Joshua, yesterday, my lawyer and I had a short debate about the purpose of business. He gave the pat answer, "Make money." I quoted Peter F. Drucker, "Create jobs." Profits exist as a measure of efficiency and as a surplus to reinvest in operations and training to keep the business competitive - not take the money to Swiss banks and gut the business.
Joseph F. Schumpeter, an economist at Harvard at the start of the 20th century made this argument. Profits exist to reinvest to create more jobs and profits. People needs jobs to live; society has the absolute right to devise any rules it wants to make sure its members live. Drucker recyles Schumpeter.
Germany today in fact follows Schumpeter, and it has the second highest export business in the world - after China. Moreover, its workers receive some of the highest pay and benefits in the world. It is because Germany reinvests the profits into improved operations(equipment, techniques, processes) and training of the workforce and management.
Germany is proof that we need not to be a Third World country to be competitive today and have jobs enough for our people. See the website of David McWilliams, an Irish busineess analyst, writer, for an excellent article on this by him.
Without a profit, you have nor surplus. Without a surplus, you cannot innovate to remain competitive. This writer is totally for profits if we reinvest those profits to stay in business and to create more business. Business is about jobs in the final analysis. The sooner American digest this the sooner we will know how to "set our house in order."
It is not take the money and run.l It is take the money and recycle it into competitive equipment and training.
Thus ends the sermon for today.
Amen.
Dr. Rux
Saturday, November 13, 2010
Canada and the Future of Food Prices
As a food-rich country, Canada can profit from the coming jump in world food prices.
The Future of Food
The low cost of food in the history of America, which has shaped its economy, is probably coming to an end. Here is why.
Wanda, yes, look for food prices to rise, not fall. Therefore, commodities could be a smart investment, field of work. I am not a financial advisor; however, it is logical. China wants more food. India wants more food. Both China and India are gaining purchasing power. They, and others, will begin to raise the bidding for food. The same process will happen to oil and other commodities.
Nassim Nicholas Taleb, author of the fabulous book The Black Swan, the 2007 classic on how chaos theory and complexity theory impact economic behavior, and one of my intellectual heroes, last week that two fields will be growth fields in the coming economic collapse: health care (demographics) and food (commodities).
Yesterday, I told this to an old friend who is now manager of a new health food store here. He is on trend with Taleb. People will eat better to better manage health care costs.
In short, for Americans, the era of low food prices is going to come to an end. More and more of our paychecks, if we have one, will go to purchase necessities.
This is why trend forecasters like Gerald Celente advise their clients to invest in farm land, start their own gardens, and pay close attention to supply and demand dynamics for food.
The Future of Food
The low cost of food in the history of America, which has shaped its economy, is probably coming to an end. Here is why.
Wanda, yes, look for food prices to rise, not fall. Therefore, commodities could be a smart investment, field of work. I am not a financial advisor; however, it is logical. China wants more food. India wants more food. Both China and India are gaining purchasing power. They, and others, will begin to raise the bidding for food. The same process will happen to oil and other commodities.
Nassim Nicholas Taleb, author of the fabulous book The Black Swan, the 2007 classic on how chaos theory and complexity theory impact economic behavior, and one of my intellectual heroes, last week that two fields will be growth fields in the coming economic collapse: health care (demographics) and food (commodities).
Yesterday, I told this to an old friend who is now manager of a new health food store here. He is on trend with Taleb. People will eat better to better manage health care costs.
In short, for Americans, the era of low food prices is going to come to an end. More and more of our paychecks, if we have one, will go to purchase necessities.
This is why trend forecasters like Gerald Celente advise their clients to invest in farm land, start their own gardens, and pay close attention to supply and demand dynamics for food.
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