Pitiful portrait

[Oh Shoot]

...Whether one has degrees or not, if an adult isn't reading at least one non-fiction book every month or two, you are setting yourself up for failure.

Mosinon writes the occasional non-fiction book. You?

- OS

[RobertNashville]

Mosinon writes the occasional non-fiction book. You?

- OS

Articles (generally revolving around what I do for a living), yes; books, no. And so what? Whether one is a published author or not and regardless of the subject matter of the material; that has nothing to do with the validity of my statement.

There are thousands of books out there filled with all sorts of facts, ideals and philosophies that would be a complete waste of time to read. While I've never personally verified this stat, I believe it's true to say that there are more books published every day than can be read in the average lifetime - one has to be very discriminating about what books he/she reads and spend their limited time on.

Edited March 7, 2011 by RobertNashville

[Oh Shoot]

...I've given my solution...

Reduce SS to just above the poverty line, say poverty plus 10%, or about $12,000 per year in TN, obviously allowing for inflation...

I don't think the limitation on Social Security payout will help as much as you expect, but could be mistaken. For instance I have contributed about a quarter million bucks inflation adjusted and if I retire at 62 the gooberment claims it will pay me $14,580 per year, pretty close to your $12,000 figure...

I've paid into FICA since my first on-the-books summer job at 13, only been out of work maybe total of 2 years out of the 46 I worked either part time or full time.

Just started getting SSI at 62. $1154.00 per month.

I'm under JayC's TN poverty level.

Something must be wrong.

- OS

[Guest Lester Weevils]

Hi OhShoot

You are making $13,848 a year and therefore ripping off the youngsters by a whopping extra $1848 per year (over the $12,000 figure).

Have you determined yet whether you will owe tax on that lavish retirement?

[RobertNashville]

I've paid into FICA since my first on-the-books summer job at 13, only been out of work maybe total of 2 years out of the 46 I worked either part time or full time.

Just started getting SSI at 62. $1154.00 per month.

I'm under JayC's TN poverty level.

Something must be wrong.

- OS

Obviously, you are a very selfish person...living in the lap of luxury.

[Oh Shoot]

Hi OhShoot

You are making $13,848 a year and therefore ripping off the youngsters by a whopping extra $1848 per year (over the $12,000 figure).

Have you determined yet whether you will owe tax on that lavish retirement?

Maybe, just gonna figure soon. This is the first year in last 13 that I can probably do my own taxes, and haven't had to pay quarterlies.

Obviously, you are a very selfish person...living in the lap of luxury.

Yeah, but just blew the simple math, duh. Maybe I better NOT do my own this year.

- OS

[mikegideon]

Hi OhShoot

You are making $13,848 a year and therefore ripping off the youngsters by a whopping extra $1848 per year (over the $12,000 figure).

Have you determined yet whether you will owe tax on that lavish retirement?

Maybe it's time to kill grandpa.

NOTE: Don't shoot him in the noggin. It's ineffective

[Oh Shoot]

Maybe it's time to kill grandpa.

NOTE: Don't shoot him in the noggin. It's ineffective

And do it from afar. I don't need a gun to off you up close.

- OS

[mikegideon]

And do it from afar. I don't need a gun to off you up close.

- OS

No reason to spare the ammo if somebody really needs it.

[Guest 6.8 AR]

And I ain't a grandpa, yet, so wait on me a little longer.

[Oh Shoot]

And I ain't a grandpa, yet, so wait on me a little longer.

I ain't gonna be one. I've done my part to stem the overpopulation part.

- OS

[mikegideon]

I ain't gonna be one. I've done my part to stem the overpopulation part.

- OS

Me neither. I was always afraid I would have one that would throw my ass out into the street when I got old. Sure did practice a lot though.

[Guest 6.8 AR]

The way my two are going, maybe, maybe not.

[Guest mosinon]

No thanks; I leave education to educational institutions; that's what we have them for. Another great, free resource is your public library.

Whether one has degrees or not, if an adult isn't reading at least one non-fiction book every month or two, you are setting yourself up for failure.

I tend to agree but I also wonder about your position, why not defend it? From what I can tell you believe all costs are automatically passed on to consumers. I think this is a simplistic notion.

I maintain that price is a function of supply and demand, I maintain that a business will charge whatever price maximizes profits. I maintain that this price is not necessarily tied to cost of manufacturing the product.

