Wednesday, January 30, 2013

Amazon lost money, but people are happy?

Sad state of affairs:

RUSH: Amazon. There's an object lesson here. Amazon reported its quarterly earnings yesterday. I don't have the data right in front of me, but Amazon did not report a profit. They did not report growth. They did not report anything that was positive, and the stock market just went up through the roof. Apple reports record revenue, the fourth most profitable quarter ever, and the bottom fell out for them. One analyst speculated, had a theory as to why Amazon's doing well. Are you ready for this? "Investors appreciate a company willing to lose money." Honest to God, that's the summarization. That's the summary of what this guy said. Amazon selling stuff at prices that can't possibly earn a profit, that deserves to be rewarded.
That means Amazon cares about people. That means Amazon's not trying to exploit their customers. So people are investing in Amazon. Their stock price went up. They're reporting losses. And the same people beating up Apple for inexplicable reasons are claiming that -- well, just one analyst. I haven't seen this as a blanket explanation, but one analyst said, "Oh, man, Amazon, you gotta love these guys. They're selling things at prices they can't possibly earn a profit. They've got the consumer in mind. You gotta really appreciate what Amazon's doing." Well, that's all well and good, but who in the heck would put their money into a company that's not going to show a profit? But people are doing it.

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