“Carl Icahn has acknowledged selling off his Apple holdings and has pointed to ‘China’s attitude’ towards Apple as his principal concern,” Mark Hibben writes for Seeking Alpha. “While Icahn regards the Chinese government as having unlimited power, in fact, the government is severely limited by economic realities, globalization, and its obligations as a member of the World Trade Organization.”
“Carl Icahn has kicked off for the Summer of 2016 a new Chinese Bogeyman, that of the pernicious Chinese Government,” Hibben writes. “Icahn said, ‘You worry a little bit – and maybe more than a little – about China’s attitude… [The Chinese government could] come in and make it very difficult for Apple to sell there… You can do pretty much what you want there.'”
“It’s obvious that this will be the new thesis that drives the stock down during the summer,” Hibben writes. “Besides formal trade requirements, China is highly dependent on its trade relationships with countries such as the US. Apple is the premier example. Apple’s manufacturing partner, Hon Hai Precision (Foxconn) is the largest private employer in China, with 1.4 million workers. As I’ve pointed out, Foxconn derives between 60-70% of its revenue from Apple, depending on the time of year. This makes Apple indirectly one of the largest private employers in China… China has more to lose than gain by blocking Apple.”
Much more in the full article – recommended – here.
MacDailyNews Take: As we wrote on Monday:
China has a lot more to lose than they have to gain by “slamming the door on Apple.”
SEE ALSO:
Carl Icahn out of Apple over worries about China’s ‘dictatorship’ government – April 29, 2016
Apple stock falls as Carl Icahn dumps all of his shares – April 29, 2016
Carl Icahn dumps all of his Apple shares; stock drops – April 28, 2016
Apple reports earnings miss in Q216 – April 26, 2016
China could slam door on Apple, says top global risk expert – April 25, 2016
China’s increasing censorship hits Apple, but Apple might punch back – April 22, 2016
China shutters Apple’s online book and movie services – April 22, 2016
Apple CEO Tim Cook joins Robert F. Kennedy Human Rights’ board of directors – April 6, 2016