Apple has just warned investors of a pre-Christmas profits fall. Competition in the tablet market is putting pressure on Apple's gross margins. Notably, Noah Smith has an interesting post which compares Sony and Apple. I like this comparison as I can remember Sony as the Apple of its day. Like Apple, Sony's rise to prominence was with a portable music device - the Sony Walkman (for my younger readers, the Sony Walkman played these things known as cassettes). Like Apple, Sony had an iconic and visionary founder in Akio Morita. Noah Smith suggests that Sony's decline was partially due to the death of Morita in 1999. Will post-Jobs Apple go the same way?
My colleague and former PhD student Gareth Campbell has created a website about the British Railway Mania - click here . This episode has been described by the Economist as probably the greatest bubble in human history. Gareth's website provides background on the Mania and posits some explanations for the 'bubble'. In his explanation of why the bubble happened, Gareth places a lot of emphasis on investor myopia regarding future dividends and uncalled capital. His study of investors during the episode does not support the view that this episode was fuelled by naive and irrational investors.