Some people view an MBA degree the same way that Charlie thought about his Golden Ticket in "Willy Wonka and the Chocolate Factory": They believe a piece of paper can magically transport you to a place you only imagined.
But can this addition to your résumé really be your dream ticket? Yes. No. Maybe.
There are no simple answers, but here are ways that an MBA might help you.
MBA could get you hired in a tough economy
Let's face it: If you had your pick between two candidates -- one with a BBA and one with an MBA -- who were both qualified for a job, wouldn't you take the one with the higher degree?
Because of the recession's affect on employment, many companies have a wealth of talent to pick from at the moment and some can afford to be choosy in their hiring. Candidates need to score every point possible, and a graduate degree may give that extra edge.
"A category of jobs that begins to show up more in a recession is one that says MBA desired or preferred versus MBA required," says Dennis Grindle, director of the SMU Cox School of Business MBA Career Management Center in Dallas, Tex. "These jobs tend to pay somewhere in between a BBA and an MBA. This allows an MBA to get into what they want to do by taking a step back to hopefully go forward later when economic times get better."
MBA may get you where you want to go faster
"Having an MBA -- as opposed to just a bachelor's degree in business -- is sort of like traveling someplace by plane instead of taking the train. With either business degree, you may eventually wind up at your final 'destination' -- but the MBA will get you there faster," says Elizabeth Freedman, author of "The MBA Student's Job-Seeking Bible" and "Work 101: Learning the Ropes of the Workplace Without Hanging Yourself."
Some of the opportunities an MBA degree may jump-start include:
• Managing larger teams
• Running meetings
• Greater interaction with clients
• More decision-making power
• Representing the company at events
• "Choicer" projects
• Responsibility for your own set of clients/projects
MBA is sometimes expected
"In certain organizations (top-tier consulting firms, for instance), having an MBA or an advanced degree is practically a requirement for certain positions," Freedman notes. "It's hard to move up without that credential, no matter how talented."
In this situation, the degree basically becomes a minimum qualification -- not your ace in the hole. To land the position, you are then expected to bring what Grindle calls "an A+ game" to the table, meaning that you have everything the employer is looking for and then some.
Grindle notes that whether a function requires an MBA or not may vary by company size, industry, state of the economy, and even geographical location. Still, there are fields that commonly utilize MBAs, including:
• Consumer Brand Marketing
• Corporation Finance
• Venture Capital
• Investment Banking
• Commercial Banking
• Production/Operations Management
• New Product Development
• Management Consulting
• Private Equity
• Strategic Planning/Business Development
MBA can round out an education
Some workers hold undergraduate degrees in fields other than business. By seeking an MBA, these employees can fill in possible gaps in their education as well as show their commitment to their field. Likewise, a person who already holds an undergraduate business degree but perhaps has been working in a different area can update his skills by seeking a graduate degree.
The decision whether or not to pursue an MBA is a tough one. It involves serious thought about money, time and career goals. But for those who decide that getting an MBA is the path they wish to take, the degree might open up a whole new world of possibilities.
Does investing in China make sense? By Bill Bonner
Does investing in China make sense? Or is Beijing a boom town ready to bust?
Yes, dear reader…prices are falling. In April, the US producer price index fell 0.1%.
Oil fell to $72 yesterday. The Dow fell 114 points.
Copper is down more than 20% from its high. Chinese stocks are down 21% so far this year.
The CRB – a measure of commodities prices – is down about 12%.
Even gold got whacked yesterday – down $13.
What’s going on?
Well, we’re in that long period of adjustment known (to us!) as the Great Correction.
In the first stage…
…the markets discover that its assets aren’t worth as much as investors had thought….
…creditors find that their credits aren’t as good as they had believed…
…consumers realize that they don’t have as much money to spend as they had hoped…
…businesses find that they don’t have as many sales as they had projected…
…and governments wake up to the fact that tax revenues are coming in at less than expected levels.
Boo hoo.
This leads to all sorts of gnashing of teeth and congressional hearings. But it’s just the way the world works.
Unfortunately, the way the world works includes a lot of preposterous ideas about the way the world SHOULD work…and a lot of scurrilous efforts pretending to make them work better.
So, while the private sector generally de-leverages – with lower prices and lower debt levels – the public sector tends to leverage up. And to hear some economists tell it, if the feds don’t come to the rescue with bailouts and boondoggles, the whole world economy will sink into a Dark Age.
A few even say the feds have no choice. Richard Koo maintains that if governments stop their stimulus spending – which, of course, adds trillions to the world’s public deficits – the deficits will go up!
Come again?
Yep. Koo’s point is pure Keynesianism…probably correct…and completely absurd at the same time: try to cut your deficit by reducing stimulus spending, he says, and you’re likely to destroy the economy, and increase the deficit too. More on that later in the week…
We’re not going to bore you with economics today – not while the world’s biggest and most dynamic country lies right outside our hotel.
We’re staying at the Grand Hyatt. But we could be in any one of dozens of international hotels in Beijing. The city is full of bright, modern, new buildings…bright, modern, new hotels…and bright, modern, new people.
“There’s a HUGE generation gap in China today,” said a dinner companion last night. “People our age [he was about the age of your editor] remember the Cultural Revolution. The only way to survive was to keep your head down. You learned not to stand out in any way. Everyone wore the same clothes. Everyone said the same things. If you didn’t you might get sent to a labor camp…or worse.
“But the younger generation has grown up in a China that is completely different. All they’ve seen is progress…spectacular progress…incredible growth. And they know that the way to succeed in this new China is to take chances…”
China has become a nation of entrepreneurs…risk takers. It resembles the US in the ’20s – before the country was taken over by corporate managers and political mandarins. China is a good place to make money.
