Apple (AAPL) CEO Cook: 'I'm Proud to Be Gay' Oct 30, 2014 07:08AM

(Updated - October 30, 2014 7:08 AM EDT)

Apple (NASDAQ: AAPL) CEO Tim Cook says "I'm proud to be gay."

UPDATE - Cook wrote an essay for Bloomberg Businessweek, which can be accessed here.

"While I have never denied my sexuality, I haven’t publicly acknowledged it either, until now. So let me be clear: I’m proud to be gay, and I consider being gay among the greatest gifts God has given me."

MORE:

Bloomberg Businessweek editor Josh Tyrangiel appeared on Bloomberg Television with Tom Keene this morning to discuss the essay. Tyrangiel said that Tim Cook told him this "is something he has been thinking about for a while, but it's not precipitated by any event. It’s not a reaction to anything." He said, “He was very clear on what he wanted. The backstory on it is pretty simple as well. He called and asked if I could come out. We had a conversation and he had something written. It was crisp and clear and frankly I hope he is available for more assignments going forward. He was very easy to work with on this. He knew what he wanted to say.”

Tyrangiel said, "He's been very private and has always felt that his job is to guide Apple. At the same time, the way he told it to me is he walks into his office every day and there are two photos. One is of Martin Luther King; one is of Robert F. Kennedy. Some days those are an inspiration and other days those are a challenge. Martin Luther King's quote sticks with him, which is 'life's most persistent and urgent question is what are you doing for others.' Over the years it has knotted him that is in a position of power and responsibility, a position of influencing people. He has had these conflicting values of privacy and wanting to lead and he ultimately decided it is more important for him to step out, to represent not only the business community and within the world, because Apple is a global company, to say to people 'I am gay, I am proud."

On whether calling on his home state of Alabama to protect gay rights was a catalyst for the announcement in Bloomberg Businessweek:

"I don't think it's a catalyst. I think what we have seen in his time as CEO is that Apple has taken a very decisive turn standing up for equality and standing up for certain types of values including transparency--not always the most popular decisions within the company. These values are consistent with the way he's been leading the company. At the same time this is a big step…for society and American business. There has never been in my searching a CEO who has voluntarily stepped out as a Fortune 500 CEO and said 'I'm gay.' And it's not just the CEO of any company; it's the CEO of the most closely watched company in the world."

"The fact that he is the CEO of Apple makes this both easier and harder. Easier in the sense that Apple is a company that has long valued creativity, innovation and equality. He told me that he spoke to the board and the board gave him complete and utter support. Full support. At the same time, Apple does business in a lot of places. It could be slightly complicated. I think that one thing about leading Apple is desire and desire for their products tends to trump prejudice. The point of it is that it is news today. It is big news. His hope and all of our hope is that it does not become news at all. We're at a really interesting moment where we have got marriage equality legalized in a majority of states. We also have states that can evict you for being gay. That can discriminate you in the workplace for being gay. I think that each person who comes out and drives our progress forward makes those things less likely and less relevant."

On how this announcement fits into the new group leading Apple:

"I actually don't think it is going to be very big news within Apple. As he says in the piece, plenty of people know that he is gay. It's never been a big deal. No one has ever treated him or he's never detected being treated any differently. Within Apple there will be a lot of people will be proud of him and happy for him, and then by 9:05 go back to the work they have to do."

On what the impact of the essay will be on political dialogue as we head into the elections:

"My guess is that there will be a lot of congratulatory phone calls heading to Cupertino today. That a lot of people recognize this is leadership…I think that we are at a place where society is genuinely leaning toward equality. It is a door that is already opening and can be pushed on. Politically, he will be receiving calls from Barack Obama, from the Clintons. A lot of people will be rooting for this story to be a positive thing and to go away swiftly because, truly, we should all be getting back to work."


Apple (AAPL) CEO Cook: 'I'm Proud to Be Gay' Oct 30, 2014 07:08AM

(Updated - October 30, 2014 7:08 AM EDT)

Apple (NASDAQ: AAPL) CEO Tim Cook says "I'm proud to be gay."

UPDATE - Cook wrote an essay for Bloomberg Businessweek, which can be accessed here.

"While I have never denied my sexuality, I haven’t publicly acknowledged it either, until now. So let me be clear: I’m proud to be gay, and I consider being gay among the greatest gifts God has given me."

MORE:

Bloomberg Businessweek editor Josh Tyrangiel appeared on Bloomberg Television with Tom Keene this morning to discuss the essay. Tyrangiel said that Tim Cook told him this "is something he has been thinking about for a while, but it's not precipitated by any event. It’s not a reaction to anything." He said, “He was very clear on what he wanted. The backstory on it is pretty simple as well. He called and asked if I could come out. We had a conversation and he had something written. It was crisp and clear and frankly I hope he is available for more assignments going forward. He was very easy to work with on this. He knew what he wanted to say.”

