Like the illusion of Wall Street, with its vast and powerful investment banks, now shuttered, China too is an illusion perpetuated by the Globalists that gave us the 15,000 mile Caesar salad, poisoned cat food and lead based paint on babies' pacifiers. Like the illusion that money would come from thin air to always push housing prices higher, China has spent a generation pursuing its illusion. Pursuing an unattainable dream to be like the West, while 6000 years of its carefully shepherded top soil blows into the sea.
More comprehensive layoff list for this week: Costar
The following future closings and permanent mass layoffs were reported in California.
• Bank of the West is laying off 46 employees on Jan. 31 at 1977 Saturn St. in Monterey Park.
• Cadence Design Systems Inc. is laying off 84 employees on Feb. 4 at 2655 Seely Ave. in San Jose.
• Centinela Freeman Regional Medical Center is laying off 202 employees on Jan. 31 at 333 No. Prairie in Inglewood.
• Construction Metals Inc. is closing down and laying off 102 employees on Feb. 8 at 12968 Santa Ana Ave. in Fontana.
• Countrywide is laying off 73 employees on Feb. 3 at 8501 and 8511 Fallbrook Ave. in Canoga Park.
• Fresno Bee is laying off 58 employees on Jan. 21 at 1626 E. St. in Fresno.
• Giant Merchandising Inc. is closing down and laying off 120 employees on Feb. 5 at 5655 Union Pacific Ave. in East Los Angeles.
IAP World Services Inc. started laying off 248 employees on Jan. 18 at 7000 East Ave. in Livermore.
• Kmart Corp. is closing down and laying off 90 employees on Jan. 17 at 1739 S. Victoria Ave. in Ventura.
• Lasco Bathware is laying off 149 employees on Jan. 11 at 3261 and 3255 E. Miraloma Ave in Anaheim.
• Lawrence Livermore National Security LLC started laying off 248 employees on Jan. 18 at 7000 East Ave. in Livermore.
• Long Beach Acceptance Corp. is laying off 135 employees on Feb. 1 at 500 North State College Blvd., Suite 350 in Orange.
• Marvell Semiconductor Inc is laying off 4 employees on Jan. 27 at 890 Glenn Dr. in Folsom, another 4 at 10955 Vista Sorrento Parkway, Suite 200, in San Diego, another 10 at 26880 Aliso Viejo Parkway, Suite 100 in Aliso Viejo, and 51 employees at 5488 Marvell Lane in Santa Clara.
• Oldcastle Precast Inc. is closing down and laying off 33 employees on Jan. 23 at 1495 8th St. in Colton.
• Optical Communication Products Inc. is closing down and laying off 130 employees on Jan. 29 at 6101 Variel Ave. in Woodland Hills.
• Option One Mortgage is laying off 157 employees on Feb. 2 at 6501 Irvine Center Dr. in Irvine and another 160 at 3 Ada in Irvine.
• Reliant Manufacturing LLC is closing down and started laying off 54 employees on Jan. 14 at 7390 Lincoln Way in Garden Grove.
• Resmae Mortgage Corp. started laying off 182 employees on Jan. 5 at 6 Point Dr. in Brea.
• SBMC Mortgage is closing down and laying off 46 employees on Feb. 7 at 14761 Califa St. in Van Nuys.
• Scan Health Plan started laying off 33 employees on Jan. 18 at 1770 Iowa Ave., Suite 110 in Riverside, another 33 employees at 2401 E. Katella Ave., #125 in Anaheim, another 41 at 2501 Cherry Ave., #200 in Los Angeles, another 51 at 3800 Kilroy Airport Way, #100 in Long Beach, and 33 at 500 N. Central Ave., #350 in Glendale.
• Sierra Cedar Products LLC is closing down and laying off 66 employees on Feb. 3 at 1401 Melody Road in Olivehurst.
• Target is closing down and laying off 133 employees on Feb. 2 at 1363 West Henderson Ave. in Porterville.
... _________________ "RRrrruuuunnnn!!!" ~Apocalypto
Posted: Mon Apr 14, 2008 3:15 am Post subject: Re: Let the layoffs begin
setag wrote:
MrBill, I am just a simpleton and your explanation is greatly appreciated and your insight is extraordinary. Thank you.
Further questions:
1.) How can this corporate finance model possible work within todays financial market environment? Risk disclosures are not made public and fair value accounting is just a myth.
2.) How can governments, corporations, banks, and people have access to credit without being caught in this cycle?
Again, thank you.
It is little bit like having access to alcohol, but avoiding becoming an alcoholic. If you cannot handle even a little bit of alcohol then abstinence is the best policy. I would suggest that governments that have to balance their budgets are the best defense against government prolifigy and waste.
