Hmm OT & all but what the hell.

Chuck you're only too happy to see the free market at work when your
local marina has to reduce prices in response to the new bloke down the
bay, so why the difference???

It's about loyalty and community.

Typical example:

Gould's widget company has produced high quality aluminum widgets in the US for
50 years. We employ 10,000 US workers, in 5 regional plants. The biggest market
for our product is in the US, and we are located here because the laws of the
United States favor and support organizing corporations. The physical,
political and economic infrastructure of the US has allowed us to prosper and
grow to be the 3rd biggest aluminum widget company in the world.

Profits are $100mm a year. As CEO, the board of directors pays me $35mm in
salary, and the remaining $65mm is distributed to shareholders as dividends.
(oh, btw, I'm the largest shareholder).

Unfortunately, the market has matured for widgets. The industry has peaked, and
analysts all conclude that the future market for aluminum widgets will be
smaller than the current.

We may have to cut prices in order to compete.

How do we accomplish this?
We certainly won't start with the CEO salary. Good grief, how's a guy supposed
to get by on much less than $3mm a month? We don't dare cut dividends, that
will reduce the stock price, and who's going to be the biggest loser in that
scenario? (The biggest stockholder, of course)

With payroll taxes and fringe benefits, the average cost for each of the 10,000
workers is $40,000 a year. (Rookies get far less, supervisors far more, but
that's the average). My largest annual expense? Payroll. $400mm.

In the midst of the economic quandry, an opportunity arises. We can move the
widget plants to Guatemala. The government of Guatemala will build us a
factory, for free. We will pay no taxes for
the first 10 years. The workforce is a problem; it is not as technically
sophisticated nor as educated as US workers. We will need to hire 15,000
Guatemaleans to produce the same output
we achieved with 10,000 Americans.

The Guatemalean workers will cost $7000 US apiece every year. Payroll shrinks
from
$400mm to $105mm. The workers laid off in the US become the taxpayers' problem
to support with unemployment benefits, welfare, vocational retraining, etc.
(Yes, I did pay a tiny portion of the total taxes used to alleviate the
distress of the unemployed workers)

The shrinking market for widgets forces us to reduce prices to a point where,
had we remained in the US, profits would have fallen from $100mm a year to only
$75mm.
However, by removing the manufacturing operation to Guatemala and saving $295mm
a year in payroll, profits actually increase to $370mm! The largest
stockholders (the folks on the board of directors) are ecstatic. They raise my
salary to $100mm, and dividends are several times what they had ever been in
the past. The stock price is whoring, er, I mean, soaring.

What am I going to do with all the extra money? I can't possibly begin to spend
it all, so maybe I'll do what the conservative economists predict and invest in
yet another industry.

(One thing for sure, I won't invest it in any industry in the US. I've already
learned that it's cheaper to pay a worker a few hundred a month than a few
thousand.)

It's about loyalty and community.

But I don't expect most people to agree.
In real life, (where I don't run a widget company), I have come to believe that
it isn't always all about money all the time.
You have to watch out for us crazy-assed liberals. :-)

On 07 Sep 2003 05:24:10 GMT, (Gould 0738) wrote:

When I say that amortization is "deceptively" simple, it is because it is
very
much a moving target: the proportion of interest to principal changes with
each
monthly payment (assuming a level payment). And the relationship between the
two components changes disproportionately with changes in

interest rate.

Accounting for amortizaton is not deceptive at all, unless a payment includes
escrow or reserve fees, choke and croak insurance, or etc. Pure P&I is simple.

For a monthly period:
1. APR divided by 12.

I suspect that you have an incorrect understanding of the term, "APR."

2. factor from step 1 multiplied against outstanding principal balance

3. result of step two recorded as "interest income"

4. balance of payment received, after removal of interest income, deducted from
outstanding principal balance.

Throwing in balloon payments, etc, does kink the whole system. My assertions in
this thread apply to loans that amortize to $0 at the end of a scheduled
contract period.

Again: what I was reacting and responding to was your statement that "your
monthly payment includes principal as well as interest, and the principal
portion of the payment doesn't increase, only the interest." That statement, as
written, is incorrect, as I tried to show.

And when I say that amortization is "deceptively simple" I mean that the
relationships between principal and interest payments and comparisons of loans
at different interest rates is not at all linear. When comparing two loans,
it's not as simple as saying, "7% is 40% more expensive than 5%"--because it's
not.

Joe Parsons

On Sun, 7 Sep 2003 09:25:28 -0700, "jps" wrote:

"JohnH" wrote in message
.. .

And I used to think lead was dense. Jipsy, in your example, will the
output per
hour change? No? Then the productivity did not increase. The production
increased.