‘Rags to riches’ stories are so common you wonder if there’s anyone left to wear rags. One of those stories had an unhappy ending yesterday when one of China’s richest men was sentenced to 14 years in jail for corruption.
Today, China seems like a more capitalist country than the US. It is full of gamblers and innovators. The pace of change is breathtaking, with construction cranes all over the city. And the buildings themselves are often daring…the roads are straight in Beijing, but the buildings lean. Some walls lean in. Some lean out. Some lean one way and then the next.
The city, what we have seen of it, does not seem anything like a ‘third world’ hive. Instead, it is a giant, modern metropolis. We came prepared to compare it to Managua or Mumbai. Instead, it compares favorably to Chicago or New York.
Beijing is not our kind of city. We prefer places where we can walk around – like Paris, Zurich or London. This is more of a car-friendly town, like Amarillo or Brasilia. The streets are wide. The buildings are tall and isolated. You go from one complex of modern high-rises to another.
But this city is much more lively than Paris or New York. It is a city still taking shape…a city that is still figuring out its role in the world. It is “making its way across a river by feeling the rocks,” as the Chinese say.
Beijing is a still city for tomorrow…
But what about investing in China? Is it a buy or a sell? We asked local experts.
The answer: it depends.
China probably is a bubble economy, in many ways. Property prices soared as people speculated on real estate. Individuals bought apartments and houses as a way to store the money they’d made in business. But unlike the US, they paid cash. Now, prices seem to be going down. Some areas are going ‘no bid,’ with prices collapsing.
But since there is little mortgage debt, it does not seem likely that the residential sector will suffer the same dramatic decline as, say, Las Vegas…
The news this morning is that Las Vegas is in the middle of a housing resurgence. More than 1,000 new units are under construction.
But wait. The city has some 15,000 empty units still on the market.
“My parents bought a house in Las Vegas in 2000,” said one of our new friends last night. “They paid $220,000. Then, in the boom, it went up to about $350,000. Now the price of the house is about $190,000.
“There’s a house I saw the last time I visited. It was on the market in 2006 for $2.9 million. A big house up against the foothills. With a guesthouse and two pools. A really nice place. It was being offered at only $700,000.”
While the residential market is not highly leveraged in China, the commercial market floats on a sea of debt.
“What happens is that local governments get into deals with local developers,” our host explained. “Between the two of them, they borrow huge amounts of money from the banks. Then they build something that feels good to everyone associated with it, but that might not have much commercial potential. Nobody wants to see the project fail, so it tends to be refinanced…and refinanced…until it is carrying a mountain of debt.
“What we’re going to see, I think, is that all that debt will come crashing down. It’s going to be a mess for while. Maybe a long while.”
Does that mean an investor should stay away from Chinese shares?
“Not necessarily,” says our local expert. “Many of these companies are still growing very fast…and many are not dependent on the building boom. Some of them have nice little niches…like selling beer and soap to a huge population of people whose incomes are rising. And because their prices have been knocked down, you can buy these companies for about 8 times earnings. It could be that they’ll go down some more in the coming crisis. Still, they could turn out to be great investments over the long run.”
Yes, dear reader…prices are falling. In April, the US producer price index fell 0.1%.
Oil fell to $72 yesterday. The Dow fell 114 points.
Copper is down more than 20% from its high. Chinese stocks are down 21% so far this year.
The CRB – a measure of commodities prices – is down about 12%.
Even gold got whacked yesterday – down $13.
What’s going on?
Well, we’re in that long period of adjustment known (to us!) as the Great Correction.
In the first stage…
…the markets discover that its assets aren’t worth as much as investors had thought….
…creditors find that their credits aren’t as good as they had believed…
…consumers realize that they don’t have as much money to spend as they had hoped…
…businesses find that they don’t have as many sales as they had projected…
…and governments wake up to the fact that tax revenues are coming in at less than expected levels.
Boo hoo.
This leads to all sorts of gnashing of teeth and congressional hearings. But it’s just the way the world works.
Unfortunately, the way the world works includes a lot of preposterous ideas about the way the world SHOULD work…and a lot of scurrilous efforts pretending to make them work better.
So, while the private sector generally de-leverages – with lower prices and lower debt levels – the public sector tends to leverage up. And to hear some economists tell it, if the feds don’t come to the rescue with bailouts and boondoggles, the whole world economy will sink into a Dark Age.
A few even say the feds have no choice. Richard Koo maintains that if governments stop their stimulus spending – which, of course, adds trillions to the world’s public deficits – the deficits will go up!
Come again?
Yep. Koo’s point is pure Keynesianism…probably correct…and completely absurd at the same time: try to cut your deficit by reducing stimulus spending, he says, and you’re likely to destroy the economy, and increase the deficit too. More on that later in the week…
We’re not going to bore you with economics today – not while the world’s biggest and most dynamic country lies right outside our hotel.
We’re staying at the Grand Hyatt. But we could be in any one of dozens of international hotels in Beijing. The city is full of bright, modern, new buildings…bright, modern, new hotels…and bright, modern, new people.
“There’s a HUGE generation gap in China today,” said a dinner companion last night. “People our age [he was about the age of your editor] remember the Cultural Revolution. The only way to survive was to keep your head down. You learned not to stand out in any way. Everyone wore the same clothes. Everyone said the same things. If you didn’t you might get sent to a labor camp…or worse.
“But the younger generation has grown up in a China that is completely different. All they’ve seen is progress…spectacular progress…incredible growth. And they know that the way to succeed in this new China is to take chances…”
China has become a nation of entrepreneurs…risk takers. It resembles the US in the ’20s – before the country was taken over by corporate managers and political mandarins. China is a good place to make money.
