Neglecting IPOs and other offerings, which are a tiny bit of the market, the dollar from person X goes to person Y who is selling the stock. Not a penny goes to the company. Do you really understand so little about how the market works?
Did you misspell bond? If so, well, maybe we can forgive you. If you really meant stock, then I think you had better stop digging.
You misunderstood me then. My point was that when you had excess capacity, you don’t invest in more. You sell off, or write off, the excess. Excess labor is the same, really. If you hire enough people for a certain level of sales, and you aren’t going to come anywhere close to it, the people have to go.
It isn’t so easy to add new products. Usually whole industry segments are flat. The company I work for actually had a ton of cash sitting around when the bubble burst, but no where to put it. They bought some companies, with varying results, but a company needs to stay focused on what they do.
IBM DOS? You mean Microsoft DOS, right? IBM PCs never came out with anything but Microsoft DOS. Surely you’ve heard the CP/M story. (CP/M was the main OS for non-Apple home computers.) IBM legitimized the PC field, and made it okay to buy one for the office. Spreadsheets, not invented by Microsoft, helped also. DOS, I assure you, didn’t take tons of capital to create. IBM handing Microsoft the software monopoly for PCs was one of the biggest blunders in business history. MS did a good job capitalizing on it, I agree.
All that other stuff was much later. Windows was not the first PC thing MS did, it was fairly late. I think I actually tried Windows 2 - it was such a piece of junk that I went back to DOS. How did you think Microsoft could afford getting Windows wrong twice? Through revenues from the DOS monopoly, that’s how.
Well then if there is no capital crunch, how is a tax policy that generates more going to help? Especially if it encourages the markets to think the Feds have their heads up their asses. The boom in the '90s got touched off not by raising taxes, or lowering taxes, or by reducing the deficit (which came later) but by the market’s belief that the government had finally gotten its act together.
Some companies are going to win with universal health care, such as car companies that pay for it now. Some companies will lose from global warming, but there will be new companies who can make solar power generators. In 1972 the car companies complained about mileage standards, and then got their lunch eaten by the Japanese. A company can be a buggy whip maker, and complain about change, or Henry Ford, and cash in. I think maybe I believe in capitalism more than you do. 
[QUOTE=Weirddave]
I think what bothers Gonzo is the idea that a poor person may spend 80%, 90% or more of their income on basic necessities while a rich person may spend 20%, 10% or less on those same necessities. Thus in his mind the poor person is contributing more to the economy because his personal cost is greater. What I have not seen is any recognition that 20% of a rich person’s income may be greater than 90% of a poor person’s, meaning that in actuality the rich person is stimulating the economy more, no matter what he does with the other 80% of his income. I also think that there are people here who truly believe, who KNOW, deep down in their hearts, that most rich people keep the bulk of their assets as cash, and late at night they strip naked and roll around in it shouting “WHEEEEE!”, right before masturbating to videos of widows and orphans being evicted from substandard slum housing. These same people usually believe that most rich people are Paris Hilton, thus they don’t work and just waste their life partying and living their lives as idle rich. They are the true believers in class warfare, blinded by jealousy so rich they taste it every second of their lives. It’s a mindset that quite honestly baffles me completely You are well named. However read up on “marginal propensity to consume” and then explain how the rich not spending windfalls like the poor is a figment of my imagination. You sure need some economic information.
Yes, they did. In the beginning, there was MS-DOS and PC-DOS, with PC-DOS being little more than a re-branding of MS-DOS. But later on, in the early 1990s they did diverge, with Microsoft and IBM taking their DOS products down different paths. I recall a number of compatibility issues that had to be dealt with around that time.
IBM continued making PC-DOS until 2000.
No, it wasn’t. None of the major home computers of the time (TRS-80, Apple II, Commodore Amiga, Commodore 64, Atari ST, TI-99/4, etc) ran CP/M (some could run it, but it wasn’t the standard OS). CP/M was always a niche operating system, and never held anything close to a major chunk of market share.
You’re assuming that had IBM kept the ‘software monopoly’ to themselves they would have done what Microsoft managed to do. Given IBM’s dismal history in PC software, that’s quite a stretch. It’s hindsight to say that IBM gave away the store to Microsoft. In fact, maybe if I IBM had hung on to it, they would have bungled it and killed their entire market. In fact, IBM did try to make their own OS - and failed. Remember OS/2?
