Comments on: As Auto Bailout Hopes Fade, So Do Stocks
Dow Plunges More Than 400 Points As Prospects Dim For Immediate Lifeline For Automakers
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- Do you understand now?
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Posted by txgrouch2007 at 08:11 PM : Nov 20, 2008
I understood. Even agree with your point to an extent. Just didnt agree that it could work. Its basically an isolationist philosophy which does not work. It was a popular philosophy in the 30''s depression too until Japan brought us forcefully into WWII.
But, if you refuse to pay for anything from China you have to build everything you want by yourself. Worse, they cant afford to buy things from you anymore because they cant get any dollars unless they sell you something. YOUR economy colapses unless you can build everything (like oil) yourself. - Reply to this comment
- While the Big Three worry about paying their bills next month, Japan''s car markers are already planning for next year and after %u2026 so that when the recession ends, Americans will have even more reasons to buy Japanese.
- Reply to this comment
- We all need full intellect robots who can do everything for us, go to work for us, etc. Then we could have even more goods, more services and work even less.
Posted by machineguy at 08:07 PM : Nov 20, 2008
See, there''s your problem. You''re skipping over the part where the robot now took your job, and YOU''RE NOT GETTING PAID ANYMORE.
Now the robot can make all the goods and services, and NOBODY CAN BUY THEM BECAUSE EVERYBODY GOT REPLACED BY A ROBOT.
Well, except one person - the boss, who turns the robots on and then goes home and collects "profit sharing" from all the goods and services made by the robots.
If anyone can buy them, that is. Which they can''t. Because they''ve all been replaced by robots.
Robots. Bad idea. Think harder. - Reply to this comment
- You''''re correct on the retooling of factories
BUT retooling factories costs money......given that the US consumer spends way more than he earns (an negative savings rate tells its own story), companies go overseas to borrow; the US govt goes overseas to borrow
Eventually it comes to the point that those lenders get nervous about your ability to pay back on those loans (it''''s the situation of the average Joe but on a far larger scale)
Of course the FACT that US executives seem to believe that they deserve $multi bn bonuses
...
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Posted by cause_y at 08:02 PM : Nov 20, 2008
I think we agree. I must have made a mistake somewhere, lol.
Its not just the CEO''s who feel entitled to more and more. They are just the visible ones.
One more step. I wouldnt retool a factory in America today. The government will tax my increased profits, then pass rules that make them look good for how I run my business, then help my workers get raises whether we make profits or not. How about another step. Ill retool, share the extra profits with the employees, and the government stays in Washington. - Reply to this comment
- OK my brief explanation of the economy went over everyone''s heads. Try an example.
If you buy from me, I get paid. Then I can go to the grocery store and the grocer gets paid.
If you buy from a guy in China, the Chinese guy gets paid. Then the Chinese guy goes to the grocery store in China and the Chinese grocer gets paid.
So, when you buy from China, the American grocer sees less pay. That''s a BAD ECONOMY for him. Because somebody else DIDN''T buy from his customer.
But it makes a GOOD ECONOMY for the Chinese grocer.
Do you understand now? - Reply to this comment
- Where is Obama?
Where is he? - Reply to this comment
- You sound like a computer automation salesman from the 1980''''s. The one who ended up putting us all out of work by making us so blinking PRODUCTIVE that they didn''''t need us anymore.
Whatever technology you install, foreign countries WILL install THE SAME TECHNOLOGY and make their products CHEAPER than you ever can. They''''ll sell it for below your cost, and they''''ll make a profit. That spells economic disaster when your competitor is making a profit by selling below your cost.
...
If I owned a large business, I wouldn''''t invest a dime. There''''s no point, it''''s an exercise in futility. Just keep turning the crank you already have until the axe falls. There''''s nothing else you can do.
Just like the steel industry did...
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Posted by txgrouch2007 at 07:59 PM : Nov 20, 2008
Nope, Im not a computer salesman from the 80''s but I do know what you mean.
The problem is they were right. We all need full intellect robots who can do everything for us, go to work for us, etc. Then we could have even more goods, more services and work even less.
Of course we have to learn to teach the robots.
