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Here's a crazy idea. A hedge fund puts a couple billion dollar short on Apple, and then pays 20,000 Foxconn workers $5,000 each to take the month off from tomo

Here's a crazy idea. A hedge fund puts a couple billion dollar short on Apple, and then pays 20,000 Foxconn workers $5,000 each to take the month off from tomorrow and go somewhere else. That's a $100m outlay for a vastly higher profit. It's not a serious suggestion but it's feasible. It's an interesting situation - an extremely highly valued company underpinned by extremely cheap labour.

jrockway 14y ago
Hedge funds (and anyone) can make money regardless of the direction the market moves, or even if the market doesn't move. So why would they do something risky, illegal, and difficult that has the potential for unbounded losses?
- rdl 14y ago
  It's easier for a third part with only money to cause damage to apple (which will happen in a known time period) than to cause a buff. (an industry player could cause positive effects, like a huge purchase of Apple into a new industry like enterprise/government, or vendor neutrality for public sector purchases, or Microsoft committing to OSX as a tier-1 OS, etc., but a hedge fund can't do that)
- joe_the_user 14y ago
  Theoretically, the only way to make money on an efficient market is to have information others don't have. Manufacturing it would one (very desperate) way. I agree that this would be too difficult to pull off (one worker spilling the beans would be enough). But "can make money on the market" mean "might make money" not "will make money". Worth keeping in mind that hedge don't just get stream of money from the market just for being hedge funds. You need to get good information somehow.
- zurn 14y ago
  That's what they do: Risk is their bread and butter. Difficulty - if it were easy, everyone would be doing it. Illegal - arguable but they're probably just good at not getting caught (and managing the risk of it). See eg. recent libor scandal.
bitcartel 14y ago
Hypothetically a bigger hedge fund could bid up Apple stock causing the smaller hedge fund to lose its shirt... and its quite plausible given that the world's biggest hedge fund is Apple! http://www.zerohedge.com/news/2012-09-30/presenting-worlds-biggest-hedge-fund-you-have-never-heard http://www.zerohedge.com/news/2012-09-30/presenting-worlds-b...
hristov 14y ago
First of all, this is obviously not happened in this situation, so we should not trivialize the existing labor problems at Foxconn with such imagined hypotheticals. Second, it is very unlikely an external party can organize such action among a foreign insular and sequestered workforce without Foxconn finding out. They certainly have spies among the workers.
CamperBob2 14y ago
Your idea requires 20,000 people to keep their mouths shut. I'm skeptical.
- scotty79 14y ago
  You can just start a compan near, target foxconn workers and hire them. Semi openly but fast.

jrockway 14y ago

Hedge funds (and anyone) can make money regardless of the direction the market moves, or even if the market doesn't move. So why would they do something risky, illegal, and difficult that has the potential for unbounded losses?

rdl 14y ago
It's easier for a third part with only money to cause damage to apple (which will happen in a known time period) than to cause a buff. (an industry player could cause positive effects, like a huge purchase of Apple into a new industry like enterprise/government, or vendor neutrality for public sector purchases, or Microsoft committing to OSX as a tier-1 OS, etc., but a hedge fund can't do that)
joe_the_user 14y ago
Theoretically, the only way to make money on an efficient market is to have information others don't have. Manufacturing it would one (very desperate) way. I agree that this would be too difficult to pull off (one worker spilling the beans would be enough). But "can make money on the market" mean "might make money" not "will make money". Worth keeping in mind that hedge don't just get stream of money from the market just for being hedge funds. You need to get good information somehow.
zurn 14y ago
That's what they do: Risk is their bread and butter. Difficulty - if it were easy, everyone would be doing it. Illegal - arguable but they're probably just good at not getting caught (and managing the risk of it). See eg. recent libor scandal.

bitcartel 14y ago

Hypothetically a bigger hedge fund could bid up Apple stock causing the smaller hedge fund to lose its shirt... and its quite plausible given that the world's biggest hedge fund is Apple! http://www.zerohedge.com/news/2012-09-30/presenting-worlds-biggest-hedge-fund-you-have-never-heard http://www.zerohedge.com/news/2012-09-30/presenting-worlds-b...

hristov 14y ago

First of all, this is obviously not happened in this situation, so we should not trivialize the existing labor problems at Foxconn with such imagined hypotheticals. Second, it is very unlikely an external party can organize such action among a foreign insular and sequestered workforce without Foxconn finding out. They certainly have spies among the workers.

CamperBob2 14y ago

Your idea requires 20,000 people to keep their mouths shut. I'm skeptical.

scotty79 14y ago
You can just start a compan near, target foxconn workers and hire them. Semi openly but fast.