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Ok. What did ‘higher margins’ refer to..sorry, I assumed net profit margins.

cercatrova 6y ago
Gross margins. Of course if they made more gross profit and reinvested it all, net profit would look the same. Making 100 bucks and reinvesting 100 is the same as making 10 bucks and reinvesting 10, in net profit terms, so net profit is not really a useful metric when judging productivity.
- deleted 6y ago
  [deleted]
- jelliclesfarm 6y ago
  It is being invested. And that means capital being ploughed back..new products and new jobs created. And more taxes. Why doesn’t that count? More 20 hour/week jobs. With more young people educated and coming out of schools..and a raising population, this is how economy keeps chugging. When Amazon builds more warehouse hubs, there is construction, more automation jobs, more drivers, more consumption, more taxes and more revenue. Most important ..more jobs. What is an acceptable alternative?
  - cercatrova 6y ago
    It counts sure but I'm saying on a balance sheet it's not useful to look at, per my example above. Increases in gross profits are much easier to look at, before they're used up for reinvestment.
    - jelliclesfarm 6y ago
      That’s why I gave the example of Amazon that has never posted anything more than 5% net profit margin ever..they do a good job at creating new jobs, new tax bases, reinvestment, Wall Street play, increasing business reach and new products. It’s a juggle. They are managing well so far. With a low profit margin. And they look pretty good.
      - cercatrova 6y ago
        I think you're misunderstanding what I'm saying. It's fine if they reinvest profits, but I'm talking about for an observer, it's easier to tell how much more money a company is making through gross rather than net profits.
  - ddingus 6y ago
    Does not matter what is done with the higher margin. The fact is when it isn't shared in higher proportion with labor, hours go up and those dollars are not available to support demand either. Taking less is the alternative. And lets be real, nobody wants to do that, and there are great reasons too. This is why I said it is a political question above. Right now market rules permit current behavior. If we want different behavior, those rules must change. We can compete with existing money with government investment in the people, lands, infrastructure and do so with the behavior intended. This will pull others that direction, though not all. We can redistribute with more aggression. We can mandate compensation differently. We can mandate hours worked. Lots of possibilities. The way I see it, growing unrest leads to national priority discussions, new policy. Or, if there is growing happiness, that will not happen. It will resolve though. One way or the other.
    - jelliclesfarm 6y ago
      You are ‘optimistic’. I predict that when automation comes around, there will be a sustained effort to be rid of non productive people. Depopulation by nature or politics/oligarchs is a guarantee. The only thing we can do is shift away from a money economy. Finding solutions with redistribution of wealth and money are castles built on sand. You can’t live in them. Automation is coming. AGI ..if it happens in our lifetime..won’t care about us.
      - ddingus 6y ago
        "When automation comes around" Fact is we are very far away from that, and just where do those who want to be "rid of unproductive people" expect them to go? Most won't be productive, and one would think they have something to say about all that. And what they say and how they say it won't be pretty, unless there is a reasonable, human answer to these kinds of questions. We are all in this together. "Those other people" are humans, same as anyone and the meaning of "productive" can, does, and should vary widely.
        jelliclesfarm 6y ago
        I am in agreement that full automation is not around the corner. Having said that, AI is still a wild card. And I mean AGI. ‘We’ will soon be 10 billion.. and there will be more UTism..’Us Vs Them’ism ...than ‘we are in this together’ when resource scarcity sets in.. I remember reading sometime ago that every time there was a drought or famine, war always followed. This was true of tribes in Africa after years of drought as it is also true for the latest Syrian War. Wars are data points. If we make each small or big war or tribal clash or even invading hordes or footnote battles as individual data points, I would hazard a guess that a famine or drought or some natural disaster or resource scarcity event would be clustered around the data points. Resources are not evenly distributed around the world. Sadly, I see very few possibilities for a happy endings for us. We can delay it. One way to do it is to make natural resources as currency. The wealth of a nation is its natural resource(including Human Resources) rather than frok speculative markets based upon consumption. In fact, consumption patterns that outstrip regeneration of resources would make a country poor rather than wealthy. It’s a way to flip our system. Other changes would also be required, of course. But the thought isn’t well formed yet. I will revisit this when I have given it more thought. Cheers!

