Workshop In An Alternate Homepower Environment

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On Mon, 20 Jun 2005 22:19:06 GMT, Matt Stawicki

Found those "WMDs" yet?
--
Cliff

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wrote:><snip>

Well, hell. Might as well just cash in your chips now. Take a quick vacation, and then head for your local crematorium.
Sheesh, George. You really need to get out more:-)
Matt
Somehow methinks supply and demand will take care of itself.
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On Wed, 15 Jun 2005 07:36:34 -0700, F.George wrote:

Thank you, Chicken Little.

Odd, that's not what my crystal ball tells me. ;-)
And that "trade deficit" is the stupidest boogeyman ever perpetrated - well, at least up in the top five stupid boogeymen - since the nervous nellies found out that it's a scary buzzword.
Do you even have any idea what a "trade deficit" _is_? It means we have two billion dollars more per day to spend on their crap than they have to spend on our crap. That means WE ARE TWO BILLION DOLLARS RICHER THAN THEY ARE!!!!! PER DAY!!!!!!!!!!
You have a significant "trade deficit" with the grocery store. How much do you spend there? Maybe $100.00/week? That's a ONE HUNDRED DOLLARS PER WEEK TRADE DEFICIT with the grocery store. They don't buy anything from you, do they?
And imagine your employer's trade deficit with _you_! He buys your labor for, what, $50K, $100K/year? How much stuff do you buy from him? Your EMPLOYER HAS A SERIOUS TRADE DEFICIT WITH YOU!!!!!
"Trade Deficit". Pfaugh!
Thanks! Rich
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<snip>

<snip> =================Please forward this wonderful news to the International Monetary Fund [IMF], the government of Argentina and the Argentinian bondholders. It will cheer them no end.
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    Greetings and Salutations....
On Wed, 15 Jun 2005 17:29:43 GMT, Richard the Dreaded Libertarian

    Hum...so you DON'T think it is a problem that America is losing the knowledge, skills and tools to manufacture even the basic tools we need to keep society going and the infrastructure kept up?

    While your point may have some validity here, the major difference is that the money in your examples is circulating INSIDE the USA. The dollars spent in a foreign market are dollars that are taken out of the economy "forever".     As an analogy, if dollars are the life-blood of the economy, foreign trade is like cutting an artery.     Now...The fact of the matter is that SOME of those dollars DO come back in, but, since it is a DEFICIT, far more are going out than are coming in. Those dollars have to be replaced in the economy somehow. One "bad" way is to simply print more money. While this gets more bucks in circulation, it also cuts down on the value of each dollar.     We have to remember that the world economy is more like a war than a cheerful family gathering. All the countries in the world are jockeying to gain advantage over the other countries, and, one way to do that is to drain the cash of one country.     America, although economically large, is not infinite, and, if we believed we were, we would be fools. The fact that the dollar has dropped in relative value on the world market is proof that the deficits are having their desired effects. Also, remember that the growing European Union can (and perhaps already has) become a larger economic power than America.     Finally, there is the basic problem that the world, in general, is not a friendly place. Countries that were our friends are now our enemies; countries that were our enemies are now our friends; The only lesson we can learn from this is that this is likely to happen again, so, to end up totally dependent on another country for our major manufacturing is a stupid thing to do.
    Regards     Dave Mundt
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snipped-for-privacy@esper.com (Dave Mundt) wrote:

Especially one with which we have such a long standing distrust. Pssst, by the way, everyone, they're still run by communists. Wasn't that the reason we fought a "war" against the Soviet Union as well as boycotting all trade with Cuba for half a century? Not to mention, OK I'll mention them anyway - Korea and Vietnam? To stop the scourge of Communism?
--
Owen Lowe
The Fly-by-Night Copper Company
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On Wed, 15 Jun 2005 18:30:40 GMT, snipped-for-privacy@esper.com (Dave Mundt) wrote:

Our excuse for killing off manufacturing in the UK was Thatcher. What's America's excuse ?
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(Dave Mundt) wrote:

