Famously debt-free under Steve Jobs, Apple is now on the hook for $43 billion in total debt

“Apple is famous for its impressive stack of $178 billion in cash and investments,” Matt Krantz reports for USA Today. “But the company is also busily digging a $43 billion hole of debt.”

“Following Monday’s $6.5 billion debt offering, the maker of electronic gadgets is on the hook for $43 billion in total debt,” Krantz reports. “That’s a remarkable increase in debt for a company that essentially owed no one under most of the comeback under former CEO Steve Jobs.”

“Apple has gone from carrying no long-term debt to $43 billion in just about two years – $39 billion of that being long-term debt,” Krantz reports. “Long-term debt carries a maturity of more than a year.”

Read more in the full article here.

MacDailyNews Take: Far cheaper than the alternative, taking on this type of “debt” falls clearly into “no-brainer” territory.

Related articles:
Apple files to sell $5 billion in new debt – February 2, 2015
Apple debt offering only $12 billion – April 29, 2014
Apple about to join the ranks of the biggest U.S. corporate debtors – April 29, 2014
Apple goes big on debt – and gets it right – May 3, 2013
Apple gains on record $17 billion debt deal – April 30, 2013
Debt-free Apple plans to borrow to finance massive capital-return program – April 23, 2013
Apple Computer now a debt-free company – February 18, 2004

94 Comments

  1. Understand about the no brainer in financial terms. Still Apple will have to pay it off eventually and that may come back to bite them in the future.
    What is a bit more unsettling is that Apple have only $20 billion cash in the US. That is still a huge war chest but I would not like it to go any lower.

  2. Wow, everybody kept railing on Apple to spend its cash horde, and now that it has done so, they’re complaining that Apple has debt. Well incurring the debt was far less expansive than repatriating the profits and paying a huge tax bill. Not to mention that Apple could pay off this debt tomorrow with one check if it wanted.

    1. You got it right. Jackasses can’t seem to make up their minds. There’s really too much butt-hurt being done by Apple and the haters just can’t stand it. Everything Apple does is seen as a negative and yet what Apple is doing is done by practically every other company, so what’s the big deal. A cash hoard of $178 billion is not going to be drained very quickly.

      Sour grapes. Apple is truly making piles of cash, so there’s no need for smoke and mirrors. Both Amazon and Google are spending heavily, but if Apple does it, then it’s a bad thing. There are factions out there that really, really hate Apple for being successful and they need to STFU and go after some less successful companies to criticize.

      1. However, in real terms, I make that a net cash cache of $135B (178-43).

        (Just for perspective. It is true that operating cash and debt can also have diff functions, but it’s also true that Apple doesn’t really have $178B free and clear compared to what they had at the time they started to take on debt in lieu of cash repatriation/taxation.)

    2. If I could borrow money at an annual rate of 3.45% for thirty years, then you can bet that I would borrow as much as I could.

      Apple is using the borrowed money to pay dividends and finance stock buybacks rather than repatriating profits and paying a lot of taxes. Apple gets to write off the bond interest, which reduces taxable profits. And Apple also leaves $43B in cash and securities that it likely invests for an overall return that is higher than 3.45%.

      At the low interest rates that the market is demanding for ing term Apple corporate bonds, Apple could make a lot of money just borrowing and investing.

        1. They can jncrease size of buybacks and dividends by getting FREE CASH with NO TAXES PAID ON …..

          Take that FREE CASH and invest back my to Apple Stock and reap the rewards of increasing the value of their own company …..

          Then to boot Apple gets to deduct the interest paid from their Federal Tax Return so if you follow the money trial Apple is getting money back into the company by borrowing at a favorable rate and paying back while deducting jnteresting form what would of been taxable earnings – Actually a brilliant accounting move …..

          Side Note:
          With the new possible tax holiday being tossed around in congress, Apple may babe to get some of those overseas earnings back not the Us where Apple can use for buybacks and dividends!

          1. “Take that FREE CASH and invest back my to Apple Stock” … My god, so myopically stupid.

            They aren’t getting “free cash”, no matter how you want to slice it, just historically low prices on borrowed cash. And borrowed cash costs money.

            Plus, you’re saying it’s ‘good’ borrowed cash because Apple is using it on stock buybacks. That’s only possibly a good thing IF Apple can buy back enough stock to be free of the Icahns of the world (a company the size of Apple makes that highly unlikely). And as for handing out dividends, that obviously makes you happy, but it’s the most absurd use of money Apple could be engaged in, short of buying Beenie Babies. Absolutely no value is returned to the company by using cash in that way. It’s simply extra cash going into the pockets of people who are already being rewarded for their bet that Apple stock would go up.