‘Rags to riches’ stories are so common you wonder if there’s anyone left to wear rags. One of those stories had an unhappy ending yesterday when one of China’s richest men was sentenced to 14 years in jail for corruption.
Today, China seems like a more capitalist country than the US. It is full of gamblers and innovators. The pace of change is breathtaking, with construction cranes all over the city. And the buildings themselves are often daring…the roads are straight in Beijing, but the buildings lean. Some walls lean in. Some lean out. Some lean one way and then the next.
The city, what we have seen of it, does not seem anything like a ‘third world’ hive. Instead, it is a giant, modern metropolis. We came prepared to compare it to Managua or Mumbai. Instead, it compares favorably to Chicago or New York.
Beijing is not our kind of city. We prefer places where we can walk around – like Paris, Zurich or London. This is more of a car-friendly town, like Amarillo or Brasilia. The streets are wide. The buildings are tall and isolated. You go from one complex of modern high-rises to another.
But this city is much more lively than Paris or New York. It is a city still taking shape…a city that is still figuring out its role in the world. It is “making its way across a river by feeling the rocks,” as the Chinese say.
Beijing is a still city for tomorrow…
But what about investing in China? Is it a buy or a sell? We asked local experts.
The answer: it depends.
China probably is a bubble economy, in many ways. Property prices soared as people speculated on real estate. Individuals bought apartments and houses as a way to store the money they’d made in business. But unlike the US, they paid cash. Now, prices seem to be going down. Some areas are going ‘no bid,’ with prices collapsing.
But since there is little mortgage debt, it does not seem likely that the residential sector will suffer the same dramatic decline as, say, Las Vegas…
The news this morning is that Las Vegas is in the middle of a housing resurgence. More than 1,000 new units are under construction.
But wait. The city has some 15,000 empty units still on the market.
“My parents bought a house in Las Vegas in 2000,” said one of our new friends last night. “They paid $220,000. Then, in the boom, it went up to about $350,000. Now the price of the house is about $190,000.
“There’s a house I saw the last time I visited. It was on the market in 2006 for $2.9 million. A big house up against the foothills. With a guesthouse and two pools. A really nice place. It was being offered at only $700,000.”
While the residential market is not highly leveraged in China, the commercial market floats on a sea of debt.
“What happens is that local governments get into deals with local developers,” our host explained. “Between the two of them, they borrow huge amounts of money from the banks. Then they build something that feels good to everyone associated with it, but that might not have much commercial potential. Nobody wants to see the project fail, so it tends to be refinanced…and refinanced…until it is carrying a mountain of debt.
“What we’re going to see, I think, is that all that debt will come crashing down. It’s going to be a mess for while. Maybe a long while.”
Does that mean an investor should stay away from Chinese shares?
“Not necessarily,” says our local expert. “Many of these companies are still growing very fast…and many are not dependent on the building boom. Some of them have nice little niches…like selling beer and soap to a huge population of people whose incomes are rising. And because their prices have been knocked down, you can buy these companies for about 8 times earnings. It could be that they’ll go down some more in the coming crisis. Still, they could turn out to be great investments over the long run.”
An MBA Could Be Useful For A Career In Healthcare Management. By the My MBA Career Content Team
Students who enroll in MBA programs typically are interested in learning the business side of their area of expertise. Many people may feel that those who want to work in the healthcare industry need to attend medical school - however an MBA can be just as valuable a degree.
Individuals who are interested in healthcare management may want to consider pursuing an MBA in order to learn how to become an effective leader, according to the Star Tribune. Some people believe that running a hospital is similar to running a business, which is where having an MBA degree can come into play.
Jack Militello, a director of an MBA healthcare program, told the news provider that holding the degree serves as a "calling card" for all kinds of business managers, and that people may be more qualified for holding executive positions if they have the esteemed degree.
Individuals who are interested in one day becoming an executive of any nature may want to consider pursuing an MBA, as the degree can be translated to a number of fields.
Individuals who are interested in healthcare management may want to consider pursuing an MBA in order to learn how to become an effective leader, according to the Star Tribune. Some people believe that running a hospital is similar to running a business, which is where having an MBA degree can come into play.
Jack Militello, a director of an MBA healthcare program, told the news provider that holding the degree serves as a "calling card" for all kinds of business managers, and that people may be more qualified for holding executive positions if they have the esteemed degree.
Individuals who are interested in one day becoming an executive of any nature may want to consider pursuing an MBA, as the degree can be translated to a number of fields.
Why Your Business Should Not Abandon Facebook By Tony Bradley, PC World
Google has taken some of the privacy heat off of Facebook with the discovery that it has "accidentally" been intercepting and archiving wireless network communications around the world with its Google Street View cars, but Facebook isn't off the hook. In fact, new revelations about how Facebook and other social networking sites share information with advertisers enflame the situation further, and the privacy backlash against Facebook could have consequences for your business.
People who read this also read:Does your business have a Facebook presence? PCWorld has a Facebook presence, as do I. McDonald's Microsoft, Taco Bell, Adobe, Apple and thousands of other companies have a Facebook presence. Some organizations, like Microsoft, have multiple Facebook profiles broken down by product groups or individual applications like Microsoft Office.
Many companies have online support forums, FAQs and other resources available, but Facebook provides an opportunity to engage customers where they are rather than expecting them to seek out your company. Establishing and maintaining a Facebook presence--or a Twitter account for that matter--allow the company to interact with customers on a more personal level and foster a sense of community and loyalty.
