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Jon Talton

Analysis and commentary on economic news, trends and issues, with an emphasis on Seattle and the Northwest.

April 26, 2013 at 10:50 AM

Vote: Is Amazon hitting the wall?

The most devastating quote in the Amazon.com earnings story by the Seattle Times‘ Amy Martinez comes from BGC Partners analyst Colin Gillis: “Amazon is planting lots of gardens, but they haven’t reaped any harvest. They could pull a Microsoft and take a decade to grow into their valuation.” CEO Jeff Bezos famously says variations of ““We are willing to be misunderstood for long periods of time.” But…ouch. With nine consecutive declines of quarterly profit, is Amazon’s spell on investors finally wearing off? It might not pull a Microsoft. It might pull an Apple.

Amazon shares are down 7.6 percent this morning. The investing site Seeking Alpha provided a look at some scenarios why the momentum for “monentum darling” Amazon might end. On the other hand, Amazon keeps growing — revenue rose a robust 22 percent in the first quarter. And the profit issue continues to involve the company’s big investments in its future. That can be a healthy strategy for long-term prosperity, but Wall Street has rarely been known for its patience.

What do you think?

Read on for the best links of the week and the haiku:

This Week’s Links:

The Bangladesh building collapse: This is what race-to-the-bottom global trade looks like | Quartz

Chained CPI has big downside for the old and the poor | NY Times

What Americans should understand about Japan’s 1990s bust | The Atlantic

What went wrong in West, Texas, and where were the regulators | ProPublica

Job polarization by skill level | Conversable Economist

Services and the slow recovery | Carola Binder

Medical journal blasts Obamacare for increasing underinsurance | Naked Capitalism

Protecting boards from their own shareholders | Baseline Scenario

Today’s Econ Haiku:

Weak GDP growth

Stall speed or the new normal?

Demand, the answer

Comments | More in Amazon.com

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