            You, like so many other stock owners, are happy Apple has started ladling more gravy to you from their high-speed train, and are justifying your extra good fortune with arguments for ‘good debt’ & ‘tax advantages’. But let’s cut through the B.S. – there is no such thing as good debt when you don’t have a cash flow/cash reserve problem, and Apple certainly was never hurting on the tax front.

            No, Apple is only pissing away this money now because it keeps the Wall St. investment vultures – oops, I mean “banks” – off their backs. You, and other stock holders, are just incidentally benefiting from this strategy.

            Yes folks, Apple is essentially paying bribe money. Wall St. had been manipulating everything from Apple’s stock price, to the returns on their investments, to even the government investigating them for every little thing imaginable (notice how we haven’t been seeing anymore iBooks-like b*llSh*t since Timmy started all these debt-funded givebacks?). Ever since since Apple started paying out dividends to the institutional investors (of which Wall St. investment banks are a huge percentage) AND using Wall St. debt products to do it – essentially paying Wall St. in order to pay Wall St. – Apple’s pretty much been left alone & the stock price has been allowed to rise commensurate with performance. The latter certainly wasn’t the case when Jobs was alive.

            Cook is calculating that Apple will perform well enough financially to keep ahead of the debt he’s incurring. Possibly a smart move, depending on Apple’s continuing to be the only company left in the world that actually innovates and produces quality products people will clamor for. However, IMO much of that kind of performance was always tied to Apple not playing reindeer games, as a general principal. The risk Cook is taking here is that he thinks he might be able to hug the Tar Baby without getting dirty. Jobs, on the other hand, just left all the financial gamesmanship alone, and focused like a laser on products. His record shows that works: Jobs saved the Mac, invented iPod, iTunes/iTunes Store, iPhone, iPad, App Store(s), and even AppleTv – all with record profits and no debt. Cook has given us updates to all of the former, buggier software, more record profits, but also record (for Apple) debt.

            The trend line seems to indicate Cook’s strategy has a way to go before being played out, but ultimately he will come up against the real consequences of throwing good money after bad. Something will come up, something big Apple will want to do, but the money needed won’t be there to make it easy because it’s been frittered on debt. At that point, I think you’ll see this all come to an end.

            The question is, how will Wall St. respond when Apple’s done rubbing their inner thighs, and how well will Apple be able to withstand the backlash.

        1. You speak a lot of what someone doesn’t know that is easily knowable. Steve Jobs hired Steve Johnson as CIO (Chief Investment Officer) in 2006 to found Braeburn Capital with a team of 5 people. Johnson left in 2013, but they’re adhering to the strategies and principles they were originally founded with.

          Do some research, it’s not that hard.

  3. The money is only borrowed because we have the tax policy favored by Democrats – always take as much as possible from evil nasty big corporations even up to all of it if possible. Apple has about 180 billion in off shore money it earned overseas and paid taxes for overseas. The US government would like to seize 38% of this already taxed money at the border, should Apple decide to bring it into America. Because Apple is a big evil greedy fat cat corporation like Democrats say all corporation are, except maybe Whole Foods or a company that loses billions pretending to create solar energy.

    1. Put down that Republican crack pipe!!

      For the record, I’m not disagreeing that our tax policy for money corporations earn overseas is absurd, but your post just sounded like a FoxNews (aka rabid Republican TV) segment!!

      1. Every word I said was true. You just don’t like hearing the truth about Democrats explained straightforwardly. It is hard to make Marxism sound good unless you are a person who likes thugs who will steal stuff so you don’t have to work.

      2. If you think that Fox is rabid Republican, then you have revealed what you think is normal, haven’t you? No doubt that you think CNN, ABCCBSNBC are “accurate” or at least “neutral”, don’t you? On what factual information is this belief based? I’ll tell you that, too — zero. Spending any time at all analyzing the media leads you pretty quickly to suss out their biases.

        Also, Fox ran the story on W’s DUI convictions the eve of the election. Pretty Republican, right? Shep Smith, boy, what a Republican that guy is, right? And O’Reilly kissing Obama’s backside all the time — real Republican there.

        Again, if you think Fox ardently favors the GOP, then you must conclude that CNNABCCBSNBC ardently favors Democrats, and does so often dishonestly. Who edited out important information about Zimmerman, trying to make look like a racist? Who ran the big X over Cheney’s face? Who lied about Bush’s memos and then had to resign in disgrace? Who broke the news about Florida’s elections before the panhandle had finished voting? You know the media; tell me.

        In short, you know nothing about what you speak.

        1. Here’s an unbiased analysis of contentious statements made on the various networks:

          I just looked each of them up on politifact.com, which is a Pulitzer Prize-winning site that specializes in unbiased reviews of statements made elsewhere. They’ll slam Obama for a lie just as quickly as they’ll slam anyone else.

          They started tracking Fox News a while back:

          politifact.com/punditfact/tv/fox/

          Note that the greater the degree of falsehood, the more ratings Fox has in that category (except “Pants on Fire”).

