I actually should have rhetorically asked "When's the last time you saw any technology product with a Made in India label on it?" I'm pretty sure that most nations in the world can produce world-class manhole covers. But I'm equally sure that not every nation in the world can produce world-class miniaturized electronics.
And my original comment was in response to the original post's mention of "moving assembly from China." Not sure where else the work could be done with high quality, with the legendary flexibility of Chinese assembly lines, and with low enough cost. Unless, of course, the work is done by (low maintenance) robots.
Sure the extra money the companies make often goes into a bank, but that isn’t much different from printing money. If you believe supply side is important, QE is for you - but the kind of right wingers who support tax cuts for businesses don’t like printing money, but both go into banks, and into—— well sometimes into people’s pockets, more likely into accelerated asset prices.
There is one important difference between real savings in the bank (whether from individuals or companies) vs just printed money from the Federal Reserve. Without printed money, the very fact that you can get a loan to start your business means that somewhere out there, someone must be saving. i.e. someone must have surplus funds. i.e. a potential customer for new businesses. Surplus funds serve as a market signal to open new businesses. With printed money it is sending a false signal to Entrepreneurs that people are flush, and to open new businesses, but of course people aren't flush, so the businesses can only either close or displace other businesses, and on net the economy doesn't grow.
The right don't like money printing because it sends false market signals, the left don't like it because the resulting inflation hurts the poor the most, I think only bankers like it, and politicians who hope against hope that monetary policy will save them from making hard fiscal decisions.
You obviously ignored the second paragraph in which you quoted me. You tried to assume a single commodity market with simple math and then felicitously assume away reality. A recession is a symptom not an economic shock. You can't just plop your fictitious economy into a recession and assume the result as fact. The thing about dealing with simple math you wanted to use is that you can only deal in a single snapshot in time. A free market will maintain equilibrium indefinitely until it is impacted by an economic shock. The topic of this article is an example of such an economic shock. A recession is not an economic shock, it's a result of an economic shock, a symptom.
In your last post I quoted, you make an erroneous statement about supply side vs demand side incentives (which would also be economic shocks) and then fail miserably trying to justify your point of view. "Give people more money and they buy", what do they buy and exactly how is that materially different than what the companies (you obviously hate) buy? "Give companies more tax cuts on profits"? Profits are not taxed, Income before interest and taxes are what is taxed. Profit/loss is what is left over after subtracting all expenses including interest and taxes from income. Obviously companies are irrational and only "hoard or at best make often stupid investments" unlike people who buy (what do they buy again?).
I'd continue but your last paragraph jumps around so incoherently It would be a waste of my time trying to parse your delusions and I have to go do that thing you clearly hate, try to make a profit.
-PopinFRESH
P.S. I love the lead in, obviously you know more than those stupid economists who write text books.
To the latter part. Yes I do. My degree is mathematics and engineering. Economics is a social science. But econ 101 is not real economics anyway.
To the personal attack - I don't hate large companies, I love Apple, however I don't believe in supply side. I've also owned a company albeit a small one.
As for your statement that profits are not taxed but "income before interest and taxes" are taxed. That's both tautological and wrong. Clearly you are not taxed after tax. And income is not taxed, profits are. Otherwise companies making a loss would be taxed.
My main point was simple:
1) companies don't react to wage cuts by hiring people so standard econ 101 is incorrect.
2) there are feedbacks in mass economies, where workers are consumers, which would in fact exacerbate recessions if everybody believed econ 101 and took a wage cut.
3) there are bigger gains to the economy from workers getting wage increases and tax cuts than companies getting tax cuts.
4) not paying taxes - cf Apples effective rate - doesn't guarantee investment.
5) banks are not very good at lending these days, when they have surplus capital instead of funding businesses they tend to fund house and other asset bubbles.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
To the latter part. Yes I do. My degree is mathematics and engineering. Economics is a social science. But econ 101 is not real economics anyway.
To the personal attack - I don't hate large companies, I love Apple, however I don't believe in supply side. I've also owned a company albeit a small one.
As for your statement that profits are not taxed but "income before interest and taxes" are taxed. That's both tautological and wrong. Clearly you are not taxed after tax. And income is not taxed, profits are. Otherwise companies making a loss would be taxed.
I think I can see why the owning of a company is past tense for you. Companies are taxed on Earnings Before Taxes also known as EBT. Depending on investments a company may have taxable interest (if they have earnings from interest that are greater than their interest expense). A loss is simply negative earnings and is calculated just as you would any other income statement. The amount of the loss is able to be applied to the previous two years tax burden or carried forward up to twenty years. I've linked what Apples income statement looks like so you can have a better idea of how things are actually calculated. Being that you study math it should be trivial for you to figure out. Again, you are not taxed on profits.
