Showing all posts tagged with economics.
Innovation is for Losers
This proposed $25 billion loan to General Motors is really bothering me. I don't understand how anyone could think they deserve it; they dug themselves into this stupid hole by refusing to run their business like a business. It seems like all GM does is crank out trucks and SUVs, ignoring the fact that people won't be able to afford to drive them for much longer.
So how did this happen? It's pretty obvious, really. GM makes about ten to fifteen thousand dollars on every SUV they sell, making them far and away GM's most profitable vehicle. When gas prices took off this year, people stopped buying them (30% drop). In fact, GM's US sales have dropped about 45% YTD. Instead of behaving like a business and adapting to changing market conditions, GM did stupid stuff like offering $2 gas to their customers for a year. Obviously, it's a little too late for them to do anything about it now, but they should have seen this coming. Look at Toyota, for example. They started selling Priuses in Japan in 1997 and worldwide in 2001, several years before the American car manufacturers did. General Motors is unoriginal, uncreative, and unimaginative. They're just now coming out with the Volt over there ←, although I wonder how it will work out based on the debacle that was the EV-1.
Amen
Here's an article about praying for lower gas prices that's worth reading. It's entertaining anyway.
Boo Socialism! Yay, Capitalism!
Just thought I'd share a neat talk I read about capitalism. Here's a taste:
Now, if the proper lessons of the collapse had been conveyed, we would have seen the error of all forms of government planning. We would have seen that a voluntary society will outperform a coerced one anytime. We might see how ultimately artificial and fragile are all systems of statism compared to the robust permanence of a society built on free exchange and capitalist ownership. And there is another point: the militarism of the Cold War had only ended up prolonging the period of socialism by providing these evil governments the chance to stimulate unfortunate nationalist impulses that distracted their domestic populations from the real problem. It was not the Cold War that killed socialism; rather, once the Cold War had exhausted itself, these governments collapsed of their own weight from internal rather than external pressure.
And here's a similar article about how Barack Obama is an evil socialist who will steal all your money. Looks like I'm voting for Bob Barr.
