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Politics Where we learn not to think less of others who don't share our views |
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#47 |
“Hypocrisy: prejudice with a halo”
Join Date: Mar 2007
Location: Savannah, Georgia
Posts: 21,393
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#49 |
Read? I only know how to write.
Join Date: Jan 2001
Posts: 11,933
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I wish I did. Because GM top management and the BoDs were so corrupt, then Rick Wagoner has zero chance of being fired. Finally Obama did what was that obvious and necessary.
A resulting and repeated top management shuffles have resulted in almost no information. Did the car guys finally take charge? Did a corporate war recently end? Not obvious. Well, the Chevy Volt even could not work a few years ago when they tried to demonstrate it to a PBS show. The Volt was supposed to be out already. Something happened. The Chevy Volt is now scheduled for sale at the end of 2010. Was it delayed because car guys finally got control of the car? Are now trying to fix fundamental defects? Or do defect exist because bean counters have still subverted reliability? I cannot learn anything. We can suspect the Volt is delayed to make something better. Just not known is why. Unknown who is running GM. They are busy claiming profits and pay backs that sound so much like the money games of earlier years. Is GM really making profits? Even that is not obvious. Especially when GM (apparently) need not release detailed information. Alan Mullaly said something stunning in a recent meeting I attended. All Fords will have four cylinder options by next year. That implies all Fords will have 70 HP/liter engines in all cars. All Ford cars will have as much horsepower as mid 1970 American V-8 cars. Ford is clearly innovating. Whereas I still would not buy a Ford. Anyone who is buying an American car should only consider Fords. Marchionne has been making statements about Chrysler. Pushing the new Jeep. Does it still have a suspension and steering system that has always been defined as "barbaric"? Unknown if Chrysler’s car guys are finally designing cars. The new Jeep might be an indicator. Meanwhile, Chrysler will remain a dog until it start selling more reliable and superior engineered Fiats. That is still years away. And then we will see whether Marchionne's magic worked. We know Ford has long been on the right track. Especially interesting is an apparent productive chemistry between Ford and Mullaly. There is very good reason to suspect Chrysler dealerships will have products to sell in a few years. GM remains a complete unknown. The battle between car guys and bean counters may be in full war mode. Or GM may be slowly converted from bean counter to car guy mentality. Almost complete silence says nothing useful. |
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#50 |
Person who doesn't update the user title
Join Date: Jul 2002
Location: Southern California
Posts: 6,674
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Michael Medved has an interesting comment about GM's lack of innovation, attributing it to their being in chronic fear of being hit with a major antitrust suit. Senior management, he says, was supposed to let up on competitiveness to keep GM market share below fifty percent, typically about forty-five, and thus stay below the trustbuster radar. This meant, don't claw after that next half percent of market share by any of the competitive means, such as marketing ingenuity, price wars, or technical innovation. The eventual result was technical sclerosis for several decades and then slumping product quality, as everybody in the firm found other concerns than customer service, maintaining customer loyalty by making such things actually palpably beneficial, or really anything that makes a company a good one. Contrast that kind of attitude with, say, what goes on at your local Trader Joe's.
Makes you rethink the whole antitrust idea -- after all, is not the free market itself firmly and naturally anti-monopoly, as trust busting is alleged to be? Why, then, should it be required to bring suit against a business simply because it is successful in a very large way? What that really is is a pointer that says There's a really big market over here. Wanna get into it? Competitors barrel-roll in, many with what they hope is improved or just plain better technology than the pioneer outfit is using, to fill this need that has come up. Five Big Lies About American Business is one heckuva book.
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Wanna stop school shootings? End Gun-Free Zones, of course. Last edited by Urbane Guerrilla; 05-27-2010 at 07:53 PM. |
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#51 | |||
Doctor Wtf
Join Date: Oct 2007
Location: Badelaide, Baustralia
Posts: 12,861
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Quote:
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Now you might reply that ... Quote:
That said, if a company really did back off from improving their products out of fear of antitrust action, something has gone very wrong. The market won't solve all our problems, but neither will the government.
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Shut up and hug. MoreThanPretty, Nov 5, 2008. Just because I'm nominally polite, does not make me a pussy. Sundae Girl. |
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#52 | |
Read? I only know how to write.
Join Date: Jan 2001
Posts: 11,933
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Quote:
Economies of scale are a myth. Economies of scale only exist in smaller organizations. Why did GM products cost more to build than Mercedes? Because GM's scale made economies impossible. If economies of scale existed, then Citigroup was the world's most efficient bank. Opposite was true because, again, that 'economies of scale' is only an economist's myth. As 1980 Ford and IBM both demonstrated, 'economies' only existed after both companies massively downsized. Fiorina was so stupid in the HP Compaq merger meeting. She also repeated that economies of scale myth - claiming HP would be more profitable because they would be #1 in this business and #2 in that market. Reality. They had to throw her out to save HP. She promoted an 'economies of scale' myth because that is what they teach in business school. Fortunately, they threw her out before she did too much damage. A company becomes #1 in the industry because they are innovative - first have 'economies'. But economists foolishly think if A results in B, then B must also result in B. Defective logic. If 'economies' result from being #1, then #1 must result in 'economies"? Total bullshit. When a company is profitable, then it can become #1. If a company is #1, it does not automatically become profitable. Did the merger of Sears and Kmart make them more profitable? Of course not. Mazda could sell less than 13,000 Myatas and be profitable. Due to 'economies of scale', GM could not be profitable on any model if selling less than 50,000. GM products always needed more parts to do same. Scale increased costs. Due to the 'economies of scale' myth, GM parts also cost more to build. Auto companies would not innovate because management could not see an innovation if they sucked it up their nose. Then, as taught in the business schools, they invented excused to blame others. What made auto companies profitable and efficient? Downsizing. "Economies of smaller scale". Once a company achieves a certain size, then "negative economies" are created with increased scale. |
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#53 |
Doctor Wtf
Join Date: Oct 2007
Location: Badelaide, Baustralia
Posts: 12,861
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So ... will UG change his position and agree with me, or hold his ground and agree with TW? Toughie ...