          NBC is shown to be substantially better, though still not great:

          politifact.com/punditfact/tv/nbc/

          Here’s ABC:

          politifact.com/punditfact/tv/abc/

          And CNN:

          politifact.com/punditfact/tv/cnn/

          You may notice that Fox’s ratings are MASSIVELY worse than any other network…even NBC (which includes MSNBC). I had not looked at these ratings prior to today, but always felt that CNN was the least biased and most honest. Politifact’s ratings back that up.

          And before anyone cries “Politifact is biased and just a liberal tool!!!” know that they rated Obama’s “You can keep your existing health plan” as the biggest lie of 2013. I think that speaks volumes for their objectivity.

          I’m assuming that Politifact did acknowledge that changes were made to make it possible to keep your existing health plan, even though the initial “letter of the law” forced insurers to cancel some existing plans because they did not meet ObamaCare’s minimum criteria for coverage.

          Some insurers did make old plans available again, some didn’t.

          1. NBC Lead News Fiction Reader – just exposed today for telling big whoppers for 13 years to cast glory on himself.

            CBS – Lead News Reader Dan Rather – fired for fabricating News,

            MSNBC – Al Sharpton, paid employee, enough said.

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            1. You’re stretching, as usual.

              First, Rather wasn’t fired from CBS, so you’re simply wrong there. Again.

              Second, the controversy to which you’re apparently alluding wasn’t him lying at all. Documents were given to CBS by a high ranking gov’t official and CBS failed to properly authenticate them (they were fake) before reporting on them. Mistake, sure, but not necessarily a lie. Fox reporters regularly DO flat-out lie, as proven by Politifact (which you conveniently ignored). Then there’s the whole Iraq war over EMDs that weren’t there. George W Bush, liar-in-chief.

              Al Sharpton. Worthless sack of sh*t, admittedly. Fix certainly had their own poor judgement in hiring Sarah Palin, who I would put up against Sharpton for “person I would least want in the White House”.

              But whatever. You obviously have your head so far up Bill O’Reilly’s butt that you apparently can’t (or won’t) see the obvious facts that Fox is the worst, most-biased channel out there.

              So, keep on believing their lies all you want. I have better things to do than argue pointlessly with you anymore. You’re wrong, but as someone else said, you seem to actually relish and gladly flaunt your ignorance and gullibility. Have a nice life, though!!

            2. Rather lied about George Bush’s war records and used fabricated documents to concoct a story. The 60 Minutes staff under Dan Rather that worked with him on the Bush report was fired. Then, according to The Washington Post at the time,

              “Dan Rather said yesterday that he will end his nearly 24-year reign as CBS News anchor early next year, setting the terms of his departure instead of waiting for an investigative report on his rushed and admittedly flawed story on President Bush’s National Guard service.”

              So, he quit to avoid being fired and to keep the investigative report from being aired. He used the report to lie and to influence an election. Kind of like the entire media has avoided reporting any truth about Obama, like Benghazi, or his very strange youth, or his school records.

              Brian Williams lied. He claimed to have been on a helicopter that was shot in the air by a rocket propelled grenade and was forced to land. He made this claim last week and he made it in detail on the David Letterman show a few years ago. It was a complete lie.

              You are obviously a Democrat and you have a very forgiving way with Democrats who lie. Now, your tolerance does not extend to Republicans who tell the truth. They really piss you off. People like Sarah Palin, who foretold the Death Panels, and who predicted Russia would attack the Ukraine if Obama were reelected and various other things the tyrant Obama would do. Sarah Palin had to be mocked and destroyed because she told the truth. The truth is an awful thing for leftists.

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      1. The money overseas has already been taxed overseas. So a 14% theft is not a good deal. And I think his proposal is to tax the overseas amounts even before the money is repatriated. Not sure. But it is of course Democrat policy to take whatever can be stolen to pay for the Martha’s Vineyard and Hawaiian vacations as well as the extra special healthcare for federal workers who somehow were exempted from Obamacare.

            1. Well we now have $10 trillion more in debt which has to be repaid. Food Stamp usage is at its highest level ever. The number of able bodied working age people actually working is at its lowest ever, with almost 100 million not working. Our health care freedom has been eliminated with Obamacare, which was sold on “you can keep your own doctor and your plan and you will save $2500 a year and the care will be better and the cost to the government will be less”. Every one of these promises is a lie, which if it had been done in the private sector the CEO would be in jail, not taking 40 weeks of luxury vacations paid for by his employers. Under Obama 200 Mexicans were murdered by guns supplied to drug cartel goons by the Obama DOJ. Our Libyan Embassy was attacked and Obama went to play card with Reggie Love while our Ambassador was murdered, then he came up with a lie about the attack being caused by YouTube. Under Obama the entire Muslim world is now on fire with Muslim warrior terrorizing everything and being supported by Obama.

