Incoming Strategies
Goodbye G.C.Js; Hello G.C.I.o.R.a.P.
My current strategy for generating income is a small purchase of Apple Computer stock. If any of you own a television, ( I didn’t for ten years ) you know all about their new I-Phone that is coming out on June 29th. My strategy is to sell my current holdings of this stock on June 28th while the anticipation is at its peak. I predict that the negative reviews of the product will begin on the evening of the 29th and last throughout the weekend. We will all hear complaints such as ” the touch screen keyboard is too small ” or perhaps ” the monthly AT+T charges are too high.” So on Monday the 2nd of July, the stock will sell off, creating a good buying opportunity during the first week of July. I will then repurchase the stock at a low price and hold onto it until the next market crash. The only complication that I see would be if the market crash occurs within the next two weeks. A couple of hedge funds are going out of business as a result of the sub-prime market crises that was the hot business news item last month. These two hedge funds were managed by Bear Stearns, which is a well run company that just doesn’t make mistakes like this. The fear is that many more hedge funds will go down and bring the entire stock market down with it. These hedge funds will have to sell their billions of shares of stock at the market price, increasing the number of shares on the market; devaluing the price of these shares due to the increase of supply of these shares. No one knows exactly what companies or investment vehicles these hedge funds own because hedge funds are not heavily regulated by the Securtiy and Exchange Commission. So everyone could start selling every stock in fear of their own particular stock(s) being liquidated by the unknown hedge funds that might be in trouble.
Anyway, back to Apple Computer. Apple not only makes good computers and devices that let you view your computer screen on your t.v. set, but it has benefited from the devaluing of the U.S. currency against foreign currencies. When Apple sells a million computers in Europe or Asia, the increased value of the currency in those countries is translated into increased dollars in profit, once the profits are exchanged into U.S. currency. This increase in profits for Apple and other U.S. companies that are multinational, has occurred even if sales have not increased recently. A million Euros of profit is now worth more in American dollars that it was last year because of the exchange rate. Whether this new I Phone is any good or not, it is going to sell regardless. It is the most trendy, must have, graduation / going off to college gift available. There is a whole cell phone culture in this world where people compare each other’s cell phones and judge each other on what kind of cell phone they have, rather than what kind of person they are or what the quality of their presence is. My own cell phone company has offered me a new cell phone with 1000 free minutes if I sign a new two year contract with them by June 28th, the day before the I Phone is released. I hope to generate income from Apple stock and get a free cell phone out of the deal ! I will share this income with certain charities of my choice.
I will also earn income from another new guitar student, beginning next week.
With excitement,
I.C.