tatsuke95

Simon and James are both best selling authors and have been blogging about economics and finance for years. Simon was the economic head hauncho at the IMF and is a professor at MIT.

I'm sure they are concerned about the traffic spike from HN...

Because leasing is a pretty efficient system that can be economically superior to buying an asset that depreciates like mad the instant you sign the papers?

Leasing isn't reserved for people who can't afford to buy a car, just like renting isn't reserved for people who can't afford to buy a home.

Oracle has the right to bundle whatever crap-ware they want. If that sullies their reputation or draws out alternatives, that's a good thing.

They are a tiny country who nationalized their banks, stiffed creditors, implemented unnecessary austerity measures and devalued their currency. I'm not sure they're a model for US economic policy.

Honest question: why not?

Seems reasonable, even if only to protect brand image.

Apple's stock price was on a parabolic growth trend. Sure, this time could be different, but history says that such growth is unsustainable. Combine that with the "intangibles" (Jobs' death) and the recent price correction isn't shocking.

Why is every movement in Apple news? Because it's one of the planet's most recognizable brands and biggest companies. Those are things that make news.

The industry needed an infusion of cash, and they spread it around a bunch of the biggest players.

I don't care about "could haves". These industries were all bailed out; some returned a profit to the taxpayers, some are still in the red without a chance of paying any of it back. Yet we continuously denigrate the industry that paid the money back as the "criminals".

>"From what I have seen, the average folks still buy into the opposite extreme"

Really? You must be living in a different world than I am. Just skim this thread, or any thread on Reddit...

>"Also, I do not think the auto industry runs Stasi-like intelligence operations where they constantly collect and pool your most private and financial information and credit ratings and use all that to evaluate how they are going to deal with and sell to you - or potentially put you out on the street."

Banks aren't planning to put you on the street. Where does this come from? Banks want to lend money and be paid back, with interest. This whole debacle worked out really well for them. They only had something like 3 trillion wiped from their collective balance sheets.

By the way, the auto-industry parents run huge financial companies.

>"it cannot be a coincident that they pay much more than a lot of other industries"

Sort of like IT? Or medicine?

I feel like these conversations are so one-sided: Why is it always this?

Yes, predatory lending happened. But you know what else happened? People fraudulently reported personal information (with little verification required, which was a government mandate) to get mortgages. People who knew they had no chance in hell to repay the mortgage, but thought they could "flip" the house in time, or that prices would never fall. I can't tell you how many stories I've read or listened to where people tell their tale of going into the bank, reporting their income way too high (yes, sometimes thanks to a pushy mortgage broker) and getting a massive mortgage. All with no job. This is fraud, but the banks don't worry too much, because worst case scenario they take back the property.

The papers you sign are your responsibility. That goes for both parties.

Back in reality, most banks have paid back their TARP funds, as did AIG, generating a hefty return over 3 years to the Treasury. You know what bailout is still significantly in the red? The auto industry. But we hear little about that because those guys don't work on Wall Street.

Strawman.

>"as do things like deliberate starvation."

How do you think economic sanctions have affected populations in Cuba, Iran and Iraq over the years? Why do you think the rest of the world sees the US as a bully?

People like Hitler, Stalin, Pol Pot are easy. But when people trot around on their moral high horse like "our" own countries haven't done despicable (read: "evil") things is where the real problem lies.

In case you hadn't heard, we got rid of Hitler. But that took people on the outside to recognize what was happening on the inside.

So putting pressure on international bodies to enforce crippling sanctions should count, right?

>my rule of thumb is, when you're feeling morally conflicted about who 'should have' won the Normandy invasion in 1944, your morality is a bit off-kilter.

My rule of thumb is: when you assume that all "our" killing is for "good" and "their's" is for "evil" your morality (as well as your knowledge of history) is off-kilter.

Some of these "real-world" business models are broken because the industry is commoditized. One one hand, the margins don't exist to offer customers a discount (remember, you're inserting yourself in the chain, so need to take some of the profit). On the other, there isn't enough value-added in the product to demand a premium; there's a mechanic on nearly every street corner in every town.

These products need to work for both buyers (people in need of car repair) and sellers (mechanics). In this case, the buyers see some obvious benefit, but what are the sellers gaining?

I've seen a bunch of Quartz articles coming up in the variety of aggregators I use. Unfortunately, they don't load.

Pro-tip: You're trying to get me to spend time reading your content. If I have to mess with my browsing setup to do so, I'm going to skip your articles. And I do.

How many years are you talking about being employed? Because doubling your salary every 3-5 years is completely unsustainable. If this occupation is so leveraged that 10% annual salary gains are "average", and 20% are "expected", there is going to be some heartache at some point. That isn't happening anywhere else on the planet.

Absolutely. I can imagine the kind of work an implementation like that entails.

Maybe I misunderstand "lock-in". Nothing is preventing me from switching providers, since there is no reliance on proprietary measures anywhere along the line. Switching from one implementation to a different one is as easy as re-doing the labour (not that that is "easy", as you point out). But that's the bare minimum that I can expect to do anyway. I certainly can't have less work to do the second time.

Perhaps it's an approach unique to me, but pretty much, yeah. If I can define exactly what I need in a service, and the service provider can assure me they can meet those demands, it's all about price.