You posit that something else is going on, that a business charges just enough to stay afloat. I'd like to hear more about this.

Sure, education isn't your bailiwick and all, but make an exception. For the children or something.

[JayC]

I think Robert is talking about long term trends, more so than short term trends...

In a free market (not that we have one of these anymore), if company A starts selling a product or service, and has lets say 100% profit in it... and then company B comes along and starts to offer the exact same product or service (and lets assume to keep things simple it's the same quality)... Over time, the profit margin for both companies will decline to a point where there is little left. Now that might take 10 years, but over time as a general rule the level of profit will be reduced to a small amount.

Now, non-free market forces, make this system very complex... if I have a trademark, or patent on a product and company B can't compete... or if I have some government tax break that allows me to sell my product below company B's price and still make a great profit...

But, generally speaking, in a true free market, the profit is beaten down to single digits over time.

I tend to agree but I also wonder about your position, why not defend it? From what I can tell you believe all costs are automatically passed on to consumers. I think this is a simplistic notion.

I maintain that price is a function of supply and demand, I maintain that a business will charge whatever price maximizes profits. I maintain that this price is not necessarily tied to cost of manufacturing the product.

You posit that something else is going on, that a business charges just enough to stay afloat. I'd like to hear more about this.

Sure, education isn't your bailiwick and all, but make an exception. For the children or something.

[Guest Lester Weevils]

I maintain that price is a function of supply and demand, I maintain that a business will charge whatever price maximizes profits. I maintain that this price is not necessarily tied to cost of manufacturing the product.

You posit that something else is going on, that a business charges just enough to stay afloat. I'd like to hear more about this.

Hi Mosinon

I don't want to take sides and am quite ignorant of the grand scheme, but some niches really do seem to charge just enough to stay afloat, including attempting to accumulate enough profit as a pad for future operations.

Sometimes a well-financed operation will even intentionally sell at a loss for extended periods.

If a person works in such a niche, then he might get the impression that such operation is typical.

Coca-cola might not price thataway but such operations do exist.

Sometimes the product might not be high volume, and even manufactured "close to the bone" might be an expensive product. Products that might not even make a lick of sense to manufacture from a business sense, but some folks are in business because "that is what they do" rather than to maximize profit.

For instance a guy really wants to make an unusual oscilloscope or whatever, and knows he can't squeeze blood from a turnip, and he can either build a minimum initial run of 2000 or he doesn't make the gadget. He can't work free, but on the other hand he can't make lavish profits and sell the silly things at all.

Have seen cases where a company would slice down to minimum profit just to avoid laying off employees. A solution that would make the accountant happier might be to scale down operations rather than scale down price. Unless the accountant's job is on the line too.

Buying short runs of custom parts from local fabricators, it sure did look like they were pricing more on the basis of materials, labor and overhead, rather than ripping me for every available penny.

Then there is the way asian OEM's operate on occasion. Sometimes they will cut off their own pecker to maximize units shipped. Wondered if maybe they were more concerned with keeping the nieces and nephews in a job rather than making a big profit.

Maybe such pricing strategies were more common in the USA in the past rather than the present. Dunno much about it.

[RobertNashville]

I tend to agree but I also wonder about your position, why not defend it? From what I can tell you believe all costs are automatically passed on to consumers. I think this is a simplistic notion.

I maintain that price is a function of supply and demand, I maintain that a business will charge whatever price maximizes profits. I maintain that this price is not necessarily tied to cost of manufacturing the product.

You posit that something else is going on, that a business charges just enough to stay afloat. I'd like to hear more about this.

Sure, education isn't your bailiwick and all, but make an exception. For the children or something.

I don't believe I ever said that all costs are "automatically" passed onto consumers.

I also never said that a business only "charges just enough to stay afloat".

I said, and I say that business don't pay taxes and the don't.

The cost of a product must be tied to the cost of its manufacture (all its cost including property taxes, excise taxes, VAT, freight, duty, income taxes, and on and on) plus some amount for true profit. Such considerations MUST be the starting point for pricing a product because if they are not then the whole subject becomes moot because that business (or at least that product) won't be in the market long enough for anyone to notice it was ever there.

