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Why Amazon Has No Profits and Why It Works

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Re: Why Amazon Has No Profits and Why It Works

#211
post #148

Earlier quoted context omitted.

Yeah, that was my thought too. > John offered three choices to rival refiners, cash, Standard Oil stock, or to get crushed ... is also a pretty good description of how Microsoft approached anyone they considered competition in the '80s and '90s: you either licensed your software to them ("cash"), sold your company to them ("stock"), or got destroyed by them. Gates' charitable efforts have earned him a warmer and fuzz…

Hmm, does his charitable efforts these days make up for the pain and suffering he caused back when he was a barracuda? (nice term, btw). I like to say yes. I think. I mean, he may have destroyed hundreds of people's livelihoods/jobs/companies, but his efforts these days are literally saving peoples lives. Does anyone have an opinion on this? I'm a firm believer people can change and while this might not be Bill Gates…

I assume from "these days" that you mean Gates, not Rockefeller.

Microsoft wrote some software that was, I would argue, overall an improvement on the software against which it competed. So Microsoft did some good. However, in the process of extracting value, they actively - and, in my opinion, often unethically - suppressed the efforts of those with whom they competed. I don't pretend to be very knowledgeable on the exact value of these positive and negative effects, but I think it's pretty clear that all of the above effects more or less amounted making a bunch of computer nerds like us a little richer, or a little poorer. Not necessarily in money, but in power... like the power to track business expenses cheaply (which Microsoft enhanced, with Excel), or the power to collaborate on making productive software for ourselves and share it freely with the world (which Microsoft harmed, see the Halloween Documents, or other conspiracy evidence of your choice).

For the most part, this only affects a few dozen million humans, and even interpreted broadly it affects perhaps 10% of humanity. And the effects are small; for almost all of the affected, life gets less than 1% better or 1% worse, due to Microsoft existing. I mean, that's bigger than most companies, but.

I'm less able to give clear magnitudes of the impact of the Bill and Melinda Gates Foundation. My understanding, though, is that they're playing a significant role in the attempts to eradicate polio. Frankly, you can inflict Windows95 on me for the next 50 years, if that's what it takes to save one person from polio. Suppose that it turns out that polio is eradicated, and the B&MGF is due 1% of the credit for that; wouldn't this be more valuable than all the harm ever done by MS, past and future? And then there's their malaria-eradication efforts, their money spent on education, their money spent on sanitation, etc etc.

Bill Gates seems to have stolen a very manageable amount of our first-world wealth, burned a good fraction of in an engine of inefficiency (for example, Ballmer got some money too), and given most of the rest of it where it could do the most good (modulo a small fraction kept for himself, to indulge in fabulous luxury). As far as I can tell, although it astounds and confounds me, Bill Gates is Robin Hood. wtf.

Re: Why Amazon Has No Profits and Why It Works

#212

Earlier quoted context omitted.

Amazon stock trades at a P/E of 910. S&P 500 average is currently around 19-20. Do you really expect Amazon to continue to grow at such a rate that its current P/E is justified?

Or perhaps P/E is not the end-all-be-all of metrics for judging value?

I completely agree, however, it is still a useful metric. And when a stock has a P/E of 910 the growth rate that the underlying business must grow at in order to justify such a price is astounding.

Re: Why Amazon Has No Profits and Why It Works

#214
post #148

Earlier quoted context omitted.

Yeah, that was my thought too. > John offered three choices to rival refiners, cash, Standard Oil stock, or to get crushed ... is also a pretty good description of how Microsoft approached anyone they considered competition in the '80s and '90s: you either licensed your software to them ("cash"), sold your company to them ("stock"), or got destroyed by them. Gates' charitable efforts have earned him a warmer and fuzz…

Hmm, does his charitable efforts these days make up for the pain and suffering he caused back when he was a barracuda? (nice term, btw). I like to say yes. I think. I mean, he may have destroyed hundreds of people's livelihoods/jobs/companies, but his efforts these days are literally saving peoples lives. Does anyone have an opinion on this? I'm a firm believer people can change and while this might not be Bill Gates…

> Does anyone have an opinion on this? I'm a firm believer people can change and while this might not be Bill Gates changing, it might simply be him "atoning for his sins" so to speak, not that I'm religious, nor that he is either I think.