Yes, whatever we are able to do, they will emulate. That is what competition is about. But what other choices do we have?
1. Let them win, we will work for their salaries
2. put walls around our country, either make it ourselves at our price or do without
3. Outperform them - Reply to this comment
- We lost the steel industry, the computer memory chip industry, the television set industry...
The auto makers are next.
It''s that simple. - Reply to this comment
- You can always isolate an economy by erecting trade barriers.
Posted by machineguy at 07:41 PM : Nov 20, 2008"
I dont believe that he''''s referring entirely to trade barriers
It''''s possible that he''''s referring in part to the fact that the average american has a bizarre "need" to buy anything and everything
Posted by cause_y at 07:53 PM : Nov 20, 2008
It''s - umm - INTERESTING to see what you fellows THOUGHT I said. Even though I wrote NOTHING THAT EVEN RESEMBLED ANY OF THAT.
Clearly you''re all drinking Cisco and hallucinating.
Time to switch to Night Train and take a nap. A LONG, LONG nap.
And don''t sleep on anything that isn''t waterproof.
www.bumwine.com - Reply to this comment
- Welcome to our level, UAW and high powered bankers and execs.
- Reply to this comment
- Where is Obama?
Where? - Reply to this comment
- Where is Obama?
Where? - Reply to this comment
- I dont believe that he''''s referring entirely to trade barriers
It''''s possible that he''''s referring in part to the fact that the average american has a bizarre "need" to buy anything and everything as they feel they have to keep up with their neighbours
For eg - explain why a couple expecting 1 child suddenly feels the "need" to move from a regular Sedan car to a massive SUV ? 1 baby DOES NOT take up all that much room !!!
Why does the average american feel the need to "upgrade" their TV EVERY year just because a new model comes out ?
The point is not about trade barriers; it''''s not about Americans NOT buying anything - it''''s more a question of scaling back their spending to SUSTAINABLE levels
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Posted by cause_y at 07:53 PM : Nov 20, 2008
Missed that part of his point. Thanks.
His point or not, its right. We have become "over-consumers" with an insatiable need for even more next time. That has to stop. We need to match our consumption by an equal amount of production.
Thats probably what most of us are saying. Just have to find a way to get there. Myabe have to not take my corporate jet to Washington nest time, lol. - Reply to this comment
- I think our only hope is to retool our factories and outproduce those guys. If we earn ten times their salary then we have to make things ten times bigger/better. Otherwise, we are trying to just take our ball and go home but the game has moved to the rest of the world.
Posted by machineguy at 07:41 PM : Nov 20, 2008
You sound like a computer automation salesman from the 1980''s. The one who ended up putting us all out of work by making us so blinking PRODUCTIVE that they didn''t need us anymore.
Whatever technology you install, foreign countries WILL install THE SAME TECHNOLOGY and make their products CHEAPER than you ever can. They''ll sell it for below your cost, and they''ll make a profit. That spells economic disaster when your competitor is making a profit by selling below your cost.
That''s working harder, not smarter - and you''re doing it in an environment that''s been arranged to guarantee your failure.
To get out of that game, CHANGE THE ARRANGEMENT that''s designed to guarantee your failure.
The voters had a choice to do that on Election Day. They chose to keep the existing arrangement.
If I owned a large business, I wouldn''t invest a dime. There''s no point, it''s an exercise in futility. Just keep turning the crank you already have until the axe falls. There''s nothing else you can do.
Just like the steel industry did... - Reply to this comment
- Why don''t we bail out and bring back RAMBLER or STUDEBAKER or DeSOTO or .... The list of American cars no longer in production is huge. WHY??? Because they didn''t produce what the AMERICAN PUBLIC wanted....Simple enough! So let''s tell Detroit what we want to buy and see if they BUILD IT and SELL IT.... I want an American made "prius-type car"===You know, a car that goes twice as far on half the gas at a reasonable price. I don''t care whether you make a better gas motor, or a hybrid or all electric to get to 60-80 miles per gallon---but you already know how to do it...The next generation PRIUS by TOYOTA is already predicting it''s lithium ion battery system will get 80-85 mph...Now the rest of you, tell them what you want....So GM, Ford and Chrysler, get off your private jets and get to work...YOU BUILD IT, and WE WILL BUY IT---''Nuff said??....If not, you can ALL be the next Rambler/Studebaker/DeSoto on the American junkheap of failed companies!!!
