well."
Apple has been campaigning for this tax " holiday" for quite awhile and
they're far from alone in this situation. The simple fact of the matter
is that companies DO hoard cash in ways that do not help the American
Are you suggesting that Apple (and MS) have some sort of vault in
their basements and are hiding the money in such a way that it gets no
use? Perhaps you don't understand that when Apple puts money into its
corporate bank account that that money is then used by the bank to
make loans to others. Thus the money is being used and people are
I'm not surprised. Zing--right over your head.
I'm flat out saying that your reading comprehension sucks big time. I
did not "suggest" anything. I pointed to exactly where the money is.
Sixty percent of the time Apple's cash is in some other country. If you
had actually slowed down enough to read what I posted you would know
that it is not always in banks, but that doesn't matter because it is
not helping us in this country.
It isn't helping us in this country because tax laws make that a bad proposition. It is, however, helping people wherever it is now.
For those whose understanding of economics is as limited as Bruce's: You
should also understand that corporations frequently export profits by
importing expenses. The money for which Apple and others would like a
"tax holiday" has not paid a penny in American taxes even though some of
it was earned here.
And nice way to clip my response to this nonsel
Thomas Jefferson - "The policy of the American government is to leave their citizens free, neither restraining nor aiding them in their pursuits.
No man has a natural right to commit aggression on the equal rights of another, and this is all from which the laws ought to restrain him."
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