The end of the US auto industry ?

...but the Macho X20's a lemon. They're doomed!


Thanks for the explanation, Mark. I understand all that (but do appreciate your thoughtful and clear explanation), but my point was pointed out in your second sentence...accrue wealth as opposed to BUILDING it.

Perhaps leech is too strong of a word. Without manufacturers and mining operations...the things that create wealth...the credit industry can't be (as) successful. My point was that the credit and insurance industries are support industries for a manufacturing society. Not the other way around.

---

Lurch
Eric Burmeister
The west coast...of Michigan



Edited 1 time(s). Last edit at 04/01/2009 10:52PM by Lurch.

Lurch Wrote:
-------------------------------------------------------
> ...but the Macho X20's a lemon. They're doomed!
>
>
> Thanks for the explanation, Mark. I understand
> all that (but do appreciate your thoughtful and
> clear explanation), but my point was pointed out
> in your second sentence...accrue wealth as opposed
> to BUILDING it.
>
> Perhaps leech is too strong of a word. Without
> manufacturers and mining operations...the things
> that create wealth...the credit industry can't be
> (as) successful. My point was that the credit and
> insurance industries are support industries for a
> manufacturing society. Not the other way around.
>
> Lurch
> Eric Burmeister
> The west coast...of Michigan
>
>
>
> Edited 1 times. Last edit at Apr 1, 2009 by
> Lurch.

Very interesting thread guys.

A little history: In the fourteen hundreds, before Columbus set sail for America an inventor had the idea of the machine gun, not as we have today, rather a multi-barrel design. At that time in history what little wealth there was, was held by aristocrats and royalty. In order to build his design the idea had to be financed ... Monies for such adventure were not easily obtained, and if/when monies could be had other technologies required suffered lack of funding too, therefore design and build often went sideways as other required materials/technology was worked on, taking years sometimes lifetimes to develop. Needless to say Columbus did not have a machine gun when he set sail.

It is a rather intricate and complicated financial world we live in, however it has severed the entrepreneur whom in turn have made or lives something people dreamed of a very short time ago.

Without wealth products cannot be financed, without products we cannot have commerce, without commerce we cannot grow wealth and start the cycle over ...

---

As always IMHO

SEAN TENNIS KF7JJR
SEATTLE, WASHINGTON
SAAB 99, SAAB 850
SAAB V4, SAAB 99T

As long as as someone values a service then wealth dose not need to be created by taking something from the ground and making it into something else.

Wealth is a measure of how much we value something whether that thing is physical or not. Today we value oil at about $40 for a barrel, last year we valued it at $140 and in a few years when everyone drives electric cars it might be valued at $4 a barrel. Thus the wealth of a Texas land owner with 100,000 barrels of oil under his land changes a lot as our values change he is not creating wealth he is simply along for the ride of how others value what he happens to have.

Likewise 3M is not valued (entirely) for the pattens, the knowledge of its staff, its distribution network etc, because if it was how could its market price change it would be valued at its book value* every day always. Sure as 3M is an operating company its book value would slowly change and wealth would be created or destroyed as the book value moved but that is not how we value things, we value companies as investments, we make our judgment on how much the company is worth by what would happen if I put in $100 today, how much will I get out in a year**? It really matters not if that company is Ford that makes a car or MGM that makes entertainment the wealth each creates or destroys is just as real and is entirely based on how we value the car or the expriance of a movie. If oil is $1400 a barrel we would likely not value the car at all since we can not afford to drive it but we might still like to walk to a theater to see a movie, we might even value the movie more and thus more wealth would have been created around movies then cars.

Even ethereal things such as ideas have value and thus having a good idea can create wealth. Wealth is not tied to the land any more, it basically has not been so since the industrial revolution in the western countries.

Wealth is tied to what we value.

* Book Value is an accounting of the value of everything a company owns, see http://en.wikipedia.org/wiki/Book_value for more details.

** Companies are valued on many things such as someone who likes an apple laptop might want to own a share even if it does not make economic since, However companies typically end up valued at some sort of discount from expected future cash flows.

---

In the long run reality always wins.

Lurch Wrote:
-------------------------------------------------------
> ...but the Macho X20's a lemon. They're doomed!
>
>
> Thanks for the explanation, Mark. I understand
> all that (but do appreciate your thoughtful and
> clear explanation), but my point was pointed out
> in your second sentence...accrue wealth as opposed
> to BUILDING it.
>
> Perhaps leech is too strong of a word. Without
> manufacturers and mining operations...the things
> that create wealth...the credit industry can't be
> (as) successful. My point was that the credit and
> insurance industries are support industries for a
> manufacturing society. Not the other way around.
>
> Lurch
> Eric Burmeister
> The west coast...of Michigan
>
Honestly, I have to strongly disagree here Eric, and want folks to see that finance and insurance are part and parcel of wealth creation activities, not just support. I am sure you 'logically' understand it; it is not a hard concept at all. But I don't believe many 'see' the whole picture.