A number of years ago I was working as a consultant for company that was truly known world-wide for its products (its name recognition was second only to Coca-Cola). I was there to work on one particular problem there were having but in doing so, I had uncovered a much bigger one which was that, taking everything into consideration, they were ultimately selling its machines to Wal-Mart for a net loss. I advised them to stop and, honest to God, their VP of sales told me straight-faced and as serious as he could be that he know they were taking a loss per item but they could make it up on volume. When I was in school and heard such nonsense I thought such stories were made-up to make a point...little did I know that at least some of them must have been true! Obviously, that VP was an idiot....the company filed bankruptcy about 18 months later...why am I not surprised???

Price is not simply a function of "supply and demand" any more than you can sell products at a loss and make it up with volume.

Of course there are many and various considerations when it comes to pricing a product other than just cost; I never said their wasn't...my current employer has multiple herds of nerds who do nothing all day but figure out what we have to charge for our products, but at the end of the day, if a business doesn't collect ALL its costs, including taxes, plus some profit from its customers; it won't be in business very long. That's why businesses don't pay taxes...their customers pay their taxes and if you truly don't understand that then I don't know what else to say.

Edited March 8, 2011 by RobertNashville

[Oh Shoot]

....Of course there are many and various considerations when it comes to pricing a product other than just cost; I never said their wasn't...my current employer has multiple herds of nerds who do nothing all day but figure out what we have to charge for our products, but at the end of the day, if a business doesn't collect ALL its costs, including taxes, plus some profit from its customers; it won't be in business very long. That's why businesses don't pay taxes...their customers pay their taxes and if you truly don't understand that then I don't know what else to say.

Of course any business, or person, must "make a profit" or eventually go out of business. Even an individual may declare bankruptcy and "go out of business".

But to say no business pays taxes because the income to pay them comes from their clients is same as saying that I don't pay taxes because my income comes from retirement income, investment income, SSI income, and freelance work, and that those sources are paying my taxes.

In other words, no organization or individual actually pays its/his own taxes.

Your continued argument in this vein is both non sequitur to the actual topic and further, is absolutely one of semantics only.

- OS

[RobertNashville]

Of course any business, or person, must "make a profit" or eventually go out of business. Even an individual may declare bankruptcy and "go out of business".

But to say no business pays taxes because the income to pay them comes from their clients is same as saying that I don't pay taxes because my income comes from retirement income, investment income, SSI income, and freelance work, and that those sources are paying my taxes.

In other words, no organization or individual actually pays its/his own taxes.

Your continued argument in this vein is both non sequitur to the actual topic and further, is absolutely one of semantics only.

- OS

And no, it isn't just semantics...it's a basic and fundamental principle that goes to the heart of how a free-market, capitalistic economy works. Failure to understand the concept is why idiots like the Dalai-Bamma and, for that matter, most Democrats and far too many Republicans either...

1. Believes that raising taxes on "business" isn't ultimately the exact same thing as raising personal income taxes (when it is he same thing) OR

2. They know the truth...they know it's the same thing but they also know that the American public is too stupid or too uninformed to know that they are one and the same thing.

P.S.

By the way, I was willing to let the topic die many posts ago if you recall - my post was a response to a direct request for a response. However, for the sake of your piece of mind, I'll never answer another question about this topic again.

Edited March 8, 2011 by RobertNashville

[Oh Shoot]

....By the way, I was willing to let the topic die many posts ago if you recall but for your piece of mind, I'll never answer another question about this topic again.

My peace of mind doesn't require that you cease to give us a piece of your mind.

- OS

[Guest mosinon]

Gosh Robert when I was in business we priced everything to undercut our competition. It was always a sales game, we tried hard to find out just what the competition was charging for a particular part and tried to charge less. And yep, we could make it up on volume.

What's that you say, how can you say you can make it up on volume if you are selling for a (paper) loss?

It is actually pretty easy. The way we priced products was materials plus something called burden. So maybe paint costs ten cents and the material costs fifty cents (people pay for tooling up front) and labor is calculated at 25 cents. You're looking at eighty five cents. Then, since it was a business, we added in burden. Burden is all the stuff you talk about, taxes, the front office, anything that doesn't directly produce income. We used a multiplier.

Turns out, if you get a big enough order, you don't have to worry about burden so much because the order is large. You can forget about changing the tooling as often as you planned and you can get the process in control. Meaning more parts in spec the first time.

Let me offer this example: You order 500 parts from us. We calculate the cost of making those parts. That calculations includes changeovers, paint changes and so forth. You order 5,000,000 parts we get to skip 100,000 changeovers. According to our formula we will be selling the parts below cost but, since we can run non stop, we actually still make a profit.