1) companies don't react to wage cuts by hiring people so standard econ 101 is incorrect.
2) there are feedbacks in mass economies, where workers are consumers, which would in fact exacerbate recessions if everybody believed econ 101 and took a wage cut.
3) there are bigger gains to the economy from workers getting wage increases and tax cuts than companies getting tax cuts.
4) not paying taxes - cf Apples effective rate - doesn't guarantee investment.
5) banks are not very good at lending these days, when they have surplus capital instead of funding businesses they tend to fund house and other asset bubbles.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
1) "standard econ 101" doesn't say anything like what you are implying. Companies will hire labor based on price and quantity needed. A rational company will produce a product where it's marginal cost equals it marginal revenue. This is the point where profits are maximized. This does not mean that if the price of labor goes down that the company will hire more people than they need. However since labor is a variable input, a decrease in the price of labor will shift the marginal cost curve which will increase the quantity supplied. Conversely an increase in the price of labor will decrease the quantity supplied.
2) Again, you are trying to apply a static model to all other variables and then looking at labor over time.
3) Please provide an economic model that demonstrates this.
4) I'm not sure what you are talking about here?
5) Care to provide documentation that shows what loans banks are making? Besides pure conjecture.
I think I can see why the owning of a company is past tense for you. Companies are taxed on Earnings Before Taxes also known as EBT. Depending on investments a company may have taxable interest (if they have earnings from interest that are greater than their interest expense). A loss is simply negative earnings and is calculated just as you would any other income statement. The amount of the loss is able to be applied to the previous two years tax burden or carried forward up to twenty years. I've linked what Apples income statement looks like so you can have a better idea of how things are actually calculated. Being that you study math it should be trivial for you to figure out. Again, you are not taxed on profits.
1) "standard econ 101" doesn't say anything like what you are implying. Companies will hire labor based on price and quantity needed. A rational company will produce a product where it's marginal cost equals it marginal revenue. This is the point where profits are maximized. This does not mean that if the price of labor goes down that the company will hire more people than they need. However since labor is a variable input, a decrease in the price of labor will shift the marginal cost curve which will increase the quantity supplied. Conversely an increase in the price of labor will decrease the quantity supplied.
2) Again, you are trying to apply a static model to all other variables and then looking at labor over time.
3) Please provide an economic model that demonstrates this.
4) I'm not sure what you are talking about here?
5) Care to provide documentation that shows what loans banks are making? Besides pure conjecture.
-PopinFRESH
1) That is merely restating your original simple graph.
2) No, my system is definitely dynamic. I am treating workers as consumers. Your simple My First Economic Graph doesn’t do that.
3) The economic system in America from 1945-1980 demonstrates this. Workers got more wages, spent more,the multipliers kept the economy growing at high trend. After 1980 with the ascent of supply side, and lower corporation taxes etc the increase in wages declined or stalled; and the long term growth trend of the economy declined. Empiricism is under-rated by social scientists.
4) Supply side economics says that if you lower taxes companies will invest more, hire more and that will accelerate demand. Apples effective ex-US taxes of about 2% prove that this is clearly false. While Apple is investing, it is not investing most or all of its money - hence it is giving it back to stock holders and buybacks - and where it invests is not America, losing any multiplier or feedback effects of having richer workers in the US.
5) Lol. I was thinking about the loans banks made from until about 2008, of which we have plenty of knowledge about. Remember the recent financial disaster, the bailout of Lehmans?
I am out of this, there is only so much lack of actual knowledge I can deal with.
For those of us with iPhones, the real issue isn't whether the battery assembly is automated. It's just how hard the manual battery replacement will be. Are this busy little robots smearing lots of ticky-tacky on these batteries as they install them or are the batteries snapped in and easily replaced?
As Apple adds more services that earn subscription money from those who use its products (i.e. streaming music and TV), it becomes more and more important for Apple to keep their gadgets working by making sure they're passed along to a second or third user. Easy battery replacement is the key to that.
No doubt Apple hasn't bothered to consider the issue of battery replacement as your post suggests. One can only hope that they have the wit to read your post. What a stupid and pointless post you made.
I can't believe it, but I've actually agreed with you on I think the last three things I've seen you post on Tallest Skil. Ha ha. I think you might actually have half a brain yet!
-PopinFRESH
Your post validates my theory that you need only a quarter of a brain to be a member of the human race.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
And no one believes Newtonian physics either, except the 99% of every day problems for which it is incredibly useful. Same goes for Econ 101 (assuming that you're referring to Intro to Microeconomics and not Intro to Macro, which I'll agree is bunk).