Tyrangiel said, "He's been very private and has always felt that his job is to guide Apple. At the same time, the way he told it to me is he walks into his office every day and there are two photos. One is of Martin Luther King; one is of Robert F. Kennedy. Some days those are an inspiration and other days those are a challenge. Martin Luther King's quote sticks with him, which is 'life's most persistent and urgent question is what are you doing for others.' Over the years it has knotted him that is in a position of power and responsibility, a position of influencing people. He has had these conflicting values of privacy and wanting to lead and he ultimately decided it is more important for him to step out, to represent not only the business community and within the world, because Apple is a global company, to say to people 'I am gay, I am proud."

On whether calling on his home state of Alabama to protect gay rights was a catalyst for the announcement in Bloomberg Businessweek:

"I don't think it's a catalyst. I think what we have seen in his time as CEO is that Apple has taken a very decisive turn standing up for equality and standing up for certain types of values including transparency--not always the most popular decisions within the company. These values are consistent with the way he's been leading the company. At the same time this is a big step…for society and American business. There has never been in my searching a CEO who has voluntarily stepped out as a Fortune 500 CEO and said 'I'm gay.' And it's not just the CEO of any company; it's the CEO of the most closely watched company in the world."

"The fact that he is the CEO of Apple makes this both easier and harder. Easier in the sense that Apple is a company that has long valued creativity, innovation and equality. He told me that he spoke to the board and the board gave him complete and utter support. Full support. At the same time, Apple does business in a lot of places. It could be slightly complicated. I think that one thing about leading Apple is desire and desire for their products tends to trump prejudice. The point of it is that it is news today. It is big news. His hope and all of our hope is that it does not become news at all. We're at a really interesting moment where we have got marriage equality legalized in a majority of states. We also have states that can evict you for being gay. That can discriminate you in the workplace for being gay. I think that each person who comes out and drives our progress forward makes those things less likely and less relevant."

On how this announcement fits into the new group leading Apple:

"I actually don't think it is going to be very big news within Apple. As he says in the piece, plenty of people know that he is gay. It's never been a big deal. No one has ever treated him or he's never detected being treated any differently. Within Apple there will be a lot of people will be proud of him and happy for him, and then by 9:05 go back to the work they have to do."

On what the impact of the essay will be on political dialogue as we head into the elections:

"My guess is that there will be a lot of congratulatory phone calls heading to Cupertino today. That a lot of people recognize this is leadership…I think that we are at a place where society is genuinely leaning toward equality. It is a door that is already opening and can be pushed on. Politically, he will be receiving calls from Barack Obama, from the Clintons. A lot of people will be rooting for this story to be a positive thing and to go away swiftly because, truly, we should all be getting back to work."


Apple (AAPL) Smartphone Shipments Rose 16.1% in Q3; Xiaomi Breaks into Top Five - IDC (GOOG) (MSFT) Oct 30, 2014 06:26AM

New smartphone releases and an increased emphasis on emerging markets drove global smartphone shipments above 300 million units for the second consecutive quarter. According to preliminary data from the International Data Corporation (IDC) Worldwide Quarterly Mobile Phone Tracker, vendors shipped a total of 327.6 million units during the third quarter of 2014 (3Q14), resulting in 25.2% growth when compared to the 261.7 million units shipped in 3Q13 and 8.7% sequential growth above the 301.3 million units shipped in 2Q14.

"Despite rumors of a slowing market, smartphone shipments continue to see record-setting volumes," said Ryan Reith, Program Director with IDC's Worldwide Quarterly Mobile Phone Tracker. "We've finally reached a point where most developed markets are experiencing single-digit growth while emerging markets are still growing at more than 30% collectively. In these markets, smartphone price points are making mobile computing possible where we once expected feature phones to remain dominant. This is great news for overall volumes, but the challenge has now become how to make money on devices that are quickly becoming commodity products. Outside of Apple, many are struggling to do this."

A driving force behind the record smartphone volume was the combined effort of the vendors trailing market leaders Samsung and Apple. "The next three vendors – Xiaomi, Lenovo, and LG Electronics – all posted market-beating growth and with markedly different strategies," said Ramon Llamas, Research Manager with IDC's Mobile Phone team. "This shows that there is still room to compete in this market, whether it be in the low end as Lenovo has done, at the high end where Xiaomi competes, or in both as LG Electronics has shown. Beyond the top five, there are a number of other vendors achieving similar results."

