Is This The First Time Apple Has Ever Been Wrong?

It seems like Apple AAPL can do no wrong, from iPods, to iPhones, to iPads. Everything the company does turns to gold. AppleInsider is reporting that Apple is a backer of having an overseas profit tax holiday for U.S. companies. There is an estimated $1.5 trillion in cash overseas on U.S. companies balance sheets doing nothing, and these companies have backed a lobbying group, named WIN America. WIN America hopes to provide these companies a tax break on the profits if they are brought back on shore. With a struggling economy, $1.5 trillion in cash could do a lot of good, but the last time there was a tax holiday on foreign cash, all companies did was buy back shares and increase dividends. Hiring was not increased, and that is what is needed today. Dividend yields on the S&P 500 are already above the yield on the 10 year U.S. Treasury, and buybacks do nothing to help the U.S. economy. The companies could make the claim that the $1.5 trillion could be used for mergers and acquisitions, which are seen as a sign of optimism for the U.S. economy. Unfortunately, M&A more often than not leads to layoffs, which is the major issue for the U.S. Unemployment is over 9%, and the U6 rate is over 16%. Almost one fifth of the country is either underemployed or unemployed, and that $1.5 trillion in cash is not likely to make much of a dent in that number. President Barack Obama has to do something to help the economy, and although the overseas profit tax holiday may not do much, if anything, he does have to do something. WIN America has said that a tax holiday will bring jobs back to America, which would be positive for America. Most people are skeptical of this ideology. "Providing American businesses with incentives to invest at home is a common sense solution that will immediately inject up to $1 trillion into our economy and provide businesses with the security and certainty they need to help Americans get back to work," the campaign's official site reads. "The time to act is now. Let's invest the money here at home -- not spend it overseas." With nearly $80 billion in cash holdings, Apple has more cash on its balance sheet than any other non bank in the country. Apple backing WIN America makes a huge statement and could eventually change the policy in this country. Talk about world domination, even if it is not as helpful as some think. ACTION ITEMS:

Bullish:
Traders who believe that a tax holiday does happen might want to consider the following trades:

• Go long the higher dividend paying mutlinationals, as these companies are likely to increase dividends. Names like McDonald's MCD, Microsoft MSFT and Oracle ORCL come to mind.

Bearish:
This idea is still bearish for employment, as the last time it happened, it did not help as expected.

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