My candidate explanation, Melinda.

Re: Why Amazon Has No Profits and Why It Works

#215

Earlier quoted context omitted.

> For instance, why can't I install a local print shop as a system printer? I'm pretty sure that FedEx Office (formerly FedEx/Kinkos) has supported doing that for many years. I suspect they aren't alone.

dragonwriter, btgeekboy, mindcrime - thanks, I never heard of that (I live outside US). A few minutes of Googling didn't turn out what I was looking for though. I can see an "upload and print" feature on FedEx website, I can see a dedicated mobile app that apparently can print files via FedEx... ... but what I was looking for is something that pretends to be a normal printer, so when i do File->Print in Word or Photo…

http://www.fedex.com/us/small-business/updates/February2011/...

Re: Why Amazon Has No Profits and Why It Works

#216
post #29

Earlier quoted context omitted.

My AMZN shares are in a Roth IRA. I can wait.

Amazon stock trades at a P/E of 910. S&P 500 average is currently around 19-20. Do you really expect Amazon to continue to grow at such a rate that its current P/E is justified?

Remember: it's the price-to-earnings ratio and not price-to-revenue ratio.

Amazon's stock trades at a P/E of 910 exactly because it's deferring profit to continue growing its revenue. At some point it's going to stop investing its revenue into growth and start realizing a profit on that revenue. At that point the P/E will come down.

Re: Why Amazon Has No Profits and Why It Works

#217

Earlier quoted context omitted.

> For instance, why can't I install a local print shop as a system printer? I'm pretty sure that FedEx Office (formerly FedEx/Kinkos) has supported doing that for many years. I suspect they aren't alone.

dragonwriter, btgeekboy, mindcrime - thanks, I never heard of that (I live outside US). A few minutes of Googling didn't turn out what I was looking for though. I can see an "upload and print" feature on FedEx website, I can see a dedicated mobile app that apparently can print files via FedEx... ... but what I was looking for is something that pretends to be a normal printer, so when i do File->Print in Word or Photo…

Cloud print from Google Chrome integrates with FedEx kinkos

Re: Why Amazon Has No Profits and Why It Works

#218
post #29

Earlier quoted context omitted.

My AMZN shares are in a Roth IRA. I can wait.

Amazon stock trades at a P/E of 910. S&P 500 average is currently around 19-20. Do you really expect Amazon to continue to grow at such a rate that its current P/E is justified?

Earnings are profits, profits are retained in the company. A simple look at the P/E ratio tells you very little without understanding the broader context.

Re: Why Amazon Has No Profits and Why It Works

#219
post #148

Earlier quoted context omitted.

Hmm, does his charitable efforts these days make up for the pain and suffering he caused back when he was a barracuda? (nice term, btw). I like to say yes. I think. I mean, he may have destroyed hundreds of people's livelihoods/jobs/companies, but his efforts these days are literally saving peoples lives. Does anyone have an opinion on this? I'm a firm believer people can change and while this might not be Bill Gates…

I assume from "these days" that you mean Gates, not Rockefeller. Microsoft wrote some software that was, I would argue, overall an improvement on the software against which it competed. So Microsoft did some good. However, in the process of extracting value, they actively - and, in my opinion, often unethically - suppressed the efforts of those with whom they competed. I don't pretend to be very knowledgeable on the…

I really like this theory. I guess it turns out that once you put into perspective what part of the world Microsoft affected, it really is fundamentally outweighed by the good the Gates Foundation is doing.

Re: Why Amazon Has No Profits and Why It Works

#220
post #79

Earlier quoted context omitted.

Great write-up, really piqued my interest in Rockefeller. Any good reads you can recommend?

The documentary series "The Men Who Built America" is a really well done overview of some of these guys.

The problem with these american HC documentaries is that they are employ certain stylistic means which make them impossible to watch for me.
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