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Australian property: Delivering Walkmans in a smartphone world

Imagine, for a moment, what the world would look like if Steve Wozniak and Steve Jobs were more interested in San Francisco real estate than computers.

The pair founded the company we know today as Apple by selling Wozniak’s scientific calculator and Jobs’ Volkswagen van. That money was enough to start Apple on the path that not only delivered the world home computers but also the iPod and iPhone.

Steve Wozniak with Steve Jobs and one of the first Apple computers.

Steve Wozniak with Steve Jobs and one of the first Apple computers.Credit:Bloomberg

It was a huge, and ultimately successful, financial gamble by the pair.

The benefits of that decision in the mid-1970s can’t just be measured in Apple’s market capitalisation (somewhere north of $2 trillion) – the productivity gains are still being felt today.

Had Wozniak and Jobs, rather than build and market a PC, invested in property, they could have made enough money to be very comfortable. But you might still be listening to music on a Sony Walkman while waiting for your visual display terminal to warm up enough so you could use it like an electric typewriter.

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In economic terms, it’s opportunity cost – what you give up to do something else. In the Apple case, the chance of making a breakthrough in computers was (fortunately) more enticing than a life in real estate.

It’s becoming clearer that, as a country, Australians are making the other choice.

Our tax system, our monetary policy settings, our fiscal settings and even our television programs all drive us to sink money into real estate rather than something that might be riskier but could deliver huge, long-term gains.

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