- Reply to this comment
- I evidently know how your economy "woks" far better than you seeing as I knew it was headed into a *** for a long time
Posted by cause_y at 07:47 PM : Nov 20, 2008
If that''s the basis for deciding who knows something, then I know more than you beacause I knew we were headed for the dumper when we elected a President whose campaign catch phrase was "I didn''t inhale."
Everything has been a pre-determined firecracker flight since then. The exhilarating rocket ride up - the inevitable explosion - now we''re on the free fall back down, to end in a crater that will take us below the surface level. - Reply to this comment
- THE BASIS of a working economy is somebody providing a good or a service that someone else is willing AND ABLE to pay for. In the ideal economy, every member of the economy is providing a good or a service that some other member is paying for. The "member" may mean a family, which includes at least one wage earner, that is, the one being paid by some other member of the econmy.
It''s that simple. Somewhere along the line in the past sixteen years, we stopped doing that. In this specific meltdown, it stopped happening because somebody decided it would be smart to let SOMEBODY ELSE provide the goods that we pay for.
Now we''re standing here looking bewildered that nobody is paying us, and yet we still need stuff that we have to pay for ourselves.
To add to the problem, somebody decided it would be smart to loan money to people who never had the ability to pay it back, so they could buy houses they never could have afforded. And rather than deny them a loan, the lenders decided to just cover up the fact that they were making loans that couldn''t possibly get paid back.
And all those chickens came home to roost at the same time.
That''s why we''re in the mess we''re in now. - Reply to this comment
- If so - then it''''s clear that the price of US goods was too high
...
It got to the point that other countries REFUSED to buy those goods (see the huge US trade deficit) or bought them but set max prices (see the EUs setting of max drugs prices). the result was that US companies tried to keep their profits constant (to justify those excessive bonuses) by raising prices in the US
Obviously there was a limit to how far they could go and how fast so they tried to lower costs by shifting jobs overseas
Combined with the incraesed prices, the lowering of incomes caused the eventual collapse of the house of cards that was laughably called the US economy
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Posted by cause_y at 07:34 PM : Nov 20, 2008
You got a good start on the problem. Except it wasnt those big bonuses the papers always like to talk about that did it. Those bonuses are too high but they are a drop in the bucket compared to the rest of our problem. If you take all those bonuses from all those CEOs, AND take those exhorbitant salaries from all those athletes, AND take all those profties from all those movie stars you get enough to give us all $3000. Its would sure help but thats not the problem.
The problem is we havent updated our factories and our workers arent able to keep up the volume that foreigh factories produce. Add to that our high salaries (CEo''s to workers) and we lose big time. - Reply to this comment
- If we didn''''t import so much, we wouldn''''t care if nobody buys our exports. We will always have something that isn''''t available anywhere else, so our exports of those items will balance out the essential imports.
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Posted by txgrouch2007 at 07:30 PM : Nov 20, 2008
You can always isolate an economy by erecting trade barriers. It helps for a while. But in the long term (5 or 10 years) it doesnt. If we decide to not buy anything (or just less) from other countries then our prices for those goods will skyrocket as we have to pay US wages for them. Your computer will cost $5000, your knit shirt will cost $50. You wont be able to buy steel (its made in Japan today) or televisions, etc. Dont even think about gas or oil.
I think our only hope is to retool our factories and outproduce those guys. If we earn ten times their salary then we have to make things ten times bigger/better. Otherwise, we are trying to just take our ball and go home but the game has moved to the rest of the world. - Reply to this comment
- then it''''s clear that the price of US goods was too high due to the assinine need of US companies to make a quick profit to "justify" the $multi bn bonuses that the executives awarded themselves
Posted by cause_y at 07:34 PM : Nov 20, 2008
You''re a complete and utter moron, and you have no clue what''s been happening in this country.
Well, except for the outrageous compensation of top executives. But you can hardly say that alone is the sole cause of our current problems. - Reply to this comment
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