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The Last Step in Destroying America...

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posted on Dec, 23 2009 @ 11:46 PM

Originally posted by havok

Prove me wrong.

Actually ... no. You make the claims, so you do the work of proving them right. Anyone can throw out opinions -- which is fine in itself -- but to then grant them status of revealed truth unless someone can prove you wrong? That is intellectual laziness!

I'm quite interested in why you believe what you do so please, prove yourself right or at least take a god stab at it.

posted on Dec, 24 2009 @ 07:30 AM
The last step in destroying America will be physical destruction of cities.

posted on Dec, 30 2009 @ 12:43 PM
reply to post by metamagic

Ugh...I figured I would have an agreement not an arguement.

Here goes:
Creative Destruction and the Financial Crisis: An Interview with Richard Foster

Richard Foster, a McKinsey director from 1982 to 2004, is a coauthor of Creative Destruction: Why Companies That Are Built to Last Underperform the Market—and How to Successfully Transform Them. In that book, he and Sarah Kaplan argue that to endure, companies must embrace what economist Joseph Schumpeter called “creative destruction” and change at the pace and scale of the capital markets, without losing control over current operations. In a recent interview with the Quarterly, Foster offered his view of how the current financial crisis might change the business world and the capitalist system.

The Quarterly: How does your vision of creative destruction apply to today’s situation?

Richard Foster: Let’s start by looking back. In the 1970s, we had the “Nifty 50”—invulnerable companies that couldn’t possibly lose, and of course they all did. It will be the same today; there will be surprising losers, and survival will come down to simple things, like cash and margins. If you’re a low-margin company without a lot of cash or perhaps with too much leverage, you will not make it. Someone will figure out how to do better.

In the financial-services sector, the upheaval will create a new generation of leaders. Fifty years ago, we didn’t have 8,000 hedge fund managers. Then somebody said, “We can go short as well as long; we have much better information than people did in the 1930s, and the information comes to us instantaneously rather than days after the event. We can make a lot of money modeling and leveraging that information.” So the hedge funds were born. How many of those guys had been successful at mutual-fund management? I don’t think any. They might have been commodity traders, but few were mutual-fund managers. Today, other kinds of people with no experience or expertise will challenge incumbents from outside the industry, and there will be a lot of them. Most of the challengers will fail, but a few will succeed, and they’ll become the heroes of the next generation. If you had to bet on anything, that’s it because that’s what has happened in the past.

The Quarterly: Could you elaborate on this life cycle?

Richard Foster: In the book, Sarah Kaplan and I show that over the long term, the market performs better than companies do. There can be periods—5, 7, 10, even 15 years—when that isn’t the case, but corporate performance always reverts to a lower level than the market because the economy is changing at a faster pace and on a larger scale than any individual company so far has been able to do without losing control. That’s the challenge: to create, operate, and trade—to divest old businesses and acquire or build new businesses—at the pace and scale of the market without losing control.

The balance among creating, trading, and excelling operationally changes over time. When the economy is in a growth spurt, there’s more creating. Few companies are trading very much and operations are fine. In those circumstances, the newer companies in the economy tend to outperform the index, and the older companies that are only focused on operations underperform the market.

As the market collapses, the weaker upstarts get squeezed out. The survivors are the cash-rich “operators,” which perform at levels closer to the averages, which themselves are lower. Companies that operate well shine in down times, as they are now. Every investor on the planet is looking for companies that have cash left. The turmoil will clear away the weaker companies—the companies that have taken too much risk. This doesn’t mean they’re bad companies; it’s just that they’ve taken on too much risk given their balance sheet resources.

A lesson in Creative Destruction

The U.S. steel industry has faced a series of crises since the mid-1970s, when steel producers engaged in a global battle for market share, profitability, and survival. The industry’s struggles graphically illustrate the impact—both positive and negative—of creative destruction on American manufacturing.

Benefits have accrued to the nation as a whole. The U.S. steel industry and its workers are three times more productive today than in the 1970s. American steel companies have invested in advanced processes that have dramatically boosted energy efficiency while reducing pollution and health threats to steelworkers. The sharp rise in coal and other energy prices since 2000 has helped U.S. steel producers that own their own raw materials.

On the ledger’s other side, steel industry employment plunged from 531,000 in 1970 to 150,000 in 2008. Steelmaking cities in the American industrial heartland were battered over these decades. In a 2006 interview, Nobel Prize-winning economist Joseph Stiglitz recounted the impact of the industry’s fall on his hometown of Gary, Indiana, a city founded by U.S. Steel Corporation a century ago. The city “reflects the history of industrial America. It rose with the U.S. steel industry, reached a peak in the mid-’50s when I was growing up, and then declined very rapidly, and today is but a shell of what it was.”

In Europe and Asia, governments have directly intervened for more than a quarter-century to help fund a massive expansion of steelmaking capacity. They have supported both official and unofficial import barriers and turned a blind eye on secret market-sharing agreements, according to evidence before the U.S. International Trade Commission and the European Union’s competition authorities.

While the United States has sporadically restricted imports, it has never developed a long-term policy to bolster the American steel industry’s competitiveness.

International trade rules permit countries to defend domestic industries against the “dumping” of imports in their home markets at “less than normal” prices. When recessions and financial crises left world markets filled with surplus steel, the U.S. industry sought dumping penalties to combat low-priced imports. In response, U.S. presidents tended to impose temporary limits on imported steel, or arrange voluntary restraints, to ease the damage to American steel firms. But the U.S. steel industry rarely got the sustained protection it sought. For a range of political and economic reasons, U.S. policy has tended to resist tough trade sanctions. Cheaper steel imports benefited the auto industry and other steel users and helped restrain inflation. And Washington has been sensitive to the outcry from foreign governments against proposed U.S. trade penalties.

The result is a U.S. steel market that is more open to foreign ownership and imports than are any of its major rivals. In 2007, more than 30 percent of U.S. steel consumption was imported, a far higher import share than one finds in the markets of major U.S. steel competitors Japan, Russia, China, and Brazil.

This is just a few explanations on the markets in which the industry has collapsed. Basically, the steel industry was sold out. Collapsing it from the inside out. Outsourcing and corporate profit margins drove business to other countries.

But I digress. I need someone to prove me wrong.

posted on Dec, 30 2009 @ 01:31 PM
reply to post by havok

nah, can't prove you wrong.
Three factors that will put the destruction in progress are population density, gender imbalance and resource depletion. We already know that the Christmas plane bomber couldn't find a wife because women are rare in Islam. Also oil is about to run out and population density is growing like crazy so yes, everything will collapse as a result of this implosion.

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