Of course, if there is a huge privacy backlash and systematic boycott of Facebook, it would reduce the value of Facebook as a marketing or customer relations platform. According to a survey from Sophos, a security software and services vendor, as much as two-thirds of Facebook users are considering deactivating or deleting their Facebook account as a result of privacy concerns.
Like all surveys, though, you have to take this one with a grain of salt. Sophos surveyed fewer than 1600 out of more than 400 million Facebook users, and by virtue of being connected with Sophos in the first place those surveyed users are arguably more likely to be aware of, and concerned about privacy and security issues. Suffice it to say that the survey is not very scientific, and most likely not indicative of the broader reality of Facebook.
The truth is that as the media has focused intense attention on the privacy issues, and a vocal minority is organizing boycotts and "mass" Facebook defections, membership has still been on the rise. The current privacy fiasco is a big deal, but just variations on a recurring theme for Facebook which has faced repeated privacy concerns and user "backlashes" and grown larger and more powerful every time.
With the latest round of Facebook moving the line in the sand and automatically opting users in to new and exciting ways of sharing information that they may not have wished to share, and the revelations of data being shared with advertisers contrary to policy, there are some reasons to be concerned. The company or community page you established in order to have a Facebook presence could be distributed, or misappropriated in ways you did not intend or approve. The message you targeted for your Facebook community could possibly now be shared elsewhere throughout the Internet.
Facebook is out of line in launching new services and changing the rules without warning, and it is out of line for not making any change that affects the way personal data is shared or distributed opt-in by default. But, in the end the social networking site will most likely continue to grow its membership despite any boycotts and defections, and it still represents a fertile and valuable arena for engaging customers and building relationships to establish and expand your brand recognition.
Don't follow the vocal minority and jump ship just yet. It's not sinking--its going full steam ahead with or without you.
People who read this also read:Does your business have a Facebook presence? PCWorld has a Facebook presence, as do I. McDonald's Microsoft, Taco Bell, Adobe, Apple and thousands of other companies have a Facebook presence. Some organizations, like Microsoft, have multiple Facebook profiles broken down by product groups or individual applications like Microsoft Office.
Many companies have online support forums, FAQs and other resources available, but Facebook provides an opportunity to engage customers where they are rather than expecting them to seek out your company. Establishing and maintaining a Facebook presence--or a Twitter account for that matter--allow the company to interact with customers on a more personal level and foster a sense of community and loyalty.
Of course, if there is a huge privacy backlash and systematic boycott of Facebook, it would reduce the value of Facebook as a marketing or customer relations platform. According to a survey from Sophos, a security software and services vendor, as much as two-thirds of Facebook users are considering deactivating or deleting their Facebook account as a result of privacy concerns.
Like all surveys, though, you have to take this one with a grain of salt. Sophos surveyed fewer than 1600 out of more than 400 million Facebook users, and by virtue of being connected with Sophos in the first place those surveyed users are arguably more likely to be aware of, and concerned about privacy and security issues. Suffice it to say that the survey is not very scientific, and most likely not indicative of the broader reality of Facebook.
The truth is that as the media has focused intense attention on the privacy issues, and a vocal minority is organizing boycotts and "mass" Facebook defections, membership has still been on the rise. The current privacy fiasco is a big deal, but just variations on a recurring theme for Facebook which has faced repeated privacy concerns and user "backlashes" and grown larger and more powerful every time.
With the latest round of Facebook moving the line in the sand and automatically opting users in to new and exciting ways of sharing information that they may not have wished to share, and the revelations of data being shared with advertisers contrary to policy, there are some reasons to be concerned. The company or community page you established in order to have a Facebook presence could be distributed, or misappropriated in ways you did not intend or approve. The message you targeted for your Facebook community could possibly now be shared elsewhere throughout the Internet.
Facebook is out of line in launching new services and changing the rules without warning, and it is out of line for not making any change that affects the way personal data is shared or distributed opt-in by default. But, in the end the social networking site will most likely continue to grow its membership despite any boycotts and defections, and it still represents a fertile and valuable arena for engaging customers and building relationships to establish and expand your brand recognition.
Don't follow the vocal minority and jump ship just yet. It's not sinking--its going full steam ahead with or without you.
How Steve Jobs threw out US$10 billion. By Brett Arends, WSJ.com and MarketWatch
Apple chief blunders on options swap
BOSTON - You've already heard about "the greatest trade ever" - hedge fund manager John Paulson's giant score betting against subprime mortgage bonds.
But no one's told you about the dumbest trade ever.
Sure, there are plenty of contenders.
But this one is a doozy.
It's got everything. Fame. Glamour. The exactly wrong trade at exactly the wrong time. Billions of dollars blown.
And you won't believe who pulled it.
More from Marketwatch:
• Tech giants poised to go M&A crazy
• Microsoft may have to fight for place on tablets
• Seller of lost Apple iPhone prototype turned in by roommate
No, it wasn't some semi-pro hedge fund manager in Greenwich. An obscure European banker. Or a crazy trader in Hong Kong.
You ready?
It was Steve Jobs.
Yes, the man who walks on water. The same genius who invented the iPhone, restored balance to the Force, and rescued Morpheus from the Matrix.
Steve - Luke - "Neo" - Jobs.
"The One."
Everybody knows that Apple Inc. (Nasdaq: APPL) stock has skyrocketed in recent years, thanks to the iPod, iPhone, iPad, and the forthcoming edible iPod Shuffle. A look through the company's proxy shows Jobs is holding a fistful of valuable paper, as you'd expect. He has 10 million shares. At the latest prices, around US$250 each, that's made him a thumping US$2.5 billion.
What isn't so widely known is that it was so nearly more. A lot more.