And no one believes Newtonian physics either, except the 99% of every day problems for which it is incredibly useful. Same goes for Econ 101 (assuming that you're referring to Intro to Microeconomics and not Intro to Macro, which I'll agree is bunk).
No I meant serious economists don't. Most scientists disregard anything with no empirical basis - and quantum mechanics has massively predictive powers. The simple axioms of economics as taught to under grads are just not true, and are non- empirical. What would happen in a recession where workers reduced their wages is not full employment but greater unemployment as workers are also consumers. Most economics doesn't treat the system as having feed back loops.
In terms of predictive power astrology is more useful. Only maverick economists - Roubini etc. - predicted the recent collapse and the fact that they are "maverick" tells you all you need to know.
Comments
Re: manhole covers imported from India
I actually should have rhetorically asked "When's the last time you saw any technology product with a Made in India label on it?" I'm pretty sure that most nations in the world can produce world-class manhole covers. But I'm equally sure that not every nation in the world can produce world-class miniaturized electronics.
And my original comment was in response to the original post's mention of "moving assembly from China." Not sure where else the work could be done with high quality, with the legendary flexibility of Chinese assembly lines, and with low enough cost. Unless, of course, the work is done by (low maintenance) robots.
Sure the extra money the companies make often goes into a bank, but that isn’t much different from printing money. If you believe supply side is important, QE is for you - but the kind of right wingers who support tax cuts for businesses don’t like printing money, but both go into banks, and into—— well sometimes into people’s pockets, more likely into accelerated asset prices.
There is one important difference between real savings in the bank (whether from individuals or companies) vs just printed money from the Federal Reserve. Without printed money, the very fact that you can get a loan to start your business means that somewhere out there, someone must be saving. i.e. someone must have surplus funds. i.e. a potential customer for new businesses. Surplus funds serve as a market signal to open new businesses. With printed money it is sending a false signal to Entrepreneurs that people are flush, and to open new businesses, but of course people aren't flush, so the businesses can only either close or displace other businesses, and on net the economy doesn't grow.
The right don't like money printing because it sends false market signals, the left don't like it because the resulting inflation hurts the poor the most, I think only bankers like it, and politicians who hope against hope that monetary policy will save them from making hard fiscal decisions.
To the latter part. Yes I do. My degree is mathematics and engineering. Economics is a social science. But econ 101 is not real economics anyway.
To the personal attack - I don't hate large companies, I love Apple, however I don't believe in supply side. I've also owned a company albeit a small one.
As for your statement that profits are not taxed but "income before interest and taxes" are taxed. That's both tautological and wrong. Clearly you are not taxed after tax. And income is not taxed, profits are. Otherwise companies making a loss would be taxed.
My main point was simple:
1) companies don't react to wage cuts by hiring people so standard econ 101 is incorrect.
2) there are feedbacks in mass economies, where workers are consumers, which would in fact exacerbate recessions if everybody believed econ 101 and took a wage cut.
3) there are bigger gains to the economy from workers getting wage increases and tax cuts than companies getting tax cuts.
4) not paying taxes - cf Apples effective rate - doesn't guarantee investment.
5) banks are not very good at lending these days, when they have surplus capital instead of funding businesses they tend to fund house and other asset bubbles.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
To the latter part. Yes I do. My degree is mathematics and engineering. Economics is a social science. But econ 101 is not real economics anyway.
To the personal attack - I don't hate large companies, I love Apple, however I don't believe in supply side. I've also owned a company albeit a small one.
As for your statement that profits are not taxed but "income before interest and taxes" are taxed. That's both tautological and wrong. Clearly you are not taxed after tax. And income is not taxed, profits are. Otherwise companies making a loss would be taxed.
I think I can see why the owning of a company is past tense for you. Companies are taxed on Earnings Before Taxes also known as EBT. Depending on investments a company may have taxable interest (if they have earnings from interest that are greater than their interest expense). A loss is simply negative earnings and is calculated just as you would any other income statement. The amount of the loss is able to be applied to the previous two years tax burden or carried forward up to twenty years. I've linked what Apples income statement looks like so you can have a better idea of how things are actually calculated. Being that you study math it should be trivial for you to figure out. Again, you are not taxed on profits.
http://finance.yahoo.com/q/is?s=AAPL+Income+Statement&annual
Quote:
My main point was simple:
1) companies don't react to wage cuts by hiring people so standard econ 101 is incorrect.
2) there are feedbacks in mass economies, where workers are consumers, which would in fact exacerbate recessions if everybody believed econ 101 and took a wage cut.
3) there are bigger gains to the economy from workers getting wage increases and tax cuts than companies getting tax cuts.