              Yes, it was a lot worse under Bush.

            2. I’m sorry, but that is so general. It sounds like a politician’s talking points.

              I used to be a Republican, I am now an independent. A big reason I am no longer a Republican is that so much of their political rhetoric is about what the Democrat’s are doing wrong, but when asked what they would do you only get vague answers, no specific plans. I await their counterproposal to Obama’s tax plan.

              I find that Republicans speak a lot about cutting government spending, but in reality they spend just as much as the Democrats, and spending without an increase in taxes to offset the spending is just irresponsible. Just my $.02

            3. Lower taxes. Get rid of the IRS, the EPA, the Department of Education, Dept of Homeland Security, Obama’s vacations. End Obamacare immediately. Prohibit any laws over 10 pages. All laws apply equally to every citizen, but mostly government employees. Any IRS agent involved in the use of the IRS to target political opponents is immediately fired and imprisoned for at least 20 years. Flat tax of 12% with no deductions. Anyone who does not pay taxes can’t vote. All voters must show up at polls and provide picture ID. End all subsidies of farm products, energy and anything else.

              There – is that specific enough for your little head?

              Sent from my iPhone

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            4. That is a ridiculous list.
              Tax revenue must support national needs. So you first have to reduce spending in order to lower taxes. Neither party has an answer there, and Republicans have almost always spent more than Dems due to their military excesses. That is a verifiable fact.

              No IRS, no nation. This is absurd.
              No EPA, then no swimmable lakes or breathable air. I refuse to allow the USA to look like Beijing. This is absurd.
              No DoEd, then the USA will fall behind all other nations in technology. This is absurd.

              DHS – I agree in spirit. We already have police departments. However, we do need a federal system to coordinate measures against interstate crimes.

              Presidential vacations – get a clue. Any president does a lot of work during his “vacations”. Some of our best presidents, like Eisenhower, did much of his meetings on golf courses. Don’t make stupid rules for others that you wouldn’t live up to yourself.

              Healthcare reform – more reform is needed, but the correct course is not to undo what has been done. Some of the reforms ARE working pretty well. The American population doesn’t understand it and needs to get educated rather than allowing partisan mislabeling to cloud their judgement. Long story short, I am HAPPY that now many freeloaders who enjoyed emergency room care at taxpayer expense now finally have to ante up. That is a huge improvement over the old system. Moreover, only a moron would go through life without insurance. If you can afford a Mac, you can afford insurance or take the time to file the exemption, of which there are many.

              10 page laws — where do you come up with this BS? The Apple privacy statement is longer. The 2014 WWDC User Privacy presentation is 109 pages. Absurd.

              Equally but mostly????? You’re not good at logic, are you?

              Then you get back into IRS and taxes which you wanted to abolish, now suddenly you want them back. Make up your mind.

              No taxes, no vote would be nice if it also applied to corporate lobbying.

              End all subsidies — great idea. Let’s get it going now by eliminating your mortgage deduction and child tax credit, the underwriting of your loans, and your charitable deductions. After all, the rules need to apply to everyone, right?

              Bottom line, Kent: clearly you have no understanding of what democracy is. The list of stuff you rattled off is unrealistic and unenforceable. BOTH parties are corrupt and special interest groups have gerrymandered their loopholes into laws. The solution is not to go back to a dictatorship, but to rewrite laws to unwind the most inefficient items. These are not the first items that cost you and I money or prevent us from being successful. Instead of making BS up like this, you need to COOPERATE in the sausage-making and COMPROMISE so that everyone walks away with a workable solution.

              One last little item: why is a picture ID needed for voting when Apple only requires a fingerprint? Let’s think to the future and get voting secure and online with several options for voter biometric verification instead of mandating an antiquated process that is inefficent and costly for taxpayers? See, if we work together toward solutions, we can all benefit. Stop pissing on the proposals of others and find areas where agreement is possible, shall we?

            5. My list reduced the cost of government. With a flat tax you don’t need the IRS, or about 95% of it. The EPA has been a net negative in terms of the environment and a definite negative with respect to property rights and employment.

              You are completely ignorant of the fact that government grows every year and never shrinks despite the fact it’s operations are mostly not needed for any good purpose. The Department of Agriculture employs 1200 Media Relations personnel. Think about that. In reality it might need one or two. In reality we don’t even need the Department of Agriculture any more than we need a Department of Personal Computers.

              Sent from my iPhone

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            6. First, you may have been a Republican and are now an independent — good. We don’t need fair-weather friends. You complain about general rhetoric, but how much did you follow individual candidates? How much did you care at the local level? Your complaints are as a general as the rhetoric. Also, you do not understand economics. Taxes follow the Laffer curve — eventually they have an outsized economic depressive effect.

