Steve Jobs once said, "A lot of times, people don't know what they want until you show it to them." Apple Inc. (NASDAQ:AAPL) has always innovated on this premise. It has brought the tech giant much success. But lately, success has been hard to come by; the stock has plummeted 40% from an intraday high of $705 last September.

The sentiment bubble Apple Inc. (NASDAQ:AAPL) has a problem that every company wants -- a cash hoard of $137 billion, but no epic idea of what do with it. I've done my part as a shareholder; the company now has all of my routing numbers. I'm still waiting to hear back. But in the meantime, here comes David Einhorn, the outspoken hedge-fund manager at Greenlight Capital. He's got a few ideas of his own. One in particular is called "iPrefs," which has brought him much scrutiny.

I never wanted to like the idea. My loyalty to Apple was too strong. Even CEO Tim Cook called it "a silly sideshow." I agreed. Besides, Apple didn't grow to become the largest company in the world with clueless management. Therefore, who's this guy Einhorn to make cash-use demands? In a recent article, I talked about how I felt he was doing more harm than good. That article prompted an exchange. Einhorn reached out to me and we discussed Apple's current situation -- more specifically, how the company is being appraised by the market.

It requires, however, much more than just a cursory view of Apple Inc. (NASDAQ:AAPL)'s status to appreciate the company's $137 billion cash pile in relation to the ebb and flow of market sentiment. Consider this: From January 2009, when the stock traded at $82.33, to its recent intraday high of $705, shares gained 756% in just four years. That's an absurd average of almost 20% per month for 44 consecutive months. Yet, the P/E ratio never fully reflected confidence -- dropping from 35 to 9, where it is today. But the cash kept rising. What's the problem? The company was carrying too much cash.

The market punished Apple Inc. (NASDAQ:AAPL) for this by discounting the cash and its future value. By contrast, Texas Instruments Incorporated (NASDAQ:TXN) , which has 43% more debt than it does cash, is making new 52-week highs. I've been scratching my head around this for quite some time. This is despite struggles with declining revenue. There's no way TI deserves a higher P/E than QUALCOMM, Inc. (NASDAQ:QCOM), much less Apple. Same goes for International Business Machines Corp. (NYSE:IBM), which has $33 billion in debt and only $11 billion in cash. It's not a great ratio. But the market forgives IBM's highly levered balance sheet because the company is seen as "shareholder-friendly." For that matter, IBM's 85% return on equity is one of the best on the market.