Smartphone Vendor Highlights:

Samsung remained the clear leader in the worldwide smartphone market, but was the only company among the top five to see its shipment volume decline year over year. With continued competitive pressure from nearly every side coupled with cooling demand for its high-end devices, the company's volumes have fallen from their previous highs at the start of the year. Although Samsung has long relied on its high-end devices, its mid-range and low-end models drove volume for the quarter and subsequently drove down ASPs.

Apple took the wraps off its highly anticipated iPhone 6 and iPhone 6 Plus, and in the process posted its largest third-quarter volume ever. Although the company posted strong results of 10 million units sold during its initial launch weekend, what should not be overlooked is the sustained demand for its older iPhone 5S and 5C models, which comprised the bulk of its volume for the quarter.

Xiaomi jumped into the top 5 list for the first time at the number 3 position thanks to its focus on China and adjacent markets, which resulted in triple-digit year-over-year growth. Key to its success was the launch of its Mi4 smartphone in August, which was positioned as a high-end alternative to the status quo. What remains to be seen is how quickly the company can move beyond its home territories to drive volumes higher.

Lenovo tied* for fourth with LG, as its results improved on steady gains at home and abroad with the share of non-China shipments rising steadily to hit 20% in 3Q14, up from 9% a year ago. Sub-US$100 smartphones like the A369i and A316 drove volumes from emerging markets in Asia/Pacific and the Middle East and Africa. Domestically, it launched a number of 4G handsets, with some at lower price points.

LG's strategy to court the market with low-cost smartphones has paid enough dividends to push its total volumes past the 15 million unit mark for the first time in the company's history. Its F-and L-series smartphones have earned a warm reception, within both emerging and developed markets. At the same time, LG released its flagship G3 to maintain a presence in the high-end of the market, lifting the company's overall LTE footprint.

Top Five Smartphone Vendors, Shipments, Market Share and Year-Over-Year Growth, Q3 2014 Preliminary Data (Units in Millions)

Vendor

2014Q3 Shipment Volumes

2014Q3 Market Share

2013Q3 Shipment Volumes

2013Q3 Market Share

3Q14/3Q13 Change

1. Samsung

78.1

23.8%

85.0

32.5%

-8.2%

2. Apple

39.3

12.0%

33.8

12.9%

16.1%

3. Xiaomi

17.3

5.3%

5.6

2.1%

211.3%

4. Lenovo*

16.9

5.2%

12.3

4.7%

38.0%

4. LG*

16.8

5.1%

12.0

4.6%

39.8%

Others

159.2

48.6%

113.0

43.2%

40.8%

Total

327.6

100.0%

261.7

100.0%

25.2%

Source: IDC Worldwide Quarterly Mobile Phone Tracker, October 29, 2014

Notes:

  • Data is preliminary and subject to change.
  • Vendor shipments are branded shipments and exclude OEM sales for all vendors. The vendor names reflected in this release represent the current parent company (or holding company) for all brands, regardless of the date of mergers or acquisitions.
  • * IDC declares a statistical tie in the worldwide mobile phone market when there is less than 0.1% difference in the market share (based on shipments) of two or more vendors.


WHO notes 13,000 Ebola cases reported, just over 4,500 deaths Oct 29, 2014 09:46AM

WHO notes 13,000 Ebola cases reported, just over 4,500 deaths.


ECB Stress Test Shows EUR 25B Shortfall at 25 European Banks (DB) (NBG) (IRE) Oct 27, 2014 09:24AM

ECB’s in-depth review shows banks need to take further action

  • Key results of comprehensive assessment of 130 largest euro area banks:

    • Capital shortfall of €25 billion detected at 25 participant banks

    • Banks’ asset values need to be adjusted by €48 billion, €37 billion of which did not generate capital shortfall

    • Shortfall of €25 billion and asset value adjustment of €37 billion implies overall impact of €62 billion on banks

    • Additional €136 billion found in non-performing exposures

    • Adverse stress scenario would deplete banks’ capital by €263 billion, reducing median CET1 ratio by 4 percentage points from 12.4% to 8.3%

  • Exercise delivers high level of transparency, consistency and equal treatment

  • Rigorous exercise is milestone for the Single Supervisory Mechanism starting in November


The European Central Bank (ECB) has today published the results of a thorough year-long examination of the resilience and positions of the 130 largest banks in the euro area as of 31 December 2013.

“This unique and rigorous exercise is a major milestone in the preparation for the Single Supervisory Mechanism, which will become fully operational in November,” said Vítor Constâncio, Vice-President of the ECB. “This unprecedented in-depth review of the largest banks’ positions will boost public confidence in the banking sector. By identifying problems and risks, it will help repair balance sheets and make the banks more resilient and robust. This should facilitate more lending in Europe, which will help economic growth.”

