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Karma is a bitch, Microsoft!!

April 23, 2009

Well, well, well, KARMA IS A BITCH, isn’t it Microsoft?!?! I’ve actually been working on a blog entry on karma that I will be posting soon… but in the meantime, I couldn’t be happier with today’s news. No, “happier” isn’t a strong enough world. I am THRILLED BEYOND BELIEF. ECSTATIC. JUMPING FOR JOY OVER TODAY’S NEWS.

Drum roll, please:

Microsoft quarterly revenue drops for first time in company history; net income plummets 32%

(Source article: New York Times)

And all this right on the heels of ANOTHER RECORD QUARTER from Apple… in the middle of a recession:

Apple smashes Street; reports best non-holiday quarter revenue and earnings in company history

Yes, there is an unusually high level of schadenfreude going on here with me, but all I can say is that it serves those a**holes at Microsoft right. I’m really sorry that I’m not being more elegant with my vocabulary, but I really don’t know how else to emphasize my complete hatred for anything to do with Microsoft. (If you’ve been reading my blog, you know that Microsoft has even treated me poorly on a one-on-one personal level, having nothing to do with how poorly they treat humanity en masse. Or maybe it has everything to do with how poorly they treat everyone.)

This is just the beginning of the end of Microsoft, folks. I’ve been waiting for this day for a long time. Microsoft is without a doubt the most evil technology company on the planet, and they deserve every single bad thing that comes their way.

After THREE DECADES of making ineffective & inadequate products, lying, stealing, cheating, abusing, corrupting, frightening, lawbreaking, destroying, confusing, deceiving, backstabbing, and defrauding — sound like any countries you know, by the way? — Microsoft is finally going to start getting what’s coming to it.

Oh, and my buddy Herbert Barry Woodrose — who writes one of my favorite blogs on the Internet — has done extensive analysis of Microsoft’s financials, and the amazing thing is that their financials are nothing short of FRAUDULENT. The TRUE STORY wasn’t even revealed in today’s financials. I’ll let Herbert post a blog entry about that one, since he’s got all the research already done on that topic.

Folks, I’ve said it a million times and I’ll say it again. STOP SUPPORTING MICROSOFT. They are out to destroy any shred of self-respect and self-worth that you may have left for yourself as a human being.

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4 Comments leave one →
  1. April 23, 2009 7:34 PM

    Holy COW… I can’t believe somehow that it’s really happening. The first time they lose money, and it’s 32%?!? That’s an insane decline… and I think it has a lot to do with those mysterious financials. A big part of the problem at Microsoft is that in order for the whole thing not to implode, the company had to do astoundingly well. Weird, right? They really can’t *just* succeed because of the way they abuse the stock option system and because of their tax structure. So long as they always did outrageously well, they could keep ripping off the shareholders to completely pay for their employees – and then they could get – if you can believe this – tax deductions (which is code for you and me and our families and friends paying Microsoft) for the honor of having the shareholder pay the payroll.

    THEN when the number of shares out there is too bloated (I mean, the stock was at a hyper inflated 30 bucks a share)Microsoft can just buy back a whole bunch of them to try and return some kind of value to the shareholder. If you need a better picture of what it means when your company continually just fires up a printer and doles out new shares, I’d refer you to the case of United States v. US Dollar. Essentially, you drive down the value per share, or *dilute* it.

    If they can keep buying the shares back, it artificially jacks the shares back up (I mean, it does increase the share value again, but CEOS use this as a trick to make the numbers look like they did something outstanding that quarter in terms of their business, returning equity to the shareholder, when the reality is they just spent more of the shareholders’ money).

    Also, a common headache for the shareholder is that when CEOs haphazardly buy back the shares, they don’t always do it the right way. The right way is to do it just the way we would do it as individual shareholders: wait until the price is attractive, then swoop in and scoop up the undervalued shares. This is good management; the way Microsoft does it would make me scream and push for a shareholder revolt.

    Imagine it: get the shareholder to pay all salaries through the stock option program, by issuing new shares and letting the employee dump them on the market to get paid, driving down the value of the shares drastically; then, get the government to reward you through payroll deductions; then, buy back shares using company money (which belongs to the shareholders) without any regard to price or timing – the only consideration is propping up the fake price of the company, which no one looks at too closely because your company makes so many billions it is seen as a permanent “mistake eraser”.

    As I noted – and not just me, but a very few other analysts I was able to catch doing this level of homework on the company – everything would be ok so long as the stock stayed attractive. The real danger is that the MS bubble would pop – if the share price dropped, it would put employee options either underwater, or force MS to dole out more shares to pay employees – meaning MS might have to start actually paying the employees, instead of having the shareholders do it.

    Also, if the price, which I felt MS still kept dangerously low, of the stock dipped, the very cheapness of the stock itself could cause people to panic and dump it. That means even more shares have to be printed to pay the employees, and that means a more concerted effort has to be made to defend the share price – namely, by using company money to haphazardly buy back ever more shares, regardless of value to the existing shareholders.

    I found an old email, I think I posted it on my blog at Checkingforelves, where I predicted, from looking at this strategy, and some other numbers involving return on assets and equity that I just flat out didn’t buy, that the MS stock price would dip to where it was at a month ago. I also predicted it would go lower, below $10. Ten bucks a share is a big deal – the closer this company gets to the evil buck a share, the more likely the public is to panic on this stock.

