Memo to Walmart

[themanintheseersuckersuit]

Henry Ford paid his workers a higher wage so they would show up for work and keep his assembly lines running so he could produce cars more efficiently and he could make greater profits.

But Ford didn't become a giant company until autos were no longer toys for rich people but a method of transportation for the masses. That's why Ford and GM are much much bigger companies than yacht manufacturers.

Did that happen because Ford paid his employees enough to buy the expensive cars of the day, or by making cars cheap enough for the common man. After thinking about that ask yourself if it would be a good thing to raise prices at WalMart. Oh, and GM is bankrupt

[silverscreenselect]

After thinking about that ask yourself if it would be a good thing to raise prices at WalMart. Oh, and GM is bankrupt

The fallacy in that argument is the assumption that anytime a company raises wages (or has any cost increase) that translates dollar for dollar into an increase in prices. It doesn't. At some point of course, rising costs have to be reflected in rising prices, but in most cases, companies look elsewhere to save money or accept a lower profit margin if they need to keep their prices competitive.

Oh, and a lot of yacht manufacturers have gone broke over the years as well.

[themanintheseersuckersuit]

After thinking about that ask yourself if it would be a good thing to raise prices at WalMart. Oh, and GM is bankrupt

The fallacy in that argument is the assumption that anytime a company raises wages (or has any cost increase) that translates dollar for dollar into an increase in prices. It doesn't. At some point of course, rising costs have to be reflected in rising prices, but in most cases, companies look elsewhere to save money or accept a lower profit margin if they need to keep their prices competitive.

Oh, and a lot of yacht manufacturers have gone broke over the years as well.

"Dollar for Dollar" is a strawman. "At some point" is a weasel phrase. When costs increase, prices rise or profits fall. Should the government mandate that Walmart make less money? Are profits evil.

[silverscreenselect]

Should the government mandate that Walmart make less money? Are profits evil.

I guess the government shouldn't mandate that Walmart abide by OSHA regulations or EPA regulations either. Those cost money and get in the way of profits as well.

[Bob Juch]

Why do liberals seem to think more government intervention in the market is the cure for problems caused by government intervention in the market?

Most of the major economic problems we've had in this country (1929, 2008, etc.) were caused by a lack of sufficient government intervention on the theory that letting business take care of itself was best for everyone.

Explain the Community Reinvestment act and Fannie Mae for me.

The CRA was passed in 1977. Don't try to blame that for problems 20 years later.

Fannie Mae, was founded in 1938 and helped bring us out of the Great Depression. It contributed to the tremendous growth of private housing.

[themanintheseersuckersuit]

Most of the major economic problems we've had in this country (1929, 2008, etc.) were caused by a lack of sufficient government intervention on the theory that letting business take care of itself was best for everyone.

Explain the Community Reinvestment act and Fannie Mae for me.

The CRA was passed in 1977. Don't try to blame that for problems 20 years later.

Fannie Mae, was founded in 1938 and helped bring us out of the Great Depression. It contributed to the tremendous growth of private housing.

So what caused the explosion of low equity home loans.

Compare and contrast the requirements for a home loan in 1938 and 2006

[Bob Juch]

Explain the Community Reinvestment act and Fannie Mae for me.

The CRA was passed in 1977. Don't try to blame that for problems 20 years later.

Fannie Mae, was founded in 1938 and helped bring us out of the Great Depression. It contributed to the tremendous growth of private housing.

So what caused the explosion of low equity home loans.

Compare and contrast the requirements for a home loan in 1938 and 2006

Unregulated mortgage brokers and greedy lenders who created unregulated credit default swap bonds.