Why in the World?

“Consumer debt, including student debt, is going to adversely and severely affect people for years,” a reader says.

“I’ve read that the average loan on a new car is $32,000. This makes no sense to me whatsoever. What in the world is wrong with people that would make them borrow money on a car? And so much?

“I grew up with cars from the 1920s and they lasted 50,000 miles. Today’s cars run well up to and sometimes exceeding 200,000 miles. Why would anyone buy a new one with borrowed money? (My present car has 412,000 miles on it, is 21-years old and runs like a wristwatch.)

“And student debt? Kids graduate owing something like $80,000 and can’t get a job good enough to pay back the debt in a reasonable time.

“I graduated in 1960 with $7,000 in debt and two children. That’s $58,000 in today’s money. But I’m an engineer and had plenty of job offers that allowed me to pay off the debt and buy a home, both in reasonable time. 

“I think our federal and state governments should spend some effort educating people about the evils of borrowing money.

“Why in the world would someone borrow more money than they can easily pay off?”

You got us. What do you think, readers?

Your Rundown for Thursday, October 31, 2019:

Making A List…

Taking a look at Apple’s most recent earnings report, revenue from iPhone sales beat analysts’ estimates — soundly — but iPhone revenues are still down 9% from last year.

We mentioned a couple weeks ago, that Apple’s introducing a budget-friendly iPhone option that’s expected to launch the first quarter of 2020, according to an article at CNBC.

Called the SE2, this iPhone iteration is expected to be priced at $399 with a design similar to the iPhone 8 and an internal processor that’s a facsimile of the iPhone 11. Apple hopes the SE2 will boost flagging iPhone sales, especially in Asia.

Smartphones aside, there’s one segment of Apple’s business that’s grown 50% over last year — wearable technology. AirPods and Apple Watches, in particular.

“Wearables continue to lead growth,” says Morgan Stanley analyst Katy Huberty. “Many investors attributed 50% wearables growth in the June quarter to shorter lead times as demand caught up with supply, however a second quarter in a row of 50%+ [year over year] growth and the fact that Apple is beating AirPods forecasts weekly suggests strong double-digit growth is sustainable.”

Guess which items will be topping Christmas lists?

In fact, Morgan Stanley “expects in fiscal year 2020 to see Apple Watch revenue to grow 24% and AirPods revenue to grow 107% year-over-year,” CNBC reports.

Morgan Stanley’s price target for Apple: $296 per share. Citigroup’s price target? $250. (This morning, Apple’s up 2.7% at $248.58.)

If we split the difference, that’s $273 per share. Which seems reasonable.

Market Rundown for Thurs. October 31, 2019

S&P 500 futures are down 5 points to 3,042.

Oil is down 70 cents to $54.36 for a barrel of WTI.

Gold is up $14.50 per ounce to $1,511.20.

Bitcoin’s up $130.35 to $9,333.64.

Have a good day. We’ll talk tomorrow.

For the Rundown,

Aaron Gentzler

Aaron Gentzler

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Aaron Gentzler

Aaron Gentzler is the publisher of Seven Figure Publishing. He is also the editor of The Rundown and has been with Agora Financial / Seven Figure Publishing since 2005. He's been covering technology and markets for over a decade.

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