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Let it be put on record that I am representing his Steveness.

There is no reason to worry, folks, Steve has done no wrong, unless you are strongly religious and frown upon the advances society has made since biblical times.

He is seeking my counsel because of some liberties a certain J. Malo took on him. That is all; Steve WILL be giving the Macworld keynote on January 9th, 2007.

I was wondering whether and when MDN would pick this story up.

Poor Fred Anderson. I don't know the circumstances - obviously. The guy has had such a stand up reputation, now completely tarnished. (Fred was the CFO during this travesty.)

Silicon Valley is shaking. Lots of cocktail party conversation on this one. This needs to be resolved ASAP.

wonder boy steve may be in big trouble....

& the last place he belongs is among hairy, fat & lonely inmates

lets all hope that Steve is innocent. Im sure billy boy and ballmer are happy though.

Maybe he needs a little karma. Shouldn't have abandonded the child he fathered or screwed his co-founder.

Great CEO.....shitty dad and friend.

Dear MDN,

Please allow Misha Bawa to continue posting. He may be crude at times, but he promises that he will make a sincere effort to stop. Misha is at heart an Apple fan first and foremost, and is typically regarded as a valuable contributor to the Apple community.

Sincerely,

Misha "3rd person" Bawa


MDN magic word: "hard"...

kk-- u need to read ahead a few chapters.

On a positive note... I'll be able to watch Steve Jobs getting carted off to jail on my new iPod video.

kk,
I would think Jobs would be ahead in the "karma" since he has spread the best OS to millions of users. He has directly improved the computing life of millions. That has to have a couple karma points attached to it right?

The Dude abides.

Hey R:

I have read all the chapters. You need to realize what is truly important in life. Apple is a company, nothing more and nothing less. Yeah they are a bit different than others, but a company nonetheless. A company that is made up of a lot of talented and dedicated people whom don't get any spotlight, most of whom have not screwed their best friends or absolved themselves of their parental duties.

Nothing makes up for abandoning a child. You must be kidding. Well, I guess if he gave all his fortunes to some adoption agencies that might make a dent.

Yeah, the coolest OS around is certainly cool, and a little music player is nice too, but in the grand scheme of things, it is the decisions you make as a man that define you, not what you do as a businessman.

It is quite sickening that someone's past can be forgotten so easily.

Be thankful for your family. You can buy another iPod and format your Mac.

brings a whole new meaning to "Reality Distortion Field" :-p

The Dude,

If that were true then Bill will soon be getting hit with a bus.

Seriously guys. I am a Mac user and fanatic too. Otherwise I would not read this site! But the endless glorification of a CEO is pointless.

I hope you all had a great holiday with your families or loved ones. That is was really matters.

... Apple's stock price has been tanking recently.

Investment firms are dumping Apple, who are watching this closely, while morons like "Insert MSNBC morons here" go on and on talking about what a great opportunity it is for everyone to buy into Apple now.

My best guess from reading Apple's own interenal report is the following:

1. Whether Fred A. was a part of this or no, it seems quite fishy that the two people Apple point the finger at are no longer with the company - everyone is okay "enough."

2. That Steve was a nieve CEO who never really did any harm here...

This entire interenal report is far too convienent, and the SEC isn't sitting around drinking the eggnog and patting Apple on the back for a job well done.

For an Apple investor these are spooky times. For those who want Apple to become the major force to brake Redmond's hold on the entire computing industry, this hope may come at the cost of criminal activity by people far too ambitious for their anyone's good...

The fact that Steve's got his own lawyers is telling enough.

It now means that there is a difference between what's best for Steve and what's best for Apple in terms of handling this matter.

@kk: Thanks for the self-righteous feminine perspective of the world. But the world contains both yin and yang. Nothing is quite as absolute as you describe.

This whole thing is a bunch of crock. This practise is most likely common in corporate America. Apple is being singled out.

Just like the scratches on the iPods!

Just yesterday, I posted on MDN that the stock option investigation was the number one overhang that was depressing AAPL.

However, today's news is not an indication that the world is falling.