Free trade. There are highly regarded experts from both ends of the political spectrum who say it's necessary.
They all have jobs in the service sector and are relatively immune from foreign competition themselves.
-- Ed Huntress
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<snip>

===========================================This may have been true at the higher levels at one time but with telecommuting service sector jobs are also rapidly disappearing. For example many low to mid level accounting jobs such as tax returns are now done overseas. Where the jobs cannot be done externally H1B visas allow worker importation.
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I didn't intend to lead that point to a discussion of how vulnerable service sector jobs are, because, as you say, that situation in general is changing fast.
With tongue in cheek, I was suggesting that US government economists, so far, aren't showing much worry about having their *own* jobs outsourced to India.
However, given that the ideological posture of our current administration seems to have no throttle and a seemingly unlimited fuel tank, they may give that one a try, as well.
-- Ed Huntress
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Perhaps, but half of my customers are in Europe and Asia. My feeling is that the value you add is what customers are interested in. It goes right to their bottom line.
--
John R. Carroll
Machining Solution Software, Inc.
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that
That's fine in your business, John. It's not so fine if you're making injection moldings for consumer products or assembling car engines in Detroit or Windsor.
-- Ed Huntress
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Ed, When I owned half of an injection molder we never lost a job we wanted to Asia, not once. In fact, the first big tooling/molding package we nailed down was something running in Malaysia. One project that was bid around the world was commercial binary syringe assemblies for tooth whitening gel. The quantities were 20 million units per month to start. You probably know the company we did this for. If you have a Hot Springs Spa, 90 percent of the molded parts are from my tools running in the United States. Carlsbad to be precise. I could go on here at some length as 100 million dollars per year in molded product is a lot of product. That isn't my point. In each and every case the costs of making product were lower when customers did business with us than if they made there purchase overseas. We were shipping parts on several jobs to China as a matter of fact.
This is the important part - in no year between 1991 and 2002 did the company's net after tax margin fall below 18 percent of gross revenues - never, not once, period. It was almost embarrassing and we did not have a single product of our own. If Detroit or Windsor can't stay busy or if GM files it won't be because they couldn't get the answer right. It will be because they kept asking the wrong damned question.
--
John R. Carroll
Machining Solution Software, Inc.
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is
to
the
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be
customers
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And are you talking about a solution for 10% of the market, or are you claiming you have a general question and a general solution for it?
Because we can always make a positive anecdote of the virtues of 10%, if we neglect the fact that an economy is all 100%, and that the consequences of what happens to the other 90% eventually catches up with all of us.
Sooner or later, you have to answer the question of how you compete with 80 cents/hour wages, when technology and business expertise can be packaged into shipping containers and sent to Bangalore or Shanghai just as easily as to Cleveland, and that clever ideas, hard work, and insight are distributed quite evenly around the world.
-- Ed Huntress
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It isn't a claim Ed, it is a proven philosophy and business model. It will work wherever you choose to run it if the infrastructure is in place.

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Focusing on wages is exactly the wrong thing to do. I paid the tool room guys a five dollar premium to the market, provided excellent medical benefits, paid time off, and contributed the legal maximum to our 401K for every employee at the time that was 4 to 1. You are closer to the mark with the clever ideas part however and I agree that no one group has a lock on that.
If you think that GM is tanking because of their labor contracts or pension obligations you are just plain wrong. They suck hind tit because their business model if for shit.
--
John R. Carroll
Machining Solution Software, Inc.
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because
asking
Proven for what percentage of the economy? Are you suggesting this is a general model that will sustain our economy as a whole? If so, how would you apply it to, say, the manufacturing of shirts? What philosophy and business model will let you make shirts at a price/quality tradeoff that competes with rural China or Bangladesh? Child labor could help, I suppose...

