Lest We Forget

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I've mentioned this before, but it bears repeating, as it is an object lesson in arrogance as well as the power of contrary thinking.

In early October, 1997, Michael Dell told a large group of technology executives that Apple might as well shut down and return whatever cash is left to the shareholders. It is sort of understandable why he would say such a thing. At the time, DELL stock was basically like AAPL today – all it did was go up, week after week (indeed, it kept doing so even after this quote, peaking in March 2000).

And Apple – poor old Apple – was a $5 piece o' crap stock that seemed like it would follow the path of Silicon Graphics into oblivion. That is, a pretty interesting company at one point which become unimportant and let progress pass it by.

For a while, Dell's quote seemed to make sound sense, because the price of DELL kept climbing, and the price of AAPL fell yet another 40% in short order. But over the long haul, AAPL has done all right. Here's a graph of its percentage change in price since the aforementioned quote.

1018-DELLQUOTE

Yep, you read that right – up 5,400%.

How has DELL stock done since then? It's up since the quote was made. About 10%.

Hubris has met its reward. Many years from now – who knows – the shoe may be on the other foot, and people will marvel that AAPL could have ever been a $320 stock. But, for now……..they own the world.