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Comment by andrepd | Hacker News Reader

It's not Apple, it's capitalism. "Unlimited growth is the ideology of the cancer cell", yet for Apple (or any corporation), it's not good enough to sell 100,000,000 phones. Next year you must sell 105,000,000. And the year after 112,000,000 (not even 110 or your growth is stagnating).

So you get rid of removable batteries so customers have to toss their phones away more often, you gimp other feature, you spend more money on advertising than you did actually developing the product (read this bit several times until it sinks in how crazy it is, yet that's how we are with every major phone, every major movie, etc), and so on.

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In 2016 RedLetterMedia did a breakdown of the movies that year, like top and bottom ten grossing movies. They stated that the advertising budget was the same as the production budget, unless they had knowledge of a different number.

I don't doubt that after 2020 the advertising budgets far outstripped the production budgets - multiple times; I am curious if that trend continues now, now that production isn't hamstrung by covid restrictions.

I'm sure everyone has seen this 100 times already but it really fits given modern advertising practice of every major company, especially in designing products to fit advertising plans.

There are also entire "industries" designed to shield people who want to find quality content from big 'A' advertising.

https://www.youtube.com/watch?v=tGKsbt5wii0 For context John Sculley said "Apple was the marketing company of the decade" in the 80s and Kicked Jobs out of Apple

I love how he uses the word “craftsmanship”, something that he understood quite well (considering how close he was working with people like Bill Atkinson, Andy Hertzfeld, Burrell Smith, etc).

Today engineers have to put up a fight to do anything resembling craftsmanship.

Do you want to retire?

Capitalism works this way because its customers, the investors, want it to work this way, because growth is how you get compound interest. Investors include anyone with an interest bearing bank deposit, a 401k, stocks, bonds, etc.

No growth means it would no longer be possible for an investment to appreciate.

I think of a similar thing when I see people complaining about how companies don't want to pay good wages. When you go shopping do you buy the $10 product or the $5 essentially equivalent alternative? Most people will buy the $5 one. If you do that, you're putting downward pressure on wages.

It's in your (purely economic) best interest for your wages to be high but everyone else's to be low. That's because when you're a worker you are a seller of labor, while when you're a customer you are an (indirect) buyer of labor.

Everything in economics is like this. Everything is a paradox. Everything is a feedback loop. Every transaction has two parties, and in some cases you are both parties depending on what "hat" you are wearing at the moment.

Growth isn’t necessary for high returns on equity. And it isn’t necessary for the investment to provide a return.

Equity returns ultimately come from risk premiums. (Which are small now in US equities BTW).

I’m invested in a microcap private equity fund that has returned >20-25% for years. They have high returns because they buy firms at 3-4x cashflow. You will get the high returns even with no growth. And with no increase in valuation. The returns are a function of an illiquidity premium.

With Apple explicitly, growth is expected given the valuation level. If it doesn’t grow, the share price will decline. So yes, in their case, firm is certainly under pressure to grow.

I also don’t agree with your “best interest for wages to be high and everyone else’s lower”. That is one aspect. It is more complicated. Consider Baumol Effect for starters.

I'm talking about macroeconomics, not micro. Risk premium means there is risk; not everyone gets a return at all. The entire society, as a whole, cannot experience consistent returns unless there is macroeconomic growth. If the pie is not getting bigger, someone has to be losing for someone else to gain.

Things like retirement, 401ks, etc., are society-wide institutions subject to macroeconomic rules.

I buy the $10 one because the margin has to come from somewhere. 9/10, the more expensive product is better.

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