Would you agree that knowledge is a form of wealth? (See Derek's post above on value.) Well if it is, then the knowledge of how to move money around, to know what risks are reasonable, and so forth, are of value in the act of managing existing wealth in the form of money accumulated or accrued. Making a finance or insurance system work better is creating wealth, in that it creates something that people can use to make their lives better. That's no different than a physical widget that makes your rally car go faster.

Your credit or debit card makes you life better; you don't have to carry cash, and with credit, you can cover some emergency repairs on the tow vehicle on the way to the next rally. Those thing have made your life better. So how the creation of a system that makes you life better not be considerd wealth creation?The POS devices, the actual plastic cards, the comm systems that carry the signals for transactions, the computers and UPS systems that back them up, etc. maybe be the product of other activites which we can more easily credit as wealth creatoin. But the act of figuring out how to put it all together and make it work is knowledge developed by, and is a a wealth creation activity of, the finance industry, pure and simple.

Regards,
Mark B.
(NOT a member of the finance or insurance industries)

Lurch Wrote:
-------------------------------------------------------
> ...but the Macho X20's a lemon. They're doomed!
>
>
> Thanks for the explanation, Mark. I understand
> all that (but do appreciate your thoughtful and
> clear explanation), but my point was pointed out
> in your second sentence...accrue wealth as opposed
> to BUILDING it.
>
> Perhaps leech is too strong of a word. Without
> manufacturers and mining operations...the things
> that create wealth...the credit industry can't be
> (as) successful. My point was that the credit and
> insurance industries by all rights should ought to be support industries for a
> manufacturing society. Not the other way around.
>
> Lurch
> Eric Burmeister
> The west coast...of Michigan
>
>
>
> Edited 1 times. Last edit at Apr 2, 2009 by
> Comrade Ivan.


Is that close to whatcher was trying to say?

And leech, welll I dunno. How about "parasite"? "slime mold", festering pustule of greed?

Damn Lurch, you're worker roots are showing!

---

John Vanlandingham
Sleezattle, WA, USA

Vive le Prole-le-ralliat

www.rallyrace.net/jvab
CALL +1 206 431-9696
Remember! Pacific Standard Time
is 3 hours behind Eastern Standard Time.

Lurch Wrote:
-------------------------------------------------------
> My point was that the credit and
> insurance industries are support industries for a
> manufacturing society. Not the other way around.
>
> Lurch
> Eric Burmeister
> The west coast...of Michigan
>
>
>
> Edited 1 times. Last edit at Apr 1, 2009 by
> Lurch.

Or as the mayor of a small southern town was quoted saying the other day: "We can't all make a living just giving each other haircuts. Some body has to make something."

---

RichardM

john vanlandingham Wrote:
> Damn Lurch, you're worker roots are showing!
>

Yeah, well...I grew up making parts in a machine shop. I quit and went to work flipping burgers at McD's because they paid better than my dad did in the machine shop. (Think about that.) My parents helped put me thru college some, but I was expected to work. I washed dishes, mowed lawns, and sold hardware and toys at Meijer (Michigan WalMart) during school months. I worked summers in tool and guage shops. When I graduated, I worked as a clay modeler...the grunts of the industrial design industry.

Perhaps it instilled in me the wrong values. I'm helping raise an 8 year old girl, now. My instinct is to tell her that she should go into finance. Why? For the rest of us, there are consequences for running your business in a risky or even fraudulent manner. What I've learned in the past few months is that there ARE no consequences in big finance. You can play with other peoples' money, take unseemingly stupid risks, and there are NO consequences. In fact, you might "earn" a big bonus while you burn down my worker family's 401(k).

Of course, I WON'T encourage her in that direction, because I want to be proud of her when she grows up and be able to look her in the eye...

And so the human comedy of banker class vs. worker class perpetuates itself...

---

Lurch
Eric Burmeister
The west coast...of Michigan

I think the largest source of anxiety in my life is the desk worker job. I feel like I'm blue collar to the bone and was raised in a very working class family. I spend many days thinking about how I really should get one of my friends to start a bar or automotive business with me.

---

Grant Hughes

starion887 Wrote:
> Would you agree that knowledge is a form of
> wealth? (See Derek's post above on value.)

Depends on knowledge about what, but yes, in general I agree with that statement.

> Well if
> it is, then the knowledge of how to move money
> around, to know what risks are reasonable, and so
> forth, are of value in the act of managing
> existing wealth in the form of money accumulated
> or accrued. Making a finance or insurance system
> work better is creating wealth, in that it creates
> something that people can use to make their lives
> better.

You are assuming that they actually HAVE said knowledge. It would appear from the examples of the past several months that they do NOT. They have been acting without any consequence for taking risks that proved far beyond reasonable, no?

It's a house of cards. "Trust me. I know how to make you money." mm hmm.


> Your credit or debit card makes you life better;
> you don't have to carry cash, and with credit, you
> can cover some emergency repairs on the tow
> vehicle on the way to the next rally.