    Again, it isn’t JUST the stock/tax scheme they work (from which, alone, MS made something like $5 billion a year, maybe more – almost as much as they made anywhere else in the company) it is also a lot of numbers that don’t add up on their assets/equity/liabilities, deep in their earnings, balance, investment and finance sheets. They seemed to be going for an effect that would look like they were doing exactly the same ratios as Apple – curious in itself – but also the hard numbers seemed to have to be at least double, if not more, than Apple’s. There was way too much similarity – and I’d say correlation – between Apple’s numbers and MS’. As if ‘someone’ refused to lose in any way to someone else. But that part of it, the motive, is just me guessing, drawing a connection where there is suspicious activity but not hard proof. The rest however, is all in their sheets.

    I have this posted all over my blog, but anyone questioning it shouldn’t waste time there – go right to MS’ financials, which are all over the internet. The tax strategy is a little more difficult to get to, and understand, but I found it and that means anyone can.

    I think that is some of what we are saying, and I think I wrote this to you a month or two ago – once the stock started imploding at the end of last/beginning of this year, MS had to start pumping some SERIOUS cash into their employees and their stock, simultaneously, That means a good $5 billion was threatened, and possibly more. That might be why it is “Net Income” that suffered so badly – although of course, this all starts with bad overall revenue. They just aren’t doing the kind of business they’ve been claiming for so long:

    They always claim millions of “licenses” sold – but never tell us what the prices on such a thing are. That’s because they practically give them away, I suspect. If you are Ballmer, and you understand very little, and you perceive that you are in a war with Apple, and you tend to yell a lot and bluster at informational events – you will most likely perceive that it is of the utmost importance to BE on the most handsets, even if it is just for free. It’s like Rush Limbaugh – Howard Stern has been complaining about this for years – Rush brags that he is on hundreds of radio stations, but the truth is his company just gives the show away, taking only advertising time in return, because they believe market proliferation is everything,.

    You could hardly blame Ballmer – up to now, market proliferation has been the whole game for MS. I challenge MS to reveal how much they really make on licenses. From what I can see, it is a ghost number. And “licenses” means ABSOLUTELY NOTHING. It doesn’t mean the licenses are being used, or that the phones are selling. If they sell a billion licenses and no one buys the Storm, it’s a pointless argument. In fact, it will make the hardware provider irate to see MS crowing, and meanwhile the hardware developer is losing assloads of money because of shitty software combined with their knock-off Iphone hardware.

    What else? Remember the Xbox debacle? They claimed for years that they were doing SO WELL – even though the numbers they were claiming were “products shipped” to stores – another meaningless number. Every Christmas, there was no shortage of Xbox’s but there were no Wii’s to be found anywhere.

    Smoke and mirrors – and also mirrors smeared with bullshit. It’s been a looooong time coming….

  2. April 25, 2009 3:05 PM

    Herbert, thank you so much for your insightful commentary on my post. Truly fascinating stuff. And one of the reasons that companies can get away with stuff like this for so long is because people in this country aren’t educated how to really research the information that is being presented to them — in this case, financial statements. I’ve said it before and I’ll say it again: I have a degree from UCLA, supposedly one of the finest universities in our country, and yet I have never been required to take one economics class in my entire life. Does that seem right t you?

  3. April 26, 2009 11:46 PM

    Did you expand this post? I like it a lot more – I loved it to begin with but I like the few things I didn’t see the first time reading this through. Good job on this entire blog – people have to understand that MS is a mostly evil corporation that uses monopolistic practices, as found by the courts, has been found guilty of software piracy (and curiously is still allowed to be at the forefront of the DRM and piracy-prevention movements) and abuses the Corporate Charter. They have slowed down and in many cases destroyed advancement and technology.

    Steve Jobs wisely said a long time ago “We have to get over … the idea … that in order for us to win Microsoft has to lose.” That was a great statement, and served to really focus and narrowly define how Apple was going to create a revolution. He needed people to understand that Apple was not going to compete with Microsoft in the mistaken idea that you have to be all things to all people.

    But something has to be said here, and it may disagree with Jobs’ view: For us ALL to win, for Technology and Science to win, for advancement, for the sake of the citizens of the US to win – Microsoft must lose. It has to come down, as surely as Corporate Media has to come down, as surely as grinding poverty has to come down, as surely as private Insurance running the entire health care system has to come down. MS has to come down.

  4. April 27, 2009 12:50 AM

    Yes, I added a couple of sentences, but really the BEST expansion to this post are your personal comments!!

    Thank you, once again, for pointing out and explaining why my angry rants & raves are justified WAAAAAY beyond simple emotions of hatred. When I tell people that Microsoft represents all that is wrong with capitalism and all that is wrong with our society, they act like I'm talking crazy-talk. But then again, these are the very same people who turn a blind eye to the rest of the problems in our society as well. Most people, as you know, are part of the problem, not part of the solution.

    YOU ARE ABSOLUTELY 100% CORRECT THAT MICROSOFT HAS TRIED ITS FUCKING HARDEST TO DESTROY ALL TECHNOLOGICAL ADVANCEMENT IN THIS COUNTRY. AND THEY WOULD HAVE SUCCEEDED, TOO, IF STEVE JOBS DIDN’T COME BACK TO APPLE AND KICK FUCKING MICROSOFT IN THE ASS.

    You are absolutely right that Microsoft must come down. Corporate Media must come down. Poverty must come down. The Meat & Dairy Industries, which are destroying our environment waaay more than the oil & transportation industries, must come down. The private health care system must come down.

    Thank you for being one of the very few people on this entire planet who actually GETS THIS. Who actually UNDERSTANDS THIS. It is sooo much larger than just Microsoft making some shitty products. It goes soooo far beyond that.

    If Microsoft comes down, that gives me faith that the other evil parts of our society can also come down.

    Thank you for being an active contributor here, and for always pointing out the much larger forest which surrounds the single trees that I am planting.

    I can’t wait (someday, no rush) to read your blog entry on your switch to Mac this week… because I know that your take on it will be unlike any other take I have ever read before in my entire life.

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