Relevant and even prescient commentary on news, politics and the economy.

Apple has some money burning a hole in its pocket

Getting real about Apple’s $100 billion stock buyback. 

Updated*

So I was hearing some where that Apple has a lot of money just burning a hole in it’s pocket. Seems there’s an arson named Carl Icahn trying to really ignite it by using twitter.

Apple has implemented a plan to spend $100 billion of it’s current estimate of $148.6 billion pocket money by 2015 to buyback it’s stock. Mr. Icahn has tweeting his joy.   Others say Apple needs to grow to grow it’s stock price.  Now wouldn’t that be the New Deal thing.

Apple has 80,300 full time equivalent employees of which 42,800 are “outside the retail division”.  Yup, you guessed…what if Apple instead of buying their stock back distributed that $100 billion to its employees?  Try $1,245,300.01 to each of them by 2015.  That’s 80 thousand new millionaires. Now that’s some job creating.

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Wage stickiness ?

Sorry for the thin posting lately…I have had some SI joint problems which makes for difficulty sitting still to focus.

Via Keven Drum comes this research paper addressing the issue of sticky wages in the economics of today:

First off, a new paper by a trio of researchers confirms some old news: Adjusted for inflation, wages began stagnating for both men and women 10 years ago. Men’s wages have actually decreased slightly since 2000, while women’s wages, which had been rising steadily for decades, flattened out nearly to zero. But it could have been worse. Economists have long known that there’s a floor to wages because employers don’t like to reduce nominal wages. If you make $10 per hour, they won’t cut your wage to $9 per hour. They’ll just hold it at $10 and let inflation eat it away. This phenomenon is called wage stickiness.

But in “Wage Adjustment in the Great Recession,” these researchers have found that wage stickiness, which is driven mostly by social convention, not economic law, might be dying out. During the Great Recession, employers were increasingly willing to cut nominal wages. Among hourly workers, the usual number who experience wage cuts is around 15 percent. That had risen to 25 percent by 2011. Among nonhourly workers, the number rose from about 25 percent to nearly 35 percent. Increasingly, it seems, wage stickiness isn’t acting as a barrier against wage losses.

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