If you're measuring the output of one worker who is paid for 40 hours but
puts in 60, you don't reduce his hourly pay, you increase his productivity
per 40 hours of pay.

You'd think a math teacher would have a little better grasp.

No spin my ass.

Hey Jips, go back and read that post. If you can make heads or tails of what it
says, please translate it for me.

Productivity is a rate, usually represented as a fraction, e.g. 37 widgets/one
hour. Productivity is not measured by reductions or increases in hourly pay.

John
On the 'Poco Loco' out of Deale, MD

"JohnH" wrote in message
...

Productivity is a rate, usually represented as a fraction, e.g. 37
widgets/one
hour. Productivity is not measured by reductions or increases in hourly
pay.

What about database entry? Is that a widget too? Is productivity based
only upon manufacturing?

"bb" wrote in message
...
On Sun, 07 Sep 2003 03:33:09 GMT, "NOYB" wrote:

My house's appraised value is up almost 50%
since Jan. '01. That's nuts.

My county appraisal went up over 40% last year.

The effect of these sharply escalating prices is to make one a captive
of the house they currently own. If I sell my house, and buy a house
of equal value, in the same city, my taxes will go up by about 300%.
I'm fortunate that I live in a house I don't mind staying in, and that
I happen to own two houses in the same neighborhood, but the situation
is rediculous.

Is it really fair that the person who buys the house next door to me
pays 300% of the taxes I pay, and receives the same services for it?

"Save our homes" is a good policy. Retirees that have lived here for 15
years couldn't afford the property taxes if we didn't have it.

"Gould 0738" wrote in message
...
My house's appraised value is up almost 50%
since Jan. '01. That's nuts.

My county appraisal went up over 40% last year.

Many people feel that state and local taxes are rising faster than federal
taxes are falling.

Floridians don't feel that way...since we have no state income tax.

"jps" wrote in message
...
"JohnH" wrote in message
...

Productivity is a rate, usually represented as a fraction, e.g. 37
widgets/one
hour. Productivity is not measured by reductions or increases in hourly
pay.

What about database entry? Is that a widget too? Is productivity based
only upon manufacturing?

Productivity is measured as Gross Domestic Product adjusted for inflation
divided by the total number of hours worked.

If an hourly worker is working more than 40 hours in a week, then those
additional hours are being reported...and they would *decrease* productivity
if GDP stayed the same. However, productivity is *increasing*...so your
theory is flat-out wrong.

"NOYB" wrote in message
m...

"jps" wrote in message
...
"JohnH" wrote in message
...

Productivity is a rate, usually represented as a fraction, e.g. 37
widgets/one
hour. Productivity is not measured by reductions or increases in
hourly
pay.

What about database entry? Is that a widget too? Is productivity based
only upon manufacturing?

Productivity is measured as Gross Domestic Product adjusted for inflation
divided by the total number of hours worked.

If an hourly worker is working more than 40 hours in a week, then those
additional hours are being reported...and they would *decrease*
productivity
if GDP stayed the same. However, productivity is *increasing*...so your
theory is flat-out wrong.

Jesus ****ing Christ!!! Try to follow along here doc. If a 40 hour worker
puts in additional time but the company doesn't pay for it, they don't
report the worker having worked 50 or 60 hours.

Everyone here seems to think that productivity only involved widgets. What
about programmers? They don't produce widgets, they produce code that gets
paid for when it's delivered. If workers are putting in 60 hours a week on
a 40 hour a week salary, the company they work for is still going to report
a 40 hour week, no?

That'd net out to a productivity gain.

So tell me how my theory is wrong?

"del cecchi" wrote in message
...

This undereporting would have to be pervasive across
the economy but undetected by anyone. It would have to be far more than
a few people allegedly staying late at walmart.

Whether or not you think it's happening, it is. And not just at Walmart.
It's happening in every sector of the economy, including mine, which is high
tech computer related.

"NOYB" wrote in message
m...

"jps" wrote in message
...
"JohnH" wrote in message
...

Productivity is a rate, usually represented as a fraction, e.g. 37
widgets/one
hour. Productivity is not measured by reductions or increases in
hourly
pay.

What about database entry? Is that a widget too? Is productivity based
only upon manufacturing?

Productivity is measured as Gross Domestic Product adjusted for inflation
divided by the total number of hours worked.

If an hourly worker is working more than 40 hours in a week, then those
additional hours are being reported...and they would *decrease*
productivity
if GDP stayed the same. However, productivity is *increasing*...so your
theory is flat-out wrong.

My engineering group consists of salaried exempt employees who don't report
actual hours worked. As reductions in workforce occur the remaining members
pick up the slack by working more hours. These extra hours are not
accounted for. jps is correct for this rather common circumstance.

-rick-