4) not paying taxes - cf Apples effective rate - doesn't guarantee investment.
5) banks are not very good at lending these days, when they have surplus capital instead of funding businesses they tend to fund house and other asset bubbles.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
1) "standard econ 101" doesn't say anything like what you are implying. Companies will hire labor based on price and quantity needed. A rational company will produce a product where it's marginal cost equals it marginal revenue. This is the point where profits are maximized. This does not mean that if the price of labor goes down that the company will hire more people than they need. However since labor is a variable input, a decrease in the price of labor will shift the marginal cost curve which will increase the quantity supplied. Conversely an increase in the price of labor will decrease the quantity supplied.
2) Again, you are trying to apply a static model to all other variables and then looking at labor over time.
3) Please provide an economic model that demonstrates this.
4) I'm not sure what you are talking about here?
5) Care to provide documentation that shows what loans banks are making? Besides pure conjecture.
-PopinFRESH
I think I can see why the owning of a company is past tense for you. Companies are taxed on Earnings Before Taxes also known as EBT. Depending on investments a company may have taxable interest (if they have earnings from interest that are greater than their interest expense). A loss is simply negative earnings and is calculated just as you would any other income statement. The amount of the loss is able to be applied to the previous two years tax burden or carried forward up to twenty years. I've linked what Apples income statement looks like so you can have a better idea of how things are actually calculated. Being that you study math it should be trivial for you to figure out. Again, you are not taxed on profits.
http://finance.yahoo.com/q/is?s=AAPL+Income+Statement&annual
-PopinFRESH
Firstly your original claim - the one I was reposing to - was that companies are taxed on pre-tax income.
Lets quote that again:
Income before interest and taxes are what is taxed.
Income is not taxed. Profits are taxed. This is so remedial it is hardly worth continuing.
Ack why not.
1) "standard econ 101" doesn't say anything like what you are implying. Companies will hire labor based on price and quantity needed. A rational company will produce a product where it's marginal cost equals it marginal revenue. This is the point where profits are maximized. This does not mean that if the price of labor goes down that the company will hire more people than they need. However since labor is a variable input, a decrease in the price of labor will shift the marginal cost curve which will increase the quantity supplied. Conversely an increase in the price of labor will decrease the quantity supplied.
2) Again, you are trying to apply a static model to all other variables and then looking at labor over time.
3) Please provide an economic model that demonstrates this.
4) I'm not sure what you are talking about here?
5) Care to provide documentation that shows what loans banks are making? Besides pure conjecture.
-PopinFRESH
1) That is merely restating your original simple graph.
2) No, my system is definitely dynamic. I am treating workers as consumers. Your simple My First Economic Graph doesn’t do that.
3) The economic system in America from 1945-1980 demonstrates this. Workers got more wages, spent more,the multipliers kept the economy growing at high trend. After 1980 with the ascent of supply side, and lower corporation taxes etc the increase in wages declined or stalled; and the long term growth trend of the economy declined. Empiricism is under-rated by social scientists.
4) Supply side economics says that if you lower taxes companies will invest more, hire more and that will accelerate demand. Apples effective ex-US taxes of about 2% prove that this is clearly false. While Apple is investing, it is not investing most or all of its money - hence it is giving it back to stock holders and buybacks - and where it invests is not America, losing any multiplier or feedback effects of having richer workers in the US.
5) Lol. I was thinking about the loans banks made from until about 2008, of which we have plenty of knowledge about. Remember the recent financial disaster, the bailout of Lehmans?
I am out of this, there is only so much lack of actual knowledge I can deal with.
No doubt Apple hasn't bothered to consider the issue of battery replacement as your post suggests. One can only hope that they have the wit to read your post. What a stupid and pointless post you made.
Your post validates my theory that you need only a quarter of a brain to be a member of the human race.
Btw nobody believes simple economics except undergraduates and the badly read. No serious economist. It probably shouldn't be taught anymore.
And no one believes Newtonian physics either, except the 99% of every day problems for which it is incredibly useful. Same goes for Econ 101 (assuming that you're referring to Intro to Microeconomics and not Intro to Macro, which I'll agree is bunk).
No I meant serious economists don't. Most scientists disregard anything with no empirical basis - and quantum mechanics has massively predictive powers. The simple axioms of economics as taught to under grads are just not true, and are non- empirical. What would happen in a recession where workers reduced their wages is not full employment but greater unemployment as workers are also consumers. Most economics doesn't treat the system as having feed back loops.
In terms of predictive power astrology is more useful. Only maverick economists - Roubini etc. - predicted the recent collapse and the fact that they are "maverick" tells you all you need to know.