3 ms·
Haha yes? Everything is replaceable but it is a major business. Huge ramifications in America if they had a major supply disruption. It’s not about the availab
by vineyardmike 4y ago
Haha yes?
Everything is replaceable but it is a major business. Huge ramifications in America if they had a major supply disruption. It’s not about the availability of glass boxes with fruit logos on the back.
The iPhone and other products obviously brings in a lot of money and supports a lot of jobs, indirectly too like through case design and apps and stuff. But China uses apple as an example of how they work with America - so much so that Tim Cook gets meetings with presidents and diplomats. And its supply chain is one of chinas major employers, so it would come at a steep cost to China. A loss of apple would likely impact other businesses soon after. China wouldn’t kill the golden goose without slaughtering the others first, or using them as an example of what’s to come.
Even beyond the iPhone as a product directly, MANY people (especially rich important influential ones) are major shareholders. So are pension funds and retirement funds and index funds. If apple had an “oops no iPhone for a year” moment that would rock the financial world way beyond their actual direct market value. They’re so big that their crash would likely slash the entire tech sector and with it the S&P 500 and with it all the index funds and with it everyone’s retirement accounts (you can see how that ripple would continue to everyone’s detriment). The US government has an interest in keeping them safe for that alone. They can lose market share and be replaced over time, but a geopolitical shock like China closing their ports to apple would be a major event the government has an interest in avoiding.
- herbst 4y agoSo the US is kinda forced to keep questionable business practice alive so pension funds are safe? I don't know why this sounds so dystopian
- vineyardmike 4y agoNo. They’re forced to keep businesses safe from outside destruction, not market forces. Basically the same as individuals. The gov also maintains a military for similar reasons. I said this in the reply. They don’t want a foreign gov to torpedo an important business for politics but they don’t need to protect against market forces. There’s no market risk to apple disappearing overnight. If it’s over a long time scale, pension funds can self manage. It won’t implode the market.