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Customers take photos while waiting on line to purchase the Apple iPhone 5 outside the Apple Fifth Avenue flagship store on the first morning it went on sale. An entire shadow economy has emerged around the iconic device.
Today is Apple iPhone 5 day. At Apple stores across Southern California, hopeful shoppers have lined up in the hundreds to obtain the glistening new gadget.
These folks will part with money, but they're also engaged in an ad-hoc iEconomy that's using the iPhone — versions both current and past — to generate profits. Here's how it goes...
It's all about real estate. According to LATimes, people who've lined up outside the Apple store at the Grove shopping complex are selling their places on line. Ten kids showed up at sunrise with the goal of selling five spots in line for $300 a pop, for a neat take of $1,500, pretty much all of it profit (they opportunity cost of standing in line at 6 a.m. when you're 19 is pretty much nil). But they miscalculated their market and could only sell the spots for...$100. Still, that's $500 in coin for...standing. In line. In warm and sunny L.A.
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An Apple Store customer looks at the new Apple iPhone 4S. It will be old news by tomorrow, replaced by the iPhone 5.
Okay, I'm obviously taking a highly contrarian position here. But in the context of iPhone 5 mania, it's a worthwhile undertaking — especially given that an analyst at JPMorgan thinks that iPhone 5 sales could add a half a point — Half a point! — to U.S. GDP growth this year. The iPhone 5, which Apple is debuting tomorrow, could literally save the economy, which actually isn't all that surprising an outcome if you believe, as I sometimes do, that the U.S. economy these days consists of Apple, the auto industry, and little else.
The iPhone 5 isn't that different from the iPhone 4S. True, it's expected to incorporate features that newer Android phones already have. With 4G LTE service and a larger screen, the iPhone 5 should be faster than its predecessor and provide lusher viewing of photos, videos, games, and so on. The battery is also reported to be beefier. But so what? Is the iPhone 5 going to rock anybody's world? It's likely to be a commendable refinement/improvement on the former model. But world-rocking in the smartphone world seems to belong to the Android Nation.
Obama can't win: "Of course, aggressively addressing capital requirements and restructuring zombie banks three years ago would have turned Wall Street against Obama—but Wall Street's now against Obama anyway. Meanwhile, blaming Wall Street for its contribution to the country's problems—and actually backing up the talk with action—would have won over the rest of the business community and Main Street." (Business Insider)
The problem of "old loans" versus "new loans" and how it relates to willingness to work. To earn money. And to spend it all paying off the old loans: "A significant fraction of households and businesses are typically so burdened with the debts they accumulated during the housing surge that they have little incentive to produce and work, because their creditors would get most, if not all, of the fruits of their labor." (NYT)