Let's go back in time.
The moment: March 2003.
More from Yahoo! Canada Finance:
• Are you born to invest?
• Indexing’s Dirty Little Secret
• The secret to consistent returns in any market
See the latest finance news
Stock markets worldwide were on the floor, following a brutal three-year bear market. The Iraq invasion was just about to start, casting a further gloom on the economic outlook. Immediate prospects for investors seemed bleak.
And while most shares had done badly, that was only part of the story. The technology industry had been devastated.
After the bursting of the tech bubble in early 2000, the Nasdaq Composite had plunged nearly 80% from its peak. Companies had folded left and right. Those left were staggering. Apple had fared as badly as any. Its stock had plummeted from a peak of US$36 all the way down to about $7. (All prices have been adjusted for a subsequent stock split.)
Jobs and other employees were feeling the pinch. Stock options they had been granted during the boom now seemed completely worthless. After all, Apple stock would have to climb all the way back up to those giddy heights before the options even started to show a profit again.
So Apple employees were allowed to swap many of their options for a smaller number that became valuable at a lower price.
As for Jobs: He volunteered to cancel all his options in return for a far smaller number of shares, worth about US$75 million at the time. The trade made sense - unless Apple boomed again.
Ahem.
The shares Jobs received are worth US$2.5 billion at today's stratospheric prices.
But what would those options have been worth?
Digging through the old proxies reveals a remarkable tale.
Jobs held 15 million options at an exercise price of US$9.15, which meant they started to gain value only if Apple stock exceeded that price, and 40 million options at an exercise price of $21.80. Apple at the time was little more than $7 a share. (These prices have been adjusted to reflect the subsequent stock split.)
Total value: US$12.8 billion.
In other words, Steve Jobs missed out on $10.3 billion in extra profits.
Apple declined to comment for this column.
Back in 2003, the company said Jobs was swapping all his options for a smaller number of shares in order to reduce the "overhang" on the stock and to allow the company to offer more options to other staff. Apparently it wasn't because he figured the collapse in the stock price had left his options completely worthless, whereas at least the shares had some value.
Let's be clear. Steve Jobs, now 55, is hardly hurting. Forbes recently ranked him the 136th richest man in the world. Including his huge stake in Walt Disney Co., he's worth about US$5.5 billion. And he's surely earned his fortune.
But if he'd kept those options, the extra wealth would have bumped him all the way up to number 32 on the Forbes list.
One place ahead of Microsoft Corp. honcho Steve Ballmer.
Say what you like: That's gotta hurt.
Brett Arends is the author of "Storm Proof Your Money," on managing your finances in this era of turmoil.
BOSTON - You've already heard about "the greatest trade ever" - hedge fund manager John Paulson's giant score betting against subprime mortgage bonds.
But no one's told you about the dumbest trade ever.
Sure, there are plenty of contenders.
But this one is a doozy.
It's got everything. Fame. Glamour. The exactly wrong trade at exactly the wrong time. Billions of dollars blown.
And you won't believe who pulled it.
More from Marketwatch:
• Tech giants poised to go M&A crazy
• Microsoft may have to fight for place on tablets
• Seller of lost Apple iPhone prototype turned in by roommate
No, it wasn't some semi-pro hedge fund manager in Greenwich. An obscure European banker. Or a crazy trader in Hong Kong.
You ready?
It was Steve Jobs.
Yes, the man who walks on water. The same genius who invented the iPhone, restored balance to the Force, and rescued Morpheus from the Matrix.
Steve - Luke - "Neo" - Jobs.
"The One."
Everybody knows that Apple Inc. (Nasdaq: APPL) stock has skyrocketed in recent years, thanks to the iPod, iPhone, iPad, and the forthcoming edible iPod Shuffle. A look through the company's proxy shows Jobs is holding a fistful of valuable paper, as you'd expect. He has 10 million shares. At the latest prices, around US$250 each, that's made him a thumping US$2.5 billion.
What isn't so widely known is that it was so nearly more. A lot more.
Let's go back in time.
The moment: March 2003.
More from Yahoo! Canada Finance:
• Are you born to invest?
• Indexing’s Dirty Little Secret
• The secret to consistent returns in any market
See the latest finance news
Stock markets worldwide were on the floor, following a brutal three-year bear market. The Iraq invasion was just about to start, casting a further gloom on the economic outlook. Immediate prospects for investors seemed bleak.
And while most shares had done badly, that was only part of the story. The technology industry had been devastated.
After the bursting of the tech bubble in early 2000, the Nasdaq Composite had plunged nearly 80% from its peak. Companies had folded left and right. Those left were staggering. Apple had fared as badly as any. Its stock had plummeted from a peak of US$36 all the way down to about $7. (All prices have been adjusted for a subsequent stock split.)
Jobs and other employees were feeling the pinch. Stock options they had been granted during the boom now seemed completely worthless. After all, Apple stock would have to climb all the way back up to those giddy heights before the options even started to show a profit again.
So Apple employees were allowed to swap many of their options for a smaller number that became valuable at a lower price.
As for Jobs: He volunteered to cancel all his options in return for a far smaller number of shares, worth about US$75 million at the time. The trade made sense - unless Apple boomed again.
Ahem.
The shares Jobs received are worth US$2.5 billion at today's stratospheric prices.
But what would those options have been worth?
Digging through the old proxies reveals a remarkable tale.
Jobs held 15 million options at an exercise price of US$9.15, which meant they started to gain value only if Apple stock exceeded that price, and 40 million options at an exercise price of $21.80. Apple at the time was little more than $7 a share. (These prices have been adjusted to reflect the subsequent stock split.)