The professional traders are already calculating the worse case scenario:
- The feds might try to put a few former execs in jail, and probably require Apple to pay a fine.
- But so far, Steve Jobs isn't personally affected.
- Big deal.

And sooner or later, this realization will come up on the market, and the stock will start rebounding.

Surprisingly, it may be as soon as two days from now - Friday, December 29, 2006 - which is when Apple has to file an update with the SEC. (Or get an extension until mid-January.)

In terms of trading AAPL today, look for the stock to bounce back (i.e. reverse the decline and start going up) at the $77.75 to $78 level, which should provide support.

AAPL may even close up from yesterday's close, given the propensity of professional traders to go for a short squeeze, when news such as this breaks.

Additional comment: Note that not a single Wall St. analyst that covers AAPL has issued an upgrade/downgrade/reaffirmation based on this Law.com article.

Why not? Because there's no real news in it, at least not yet.

The real news will come when Apple files its own 8-k annual report with the SEC (possibly as soon as two days from now), and again when the feds conclude their investigation.

Lastly, Steve Jobs hiring a lawyer to represent him personally is not necessarily an indication that his interests are no longer aligned with Apple's. (If that were truly the case, he would no longer be Apple's CEO.) Rather, it's simply prudent to hire a lawyer if and when the feds come knocking at your door.

Look, all of this is speculation until charges are laid, and this has not happened. So let's just see how the whole issue plays out before we start before we start passing judgement.

No analyst posted a report because they're all out for the week. I should know. I work in the offices and it is DEAD here.

Hmmm, what was that name of that unauthorized biography that raised a rukus a while back?


iCon


Sadly ironic.

Apple's stock has been going down for a number of reasons. I believe Cramer's version on why the big firms are dumping the stock. I also believe it's temporary. Apple is only a company, if "only a company" refers to a publicly traded organization intent on making money. But how it makes its money is also important. It is still poised to grow. A temporary decline is fine. I'd bet that once the smoke clears here, it's going to be in The Company's favor.

"This whole thing is a bunch of crock. This practise is most likely common in corporate America. Apple is being singled out."

Don;t be silly dozens of other companies have already been probed, people are in jail for this already.

"- But so far, Steve Jobs isn't personally affected."

But he was and he knew. All they've got to do is put the case together.

"Lastly, Steve Jobs hiring a lawyer to represent him personally is not necessarily an indication that his interests are no longer aligned with Apple's."

It's pretty good indication, It happens all the time in criminal investigations and trials. Often defendants are represented by the same lawyers. If a corporate officer has done no wrong, the corporation will defend itself and them. But once the defendant's interests differ e.g one is about to testify against the other, or one defendant's strategy to protect themselves is prejudicial to another defendant, separate counsel is required.

"Note that not a single Wall St. analyst that covers AAPL has issued an upgrade/downgrade/reaffirmation based on this Law.com article."

Down 5% on a volume of 12 million shares, and it's only 9:41 I think the smart money's speaking.

And at 09:53, AAPL has just risen to session highs of $78.35. (Btw, the next level that shows resistance will be the ~$80 area.)

Determining what the "smart money" is doing is silly on such a short timescale, unless you're daytrading stocks.

Let's wait until December 29th to see whether Apple files the 8-k, and if so what is in it.

All that glitters is not gold.

"Genius" Steve, like his hardware and software, does not, my friends, 'just work'. And, now the whole world knows.

Will the Feds come on stage and put him in cuffs in the middle of the keynote next month?

"Let's wait until December 29th to see whether Apple files the 8-k, and if so what is in it."

Sure, OK, 9:57, 20 million shares changed hands, and people WISHING they could still get $78.35...

I think you need to look at the next level of resistance that Apple's going to bust through on the downside.

SeparateCounsel said: "Often defendants are represented by the same lawyers. If a corporate officer has done no wrong, the corporation will defend itself and them. But once the defendant's interests differ e.g one is about to testify against the other, or one defendant's strategy to protect themselves is prejudicial to another defendant, separate counsel is required."