            7. “We don’t need fair-weather friends”

              Just because you we don’t agree. What kind of response is that? The Republicans aren’t going to win by just catering to people who think just like them. They should have a message that reaches out to more independents. Regarding my rhetoric, my first post had specifics and a link to the source of the data.

              I do follow individual candidates and will vote for the best candidate whether he or she’s is a Republican, Democrat, Indepependant, Conservative, or Libertarian. I don’t vote strictly across any one party line because frankly neither the Republicans or Democrats represent me.

            8. Agree 10,000% with what JoeKnows just said.

              Similarly, I was also a registered Republican up until a few years ago, and am now an Independent.

              As he said, Republicans tend to talk a lot about what’s right and wrong, and I often agree with them in principle/theory/philosophy….but they have no plan to actually deal with REALITY.

              It’s like wanting to ban abortions. I agree in principle…abortions are horrible. Republicans will say abstinence (proven not to work) or “adoption is the answer,” but (a) are there really enough people out there wanting to adopt? (a million or so, give or take), and more importantly, (b) will there be enough wanting to adopt THE SAME NUMBER OF UNWANTED CHILDREN next year? How about the year after? And every year after that??

              The answer is “no, there aren’t,” so these children will wind up being cared for by the government….oh, wait…but the Republicans want to get rid of a lot of those programs. So instead they’ll be on the street, dealing drugs, violent crimes, etc, inflating our already large prison population as a burden on taxpayers.

              And that’s typical of Republican proposals….they insist on doing what they think is ideally right (with little to no compromising), but have no plan whatsoever in actually fixing the problems that will result.

              They want to repeal Obamacare. Fine. But what then? Pretty much everyone agrees that the healthcare system was f***ed prior to Ocare. I’ve yet to hear a Republican counterproposal, probably because there isn’t one.

              Is Ocare perfect? Of course not, but they don’t want to talk about FIXING it, just repealing it, which is idiocy.

            9. How about we just delay Obamacare until all the people in the Federal government are willing to be on the same plan. That will end it forever.

              Sent from my iPhone

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            10. I used to be a registered Democrat until I got tired of associating with people who hate America, don’t give anything to charity, love high taxes but do all they can to avoid paying them, talk endlessly about the right to “choose” and then force all Americans to buy a health care plan they don’t want. I hated the hypocrisy of my Democrat friends who thought the earth would end next week due to global warming but they all have big houses, big cars and fly all over burning fossil fuels while the world is about to be destroyed by carbon use. I got sick of them priding themselves on being open and tolerant but calling any black conservatives “uncle Toms” – aren’t black people allowed to have opinions? Only leftist opinions approved by people like Al Sharpton.

              I got tired of them bragging about how they support women’s rights and them making a rich celebrity out of Bill Clinton, a serial rapist with more victims than Bill Cosby. Clintons victims got called “trailer trash” by Clinton’s paid goons and my Democrat friends were OK with all of his rapes.

              So I left the Democrat party. Then I took a very long shower.

              Sent from my iPhone

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          1. LOL @ JoeKnows. Oh here it is — the Republicans have no plans! They’re just babies who delay and obfuscate! They’re obstructionists! You act like there is only one plan. Why? Paul Ryan’s budget passed the House, and it had several ideas within it. Boehner passed the Cromnibus bill according to very different principles. Does this show you that there is no one single GOP plan? I’m sorry, but you will have to look at people who propose plans and not parties.

            1. Oklahomans at local and state levels were and still are against the pipeline going through their lands. Furthermore, there are parallel pipelines that can easily be upgraded to move the sludge where it needs to go — or better yet, we can let multinational oil companies build newer, more efficient refineries in Canada where the tar is. There are many proposals on the table and many groups have a legitimate say in the outcome.

              But don’t let the complicated reality of the situation get in the way of your hyper-partisan thinking. Funny how the extreme right-wingers want the feds to get out of anything, but when an oil company wants to take public and private land and requires the federal government to okay it, then suddenly they demand that the feds push through a repulsive legal “eminent domain” judgement. Hypocrites.

            2. My issue with the Keystone pipeline is that aside from temporary construction jobs, what’s in it for America.

              The Keystone pipeline will help Keystone XL/ TransCanada ( a Canadian company ) send bituminous tar sands to the Gulf refineries so that it can be refined and sold on the global market. It will not help us with energy independence so why do so many peoe want to support a foreign oil company. I think the reason for the support on the Republican side is just because of lobbyists. It is easy to see who’s pocket they are in.