On an individual or corporate level you have to distinguish between income producing and appreciating assets versus depreciating assets. And, of course, it is always easier to buy an asset than to fund it. So the easiest way to avoid the liquidity trap is to ask yourself how you intend to fund your purchases? If it based on unrealistic assumptions then you are likely walking into a liquidity trap.
Actually there is no separating the corporate finance model from today's financial market environment. The market rewards prudence and punishes risk in the form of lowering the cost of capital for the well-run company or nation and by demanding higher real rates of return from companies or nations that are seen as more risky.
However, interestingly, the market sometimes gets it wrong or take too long to digest new information completely and accurately. At the moment there is a flight to simplicity as many market participants realize how wrong they had gotten it with regards to complicated credit products they barely understood. I do not believe in perfect markets, but that is another story.
They will reward a country or a company for their faster growth, even if it is unsustainable or built on a shaky foundation, while spurning slower growing, more conservative firms and nations. Think the new economy versus the old economy during the dotcom bubble. This leads to a misallocation of resources, while that over optimism lead to over investment and later a busting of the bubble.
What we are saying is that if you consciously design your capital structure properly you will not fall into a self-reinforcing liquidity trap. Whether that is as an individual, company or country. The external shocks will always take place. We have not tamed the business cycle and we have not conquered nature. Therefore any capital structure has to be balanced and flexible. If you price everything to perfection then even a small credit contraction can have large implications.
In the United States, for example, unemployment, inflation, nominal interest rates and growth do not point to financial catastrophe per say when compared to other nations that have higher strucutural unemployment, higher inflation, higher nominal interest rates or lower growth. However, if individuals, firms and nations invest assuming that the virtuous cycle will never change for the worse then that leverage almost insures that even a relatively small wobble in the real economy can reverberate through-out the entire economy through financial markets or the cost of capital that everyone must pay.
5-6% interest rates alone are historically fairly consistant with stable long-term growth. So the economy must have been very unbalanced if it relied of ultra low real interest rates to keep the economy expanding nominally. In turn those ultra low rates were then priced into future rate expectations.
But as to your point about risk disclosures not being made publicly they certainly are. But they are also routinely ignored. Every single email that I receive from a bank or broker has a risk disclosure at the bottom. Every research report as well. However, very few people will bother to read a hundred page plus prospectus before deciding to buy a stock for example. Many do not bother to read the annual reports. I certainly do not have time to do proper research on each and every company that I own shares in. I rely to a certain extent on their financial ratios.
We have existing laws to prosecute for corporate fraud. However, no one position should be large enough to wipe out your portfolio. If it is, then it is unbalanced. So if I take a hit on GE last week that is balanced by investments in other assets. I certainly do not have my life savings invested in my firm in the form of shares and pension, and neither should anyone else. That would be a liquidity trap as well as when the company runs into operating or competitive problems then it effects my salary, my savings and my pension. It would be a self-reinforcing vicious circle should anything go wrong, and anything can go wrong. That is the point as Enron employees found out to their disadvantage.
Fair value accounting is not so much a myth, but it relies on continuous pricing to be able to find market prices for assets at any given time. And again as you are likely aware the income statement and the balance sheet are snapshots of profitability and the book value of the company. They reflect past performance more than they are predictors of future profitability. However, if you look at financial statements using a corporate finance model you can see if a firm relies too heavily on short-term, variable interest debt. Or if too great a percentage of their sales and profits are dependent on too narrow a customer or geographical segment. That may be a warning signal to avoid this company or to limit your investment to a small percent of your overall balanced portfolio.
Unfortunately, there are no easy answers. No super-regulator exists or will ever exist that can protect investors from both market risk and from firm specific operating risk. They can punish fraud. They can demand that public statements meet a certain minimum threshold in disclosure. They can insist on compliance. They can change accounting standards. But at the end of the day when you buy a share you are exchanging your cash today in exchange for a share of the company's future revenues, and that will always create uncertainty and risk.
In terms of strategy a balanced portfolio of businesses will mean that a firm gets its revenues and profits from fast growing, profitable businesses and cash cows. In a two by two matrix it might look like this:
So your decision to invest in a company should be based just as much on its competitive position as on its financials. Again no super-regulator is going to help you out with those decisions. Nor should they. _________________ The organized state is a wonderful invention whereby everyone can live at someone else's expense.
Posted: Mon Apr 14, 2008 7:47 pm Post subject: Re: Let the layoffs begin
Most informative, MrBill!!
"I do not believe in perfect markets" - By MrBill
Perhaps, this may be the best lesson for me.
The following is a good article I read and thought you would be interested in reading it also. I have chosen not to paste it here cause it is rather lengthy.
It seems like Friedman became too hung-up on the ideology of monetarism to the detriment of critical thinking. Something we can all learn from. Cheers. _________________ The organized state is a wonderful invention whereby everyone can live at someone else's expense.