Which was my point with regards to ADP. It may be clunky and unpretty, but it does what I need it to do: pay my employees, accurately and on time (disclaimer: I hope, still in implementation!). Flash and prettiness is nice, but if it's superfluous, it has to be free.

Good stuff. I'm going to keep my eye on this. Having gone through it, it's an interesting space. I think it can be done better than the incumbents, and that's key, right?

My point was that there's a bit too much "shoot-for-the-stars" mentality when great start-ups are on the rise. Players like ADP are slow because they are large. But they got large because, at the end of the day, they offer a good product (maybe a tad pricey). $30BB in market cap ain't easy to achieve.

Anyway, I believe there's a big hole ZP can fill, especially if you can market to businesses that can't justify spending thousands per year on payroll. It didn't make sense for us for a long time. It's nice to see a relateable problem being solved. Congrats on the round, and good luck.

I'm currently in the middle of an ADP implementation for our company (120 employees), so I have a bit of insight into this. Once you reach a certain threshold of costs associated with payroll, it's very hard to beat the big players:

>"These legacy companies rely on selling to other enormous enterprise clients whose opportunity cost of switching services provides a sufficient lockin"

I don't know about this. How am I locked in? Sure, there is some labour associated with moving employee files from one provider to the next, but you have to do the same to get your data into ZenPayroll. ADP required me to fill out a spreadsheet with the required employee information. Once the data is in, you flip the switch and you're up and running on the new system. I don't see any lock-in whatsoever. I still have my employee information spreadsheet, ready to pass to the next competitor. What am I missing?

>"Faced with expensive and complex software options"

Not really complex. We worked with an ADP "implementation specialist" to design the earnings/deductions rules (customized to our specific needs), which took about a week. Now we enter hours in a text box, and adjust parameters as needed. Sure, the interface isn't pretty, but we're talking about tab-ing through text boxes and entering numbers. Can't be much more intuitive.

>"With ZenPayroll, companies can handle the standard functions of adding employee hours, overtime pay, bonuses, reimbursements, garnishments, benefits, etc., and issuing periodic payments via check or direct deposit."

This is standard for payroll systems.

>"Where ZenPayroll really sticks its head above the crowd is in the long term tracking and management for both employees and employers. On the platform..."

Standard features, at least with ADP.

We made the decision to switch from manual payroll to a payroll service when the cost/benefit made sense. I can understand that that threshold is far, far lower for the multitude of 1-50 employee sized businesses out there. ZenPayroll looks good there.

But the big players can offer something I can only assume ZP can't: support. We have two agents, ready to handle whatever crazy questions our staff has. That's vitally important to an enterprise. Although the author sees payroll as "evil", we're talking about other people's livelihood. It's not to be taken lightly. I don't see one mention of support in the article.

For $30/month, there's a market, and a big one. But let's not fool ourselves into thinking that the big players have nothing to offer. And they won't be easily displaced.

Whole-heartedly agree. I'm an economics guy myself, so I didn't intend to denigrate the degree choice. Top students will succeed no matter what; but the law grad outlook (or lack of) is no joke.

http://professional.wsj.com/article/SB1000142405270230445860...

Law school has been the "go to" graduate option for the "soft" sciences for a long time, since there is no requisite pre-law undergrad. It's also led to a surplus of Law graduates with no job prospects.

>"Is "college education" a proxy for gradschool ?"

I believe that is actually teaching college courses. But I could be wrong.

No, I disagree because I know what a substantial portion of Apple's investments are (this information is public), and they are, by definition, cash or cash equivalents.

>"Let's start simple: Can you explain why if you think they are 'cash' or 'cash equivalents', they're explicitly not listed in the 10-k as "cash equivalents"?"

Because they don't have to list them as such? There's a lot of deception in SEC filings; that's half the game. It's only me speculating, but I believe Apple is utilizing many tricks to help them retain all those earnings, rather than paying taxes on all those profits. Would that surprise you?

>"Given the companies don't believe they are cash or cash equivalents, or at least their auditors don't, can you explain why you do?"

Taxes.

I mean, this side-discussion started because you made the claim:

"In short: Apple doesn't really have some amazing amount of cash."

Which is only true in the strictest definition of "cash". When "cash" is used how most investors understand it --those people you accused of being "seriously confused"-- Apple has a bunch. You don't have to take my word for it, it's out there.

Yes, it is.

I take offense to stating that people who use the term "cash" don't know what they're talking about. They, in fact, do know that "cash" doesn't imply Apple has a Scrooge-McDuck-type vault loaded with hundred dollar bills.

>"If i own a million shares of apple stock, I don't own cash or a cash equivalent"

Commercial paper, short-term debt, preferred stock, T-bills, option contracts are all cash equivalents. This is where Apple is putting its money (they aren't buying tens of billions worth of common stock). It's "cash".

It's semantics. It's cash. Not in the literal sense that they are wallpapering the headquarters with it. But it's cash from profits they've earned, that are invested in bonds and securities, just like you are I would.

>Long term marketable securities are basically those things that they would likely take a significant hit on if they had to actually convert to cash in a reasonable period of time.

Not necessarily true. Apple holds something like $15BB in Treasuries under their LTMS holdings. These are liquid (hence the label marketable). They also own a bunch on municipal bonds and corporate debt, most of which are also extremely liquid.