Total value: US$12.8 billion.
In other words, Steve Jobs missed out on $10.3 billion in extra profits.
Apple declined to comment for this column.
Back in 2003, the company said Jobs was swapping all his options for a smaller number of shares in order to reduce the "overhang" on the stock and to allow the company to offer more options to other staff. Apparently it wasn't because he figured the collapse in the stock price had left his options completely worthless, whereas at least the shares had some value.
Let's be clear. Steve Jobs, now 55, is hardly hurting. Forbes recently ranked him the 136th richest man in the world. Including his huge stake in Walt Disney Co., he's worth about US$5.5 billion. And he's surely earned his fortune.
But if he'd kept those options, the extra wealth would have bumped him all the way up to number 32 on the Forbes list.
One place ahead of Microsoft Corp. honcho Steve Ballmer.
Say what you like: That's gotta hurt.
Brett Arends is the author of "Storm Proof Your Money," on managing your finances in this era of turmoil.
Scientists discover explanation for why the Universe exists. By Michael Bolen (Yahoo! Canada News)
Physicists have long wondered why the universe exists when matter and anti-matter particles obliterate each other on contact.
But new data from a particle accelerator in the United States suggests a reason.
The tests showed that when anti-protons and protons collide, the resulting new particles show a one per cent skew toward matter over anti-matter. Over a long period of time, this characteristic of the universe could explain why matter has come to dominate over anti-matter.
"Many of us felt goose bumps when we saw the result," said Stefan Soldner-Rembold, a physicist at the University of Manchester in the United Kingdom.
"We knew we were seeing something beyond what we have seen before and beyond what current theories can explain."
Every basic particle of matter has a matching anti-particle. The anti-particle has the same mass as the standard particle, but an opposite electric charge. Anti-matter is not to be confused with dark matter.
While anti-matter has been demonstrated in numerous experiments, dark matter remains a hypothesis used to help explain the effects of mass which scientists cannot currently see.
The dark matter hypothesis helps to explain why the universe hasn't expanded into a cold and relatively motionless void. The extra mass, and resulting gravity, is the reason galaxies form into clumps rather than flying apart.
Particle accelerators, such as the Tevatron collider at the Fermi National Accelerator Laboratory in Illinois, which conducted the tests, and the Large Hadron Collider at CERN on the Swiss-French border, use electric fields to smash particles into each other at incredibly high speeds.
Scientists then study the particles that are created. Researchers seek larger and larger accelerators in order to create collisions that more closely resemble those which took place soon after the Big Bang 13.7 billion years ago, when the temperature and density of the universe were much higher.
The new findings deviate from what is known as the Standard Model, the theory created in the 1970s to explain the complex interaction of sub-atomic particles.
Up until now, the model predicted a small preference toward matter over anti-matter, but not enough to explain the structure of the universe we see today.
The findings come ahead of an experiment to be held at CERN, called LHCb, also aimed at explaining matter's dominance.
Consequently, the results of the test in the U.S. could soon be confirmed and expanded, forming the basis for a new or amended quantum theory.
But new data from a particle accelerator in the United States suggests a reason.
The tests showed that when anti-protons and protons collide, the resulting new particles show a one per cent skew toward matter over anti-matter. Over a long period of time, this characteristic of the universe could explain why matter has come to dominate over anti-matter.
"Many of us felt goose bumps when we saw the result," said Stefan Soldner-Rembold, a physicist at the University of Manchester in the United Kingdom.
"We knew we were seeing something beyond what we have seen before and beyond what current theories can explain."
Every basic particle of matter has a matching anti-particle. The anti-particle has the same mass as the standard particle, but an opposite electric charge. Anti-matter is not to be confused with dark matter.
While anti-matter has been demonstrated in numerous experiments, dark matter remains a hypothesis used to help explain the effects of mass which scientists cannot currently see.
The dark matter hypothesis helps to explain why the universe hasn't expanded into a cold and relatively motionless void. The extra mass, and resulting gravity, is the reason galaxies form into clumps rather than flying apart.
Particle accelerators, such as the Tevatron collider at the Fermi National Accelerator Laboratory in Illinois, which conducted the tests, and the Large Hadron Collider at CERN on the Swiss-French border, use electric fields to smash particles into each other at incredibly high speeds.
Scientists then study the particles that are created. Researchers seek larger and larger accelerators in order to create collisions that more closely resemble those which took place soon after the Big Bang 13.7 billion years ago, when the temperature and density of the universe were much higher.
The new findings deviate from what is known as the Standard Model, the theory created in the 1970s to explain the complex interaction of sub-atomic particles.
Up until now, the model predicted a small preference toward matter over anti-matter, but not enough to explain the structure of the universe we see today.
The findings come ahead of an experiment to be held at CERN, called LHCb, also aimed at explaining matter's dominance.
Consequently, the results of the test in the U.S. could soon be confirmed and expanded, forming the basis for a new or amended quantum theory.
Facebook Is Flirting With a Big Business Backlash. By Renay San Miguel TechNewsWorld
Facebook's race to monetize its content is fueling its drive to make everything open, and users and company brands alike may get left behind in the dust. Businesses are very sensitive about protecting their brand logos, and customers who feel a firm's association with Facebook intrudes on their privacy may not be customers for long.
Was it only four years ago that the anti-Facebook crowd was backlashing against the concept of the News Feed? Time sure flies when you're accusing the world's biggest social network of invading its users' privacy.