Wrong again. Microsoft’s ‘core’ product at the start of the 1980’s was MS-BASIC, a language that Bill Gates himself wrote, and which he managed to market to just about every popular home PC around. Microsoft then developed a bunch of very popular software for the Macintosh, like Multiplan and Word. Other than during the very earliest days of the company, MS-DOS never brought in the majority of revenue. By the end of the 1980’s, all of Microsoft’s operating systems AND languages together only accounted for about 45% of revenue.
You mentioned Windows 2. Yes, it was junk. Microsoft didn’t get Windows right until V3.0. But there’s exactly why Microsoft was so successful - it wasn’t because they had a monopoly position on anything. Microsoft was successful because they were dogged. They never stopped improving their products. They kept hammering away at the competition until they beat them. Multiplan, when it first came out, was buggy. They released new versions. But Lotus 1-2-3 was far better. Microsoft then went back to the drawing board, retooled, and came out with Excel, then integrated Word, and eventually destroyed Lotus.
If you think Microsoft’s success was a fait accompli because they had cash, you have to explain how they managed to crush Lotus, when at the time Lotus was huge and had a dominating market share position with 1-2-3.
And anyway, monopolies are no guarantee of ongoing success. Ask IBM, who had a virtual monopoly on the mainframe and minicomputer market in the 1960’s. They made a few mistakes and strategic errors, and got chewed up by DEC and others.
If Microsoft has had a near monopoly on OS’s with Windows, maybe it’s just because windows is pretty darned good. If it stops being darned good, they’ll lose their monopoly. That may even happen yet - Vista was certainly a step in the wrong direction, and the result has been slow sales and an increasing encroachment of Linux on their market share.
Nonsense. You think the market boomed because people went, “Hey look! Government’s good now! Let’s build stuff!”
The boom of the 1990’s has a lot more to do with the rapid rise of globalization and free trade in that decade, coupled with the rise of the internet and the widespread adoption of the computer which drove up efficiency. That, coupled with government that didn’t keep tinkering with the damned economy (Bill Clinton turned out to be far more ‘conservative’ than Bush), the winding down of the cold war with the subsequent business opportunities it brought, the ‘peace dividend’, and a whole host of other positive changes that all happened in the latter half of the 1990’s. And of course, a big part of the ‘boom’ of the 1990’s turned out to be a speculative bubble that we all paid for in the first half of the 2000’s.
What, you mean you’re not going to force them to honor their commitments? Universal Health Care becomes the world’s largest giveaway to the auto companies? I thought you were against corporate fat-cats getting bailed out by the government?
If universal health care comes, and it doesn’t include a mechanism which requires corporations and unions who have huge health care funds to turn those funds over to the government and meet unfunded liabilities they have promised to their workers, it will be the largest corporate giveaway in history. Surely you don’t intend for that to happen, do you?
Oh, and the auto industry’s problems with health care aren’t due to the costs of the current work force or the costs of current agreements - Toyota and Nissan and Honda also cover health care in their American plants. The problem GM and Ford have is that they made outlandish offers to unions in the 1970’s and 1980’s when union power was at its peak, and now all those workers are retiring and want their gold-plated pension and health care benefits. They’d damned well better not get a pass on those commitments and be allowed to turn billions of dollars in liability over to taxpayers.
Right. And if it were profitabe to do so, they’d already be doing it. And if it becomes profitable to do so in the future, they’ll do it without the government telling them to. The notion that government regulation will pay for itself with all these new companies springing up to take advantage is just hogwash. It’s like blowing up a factory and saying you’re creating economic growth because think of all the jobs that will be created rebuilding it!
Interesting take on the situation. Another way of looking at it is this: American car companies were good at making big, powerful, gas guzzling cars. Japanese auto makers were good at making small, fuel efficient cars. Then the government stepped in and decreed that American cars shall now have Japanese car requirements. And lo and behold, the Japanese cars turned out to have an advantage! Who’d have thought it? Early CAFE requirements directly resulted in cheap crappy rattle-trap American cars with floppy frames and thin bodies that rusted out and crappy engines that blew up all the time. It took over a decade for American manufacturers to figure out how to do better, and by then the Japanese had huge market share.