Lawyers representing the company cannot defend or represent the interests of its employes (or board members, etc.) They are different parties with potentially different interests (regardless of any wrongdoing). Even though no one may have done anything wrong the company still cannot defend the employee. Yes their interests may be the same in many respects but the attorney for the company is ONLY representing the interests of the company. Even if that may, at times be adversarial for the interests of an employee. The fact that Steve, or anyone else involved in this has retained their own attorney is simply a prudent move if there is any potential for personal exposure, which, as I read the circumstances involved here, there could be. Reading anything into the fact that Steve retained an attorney is meaningless.

Steve is a smart man so he made an intelligent decision to retain an attorney to represent him.

Everybody is innocent until proven otherwise. I'll give him the benefit of the doubt.

Even i'm innocent of throwing chairs. Did someone see me doing that? But seems the trial is already made and waiting for a sentence.

"Lastly, Steve Jobs hiring a lawyer to represent him personally is not necessarily an indication that his interests are no longer aligned with Apple's. (If that were truly the case, he would no longer be Apple's CEO.) Rather, it's simply prudent to hire a lawyer if and when the feds come knocking at your door."

Exactly...Apple's lawyers represent Apple not SJ. IF SJ is being implicated individually, he would need a lawyer to represent him.

SeparateCounsel, I have no desire to get into a pissing match with you.

I'm just calling it as I see it, and reporting what I believe professional traders are thinking/doing.

Along those lines, an analyst at Piper Jaffray just issued a note saying only a 5% probability exists of Steve Jobs being involved, and not at all surprising that he's getting his own lawyer.

Support: AAPL's primary support was in the $77.75 to $78.00 area. If that falls, AAPL has secondary support in the $76.90 to $77.00 area. Below that, tertiary support lies in the $76 area. Look for potential bounces if the stock approaches these areas.

Resistance: The ~$80 is the first level of any meaningful resistance.

kk,

You must be one of those folks that sit

around judging people from the sidelines,

never looking inward. But hey, as long

as you are comfortable in your own skin,

right? KARMA, please. WTF is this, 'My

Name Is Earl'? I don't think misdeeds

should be forgotten, but I also don't

think that they should be brought up

when they are irrelevant. Sorry everyone,

but self righteousness pisses me off.

This is real bad news.
Real bad news.
Jobs is possibly looking at jail time. The former APPle CFO is being fitted for his jail uniform now....

At the least this is a total distraction from the job, plus it paints Apple as a sleazy company.

If these accusations were being made about Microsoft and Gates...whew!; Just imagine the negative MDN take.

MoMo Trader, Where or how do you get your information? I hear this stuff but can't figure out how it is derived. Thanks.

Counsel, in a word, Bollocks

California bar Association Rules of Professional Conduct, Rule 3-600. (E)

A member representing an organization may also
represent any of its directors, officers, employees,
members, shareholders, or other constituents, subject to the
provisions of rule 3-310. If the organization's consent to the
dual representation is required by rule 3-310, the consent
shall be given by an appropriate constituent of the
organization other than the individual or constituent who is
to be represented, or by the shareholder(s) or organization
members.

Steve was happy to be represented by the same firm, now he feels he needs different representation. This is Required only if there is a conflict of interest. However if the decision wasn't forced on him, he's made a decision that he no longer thinks it's a smart idea to be represented by the same people who represent Apple.

So can you read anything into that for sure? No. Does it make me more nervous than Steve continuing to be represented by the same firm? Absolutely. It means there's some reason he or they felt a need for that.

JP Morgan issued a note saying the Law.com article has very little to say about Steve Jobs, and JP Morgan reiterates its "Overweight" rating on AAPL.

(An overweight rating in JP Morgan parlance advises fund managers to buy more of AAPL than other stocks in the same industry or sector.)

AAPL is currently trading at $78.43.

Curious, most of the sell-side analysts (Piper Jaffray, JP Morgan, Goldman Sachs, Bank of America, etc) issue their research to their clients, which are mostly fund managers and wealthy individuals. These people get early access to the notes, presumably so they can make intelligent decisions before the note's information is made public.