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easily
Your $5 premium probably was around 20% of 40% of your costs: as a round approximation, perhaps 8% of your cost of production, based on tooling-industry rules of thumb.
When you're up against 80 cents/hour, how do you account for the 96% disadvantage? Do you think that improved efficiencies in general (not just yours, but those of the economy as a whole) can cover 96% differences? Any model that I know of, that points in that possible direction, is based on getting rid of all of those people you employ and adopting the values and standards of the Third World.
And then business in general winds up hoist on its own petard.

pension
So you're saying they can absorb $1,500/car just by having a better business model than Toyota or Hyundai? And then, after gaining a $1,500/car advantage over them simply through smarter organization, that they can maintain that advantage in a viciously competitive global market?
These are all fine assertions, John, but I'd like to see the specifics. Frankly, I don't believe you can "business-model" your way to success when you have the kind of legacy overhead that GM has. That is, unless your business model is based on moving all of your manufacturing offshore and abandoning your legacy entitlements to the federal government.
-- Ed Huntress
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No, they can do that by properly understanding and then delivering to their market. This is what they are utterly failing to do. The difference in price between a Hyundai built in Arkansas and a GM product built anywhere is much more than 1,500 dollars. As a percentage it's about half.

They do not gain any advantage with a reduced price and shouldn't try. Good value is critical in purchasing but you are talking about racing to the bottom and that is the stupidest thing I have seen in recent times. It does not work.

Just the opposite in most respects. You are smarter than this Ed.

Ed, I am unable to continue this for the rest of today but I will. I read what you have written about global markets and manufacturing. The questions and their answer are largely contained in your own work and the underlying research behind it. The need to present fresh facts doesn't exist. There aren't really many fresh facts regardless. A fresh perspective is the key, as I said. You answered, intelligently I might add, the wrong question. Your work revolves around looking like a top notch vendor. This is certainly necessary but it is also the WRONG WRONG WRONG perspective. I get paid big bucks for this Ed and have yet to see anyone who will truly embrace what I provide as a service fail to flourish . I also have enough confidence in the results that I only take equity. I also, except once and not directly, don't do "turn arounds". My advice under the turn around scenario has consistently been "Get Out and do it Now".
The five dollar ratio to costs was 6 percent and we knew that percentage very precisely.
--
John R. Carroll
Machining Solution Software, Inc.
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their
product
Hyundai understands the market pretty well, too. In fact, I bought one last September, after trying out all of the Japanese and American competition. The Europeans offer no competition in that market. Any European car that's technically competitive costs $10,000 more, at the minimum. My Hyundai Sonata is a hell of a car for the money, and 'way ahead of anything comparably priced -- in other words, anything in that market.
The next day I bought a Ford Focus ZX3. It's another good car for the buck, although the bottom-end Civics probably are better overall. I just liked the handling and performance; with its 2.3-liter engine, it will stomp any Civic. <g> I consider it a good buy, though, and not bad for an American car built in...Mexico.

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What does work? Are you suggesting that GM can dope out the market better than Toyota, Honda, Nissan, Audi, etc.? How would they do that? Are they somehow smarter?
I don't think they're smarter. Since all of those foreign car makers have good American marketing people to serve the US market, I don't think GM has any greater knowledge of the market or greater insights into what people want.
So, what's left?

when
I thought I was until I spent a year of research in preparation for the 5,000 word articles I wrote about China trade a couple of years ago. Now I realize we're living on a heap of wishful thinking and baloney.
Any advantages we have are going away very quickly. In fact, our multinationals are shipping the advantages offshore as fast as they can. I'm waiting for the Milton Friedman dollar devaluation, but there will be hell to pay if and when it happens. The recent devaluation ain't it.

perspective
is
When you get some time, John, it would be good to hear more about what you're saying. It's one of the most important issues in metalworking today, if not THE most important issue.

Well, 8% was reasonably close, then. d8-)
-- Ed Huntress
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<snip>

============Right on!!!!! You also need to include Ford. A major contributing factor is that they can't decide if they are banks or car companies. They also seem to have forgotten than you can't milk a "cash cow" if it is dead.....
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the
They're doing better as banks.
What's your SPECIFIC suggestion, George?
-- Ed Huntress
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