CAFE may be directly responsible for the decline of the American auto industry. That and auto tariffs which for a long time protected American car manufacturers from foreign competition.
No, in your world, the buggy whip maker would have complained to Congress, which would have established the Buggy Whip Protection Act to prevent an ‘American way of life’ from disappearing. The Buggy Whip Maker Lobby, long entrenched and having already bought oodles of politicians, would have waged war against the upstart Henry Ford. They would have pointed out that buggy whip makers are skilled craftsmen, mostly small businesses, often family owned, working in quiet environments. In contrast, Henry Ford was putting people in noisy, dangerous steel factories on assembly lines doing rote work not suited for humans, pulling people away from the ‘traditional’ industries and family businesses and small towns into faceless armies of laborers. Something must be done! And these cars they are putting out emit noxious fumes, scare horses, and are a menace to safety.
Then they would have pushed politicians into enacting road safety laws that discriminated against automobiles, forced onerous regulations on them in the name of the public good, and forced poor Henry out of business.
I think the bigger problem is that this country has to start making more things the world wants to buy. Just employing longshoremen who unload all the stuff we inport from other countries is not going to do the trick. Its pretty clear we aren’t going to be exporting a lot of clothing or plastic toys anytime soon and you can only thwart market forces for so long before it catches up to you. Corporations and the investor class are just market participants who will act in their own best interests and we should treat them accordingly.
You called it horseshit, not me.
The poor are capital constrained in a way that the wealthy are not. This might be a matter of differences between how we define poor and wealthy.
Why? How? Are we going to force the world to buy things at prices consummate with our labor costs? How do we pull off that trick? Unless you think there is some innate quality that Americans have in manufacture that other people don’t.
Bit more to it than that…did you read all of what I wrote? However, even if we do the cartoon simplified version, how do you propose we change that? Force Americans to buy 'merican goods only? Ramp up import costs and tariffs? Force US companies to…what? Keep all manufacturing here in the US? Not allow them to import goods or services from abroad? What do you propose we change?
Why is it vital that WE manufacture those things? Why will it catch up to us? We live in a POST-industrial age. Maybe we should start thinking about non-manufacturing products and services instead of trying to compete in a market we obviously CAN’T compete in with our labor costs? In fact…lo and behold! That is exactly what we ARE doing!
Which is what they ARE doing. Unless of course you decide to inject artificial ‘levelers’. How do you propose we level the playing field so that US companies can compete in manufacturing with countries like China and India who’s labor costs are a lot lower than ours? What specifics do you propose to enable that to happen.
-XT
Like tax cuts that are only possible by increasing the deficit? Is that the kind of "artificial ‘leveler’ " you are talking about?
Personally, I kind of like the fact that we’ve gotten wealthy enough that our citizens don’t have to do mindless labor on assembly lines. If we’re rich enough to get other people to make our things while we focus on higher-level pursuits, fantastic.
I’m also happy that in outsourcing our low-skilled, low-paid labor elsewhere, we help lift others out of grinding poverty and subsistence farming and give them the chance too build the kind of infrastructure that has gotten us the standard of living we enjoy.
Win-win. That’s how free trade usually works.
But we haven’t; now they do mindless work stocking shelves at Wal-Mart. They were better off making widgets.
Well, its a matter of how productive we are. We will never make plastic widgets or even iphones (they are made in China), but we do have comparative advantages in other areas. Unfortunately they are not in areas that suck up huge amounts of labor and you wonder what people will be doing to earn a living going forward.
I was hoping you could provide the answer to that one.
I think we are in agreement in some respects but there is a transition issue and you have to wonder how many more real estate agents and mortgage brokers this economy is going to be able to absorb.
I think we might be talking past on another on this point. I am just saying that we don’t need to deify corporations and do everything in our power to make life easier for them if they are not mkig life better for human beings.
Are you under the impression that everyone is a doctor or lawyer now? What high level pursuits do you think have replaced all that mindless work?