Many people look askance at sell-side analysts, because they have an built-in conflict of interest: their employers are investment banks, looking to sell investment banking services to the companies they cover for analysis.

Most buy-side analysts are employed by investment funds or private equity firms, and their research is usually free of conflict of interests. However, their research very rarely gets published.

As for the information itself, it can and usually does become public, usually within a matter of minutes or hours (and sometimes days), either through wire services (Reuters, Bloomberg, etc) or through media outlets such as CNBC or the Wall St. Journal or many others.

The biggest signal of information is the stock's price action. If a stock's price falls with increasing volume without any news being disseminated, you can be sure that somebody somewheere has downgraded the stock.

Lastly, you can use any number of websites for technical analysis of a stock, where you can determine support/resistance levels, trendlines, technical indicators, etc.

If you want to trade or invest stocks (trading is not the same as investing), you need to be aware of these sources of information, and how they can move markets.

Moment of truth for AAPL: It is now trading at $79.68, having reached a high of $79.96 -- just below the $80 resistance level identified earlier.

Watch the price action here as the stock tests this $80 level. The price action will tell you a great deal about where AAPL is headed later today and the rest of this week.

How does the stock-options scandal affect Al Gore?

AAPL is currently trading at $80.30, having reached a session high of $80.45.

Based on this price action, AAPL appears to be breaking through the ~$80 resistance level.

Look for confirmation of whether this breakthrough is real by watching whether this level holds as support as the stock pulls back.

If the $80 break is decisive and confirmed, then the stock will probably consolidate the rest of the week, and then start an uptrend next week, as the new year rolls in. (This will be helped enormously if Apple can file its 8-k report with the SEC by December 29, 2006, without applying for a new extension.)

If the $80 level fails to hold on a pullback, then the stock will probably trend down towards today's low of $76.77.

(Note to traders: The markets will be closed on Monday, January 1 for the holiday. There is also speculation that the markets may be closed next Tuesday or Wednesday as well, in honor of the death of President Gerald R. Ford.)

Question: "How does the stock-options scandal affect Al Gore?"

Answer: It doesn't. The stock option problems at Apple arise from option grants made from 1997 through 2002. Al Gore didn't become a director at Apple until March 2003.

As we head into the final 30 minutes of trading, AAPL has solidly and decisively broken through the $80 resistance level. It has in fact, gone green - it's up nearly 30 cents from yesterday's close.

Needless to say, this price action confirms that Wall St. does not see today's Law.com article as affecting Apple's or Steve Jobs' future prospects.

The real relief rally in the stock will come, though, when Apple finally files its annual report from the SEC, which may be within two days, or by mid-January (if Apple requests an extension).

Good day to all, and happy investing.

(Late addition: It appears that ChangeWave Research is increasing its price target for AAPL to $125.)

A stock that goes from 50 to 93 and then back to 77 is not "tanking". It is just being a stock. Just when a test of 100 looked like a sure thing, it corrected. That's what stocks do. (I soooo want to say "Welcome to the Social"... go figure.)

A news item like this can trigger a selling climax (flush out all the scared short term money) and put in a short term bottom. But you never really know except in hindsight.

Since the accounting restatement won't affect the company's business a whit, I'm more interested in the season's ipod and mac sales (the real potential for upside surprise is on the mac side).

The group psychology of markets is a fascinating beast. Everyone now "knows" that Apple runs up before MacWorld and the corrects on the news, no matter how good. Soooo... this year, the stock corrects well in advance of MacWorld. If you know there's a race for the door coming, you at least stand close to the door. So does everyone else and suddenly the race comes early. Basically whenever something is widely "expected" in stock movement, the expectation of it makes something else happen entirely.

But if the mac business is really growing, that's real growing profits and cash flow that will drive the long run.

My advice is to always buy AAPL, no matter what the market conditions or hype. AAPL is ALWAYS a buying opportunity!

THIS IS A GLORIOUS BUYING OPPORTUNITY!! BUY, BUY, BUY!!!