I don't use credit cards and haven't used one since 2001, the first time I made a stab at a national championship. Cut them all up (actually, I only had one) and made sure that my rally bills are paid for with cash or sponsorship ever since then. I have a debit card that works solely on my checking account. NEVER race on credit!!! I did finance my truck and am financing my barn, but the truck got paid off so now it's just my barn. Paid cash for my trailer, tools, etc.


> Those thing
> have made your life better.

Not at the interest rate I was paying. Never so happy to clip a card in half.


> So how the creation of
> a system that makes you life better not be
> considerd wealth creation?The POS devices, the
> actual plastic cards, the comm systems that carry
> the signals for transactions, the computers and
> UPS systems that back them up, etc. maybe be the
> product of other activites which we can more
> easily credit as wealth creatoin.

True.

> But the act of
> figuring out how to put it all together and make
> it work is knowledge developed by, and is a a
> wealth creation activity of, the finance industry,
> pure and simple.

And so why is Citigroup at 2.78??


I don't like borrowing, Mark. Never have. I've been really fortunate to have a few sponsors who have helped make rallying possible for me, but I worked for those, too. And yes, that is advertising and yes, I am part of the leech society when engaging in it. It is valuable, yes (or else they wouldn't do it), but it is in SUPPORT of selling CARS (or parts or whatever).

---

Lurch
Eric Burmeister
The west coast...of Michigan



Edited 3 time(s). Last edit at 04/02/2009 12:52PM by Lurch.

Eric,

You are welcome to your view. I give up.

Mark B.

Something Lurch said made me think of this. Good book, easy read in an afternoon. It goes lots of different directions, but when it talks about the control of information. Basically if you have the info to make a good decision then that is bad for the professional investors or real estate agents etc. These guys roll the bones with your cash becasue we (many of us anyway) gave it to them without really knowing what they were going to do with it. Same with the housing bubble that started this whole thing.

Mark, please don't take any of this personally. I still consider you one of my bestest rally friends and I didn't pursue this to make you feel bad or anything.

I do appreciate you taking time to explain it.

FWIW...I thought we were mostly on the same page...

M. Bowers:

"So do you want to concentrate more of the US wealth creating activity to finance (basically, getting interest on loans), or try to get it a bit more back into balance by supporting domestic manufacturing? \

And so everyone understands the concept of weath creating activities: We have some natural resources extraction (minerals, coals, oil, gas); we have some manufacturing wealth creation in all the factories we do have. Farming is a wealth creation activity. Energy generation is also. Technology/engineering is also, when we can sell it to others. The building industry is also much about wealth creation.

What are not wealth creation? Any maintenance activity: much of health care, auto repair, highway maintenance, home repair, and similar."

---

Lurch
Eric Burmeister
The west coast...of Michigan



Edited 1 time(s). Last edit at 04/02/2009 01:44PM by Lurch.

frumby Wrote:
-------------------------------------------------------
> Something Lurch said made me think of this. Good
> book, easy read in an afternoon. It goes lots of
> different directions, but when it talks about the
> control of information. Basically if you have the
> info to make a good decision then that is bad for
> the professional investors or real estate agents
> etc. These guys roll the bones with your cash
> becasue we (many of us anyway) gave it to them
> without really knowing what they were going to do
> with it. Same with the housing bubble that
> started this whole thing.


I've read freakenomics... entertaining read.

The housing bubble had nothing to do with people withholding information.

The Economist was going on about it AT LEAST 3 years ago..

People got the red-mist and started thinking that no matter how much they paid for a place, a little dab of paint, and they could sell it for 50g more.

A pretty good rule of thumb is, what could you get a month for your place if you rented it.. it should be close to the mortgage payment.

I think a whole lot of people knew they were over extending themselves, but figured they could sell for a profit if worst came to worst.

---

Andrew M
Onterrible
30ish

frumby Wrote:
-------------------------------------------------------
> ...but when it talks about the
> control of information. Basically if you have the
> info to make a good decision then that is bad for
> the professional investors or real estate agents
> etc.

I read Freakenomis - I have no major issue with it. However just because you may know everything I know you still need to execute on that knowlage and that is where I see the biggest differance between my competors (professional investors & real estate developers) and I.

My work is not really that hard, a little adding, some substracting, undersanding how to cacluate the time value of money, learning codes such as zoning code, ADA code, Fire Code, building code & managing a big team of people consulting or working on the project such as architects, engineers, lighting designers, interior designers, concrete formers, bick layers etc.

Everyone that has been doing it for more then a few years know what needs to be done yet time and time again a few firms and people outperform the rest. I think it is the will power to really do ALL of the work well ALL of the time that sets people apart not knowlage.

I am a Director at a Real Estate Investment Trust so very much both an investment professional and a real estate professional. I tell anyone who asks anything they want to know about it.

---

In the long run reality always wins.

The big three American auto manufactures have been building crap for so long they don't even realize it anymore. The only reason that they are still around is because of the federal government both buying their products and flat out giving them money. I say force Ford to sell only their European models here and let GM and Chrysler go under.

Robert.

---

Robert.

"You are way too normal to be on Rally Anarchy." Eddie Fiorelli.