            3. The reason the Democrats have fought Keystone is nothing to do with the environment. Democrats don’t give a shit about that or they would not build windmills that annihilate bald eagle populations and they wouldn’t promote ethanol that results in the deforestation of vast swaths of old timber and prairie land in Central and South America. The Democrats are, of course, all about money, and Warren Buffet is a big Democrat donor and he owns a rail line that get paid billions to transport oil from Canada across the US, since there is not a good pipeline. Now, of course it may not be a really good or safe idea to transport huge amounts of oil on trains across vast distances of track where derailments are a constant possibility. A pipeline is much safer. But then you don’t get the big donations from Warren Buffet. And Democrats are always about the money.

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            4. @Kent

              I agree with everything you said in the last post. The Democrats are all about money, but so are the Republicans. The main differences are the special interest groups they cater to.

            5. Please don’t put words in my mouth. I didn’t call anyone a baby or obstructionist. I simply stated my opinion and why I am an independent and not a Republican.

              In a way I’ve followed your advice. Instead of looking at the party I look at individual people. I think that makes me more of an Independant.

          1. And why is this new TAC needed? Is it to fund Obama’s health care, which is not ObamaCare? Is it to fund new IRS agents to attack his opponents, the people who don’t hate America as it was founded? Is this new money for more aid to Iran or more tax refunds to illegal aliens who don’t pay taxes? Why does the jackass need more money?

            Sent from my iPhone

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            1. None of the above. It’s to fund infrastructure, specifically highway infrastructure, which is woefully underfunded and in terrible shape, but Congress won’t raise the gasoline tax to replenish the transportation trust fund, because that would be raising taxes. Not that you’re going to read or understand this, because the majority of your comments appear to indicate a willful (dare I say prideful) ignorance. A mind is, indeed, a terrible thing to waste.

            2. We have a Highway Trust Fund for that purpose. But the Federal Government keeps robbing it to pay for other stupid things. The Highway Fund generates the money needed for highways. We also have a Social Security Fund that has been robbed and is now stuffed with worthless IOUs. We also have $17 trillion in debt. We also had a $1 trillion stimulus plan under Obama in 2009 that was supposed to do all the infrastructure and fix all the “shovel ready” stuff. My town got a $10 million four lane road we don’t need. They were done all across America.

              No, it’s time to not give more money to the jackasses in Washington who spend 40 weeks a year on luxury vacations from which they lecture us working stiffs about the growing inequality, while Hillary charges a state university $250,000 for a 45 minute speech about how unfair America is, and she demands a private jet fly her in and out. I will voluntarily send in extra tax money if someone would have Dexter Morgan take out the trash that is the Democrat Party.

            3. This post shows just how rabid your hatred of Obama is, plus how little you actually know or understand about how government works.

              The 2009 stimulus you’re talking about was put in place by BUSH, not Obama, at the end of Bush’s reign as idiot-in-chief. Look up TARP on wikipedia for the proof that you likely still won’t believe because it conflicts with your unreasonable hatred of all things Democrat.

              Similarly, an incoming president also has to live (for his first year in office) with the budget passed under his predecessor’s final year. Continued effects of policy will last longer, for better or worse.

              So, a SUBSTANTIAL amount of the debt you claim Obama caused was actually (a) Bush’s 2009 budget, (b) continued cleanup of the train wreck caused by the Bush administraion’s bad policies, and (c) continuing and eventually winding down Bush’s completely unjustified war in Iraq, and (d) winding down the war in Afghanistan that Bush had dragged out entirely too long.

            4. Rabidly hate??

              Well, Obama used pure lies to pass Obamacare, and in the process has done irreparable harm to people around the country who have lost their jobs, their doctors, their savings due to insane deductibles, and their medical freedom. All for an awful plan that the legislators exempted themselves from.

              Obama has used the IRS to attack his political opponents. I hate him for using the illegal force of government against law abiding citizens because he does not want criticism.

              Obama had Mexicans killed with semi automatic rifles he had the ATF allow to go to drug cartel goons all so he could use the subsequent deaths to promote gun control. A couple of US border agents were killed in this undercover illegal program that he used because he cannot be honest in his political efforts. I hate him for that.

              He let the Americans die in Benghazi where he had them in a strange non-embassy building distributing weapons to Muslim terrorists. Our people were killed during an attack when he did nothing to help them. I hate him for that.

              Obama has used every episode possible to incite racial hatred of law enforcement and the white community in general. He always sides with criminals against honest efforts by citizens and law enforcement and the end result is ever increasing racial hatred that he creates. Trayvon Martin, Ferguson, Missouri, Yale professor, and more. All racial incitement created by promoting lies.

              Obama lies every time he talks. I do hate him for that. I don’t like pathological liars. Do you?

              Obama hates America. He trashes it all the time while globetrotting to parts of the world that we have lost tens of thousands of lives defending. He is a detestable being.

              Yes, I do hate him. It is right to hate evil.

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            5. Oh, and as for Hillary’s outrageous speaking fee…

              I agree 100%. It’s absurd. However, no one is *making* them book her for a speech. They could easily get someone else who charges less and may give a better speech (I don’t hate Hillary, but am not a fan).