Forget about the current spasm of criticism; hating on Facebook has been the default setting for a sizable portion of the technosphere -- and, it seems, a big chunk of the network's users -- for a while. Type in "anti-Facebook groups" in Google (Nasdaq: GOOG) and you get a hit parade of mainstream media articles and blog posts zeroing in on Mark Zuckerberg's creation. Time Magazine focused on the anger expressing itself back in 2006 with a flurry of "I Hate Facebook" groups on the network, venting about the then-new News Feed, which announced all your friends' activities to the world -- so-and-so likes this, whats-his-face is now friends with that-guy-there, etc.
Facebook was barely more than a college-based Web phenomenon and had just made itself available to membership for anyone 13 years of age and older when Time's Tracy Samatha Schmidt wrote, "Like it or not, Facebook's face may be changing for good. The social networking site, which was originally an exclusive website for college students, has expanded to include high school students and corporations. Sponsors now spend thousands to advertise on the site, and politicians are also tapping into Facebook. For Zuckerberg, the News Feed allows Facebook users to better keep up with each other. 'All the most interesting stuff that's going on is presented to you,"' Zuckerberg told Time recently. "'The analogy would be instead of an encyclopedia, it's now news. We're emphasizing what's going on now.'"
Deja Vu
But what went on back then was invading users' privacy, said critics. Sound familiar? And yet the News Feed is still around, and those "I Hate Facebook" groups on Facebook could not throw cold water on the social network fire. Eight million college-based members went forth and multiplied to 50 million global users in 2008 when the Times Online website headlined its article, "The Anti-Facebook Movement." The gist of that story? University students in the UK who were boycotting the network for what they saw as its disdain for user privacy: posting profiles on Google and letting advertisers target users via demographic data. Yet those same "Facebook refuseniks" were lamenting how they were missing out on campus activities and social events because organizers of such were using Facebook pages as promotional tools to save money and generate feedback, thereby immediately turning the non-joiners into the uncool kids.
The Times' Bertan Budak wrote, "University club and events promoters are becoming increasingly dependent on reaching their target audience through electronic invitations via social networking websites -- with Facebook being the popular choice of such sites, according to Sumaer Amar, an events organiser, who runs Sumaer & Co., a company that provides students in the North of England with club, R&B and costume themed nights. 'Promoters generally use Facebook to promote their nights because it's fast, easy and free,' explains Sumaer, who is also studying for a business degree at Stephenson College, Durham University. 'With the RSVP function [on Facebook] they also let us [promoters] know what kind of a turnout to expect.'"
Risky Business?
Three things should be clear by now: Sumaer is probably on his way to a profitable career as a digital media strategist/content director for a major marketing firm, Zuckerberg and company have shown time and again (with the notable exception of the Beacon ad data fiasco) that they are going to do what they want to do with user data -- privacy issues be damned -- and a business/marketing angle has always played some kind of supporting role in the Facebook story.
And therein lies the real danger for Facebook regarding the latest backlash: Small, medium and large businesses may actually start paying attention to the privacy issues and wonder whether their credibility and customer trust are at stake.
Social media marketing specialists have told me in previous stories how much value Facebook and Twitter can bring to companies and their brands. The distance between brand and customer is narrowed; interactivity and user feedback via comments on Facebook fan pages and tweets encourage conversations with human beings, not lectures from faceless corporations. The new Open Graph platform, with the omnipresent "like" button seeding the Web, turns that Internet into the mother of all recommendation engines. What company wouldn't want to engage in all that?
Yet a very influential social media analyst, Jeremiah Owyang of Altimeter Group, has dug up some reasons why companies should be afraid, be very afraid, of recent Facebook controversies. In a post on his Web Strategy blog titled "How Facebook's Community Pages and Privacy Changes Impact Brands" -- a post that's making the Twitter rounds among marketing types -- Owyang shares some points raised during his talks with "a handful of brands and their representatives."
Facebook's race to monetize its content for advertising purposes is fueling its drive to make everything open, even if users and brands get left behind in the dust. New "Community Pages" aggregate content from Wikipedia and Facebook users via wall comments. The idea is to let everybody talk about subjects of mutual interests, but it's also pushing corporate information and logos from those Wikipedia pages out to new destinations. The social network's new moves are intended to maximize search engine optimization, but they could also mean confusion for customers who run into that info, thinking its the official company Facebook page. And there's that thing about some users not realizing their wall comments could be heading somewhere else on the Web without their knowledge. Community pages also don't let you leave comments; where's the interactive love in that?
Once again, Facebook does whatever it wants with member data and "asks for forgiveness later," as Owyang argues. That apparently goes for companies as well; Owyang says brand representatives he spoke with weren't notified about the new pages. A loss of trust in Facebook by companies mixed with their customers' concerns about privacy and how FB is using their data can result in a volatile combination; both brands and customers could take their business elsewhere.
I say "could" because in spite of what is clearly a pattern by Facebook of disregarding users' concerns, the company has grown to 400 million-plus members. People keep joining and sharing, and businesses keep following the potential money. I doubt the recent "boycott Facebook" dates will have any impact, and a few bloggers and tech-watchers are coming to Zuckerberg and Facebook's defense. (I'm waiting for the "Leave Mark Alone!" video on YouTube, done a la "Leave Britney Alone!"-style).
Yet Facebook really rolls the dice by playing haphazardly with the trust of businesses, and the resultant trickle-down effect involving user trust. There's a reason why companies zealously protect their brand and logos; they know consumers don't look scour their neighborhood supermarket for anything that says Proctor and Gamble. They're looking for Pampers. A brand is their face to the world. And now Facebook wants to tinker with that.
Was it only four years ago that the anti-Facebook crowd was backlashing against the concept of the News Feed? Time sure flies when you're accusing the world's biggest social network of invading its users' privacy.
