Apple pays dearly for staunch privacy stance

Apple’s CEO Tim Cook appears to be in trouble over his repeatedly stated opinion on technology and personal privacy.

Cook has been consistent in his stance on releasing private information of his customers from the San Bernardino shooters in 2015.

On Sunday Cook appeared on “60 Minutes” and his recent presentation backing the right to privacy at an European Union conference. No other US tech CEOs appeared live at this conference.

During his EU presentation, Cook said this: “Today [the private information] trade has exploded into a data industrial complex. Our own information, from the everyday to the deeply personal, is being weaponized against us with military efficiency,” Cook said at a conference in Brussels on data privacy last week.

Google, Facebook, Microsoft, Twitter and SnapChat among others declined to appear live.

So come Monday two iPhone component suppliers cut sales projections for the upcoming quarter. While neither company named Apple as the reason for the revenue shortfall, Wall Street took Rice to the woodshed taking 5% or roughly $50 billion out of investors pockets.

Apple has said recently it will not breakout individual product sales numbers anymore in it quarterly earnings reports in keeping with other manufacturers.

Now iPhone sales may be slowing as market saturation and the costs for replacement units continue to rise, but the timing of these two events — “60 Minutes” and stock collapse — appear to be a shot across the bow of Apple to tone down the privacy rhetoric.

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Divided government doesn’t have to be divisive

Welcome to 2018 AM — after midterms.

The House of Representatives goes to Democratic control, but by a smaller majority than is usually accomplished by the party not in the White House in the midterm election.

The Republicans, however, gained further control of the Senate, which is where many of the ongoing investigations that began in the House of the intelligence agencies will move to in January.

Given that the blue wave was somewhat muted, The Dems should think about bringing in some fresh blood in its leadership roles. Moderates, who will be around in the next 10 years and ran on something more than being anti-Trump. If not, and the plan is to be obstructionist, then we could easily see a reversal in two years.

If the Dem leadership pursues impeachment hearings against President Trump and or Supreme Court Associate Justice Brett Kavanaugh, which will go nowhere since the Republicans control the Senate, then it will be a long, unfruitful two years of gridlock.

Something that the country will endure, but it will not improve the economy or anyone’s lives. The markets like divided government since very little regulation comes out of it, but people’s lives suffer, since little in the way of benefits come to light either.

So we move on and see what can be finished with this session of Congress and more importantly, what Special Counsel Robert Mueller has to say about the 2016 presidential election.

Stocks up, wages up, unemployment down. How could the Midterms be close?

As a financial writer in real life, I find it odd that the economy is not being ballyhooed by the Republicans more during this Midterm election. Or should I say not mentioned in the media more.

Stocks, as measured by the Dow Jones industrial average, are up 25% since President Trump was elected.

No the only focus the stock markets get nowadays is the recent gyrations in October, which also overshadowed the latest wage data showing a pay raise of more than 3% according toLabor Department data released Wednesday. The wage gains make sense since there is now a decades-low unemployment rate.

An argument could be made that the recent stock pullback story has much to do with a concern that the Democrats could possibly win the House of Representatives.

Certainly Wall Street has a growing concern that Rep. Maxine Waters could take over the leadership of the House Banking Committee. The same Maxine Waters who told protestors to go after Administration members of Republican members of Congress if you see them in a restaurant or the movie theater.

It’s not a question of impeachment, because that will never be in the cards, since the Democrats will never have enough votes to get charges brought and passed onto the Senate. No the real question is what do the Democrats stand for economically?

There’s very little evidence of any economic platform or any platform except being anti-Trump. But no one calls them out on this.

A perfect example of this is in San Francisco, where the Democratic Mayor and city council want to raise real estate and business taxes to stem the tide of growing homeless people defecating in the streets among other quality-of-life issues.

Left-leaning Silicon Valley firms like Google and Amazon among others are squawking over having to pay more taxes. Threatening to move out of the city if they are forced to pony up cash to alleviate a problem they caused by moving in and distorting the cost of housing in the Bay Area.

So where is the left’s economic thought? Clearly tax and spend doesn’t resonate with its biggest boosters — California tech companies.

And I would say it does not sit well with many institutional investors as well.

Silicon Valley shareholders take big hit for firms’ political partisanship

The Silicon Valley giants are getting knee-capped in the stock market as the premise of users privacy violations pile up on the largest social media firms.

Alphabet’s Google, Facebook and Twitter have all seen shares beaten up  over the last two weeks as they all announced user information was not protected and distributed to third-party vendors.

Third-party vendors is code for outfits like Cambridge Analytica, which take demographic data to target political and marketing advertising to users. These data mining firms make 100s of millions of dollars selling this data.

The data is still highly coveted by political campaigns despite the Facebook/Cambridge Analytica scandal in the 2016 presidential election. While outrage at the actions was loud actual legislation was not forthcoming since both parties crave the information.

Google’s breach was so troubling that the company closed down it’s Google+ social media platform. The bigger problem was that Google hid the breach for months in order not to have the government bring further action against the company.

It’s reported that the government’s ears and eyes through the NSA have all the data that was compromised and where it was sold and to whom.

While most of the news coming out about draining the swamp is dealing with career political appointees operating outside the law within government agencies, this data has real-world, actionable ramifications. Public companies have shareholders, who suffer losses as these Silicon Valley firms get involved in partisan politics at the levels inferred by these actions.

Are the markets a tell on the midterms?

Are we seeing real-world exercises being conducted as a result of President Trump’s ongoing battle with the Deep State?

All of a sudden last week large institutional investors woke up and decided that the bull market was coming to an end and the Federal Reserve, which has been begging for the last decade to get the inflation rate close to 2 percent, discovered that runaway inflation was a real concern and said it would raise rates “aggressively” to combat it.

Now admittedly no market only rises with no corrections or pullbacks and it may be a little early to attribute the latest equity choppiness to anything more than profit taking and it being October, but the timing is curious.

The markets also have international concerns in Italy and China, which could be the contagion to hurt US growth and need to be watched carefully, but not to the degree we are seeing right now.

Trump did pick Fed chief Jerome Powell and he has reigned in the number of voices in the Fed speaking on the economy. Under ex-chief Janet Yellen it seemed even the maintenance staff at the Fed were allow to opine on monetary policy for TV audiences.

The President on Wednesday questioned the Fed’s rhetoric on inflation to reporters saying he thought it was crazy for Powell & Co. to be so aggressive in its stance on raising rates.

You see the Fed doesn’t really have to raise rates to curtail growth right now. The threat alone is enough to squeeze lenders into jacking up loan rates or to call in more questionable loans, which all dampen continuing growth. And as markets fall margin calls can steepen the decline as investors sell what they have to cover other bets.

So let’s keep an eye on this as the midterms near. I’m sure The President will have much to say should this sell off continue.