              If some university was willing to pay me $250K to give a speech, you’re damn right I’d take it, too.

              And you know that despite all your indignation about Hillary getting it, you’d take it too….but I don’t think anyone wants to hear you give a speech.

              It’s called “capitalism.” I would have thought that as a Republican you’d be in favor of it. Oh, but that’s right….it’s “the enemy” getting the money this time.

              It’d be by you OK if Bush got that much, I’m sure….but I don’t think many want to hear any more of *his* gibberish, either….

            6. It’s kind of amazing but the primary organizations willing to pay the insane speaking fees that Bill and Hillary Clinton demand, and soon Obama will demand, are state universities or organizations that derives their funding primarily from government sources. These universities only give these insane fees to liberal idiots who then come to the campus and criticize “greed” of business owners and trash the product of free enterprise, the part of the economy where people actually create things of value. There is no $250,000 fee for Sarah Palin or Newt Gingrich or Donald Rumsfeld or Clarence Thomas. No, you have to be a person who will speak against the greed of capitalism to be paid $250,000 for 45 minutes and demand a list of 50 royal treatments be accorded you during your two hours. This is a Democrat greed and corruption game.

              >

            7. @Kent Ramsay: Once again, you blabber on without knowing what you’re talking about.
              newsDOTyahooDOTcom/blogs/ticket/george-w-bush-racks-15-million-speaking-fees-192157129.html (swap out the DOTs appropriately for periods)

              Yes, FIFTEEN MILLION for your beloved Republican, George W “Gilligan” Bush.

              And Reagan was pulling in $50,000 per speech post-presidency…IN THE EIGHTIES. Adjust for inflation, and yeah, you’re getting mighty close to Hillary’s fees. Another article I saw said “Back in 1989, Ronald Reagan faced harsh criticism for accepting $2 million to deliver two short speeches in Japan.”

              So, you see…greed runs on BOTH sides of the political fence, and Republicans are every bit as guilty of it as Democrats.

              Here’s another quote I saw that “Sarah Palin has made headlines recently for her exorbitant fees that she charges for her tea party appearances – from $100,000-$150,000. ” (that was in a 2010 article on investopedia.com). And she was only governor of the least-populated state in the country (well…and a complete joke of a VP candidate).

              Also, “Students there found a copy of a Palin contract in the trash that outlines requirements for Palin’s speech, including that her air travel must be first-class or on a Lear jet, that her hotel stay must include two to three rooms booked under an alias and that any lectern for her must have two unopened bottles of water and bendable straws.” That was related to a speech she gave at California State University for which she was reportedly paid $100,000.

              So, again, you don’t know what you’re talking about and your bias has completely blinded you to the faults, greed, and failings in your own party. Sorry to burst your little bubble with pesky facts, but there they are!

              And again, I’m a registered Independent because I realized that BOTH parties are full of crap (though I do think the Republicans are worse).

            8. Most of what you said was true (as far as Hillary getting outrageous fees for speaking), which is why I didn’t refute it.

              Again, you missed the point, which is that the Republicans get similarly outrageous fees.

              You claim its “Greedy Democrats.” No, it’s “Greedy Politicians,” including “Greedy Republicans.”

              But no one is being forced to pay these fees. They’re charging “what the market will bear,” which is the foundation of capitalism. If you truly understood the Republican platform, you’d realize that’s practically their motto.

              But whatever…you’re too biased and ignorant to waste more time arguing. And I don’t mean that as an insult…”stupid” would be an insult….you’re simply biased, misinformed, and hell-bent on staying that wa, which is your right.

              Have a nice life!!

            9. GIve me the story about the Republican who was paid $250,000 for a one hour speaking engagement at a state university, and who was guaranteed private jet travel and her own female masseuse as part of the contract.

              You won’t find any such story. Again, you missed the point. Democrats always criticize greed while they are stuffing their wallets with taxpayer money, like Obama’s vacations, and they never do a thing during their career to ever produce anything on their own. They are purely fed by the public sector, and then of course corporate fat cats who want to buy influence (this is called graft). Bill Clinton was flown around by the pedophile to his island where he keeps the young girls in bikinis for rich lecher Democrats. Like Bill Clinton.

