Two blue-chips the analyst community counts on to drive bulls over cliffs have faltered. Apple has missed Q4 earnings estimates. When your earliest adopters are fanatically devoted to shiny new products and expect version 5, an interim product called 4S just won't do. Delaying it one month didn't help either. Amazon's new gizmo will bring full blast margin compression to a commoditized product. Apple's ability to extract monopolistic rents from this market is peaking, so it absolutely must milk this cash cow to fund the rest of Steve Jobs' legacy blueprints.
The second unpleasant surprise for bulls is an even worse story of eroding monopoly power. Goldman Sachs lost money for itself. I'll skip the hard-core analysis and just say that bad karma from publishing equity research that lost money for clients has finally caught up to the firm.
These two stocks are symbols of the gossamer knowledge economy as much as railroad stocks used to be bellwethers of the old-fashioned America. It's time to fold up the revival tent, bull investors, and head for defensive ground.
Full dislcosure: No positions in AAPL or GS.
The second unpleasant surprise for bulls is an even worse story of eroding monopoly power. Goldman Sachs lost money for itself. I'll skip the hard-core analysis and just say that bad karma from publishing equity research that lost money for clients has finally caught up to the firm.
These two stocks are symbols of the gossamer knowledge economy as much as railroad stocks used to be bellwethers of the old-fashioned America. It's time to fold up the revival tent, bull investors, and head for defensive ground.
Full dislcosure: No positions in AAPL or GS.