Gross margins. Of course if they made more gross profit and reinvested it all, net profit would look the same. Making 100 bucks and reinvesting 100 is the same as making 10 bucks and reinvesting 10, in net profit terms, so net profit is not really a useful metric when judging productivity.

deleted 6y ago
[deleted]
jelliclesfarm 6y ago
It is being invested. And that means capital being ploughed back..new products and new jobs created. And more taxes. Why doesn’t that count? More 20 hour/week jobs. With more young people educated and coming out of schools..and a raising population, this is how economy keeps chugging. When Amazon builds more warehouse hubs, there is construction, more automation jobs, more drivers, more consumption, more taxes and more revenue. Most important ..more jobs. What is an acceptable alternative?
- cercatrova 6y ago
  It counts sure but I'm saying on a balance sheet it's not useful to look at, per my example above. Increases in gross profits are much easier to look at, before they're used up for reinvestment.
  - jelliclesfarm 6y ago
    That’s why I gave the example of Amazon that has never posted anything more than 5% net profit margin ever..they do a good job at creating new jobs, new tax bases, reinvestment, Wall Street play, increasing business reach and new products. It’s a juggle. They are managing well so far. With a low profit margin. And they look pretty good.
    - cercatrova 6y ago
      I think you're misunderstanding what I'm saying. It's fine if they reinvest profits, but I'm talking about for an observer, it's easier to tell how much more money a company is making through gross rather than net profits.
- ddingus 6y ago
  Does not matter what is done with the higher margin. The fact is when it isn't shared in higher proportion with labor, hours go up and those dollars are not available to support demand either. Taking less is the alternative. And lets be real, nobody wants to do that, and there are great reasons too. This is why I said it is a political question above. Right now market rules permit current behavior. If we want different behavior, those rules must change. We can compete with existing money with government investment in the people, lands, infrastructure and do so with the behavior intended. This will pull others that direction, though not all. We can redistribute with more aggression. We can mandate compensation differently. We can mandate hours worked. Lots of possibilities. The way I see it, growing unrest leads to national priority discussions, new policy. Or, if there is growing happiness, that will not happen. It will resolve though. One way or the other.
  - jelliclesfarm 6y ago
    You are ‘optimistic’. I predict that when automation comes around, there will be a sustained effort to be rid of non productive people. Depopulation by nature or politics/oligarchs is a guarantee. The only thing we can do is shift away from a money economy. Finding solutions with redistribution of wealth and money are castles built on sand. You can’t live in them. Automation is coming. AGI ..if it happens in our lifetime..won’t care about us.
    - ddingus 6y ago
      "When automation comes around" Fact is we are very far away from that, and just where do those who want to be "rid of unproductive people" expect them to go? Most won't be productive, and one would think they have something to say about all that. And what they say and how they say it won't be pretty, unless there is a reasonable, human answer to these kinds of questions. We are all in this together. "Those other people" are humans, same as anyone and the meaning of "productive" can, does, and should vary widely.
      - jelliclesfarm 6y ago
        I am in agreement that full automation is not around the corner. Having said that, AI is still a wild card. And I mean AGI. ‘We’ will soon be 10 billion.. and there will be more UTism..’Us Vs Them’ism ...than ‘we are in this together’ when resource scarcity sets in.. I remember reading sometime ago that every time there was a drought or famine, war always followed. This was true of tribes in Africa after years of drought as it is also true for the latest Syrian War. Wars are data points. If we make each small or big war or tribal clash or even invading hordes or footnote battles as individual data points, I would hazard a guess that a famine or drought or some natural disaster or resource scarcity event would be clustered around the data points. Resources are not evenly distributed around the world. Sadly, I see very few possibilities for a happy endings for us. We can delay it. One way to do it is to make natural resources as currency. The wealth of a nation is its natural resource(including Human Resources) rather than frok speculative markets based upon consumption. In fact, consumption patterns that outstrip regeneration of resources would make a country poor rather than wealthy. It’s a way to flip our system. Other changes would also be required, of course. But the thought isn’t well formed yet. I will revisit this when I have given it more thought. Cheers!