Economic Irony.

[jaguar]

Continuing the outsourcing/jobless recovery debate I got a copy of a recent piece of economic analysis today.

It's been noted that prices that manufacturers give to retailers have recently been at best, steady, mostly due to Wallmart syndrome of intense pressure from retailers. This has lead to manufacturers not passing on increased commodity costs from Steel to recent hikes in oil prices. Their response has been to look for other places to cut costs, resulting in slashed hiring rates, not replacing staff that leave and cutting staffing budgets.

Keep it up and it might get cheap enough to afford on unemployment I guess.

[Happy Monkey]

Walmart destroys it's suppliers by requiring them to decrease prices a certain percentage each year no matter what. It's like crack for small companies. They get a huge high the first couple of years from the huge sales, but then they have to strip further and further down until they can no longer afford to supply Walmart. But by that time, they've lost all of their good business practices, and can't make quality products anymore.

But venture capitalists are always ready to help start a new company, so Walmart moves on to the next victim.