              >

      2. Most countries have much lower taxes for overseas profits as they are smart enough to realize they want their corps to funnel cash back home : i.e like if their corporations made money in China they want to encourage those companies to bring it back instead of investing in China. (think about it Chinese money building Mac factories in USA!) The USA currently has the highest reparation rate in the OECD.

        secondly local for USA profits Apple pays 20-30% tax.
        The Korean govt. charges Samsung less than 5% for local Korean profits as it wants to support local companies.
        Apple in Korea pays Korea a much higher rate for Korean sales and THEN it has to pay repatriation tax if it wants to bring it back to USA and THEN Apple investors have to pay income tax on dividends and capital gains tax (if they sell the stock)…

        (because of state and Federal taxes the USA has among the highest tax rates for corporations in the world which the OECD estimates at 39.2 — less with deductions but still high. Other’s like Switzerland has a rate of 8.5%)

        USA corporations are functioning with one hand tied behind their backs : look at Lenovo , Acer etc swamping HP and Dell in the PC business (I only quote PCs as it’s easier to illustrate, I’m a Mac user). Tax is not the only reason but a significant one why the economy sucks.

    1. Saving money is the ENTIRE point of this accumulation of debt. Sick as it is for wealthy Apple to go into debt, as BizLaw pointed out above, the alternative is MUCH more expensive. #MyStupidGovernment can’t figure out that getting foreign profits into the USA is critical. Instead, they want to force foreign made profits to stay outside the USA thanks to idiotic gouge taxation on those foreign profits. (O_o)

    1. It’s not that being debt free as much as accruing debt isn’t necessarily a bad thing. In this case Apple could bring cash into the U.S. and pay a high percentage in taxes, or they could take on debt, pay the extremely low interest, and make more money on the return on the cash holdings. This isn’t even necessarily a repatriation issue, although that helps. Even if it was domestic cash, the interest should be lower than a return on what you can invest in conservatively.

        1. That’s not really relevant. Personal economics != corporate economics != state/country economics != global economics.

          Yes, you most likely personally want to pay cash for stuff instead of buy on credit and pay the interest.

          However, imagine this scenario…

          Go back a few years and suppose you needed a car and you had several thousand dollars in cash. You found a car for the price that met your needs, and the dealer says they could sell you the car at the same price, but with financing that equated to really low interest. You could’ve been better off buying the car on credit and taking your cash and buying Apple stock.

          The same goes with the house, with the added benefit of tax deductions on the mortgage.

          On the corporate level, specifically for Apple, that scenario becomes much more likely and that’s what Apple is faced with. The interest on the debt is a write-off and is lower than the tax on the same amount of money.

            1. It’s not a philosophy. Unless you consider looking at two piles of money and choosing the bigger one a philosophy.

              I think people confuse Apple not having debt after Jobs came back and the company became successful again with Jobs thinking there was something inherently wrong with debt.

              Sure, Jobs never wanted to be beholding again to others to whom he received financing, but there’s a huge difference between being in debt (as a net) and having debt on your books that can be wiped out at any time by an overwhelmingly larger pile of cash.

              Jobs had no problem with leasing his Mercedes instead of paying with cash for his own personal reasons (not wanting to get it registered), and likewise had no problems with the various cash management strategies being implemented today by the people he hired in 2006. Really, he was as unfocused on cash strategy as a CEO could be.

  4. Apple is simply being smart with their cash. Interest rates are so low right now that it may actually make sense to carry debt even if you have the cash to pay it off.

    I’m doing the same thing. I have cash available to pay of both car and mortgage loans…but with rates of 1.49% and 3.00% (15-yr) respectively, it doesn’t make sense…I’m gaining more than that in my investments!

      1. He is paying 1.49% in interest. If his investments are yielding 5% or more then he is netting 3.51% or more on the money he would be used to pay off the car and mortgage.

        I say more because there are also tax advantages to the mortgage debt.

        1. Just fixing a typo.

          He is paying 1.49% in interest. If his investments are yielding 5%, then he is netting 3.51% or more on the money that would be used to pay off the car and mortgage.

          I say more because there are also tax advantages to the mortgage debt.

          1. That’s one way of looking at it. 🙂

            Another is that he is using the value or equity of his car or home to make more money. He is still making the payments on his home and car loan, just profiting from it as well.

            It all depends on the risk/reward ratio you are comfortable with.

            1. JoeKnows gets it.

              I do own my home, but I’m leveraging its value to achieve greater gains in the stock market. When I’m ready to retire in a couple of years (by age 50, I hope), I’ll probably pay off the mortgage (car will already be done), purely for the increased stability and “peace of mind” that comes from having no loans.

              At the moment, with a good-paying job, the risk of investing the money vs paying off the mortgate is worth it. Once I stop working, my income will be reduced substantially, so I’ll want more certainty.

              It’s honestly just an intellectual vs. emotional debate. I completely understand both sides of it…emotionally I want to be debt-free NOW, but intellectually I know that I’m better off keeping the low-interest loans for now.

  5. But if Apple borrows money to avoid repatriating costs from overseas, pays interest, and then has to bring in the funds from overseas to pay back the debt with the high taxation….

    Not a no-brainer. No one knows if that overseas money will get a tax holiday by then. If not, then this is a costly scheme.

    I believe the real reason for doing this is to play nice with the financial markets and for political lobbying influence.

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