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Freako, please kill it for me. 
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I thought that the following picture, originally posted by Q Cubed
would be rather relevant for this thread. The inscription says "Journal about how money is made".Attached FilesFreedom is just unawareness of being manipulated.Comment
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Sorry to keep jumping around on topics, but I found this FT article interesting about regulating drug prices and how the American consumer is getting shafted by all of these central planning types in Europe and Canada.
Overall, I agree with the head of the FDA. Many European countries are joined in a pact of freeloaders. However, I don't think the answer is for the US to emulate these central planners. Otherwise, everybody would have fewer good new drugs. It makes sense that the drug companies would want to be most involved and spend most of their R&D money in their overwhelmingly biggest market, but I wonder how far that goes.Last edited by DanS; September 26, 2003, 00:38.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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That just means a **** is more expensive in the US due to structural rigidities.Originally posted by TCO
So if a **** in France costs 100 Euros. And a **** in the US costs $200 and a Euro is worth $1.2, then the French **** is worth $120. It's just too easy to get laid there. Like ice in the arctic.“Now we declare… that the law-making power or the first and real effective source of law is the people or the body of citizens or the prevailing part of the people according to its election or its will expressed in general convention by vote, commanding or deciding that something be done or omitted in regard to human civil acts under penalty or temporal punishment….” (Marsilius of Padua, „Defensor Pacis“, AD 1324)Comment
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****We the people are the rightful masters of both Congress and the courts, not to overthrow the Constitution but to overthrow the men who pervert the Constitution. - Abraham LincolnComment
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Structural rigidities
Originally posted by Serb:Please, remind me, how exactly and when exactly, Russia bullied its neighbors?
Originally posted by Ted Striker:Go Serb !
Originally posted by Pekka:If it was possible to capture the essentials of Sepultura in a dildo, I'd attach it to a bicycle and ride it up your azzes.Comment
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You like puritanism, or what? Pervert.“Now we declare… that the law-making power or the first and real effective source of law is the people or the body of citizens or the prevailing part of the people according to its election or its will expressed in general convention by vote, commanding or deciding that something be done or omitted in regard to human civil acts under penalty or temporal punishment….” (Marsilius of Padua, „Defensor Pacis“, AD 1324)Comment
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I second this.Originally posted by Ted Striker
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I have a meandering multi-disciplinary question. Please correct anything you see that doesn't make sense as well as answering the questions (as I'm just using common sense assumptions about how some of this stuff works).
I was stunned to hear Michael Dell say that Dell has an inventory ratio of over 100. Its financials indicate that Dell has been able to double its inventory ratio in the last 5 years. Stockpoint says that the S&P average is around 10, which seems about right--you sell out your inventory every month or so on average. People pay their rent every month, etc. Anyway, Michael Dell's point was that the rise of the information age was less important from a retail perspective (for instance, ordering something on the web) than from a business process perspective (more efficiently getting the product to the shelves).
By comparison, Wal-Mart has an inventory ratio of 7.5 or so. Kroger, the biggest US supermarketeer, has an inventory ratio of 9 or so. Now I was led to believe that the supermarketeer had low margins, but made their money by turning over their inventory quickly and having high volumes. But doesn't this indicate that Dell is woefully out-supermarketing the supermarketeers? Also, as a basic matter, doesn't this result in Dell using its capital most effectively? I don't know of a company with a higher inventory ratio (although I'm guess at least one exists). How does this effectiveness show up in the marketplace? Is it just that Dell has lower capital costs? How do we quantify the advantage this gives Dell over its competitors?
Now another part of this question. In macroeconomic terms, I think the equation is something like money supply x velocity = economic output. If the Dells of the world increase their inventory ratios, then that increases the economy's velocity. Money supply has been fairly easy in this recession, but as happens in all recessions, velocity decreases. Put simply, if the Dells of the world are able to increase their inventory ratios very healthily from boom time throughout a recession, wouldn't that indicate that the economy could move to the upside an awful lot, once the velocity in other parts of the economy pick back up?
Also, since the inventory ratio impacts the efficitiveness of the use of capital, wouldn't that impact capital productivity rather than labor productivity? If this is so, then wouldn't that indicate that once the speculative bubble of the late 90s wears off, the economy is on track for much higher capital productivity? Lastly, wouldn't the rise of the information age impact capital productivity to a higher degree than labor productivity.
As I discussed some time ago, the information age seems to have come only recently to US manufacturing. For instance, my brother-in-law who is a machinest at a Meritor truck axel plant keeps b&m-ing to me about how the new inventory control system they have sometimes stops the line because they don't have 50 cent bolts in stock. As an aside, ArvinMeritor has increased its inventory ratio from 9 to 13.5 in the last 5 years.Last edited by DanS; September 28, 2003, 15:20.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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You have a lot of different points, here. With respect to the supermarkets, they make a lot of money on accounts payable/receiveable difference. They get 90 day payment terms for their debts but require 30 days for their suppliers.
Wrt inventory, I believe you are talking inventory "turns". I just want to make sure what we are talking about. There is working capital other than inventory. Something to watch for, when you start looking at ratios. I would watch the definitions, especially if it is a news article. Can easily be talking apples and oranges.Comment
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Originally posted by TCO
You have a lot of different points, here. With respect to the supermarkets, they make a lot of money on accounts payable/receiveable difference. They get 60 day payment terms for their debts but require rapid payment for their customers.
Wrt inventory, I believe you are talking inventory "turns". I just want to make sure what we are talking about. There is working capital other than inventory. Something to watch for, when you start looking at ratios. I would watch the definitions, especially if it is a news article. Can easily be talking apples and oranges.Comment
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I hate it when I quote instead of edit.Comment
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I'm DanSing you liberally, but yes I'm talking about the yearly inventory ratio (how many inventory turns over a period in question). COGS/Inventory. Calculated using a calculator based upon Stockpoint numbers, not any article.I came upon a barroom full of bad Salon pictures in which men with hats on the backs of their heads were wolfing food from a counter. It was the institution of the "free lunch" I had struck. You paid for a drink and got as much as you wanted to eat. For something less than a rupee a day a man can feed himself sumptuously in San Francisco, even though he be a bankrupt. Remember this if ever you are stranded in these parts. ~ Rudyard Kipling, 1891Comment
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Well everyone says they have a great setup but still a turn every 3 days seems unbeleiveable. Still wonder if there is some issue with the numbers. Maybe they do a lot of contract manufacturing and so a lot of the inventory is not listed as theirs? Still 3 days sounds fishy. Would think that you have to take credit fro it during delivery and that would average 3 days on its own (or more).Comment
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Do they sell any services that might show up in COGS but not inventory?Comment
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