Free trade is not win/win. Free trade between two parties increases the combined welfare of both parties but there is no guarantee that both parties benefit from free trade.
No idea where this came from. It really has nothing to do with what I was saying.
Like the one’s I described. Tariffs. Extra import duties. Trade barriers. Whatever. There is no way the US can compete in manufacturing against countries who have very cheap labor forces unless we either A) Allow manufacturing companies to get rid of unions and cut workers salaries/benefits to the bone so that our labor costs are the same as India or China’s or B) Erect artificial measures to level the playing field so that foreign goods cost as much as US goods. I assume that you would not go for A…so that leaves B as the only alternative I can see. Do you have others?
Of course the right answer is C) Don’t play that stupid game anymore and move on. We can’t compete in manufacturing and wishing we could isn’t going to make it so.
Since WalMart only employs like a million workers (this figure would include executive types as well as worker bees btw) world wide…what do the rest do? Your hyperbole only makes you look foolish…JMHO of course.
-XT
I’ll be brief, to not hijack any further. Don’t you think IBM could have done better if they controlled the software? Maybe not a monopoly, but a lot more control? They did know how to be a monopoly quite well, actually, and they lost out not because they screwed up mainframes, but because technology moved past mainframes. If MS loses out it won’t be because they’ll lose out on PCs, but because portable devices take most of the market, and the PC market gets stagnant. I’m a UNIX person (and Multics before it) but much as I’d like to believe Linux will get market share, it’s not going to happen - not for the big home and business desktop market.
I’ve used MS BASIC before there were PCs, and I mentioned it elsewhere. But just perhaps some of the success of the MS apps comes from their old habit of using hidden system calls and such. If you’ve read about the antitrust case, you know they’ve crippled other people’s code.
I’m not belittling their coding ability - at least in the early days. There is a nice anecdote in a book on the case about how when they worked on what would become NT they found a chunk of code they were able to chop in less than half, keeping functionality and making it faster. The IBM people went nuts, because all their metrics were on lines of code, and they didn’t know how to handle the case where negative lines of code was good.
I’ve never used OS2, but I know people who loved it. Was its failure purely technological, or did MS have the monopolistic advantage back then.
Ah, but what were the margins on MS-DOS, and how did they use it to leverage their PC tools? You can hardly count the impact of Windows Media Player today by measuring revenue.
Wow, improving products with new releases. Aren’t we lucky that MS invented that. We both know that Vista will be successful no matter how bad it is, because people will have to upgrade eventually. I started out in the Bell System, and I know from talking to the old consumer products people what they got away with from being a monopoly.
No, they gave business a stable environment. There was prosperity even outside of the bubble. And the bubble, as I’ve said, is a great example of how dumping more investment dollars on business doesn’t lead to a better climate in the long run.
It puts them on equal footing with foreign companies who don’t have to pay healthcare, and it puts companies who pay for healthcare on equal footing with those who don’t. The auto companies did screw it up in the early '50s when they negotiated health care with the unions, instead of pushing government for some sort of UHC. It was fine for decades, but then made them uncompetitive - not the only reason, of course.
I’m not aware of reserves. But I do agree that one way or another corporations will have to be taxed to pay for it - but this might result for more taxes for companies who don’t offer it now, and less for those who do, to even the playing field.
But I don’t buy the car companies arguments that health care costs are the only reason they’re losing.
Who’s talking about regulations? How about incentives, like we’re going to have in California? There isn’t the volume yet to advance the technology, and the volume won’t come because solar power generation isn’t a clear win yet, because of the cost of the equipment. Either it will be a fad, like the Prius, or government can help private industry out by making them more attractive. The market can easily get to local maxima (like SUVs) and government can help move it to more global maxima before some disaster strikes.
[quote]
Interesting take on the situation. Another way of looking at it is this: American car companies were good at making big, powerful, gas guzzling cars. Japanese auto makers were good at making small, fuel efficient cars. Then the government stepped in and decreed that American cars shall now have Japanese car requirements. And lo and behold, the Japanese cars turned out to have an advantage! Who’d have thought it? Early CAFE requirements directly resulted in cheap crappy rattle-trap American cars with floppy frames and thin bodies that rusted out and crappy engines that blew up all the time. It took over a decade for American manufacturers to figure out how to do better, and by then the Japanese had huge market share.