It seems like Friedman became too hung-up on the ideology of monetarism to the detriment of critical thinking. Something we can all learn from. Cheers.
wow just the first paragraph and I already disagree with 2 things the author mentions. ha ha To begin with if we go back to Victorian England as so "colorfully" described by Charles Dickens MOST people would agree wholeheartedly and call that a classic example of a "free market" economy-->"It was the best of times, it was the worst of times..." + "please sir can I have some more?" *holds up an empty bowl asking for more gruel* However I disagree. If we use the dictionary definition of "free market" then even the economy of Victorian England would not qualify. IMHO England was not "free market" enough to deserve to be called "free market". The first 100++ years of the USA would be a much better example.
///
I think one of the reasons why it's so difficult to find an economic theory that can properly explain all the craziness in this world is because humans are part logical + part chaotic emotional. Did "classical economics" failed to give explanations or solutions to the great depression? Maybe yes/no....so what, who cares? Newton's laws of motions did not properly explain the movements of subatomic particles but he's one of the greatest scientists the world will ever know. Just because a theory does not provide a complete solution to every scenario imaginable under the sun does not make it a failure. Good luck trying to find such a formula!
///
Posted: Wed Apr 16, 2008 1:39 am Post subject: Re: Let the layoffs begin
The evolution of economic theory is not unlike that of the field of psychology. You have a progression of theories. Like Freud and then the Jung and the anti-Freuds. Maslow's hierarchy of needs. Erikson's developmental view of man. Skinner's behavioral psychology. Up to the present view of pharma based psychology. They all provide a framework for understanding a particular problem or behavior, but none explain everything to everybody's satisfaction.
The best economic policy draws on a multi-disciplinary approach that borrows from biology, ecolology, statistics, engineering, the social sciences and even entomology for its inspiration. Economic theory tries to describe a physical problem. It is not divorced from it.
In the context of layoffs, downturns, recessions, depressions and economic collapse the challenge is not to explain such events in hindsight with a simple model, but to realize that it is the human element that we are most concerned about not the loss of wealth or productivity.
If economic events did not have social consequences then there would be far less controversy about which economic approach works best and why? I happen to believe that the wealth and poverty of nations rests on these questions, so it matters a great deal. In times of scarcity much more so. The poor benefit the most from good economic policies and suffer the most from bad ones.
Physical Reality > Economic Consequences > Social Reaction > Political Response > Feedback Loop > New Reality > Etc. _________________ The organized state is a wonderful invention whereby everyone can live at someone else's expense.
Joined: Jun 13, 2007 Posts: 3909 Location: Minniesotuh
Posted: Mon Apr 28, 2008 5:07 pm Post subject: Re: Let the layoffs begin
GM to cut truck shifts, leading to layoffs
High gas prices, slump in housing hold back automaker’s sales
DETROIT - General Motors Corp. said Monday it plans to cut one shift at four North American factories that make pickup trucks and big sport utility vehicles, laying off about 3,500 workers.
The world’s largest automaker said the cuts are due to sagging sales, brought on by high gasoline prices and an economic downturn.
GM said the cuts will affect pickup factories in Pontiac and Flint, Mich., and Oshawa, Ontario, as well as the full-size SUV plant in Janesville, Wis. …
Want a truck? Out of luck?
Joined: Jun 13, 2007 Posts: 3909 Location: Minniesotuh
Posted: Sun May 04, 2008 9:47 pm Post subject: Re: Let the layoffs begin
UBS May Cut 8,000 Jobs After SF12 Billion First-Quarter Loss
By Elena Logutenkova
May 5 (Bloomberg) -- UBS AG may cut as many as 8,000 jobs as it grapples with the biggest credit writedowns of any European bank and a 12 billion-franc ($11.4 billion) first-quarter loss.
Switzerland's biggest bank, which had a 3 billion-franc profit a year earlier, is set to spell out plans for layoffs when it reports detailed results tomorrow. The company will probably say it's eliminating between 2,500 and 3,000 jobs in its investment bank, more than 10 percent of the division, two people familiar with the matter said May 2.
``UBS is scaling down investment banking,'' including reducing trading bets and giving up off-balance sheet units, said Frankfurt-based Landsbanki Kepler analyst Dirk Becker, who advises clients to ``reduce'' holdings of UBS. It is ``realistic'' to estimate that the company will fire one tenth of its 83,000 employees overall, he said. ...
UBS _________________ "RRrrruuuunnnn!!!" ~Apocalypto
Joined: Jun 13, 2007 Posts: 3909 Location: Minniesotuh
Posted: Fri May 09, 2008 9:59 pm Post subject: Re: Let the layoffs begin
Space shuttle shutdown may kill 8,000 jobs
NASA estimates employment loss when fleet is retired in 2010
By Matt Sedensky Tues., April. 1, 2008
AP-MIAMI - More than 8,000 NASA contractor jobs in the nation’s manned space program could be eliminated after the space shuttle program is shut down in 2010, the agency said Tuesday.
