“It’s Not Too Late…”

One of the great parts of writing this letter is the people I get to meet. Among those I enjoy hearing from is former NYSE floor trader, Clay Tompkins. His years spent on a trading floor gives Clay a certain insight about markets that is tough to describe. It involves a willingness to fade consensus accompanied with a healthy respect for the power (madness?) of the crowd.
Clay sends me tidbits from time to time, with a few wise words that always seem to resonate with me. In the heat of the summer, he started sending warnings about Apple.
Kev, There’s an interesting piece on Novo Nordisk in the WSJ today, about how they improved their insulin and raised prices accordingly, with the result that customers opted for the older, cheaper formulation.
Apple is doing the same, and I think the results will be the same. My daughters scoff at the idea that they or their friends would seriously pay $1100-1400 for the new phone. Andy Kessler called this the ‘ radial tire’ problem, whereby radials, getting 50,000 between replacement killed the bias ply model which needed changing every 12,000.
Buffett and Tepper and all the rest are too rich to get it.
I know your site says ‘ macro’, but at 3.6% of the S&P, a falling Apple will have real repercussions.

This post was published at Zero Hedge on Sep 25, 2017.