Forget about the current spasm of criticism; hating on Facebook has been the default setting for a sizable portion of the technosphere -- and, it seems, a big chunk of the network's users -- for a while. Type in "anti-Facebook groups" in Google (Nasdaq: GOOG) and you get a hit parade of mainstream media articles and blog posts zeroing in on Mark Zuckerberg's creation. Time Magazine focused on the anger expressing itself back in 2006 with a flurry of "I Hate Facebook" groups on the network, venting about the then-new News Feed, which announced all your friends' activities to the world -- so-and-so likes this, whats-his-face is now friends with that-guy-there, etc.
Facebook was barely more than a college-based Web phenomenon and had just made itself available to membership for anyone 13 years of age and older when Time's Tracy Samatha Schmidt wrote, "Like it or not, Facebook's face may be changing for good. The social networking site, which was originally an exclusive website for college students, has expanded to include high school students and corporations. Sponsors now spend thousands to advertise on the site, and politicians are also tapping into Facebook. For Zuckerberg, the News Feed allows Facebook users to better keep up with each other. 'All the most interesting stuff that's going on is presented to you,"' Zuckerberg told Time recently. "'The analogy would be instead of an encyclopedia, it's now news. We're emphasizing what's going on now.'"
Deja Vu
But what went on back then was invading users' privacy, said critics. Sound familiar? And yet the News Feed is still around, and those "I Hate Facebook" groups on Facebook could not throw cold water on the social network fire. Eight million college-based members went forth and multiplied to 50 million global users in 2008 when the Times Online website headlined its article, "The Anti-Facebook Movement." The gist of that story? University students in the UK who were boycotting the network for what they saw as its disdain for user privacy: posting profiles on Google and letting advertisers target users via demographic data. Yet those same "Facebook refuseniks" were lamenting how they were missing out on campus activities and social events because organizers of such were using Facebook pages as promotional tools to save money and generate feedback, thereby immediately turning the non-joiners into the uncool kids.
The Times' Bertan Budak wrote, "University club and events promoters are becoming increasingly dependent on reaching their target audience through electronic invitations via social networking websites -- with Facebook being the popular choice of such sites, according to Sumaer Amar, an events organiser, who runs Sumaer & Co., a company that provides students in the North of England with club, R&B and costume themed nights. 'Promoters generally use Facebook to promote their nights because it's fast, easy and free,' explains Sumaer, who is also studying for a business degree at Stephenson College, Durham University. 'With the RSVP function [on Facebook] they also let us [promoters] know what kind of a turnout to expect.'"
Risky Business?
Three things should be clear by now: Sumaer is probably on his way to a profitable career as a digital media strategist/content director for a major marketing firm, Zuckerberg and company have shown time and again (with the notable exception of the Beacon ad data fiasco) that they are going to do what they want to do with user data -- privacy issues be damned -- and a business/marketing angle has always played some kind of supporting role in the Facebook story.
And therein lies the real danger for Facebook regarding the latest backlash: Small, medium and large businesses may actually start paying attention to the privacy issues and wonder whether their credibility and customer trust are at stake.
Social media marketing specialists have told me in previous stories how much value Facebook and Twitter can bring to companies and their brands. The distance between brand and customer is narrowed; interactivity and user feedback via comments on Facebook fan pages and tweets encourage conversations with human beings, not lectures from faceless corporations. The new Open Graph platform, with the omnipresent "like" button seeding the Web, turns that Internet into the mother of all recommendation engines. What company wouldn't want to engage in all that?
Yet a very influential social media analyst, Jeremiah Owyang of Altimeter Group, has dug up some reasons why companies should be afraid, be very afraid, of recent Facebook controversies. In a post on his Web Strategy blog titled "How Facebook's Community Pages and Privacy Changes Impact Brands" -- a post that's making the Twitter rounds among marketing types -- Owyang shares some points raised during his talks with "a handful of brands and their representatives."
Facebook's race to monetize its content for advertising purposes is fueling its drive to make everything open, even if users and brands get left behind in the dust. New "Community Pages" aggregate content from Wikipedia and Facebook users via wall comments. The idea is to let everybody talk about subjects of mutual interests, but it's also pushing corporate information and logos from those Wikipedia pages out to new destinations. The social network's new moves are intended to maximize search engine optimization, but they could also mean confusion for customers who run into that info, thinking its the official company Facebook page. And there's that thing about some users not realizing their wall comments could be heading somewhere else on the Web without their knowledge. Community pages also don't let you leave comments; where's the interactive love in that?
Once again, Facebook does whatever it wants with member data and "asks for forgiveness later," as Owyang argues. That apparently goes for companies as well; Owyang says brand representatives he spoke with weren't notified about the new pages. A loss of trust in Facebook by companies mixed with their customers' concerns about privacy and how FB is using their data can result in a volatile combination; both brands and customers could take their business elsewhere.
I say "could" because in spite of what is clearly a pattern by Facebook of disregarding users' concerns, the company has grown to 400 million-plus members. People keep joining and sharing, and businesses keep following the potential money. I doubt the recent "boycott Facebook" dates will have any impact, and a few bloggers and tech-watchers are coming to Zuckerberg and Facebook's defense. (I'm waiting for the "Leave Mark Alone!" video on YouTube, done a la "Leave Britney Alone!"-style).
Yet Facebook really rolls the dice by playing haphazardly with the trust of businesses, and the resultant trickle-down effect involving user trust. There's a reason why companies zealously protect their brand and logos; they know consumers don't look scour their neighborhood supermarket for anything that says Proctor and Gamble. They're looking for Pampers. A brand is their face to the world. And now Facebook wants to tinker with that.
Subscribe to:
Posts (Atom)