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Forbes Magazine Publisher Rich Karlgaard and “State of the Union” author Phil Dine on Apple CEO Tim Cook’s recent comments.
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Apple shareholders they are nervously looking to management for.
Some sign any sign that they are addressing the company's plummeting stock value it's declined 25%.
Over just the past two months.
But -- CEO Tim Cook recently described his company's responsibilities.
As quote.
Creating jobs many shareholders.
Became even more worried about the stock's future should happen or any other company for that matter be more concerned about creating jobs.
Then they are about creating shareholder value joining us now is rich call guard.
Forbes magazine publisher and Phillips died author of the recently updated edition of state of the unions how labor can strengthen the middle class improve our economy and regain.
Political influence rich first do you.
Why did Tim Cook save us a look a lot of shareholders out there millions of shareholders who want the stock value to come up.
And creating jobs is is not what they see the management's first responsibility being.
Well I think he said that that partly for political cover apple is still a very valuable powerful company was the most valuable company that -- was.
In September when it reached its high and when you're that you have targets -- -- -- the real issue for -- those suddenly faces competition to its most profitable product.
The iPhone with -- Samsung and everybody else getting into it -- I think the first obligation of apple is to make sure can have a successful future as it is have in the past.
Well but fill -- the point he areas is a very simple point is at some times.
A company becomes more valuable if it lays off workers it's an awful fact -- some big.
Terrible you have to deal we just saw recently in December 5 we -- happen with Citigroup.
Citigroup announced that they were laying off 111000 workers and we -- saw the stock rise 7%.
On the same day.
Specifically because they laid off workers so what happens.
When it laying off workers actually helps a company stock value.
-- the way you pose -- question the -- was should the company be more concerned created jobs and within its bottom line I don't think that's the question.
I think for too long people said a company should only be concerned with the bottom line I think that's a primary -- -- I could fill I -- you're gonna go there that's why specifically asked about the city example there was an example.
-- cutting workers laid off 111000 workers led to a 7% increase in the stock value how do you explain that.
Look if a company -- is overstaffed it obviously needs to have that appropriate workforce is no argument there.
So that means that what Tim Cook was saying you know was was inconsistent.
With the fact sometimes you have to focus.
On cutting into workers in order to create more shareholder value right.
The question is are well.
Are we talking about jobs overseas vs jobs here are we talking about a workforce size in the United States the point is you have to go where ever you can in order to get the most value for your share.
All right but that's what I want to address and and yes but do you believe you're talking short term long term.
Every corporation benefits from a from a robust economy and from an expanding middle class that can buy the products they also benefit from good public relations and a positive image.
When they move jobs back to this country instead of instead of having workers overseas who aren't free to bargain decent wages due to war.
OK rich I guess what.
Concerns a lot of shareholders out their apple shareholders is that.
Is or the question is Tim Cook taking his eye off the ball as he focused as you mentioned this was done primarily for political coverage.
Political parity yet that really didn't Andrea -- I never -- editor it is Steve Jobs his mind he was more focused on getting shareholder value wherever he got it.
Maybe not so what Tim Cook.
Well you know -- caucus had.
Are really good fourteen months -- and Steve Jobs is successor except for the last two months.
And the first cracks started -- a couple of months ago with the Google man -- Apple's.
Mapping technology which is far inferior to Google.
Now apple it as it comes to jobs.
The small lower case.
Apple is a little bit different because it's so profitable.
That I think that it can have growth by creating jobs but the primary thing that Tim Cook should be concentrating on.
Is a sudden new competition.
In the Smartphone space if that means creating innovative jobs in America our innovative jobs in China he's got -- -- drive that kind of innovation that's -- to make a profit for.
But -- -- I got asked once again do you ever as CEO have to choose between on the one hand saving jobs and on the other hand creating shareholder value.
Yes you probably -- often have to choose -- -- said whether you're gonna create American jobs are jobs overseas.
You want to opt for American jobs because that not only -- -- are you being a responsible member of society.
You're expanding the economy and you're expanding your customer base.
-- what do you think about this move from China where it now lot of companies for for very cost saving reasons are coming back to the United States saying there's so much corruption in China and they don't -- the orders probably -- that's why they're bringing jobs back home to America is is it that more than the political cover.
But you know I think -- I actually think Philip and I are gonna see the same happy results even though we come matter from different angles I think you should be able to -- Beef to freely trade freely create customers and employees that wherever you want them the world I don't see that you have a moral obligation.
To do within certain borders.
But with fuel costs rising.
-- around the world with wages going up in China 20% per year -- uncertain future leadership in China.
With America's increasing energy independence which is a real.
Positive surprise it all argues for bringing back jobs.
Back to the United States but for the right reason -- That would be nice if we got good manufacturing jobs right here again creating shareholder value at the same time rich -- guard Philip -- great to see you both gentlemen thank you very much appreciate it.
Thank you -- --