[quote]
I’m old enough to remember 30 cents a gallon gas, and the shock when it went to a buck. Smaller cars didn’t begin in '73 - I bought a Pinto before the '73 crisis (and liked it quite a bit.) The move to Japanese cars was a result of gas prices, not anything that government did. I can’t blame the car companies for not figuring this out - back then. This is a great example of local maxima. Margins on gas guzzlers are bigger, so the effort goes into making and selling more, and consumption goes up, and all is fine - until the shortage (from China and India now) causes gas prices to spike and SUV consumption to go into the crapper. If the government had increased mileage requirements before, there would be more options. If the government told the car companies which cars to design, I’d be with you in opposing it, but saying that we need to reduce oil consumption for national security lets them figure out how to do it, and lets them compete in finding the best way. Even Bush said we’ve got to get the oil monkey off our backs, but he doesn’t want to inconvenience Detroit in any way, perhaps thinking they aren’t up to the job. Maybe he’s right, in which case tough on Detroit.
I don’t think CAFE had much to do with it, but I’d buy that tariffs did.
Who exactly is it I’m trying to protect again? Ford paid his workers very well, I guess he was a socialist. The climate change deniers and environmental regulation haters are doing it because it supposedly will hurt American business. I’m saying it will no doubt hurt the companies who can’t adapt, but will build bigger and better companies with innovations. Government should be setting big goals, like reduction of greenhouse gases, and let industry figure out how to meet them the best.
Let’s say government in 1890 had to deal with the horse shit crisis. Setting goals for the reduction might have led to better horse diapers - but the people who built cars, and got the horse shit reduction credit, would have won. The global warming denier side would have fought against any such credits, not wanting to hurt the stable or street cleaning industries. Today we’d no doubt have very efficient horse shit incinerators - but still be riding horses.
Say “Do you want fries with that?” of course. People laid off from manufacturing jobs do get work, but usually at lower wages. Yeah, I know, they should have gone to college so it’s their own fault.
It’s not just widget production that is outsourced. Service jobs including high -skilled computer programming, software development, and medical technicians are leaving the country, as well. The middle class is going to feel the pinch, and there doesn’t seem to be a plan to address the problem American workers face.
The massive pay gap between U.S. workers and workers abroad will keep jobs flowing off shore, but the widget makers in China and the service workers in India are not living any better than displaced American workers. Why doesn’t the U.S. fight to improved global labor practices to lift up the working poor and decrease the wage gap? The massive monetary gains from the global free market only profit corporations. There is no shared prosperity. It is in the multinational corporations’ best interest to suppress workers rights and benefits across the globe and the government is ignoring and encouraging these practices.
At the very least, there could be a response to displaced workers and declining wages with increased unemployment benefits, universal health care, subsidize housing and child care, etc. This administration’s policy of tax cuts for the wealthiest Americans, endless war spending, the push to privatize all public services, including the public schools, and a total disregard towards the economic impact of globalization on American workers is incompetent and inhumane.
And stooping to personal insults in GD makes you look like you are conceding the point.
Since neither of us has ‘Moderator’ tagged under our name I’ll give you my two cents and then let the mods decide (if you thought it WAS an insult you should have tagged my post for THEM to review).
I said you looked foolish. This is different from me calling you a fool. The second is a personal insult. The first is an observation…and to my mind a quite mild one.
As with your misjudgment that it is a personal insult, you are also off base that I’m conceding anything there. I think it’s a silly argument on your part and you look silly by making it. You claim ‘But we haven’t; now they do mindless work stocking shelves at Wal-Mart.’ Fine. Do you have a cite to back it up? It seems unlikely that the majority of out of work manufacturers go to work for WalMart…or sling fries.
Even if the DO…I have yet to hear what your alternative is. It’s one thing to say ‘Oh, it’s bad that textile manufactures have moved production to China and India or the Pacific Rim! What will happen to the poor textile workers? Think of the children!’ Blah blah blah. It’s another to to DO something about that. Well…what would you have us do about it? I don’t see any palatable alternatives myself…so, how about you?
-XT