Now you know how to make it up on volume. Back to the notion that corporations don't pay taxes. Okay, let's assume they don't, let's assume that all the costs are passed on to consumers. If corporate taxes go up by a percent I will pay an extra percent for a product. It is true for gas, right?

So then I find it odd that corporations bitch about taxes. What the hell do they care, they just pass it along to the consumer, right?

But they do care, taxes are a big deal to them.

You're right about commodities but your analysis is not right when applied to non fungible commodities.

To be clear, I'm not saying that you can solve the budget woes with corporate taxes, I'm not saying that corporate taxes are even a good thing. All I am saying is that the idea that corporations automatically pass the taxes on to the consumer is demonstrable false.

[RobertNashville]

Gosh Robert when I was in business we priced everything to undercut our competition. It was always a sales game, we tried hard to find out just what the competition was charging for a particular part and tried to charge less. And yep, we could make it up on volume.

What's that you say, how can you say you can make it up on volume if you are selling for a (paper) loss?

It is actually pretty easy. The way we priced products was materials plus something called burden. So maybe paint costs ten cents and the material costs fifty cents (people pay for tooling up front) and labor is calculated at 25 cents. You're looking at eighty five cents. Then, since it was a business, we added in burden. Burden is all the stuff you talk about, taxes, the front office, anything that doesn't directly produce income. We used a multiplier.

Turns out, if you get a big enough order, you don't have to worry about burden so much because the order is large. You can forget about changing the tooling as often as you planned and you can get the process in control. Meaning more parts in spec the first time.

Let me offer this example: You order 500 parts from us. We calculate the cost of making those parts. That calculations includes changeovers, paint changes and so forth. You order 5,000,000 parts we get to skip 100,000 changeovers. According to our formula we will be selling the parts below cost but, since we can run non stop, we actually still make a profit.

Now you know how to make it up on volume. Back to the notion that corporations don't pay taxes. Okay, let's assume they don't, let's assume that all the costs are passed on to consumers. If corporate taxes go up by a percent I will pay an extra percent for a product. It is true for gas, right?

So then I find it odd that corporations bitch about taxes. What the hell do they care, they just pass it along to the consumer, right?

But they do care, taxes are a big deal to them.

You're right about commodities but your analysis is not right when applied to non fungible commodities.

To be clear, I'm not saying that you can solve the budget woes with corporate taxes, I'm not saying that corporate taxes are even a good thing. All I am saying is that the idea that corporations automatically pass the taxes on to the consumer is demonstrable false.

You just won't leave it alone will you? You claim ignorance and want me to "teach" you then use big words that I bet you barely understand to reject everything I've said.

Believe what you want...I just thank God I don't work for a company where you are setting product pricing.

[Guest Overtaker]

So then I find it odd that corporations bitch about taxes. What the hell do they care, they just pass it along to the consumer, right?

But they do care, taxes are a big deal to them.

Passing any amount of the tax to the consumer rises the price, thereby decreasing quantity demanded which results in fewer sales. That's why they care, even if the tax is being passed on.

From what I can tell you believe all costs are automatically passed on to consumers. I think this is a simplistic notion.

All I am saying is that the idea that corporations automatically pass the taxes on to the consumer is demonstrable false.

It depends on the elasticity of demand, as explained many posts ago. Maybe these graphs will better illustrate the theory.

[Guest mosinon]

Well, I am mostly waiting for you to defend your position. If you can't no big deal. This, of course, isn't a personal deal. This is more of an economics discussion. I'm more interested in the discussion than necessarily being right. I might learn something and all.

by the way fain != feign

Oddly, I don't think we disagree on very much. We tend to disagree on how corporations price products. You think that Apple sets the price of the new iPad based on a formula where taxes are are a driving source. I think that Apple sets the price of the new iPad based on what consumers are willing to pay.

One of us believes in the free market system and the other one of us is RobertNashville.

[Seaslug]

You just won't leave it alone will you? You claim ignorance and want me to "teach" you then use big words that I bet you barely understand to reject everything I've said.

Believe what you want...I just thank God I don't work for a company where you are setting product pricing.

Believe me, those of us who enjoy making money are glad that you don't work for our companies, as well...

Just to be clear on your position, you use poor grammar, poor syntax, and misspelled words to make a point that is both circular and semantic (and which has been repeatedly torn to shreds with real-world examples that you refuse to refute), and it's everyone ELSE who is ignorant?