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Shut up and hug. MoreThanPretty, Nov 5, 2008. Just because I'm nominally polite, does not make me a pussy. Sundae Girl. |
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#54 |
Why, you're a regular Alfred E Einstein, ain't ya?
Join Date: Jun 2006
Posts: 21,206
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I don't know, but I love this intelligent discourse. Did that sound dirty?
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A word to the wise ain't necessary - it's the stupid ones who need the advice. --Bill Cosby |
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#55 | |||
barely disguised asshole, keeper of all that is holy.
Join Date: Nov 2007
Posts: 23,401
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Quote:
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"like strapping a pillow on a bull in a china shop" Bullitt |
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#56 |
Read? I only know how to write.
Join Date: Jan 2001
Posts: 11,933
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Once an employee retires, then that employee is no longer an expense to the company. Of course, that means the company is honest. Every day that employee works, the company puts a little more money in his pension fund. When the employee retires, only the pension fund - not the company - pays that retired employee.
But GM mortgaged everything to make management look good. GM stopped funding the pension fund decades ago so that the world's worse and most expensive cars would show a profit in the 1990s and 2000s. Why were pensions a problem for GM? In a world where bean counters screw everyone, the unfunded pension fund then gets blamed on union employees. When tens of $billions are owed to the pension fund, then GM knows a majority of Americans will blame the unions rather than blame what is taught in the business schools. GM did what any good business school graduate would do. Mortgage the company and then blame someone else. Union costs were never a problem. Lying bean counters who stop funding pension were the problem. GM owed tens of $billions in unfunded pension obligations. Business school graduates who stifled innovation to make short term profits – that is GM's major problem. By shorting those $billions, GM could claim $millions of annual profits. Claim profits on cars that (if the bean counters were honest) should have forced GM into bankruptcy in 1991. Then when the spread sheets could not longer hide the truth, 'blame the unions' always works on an American public fed only by sound bytes. Unions never created any of this. Once a bean counter is taught that “the purpose of a company is profits”, then his whole life purpose is similar to a mafia don. Do anything to make a profit. Unions did not create a problem that has existed in GM for more than 30 years. So who suffered because top management lied? Everyone except top GM management. GM's pension problems are directly traceable to spread sheet spin. Other companies simply meet their pension obligations. GM stopped funding the pension funds in 1991 to avoid bankruptcy - to protect top management jobs and bonuses. 18 years later, the bills came due. So we should blame the unions? That is what GM did. GM called it legacy costs rather than call it by its real name - bean counter fraud. Last edited by tw; 05-29-2010 at 02:01 AM. |
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#57 |
barely disguised asshole, keeper of all that is holy.
Join Date: Nov 2007
Posts: 23,401
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So simply stated, in one word, what you are saying is that the pensions & benefits for retirees are NOT a cost to a company?
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"like strapping a pillow on a bull in a china shop" Bullitt |
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#58 | |
Read? I only know how to write.
Join Date: Jan 2001
Posts: 11,933
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Quote:
But when bean counters do their magic, then somehow those costs get mortgaged. Future generations must pay for that employee. Using propaganda, GM called that a legacy cost. Honda and Toyota have the same retired employees without any legacy costs. It's called honesty. |
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#59 |
barely disguised asshole, keeper of all that is holy.
Join Date: Nov 2007
Posts: 23,401
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It was a yes or no question. From your answer, I'm forced to assume a yes answer. However, I find it very difficult to believe.
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"like strapping a pillow on a bull in a china shop" Bullitt |
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#60 |
Read? I only know how to write.
Join Date: Jan 2001
Posts: 11,933
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Pension and benefits are a cost to the company when the worker is working. Pension and benefits should not be a cost to the company when a worker is retires. So your answer is both "yes" and "no".
When a company is mortgaging its future to protect bean counter management, then pension and benefits remain a cost to the company years later. No 70 Horsepower per liter engines in all cars for 20 years. Cars that still required wheel alignment. Examples that say GM had no interest in honest accounting. Any expense that remains unrealized for years is a profit to the company today. So now the answer is "yes". GM retired employees remain an expense to GM. GM did what was also situation normal on Wall Street. You asked a question that is intentionally confusing. How many more "yes" and "nos" apply? Welcome to what was made acceptable in the 'new American finance' standards. Welcome to why finance people must be so heavily regulated. Welcome to the resulting melt down that happened 17 years later because GM management refused to address their management problems in 1991. GM invented legacy costs without admitting to mafioso objectives. Screw the product; only reap profits. Those who only want “yes and no” answers were easily sold GM lies - ie legacy costs. GM management got even more bonuses for mortgaging America's future for personal gain. More “yes and no” answers are for those who ignore details of reality. Answer to your question are multiple "yes" and "no". |
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