The number of civil servants is expected to remain roughly the same, but dramatic job cuts are possible among private contractors as NASA transitions to the Constellation program, which is developing the next-generation vehicle and rockets to go to the moon and later to Mars.
Constellation isn’t scheduled to begin flights until 2015. …
NASA _________________ "RRrrruuuunnnn!!!" ~Apocalypto
Sharper Image stores to be closed and liquidated
Sun Jun 1, 3:39 PM ET
NEW YORK (Reuters) - All remaining stores of bankrupt gadget retailer Sharper Image Corp (SHRPQ.PK) will be closed and liquidated, its new owners said on Sunday.
More than $50 million of inventory is being sold at 86 Sharper Image store-closing sales throughout the United States, liquidators the Hilco Organization and Gordon Brothers said in a statement.
A joint venture led by units of Hilco and Gordon Brothers purchased the company's assets at a bankruptcy auction last week for $49 million, and plan to continue its wholesale, direct-to-retail, e-commerce and catalog businesses under a new licensing strategy.
...
_________________ "It's called the American Dream because you'd have to be asleep to believe it."
ohh no! Where will I go now to get a shiatsu foot massager?
Is it my imagination or most of the stores going belly up these days are the "non-essential" stuff, basically 75% of the crap you see in a shopping mall. The whole premise of a mall is the "ambience". All the pretty interior designing is suppose to make shopping a pleasurable experience.
I think in a post PO world consumers will barely have enough to buy the goods they want let alone the interior designing. Shopping malls will become a thing of the past.
Because retailers rely on a broad network of suppliers, their bankruptcies are rippling across the economy. The cash-short chains are leaving behind tens of millions of dollars in unpaid bills to shipping companies, furniture manufacturers, mall owners and advertising agencies. Many are unlikely to be paid in full, spreading the economic pain.
When it filed for bankruptcy, Sharper Image owed $6.6 million to United Parcel Service. The furniture chain Levitz owed Sealy $1.4 million.
And it is not just large companies that are absorbing the losses. When Domain, the furniture retailer, filed for bankruptcy, it owed On Time Express, a 90-employee transportation and logistics company in Tempe, Ariz., about $30,000.
Last edited by cube on Mon Jun 02, 2008 2:09 pm; edited 1 time in total
Posted: Mon Jun 02, 2008 2:06 pm Post subject: Re: Let the layoffs begin
LoneSnark wrote:
Hmm, 'bursting of the housing bubble' has made my dollars worth more; I can buy 20% more house today than in 2006 with the same dollars. Looks like deflation to me, as the same dollar is now backed by more house, which last I checked was real value.
Does it really need saying? Adam Smith proved over 200 years ago that metals such as gold and silver have no more intrinsic value than anything else people want that is scarce. If you bought gold in 1980 then you had to watch as more and more money was created, inflation drove up the price of everything, but not the value of your gold, which collapsed from over $840/oz in 1980 to $260/oz in 2000.
Quite. We misunderstand value, since there is intrinsic value and extrinsic value. Market value is a combination of them both. Gold is valuable for it's uses, but it is not as valuable in large nation as a currency since there is not enough of it. Energy is valuable intrinsically, but perhaps it is only necessarily so during times of shortage. Whatever you need that you lack is valuable.
AP GM closing 4 truck, SUV plants in North America
Tuesday June 3, 11:49 am ET
By Tom Krisher, AP Auto Writer
GM closing 4 North American truck, SUV plants, affecting 10K workers, reviews Hummer plans
WILMINGTON, Del. (AP) -- General Motors is closing four truck and SUV plants in the U.S., Canada and Mexico, affecting 10,000 workers, as surging fuel prices hasten a dramatic shift to smaller vehicles.
CEO Rick Wagoner said Tuesday before the automaker's annual meeting in Delaware the plants to be idled are in Oshawa, Ontario; Moraine, Ohio; Janesville, Wis.; and Toluca, Mexico. He also said the iconic Hummer brand will be reviewed and potentially sold or revamped.
Wagoner said the GM board has approved production of a new small Chevrolet car at a plant in Lordstown, Ohio, in mid-2010 and production of the Chevrolet Volt electric vehicle in Detroit.
Wagoner announced the moves in response to slumping sales of pickups and SUVs brought on by high oil prices. He said a market shift to smaller vehicles is permanent.
GM shares rose 25 cents, or 1.4 percent, to $17.69 in morning trading.
The cuts will affect 10,000 hourly and salaried workers. Many will be able to take openings created when 19,000 more U.S. hourly workers leave later this year through early retirement and buyout
...
Yahoo _________________ "It's called the American Dream because you'd have to be asleep to believe it."
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