The comprehensive assessment—which consisted of the asset quality review (AQR) and a forward-looking stress test of the banks—found a capital shortfall of €25 billion at 25 banks. Twelve of the 25 banks have already covered their capital shortfall by increasing their capital by €15 billion in 2014. Banks with shortfalls must prepare capital plans within two weeks of the announcement of the results. The banks will have up to nine months to cover the capital shortfall.

The AQR showed that as of end-2013 the carrying values—or book values—of banks’ assets need to be adjusted by €48 billion, which will be reflected in the banks’ accounts or prudential requirements. Furthermore, using a standard definition for non-performing exposures (any obligations that are 90 days overdue, or that are impaired or in default), the review found that banks’ non-performing exposures increased by €136 billion to a total of €879 billion.

The comprehensive assessment also showed that a severe scenario would deplete the banks’ top-quality, loss-absorbing Common Equity Tier 1 (CET 1) capital—the measure of a bank’s financial strength—by about €263 billion. This would result in the banks’ median CET1 ratio decreasing by 4 percentage points from 12.4% to 8.3%. This reduction is higher than in previous similar exercises and is a measure of the rigorous nature of the exercise.

“This exercise is an excellent start in the right direction. It required extraordinary efforts and substantial resources by all parties involved, including the euro area countries’ national authorities and the ECB. It bolstered transparency in the banking sector and exposed the areas in the banks and the system that need improvement,” said Danièle Nouy, Chair of the Supervisory Board. “The comprehensive assessment allowed us to compare banks across borders and business models, and the findings will enable us to draw insights and conclusions for supervision going forward.”

Since the announcement of the exercise in July 2013, the largest 30 participating banks have undertaken various measures, including capital raising to an amount of €60 billion, to strengthen their balance sheets by a total of more than €200 billion. These frontloaded measures are part of the overall successful outcome of the exercise. Some of the measures taken in 2013 reduced the insufficiencies detected by the comprehensive assessment; some measures adopted in 2014 may count toward the coverage of the capital shortfall.

Comprehensive assessment

The comprehensive assessment—which joined up the AQR and the stress test components—was aimed at strengthening banks’ balance sheets, enhancing transparency and building confidence. The 130 banks that were examined accounted for assets of €22 trillion, which represents 82% of total banking assets in the euro area. It was performed under the current EU Capital Requirements Regulation and Directive (CRR/CRDIV), which include certain national discretions. These national discretions can lead to differences in, for example, the definition of capital. These differences will gradually diminish over the coming years as transitional arrangements in the relevant regulation are phased out. The ECB recognises the need to improve the consistency of the definition of capital and the related quality of capital. ECB Banking Supervision will address this as a matter of priority.

AQR

The AQR conducted by the ECB and national competent authorities (NCAs) examined whether assets were properly valued on banks’ balance sheets as on 31 December 2013. It made banks comparable across national borders by applying common definitions for previously diverging concepts and a uniform methodology when assessing balance sheets. More than 6,000 experts across the Single Supervisory Mechanism examined more than 800 individual portfolios in detail, among other things thoroughly analysing the quality of the credits of 119,000 debtors of banks. The review provides the ECB with substantial information on the banks that will fall under its direct supervision and will help its efforts in creating a level playing field for supervision in the future.

Stress test

The stress test was performed by the participating banks, the ECB and NCAs in cooperation with the European Banking Authority (EBA). The EBA also designed the stress test methodology, while the adverse scenario was developed by the European Systemic Risk Board (ESRB) in cooperation with the NCAs, the EBA and the ECB. Banks were required to maintain a minimum CET1 ratio of 8% under the baseline scenario (as for the AQR) and a minimum CET1 ratio of 5.5% under the adverse scenario. The stress test is not a forecast of future events, but a prudential exercise to test banks’ ability to withstand weakening economic conditions; participating banks were encouraged to make conservative projections, which were challenged according to strict quality assurance requirements. A novel element was that information acquired from the AQR was incorporated in banks’ balance sheet starting points and in related stress test projections.

Bank-by-bank disclosures

In the 130 individual bank templates, the ECB distinguishes between capital shortfalls identified in the AQR and those identified under the baseline and adverse scenarios of the stress test. In the comprehensive assessment, the two items are joined up. The templates also provide important additional information on each bank, such as the issuance of capital instruments already undertaken in 2014. The full results of the stress test are also published by the EBA. The aggregate report on the full outcome of the exercise for all banks can be found at: http://www.ecb.europa.eu/ssm/assessment/html/index.en.html.


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