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Message |
    
Frederick A. Babb
Hsympothai Member
Post Number:
422
Registered: 04-2004
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, April 29, 2006 - 07:26 am: |   |
This is an interesting theory. How much of the instability of the middle east is linked to maintaining the profits of our oil companies?
http://www.ironicallyspeaking.net/HEADLINES/29%20APRIL%2006%20%20AS%20PROFITS%20SOAR%20UNAPOLOGETIC%20OIL%20INDUSTRY%20LINKED%20TO%20AL%20QAEDA%20ARMS%20DEALS.htm
Preview books: http://www.frederickbabb.bravehost.com |
Todd Hunter
Mindsight Moderator
Post Number:
3269
Registered: 02-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, April 29, 2006 - 01:39 pm: | |
Unfortunately, when you look at sheer profits in dollars, the numbers are always going to look too large. The real number you want to look at is profit margin, which has stayed the same at around 7-10%.
I'd venture to say that this profit margin, if it isn't much lower than other industries, is at least running close to others.
Mindsight Moderator
Aston's Blog
MWWB |
Fred Dungan
Unity Member
Post Number:
1612
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, April 29, 2006 - 03:23 pm: | |
You really believe that? Listen to the trial of Enron's former CEO, Ken Lay, and you will learn how energy corporations cook the books. The statistics say what they want them to say. The bottom line is that the consumer is being gouged and, in some cases, defrauded.
http://www.fdungan.com/vigilantes.htm |
Laurel Johnson
Unity Member
Post Number:
4257
Registered: 01-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, April 29, 2006 - 03:27 pm: | |
Unfortunately, I always believe that every pocket of instability everywhere in the world is induced for a reason -- money or power or both. That is man's nature. "The love of money is the root of all evil." has always been true.
Laurel Johnson
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Todd Hunter
Mindsight Moderator
Post Number:
3272
Registered: 02-2003
Rating: N/A
Votes: 0 (Vote!) | | Posted on Saturday, April 29, 2006 - 08:42 pm: | |
"You really believe that?"
Yes. I also believe that people have a tendency to concentrate on big numbers without knowing all the facts, because emotions take over and override logic.
When the military spends $1000 for a hammer, the vast majority are dumbfounded. How could they pay so much for something that costs me $10?
What I (and many others in a federally regulated industry) know is that with government oversight, that same hammer that costs me $10 at the hardware store is not put through the same stringent testing that hammers for the military (or hammers that have to be put through specific government testing) go through. The cost for all this testing has to be included in the cost of the component.
The same thing applies here: Unless we have folks who have worked in the industry vouch otherwise, I'd say that profit margins have not changed.
Is that to say the oil companies aren't using federal environmental regulations as an excuse to limit supply through the lack of new refineries?
No...but to point at their profits alone and call it unfair that they make so much goes against the core of the free enterprise system.
Mindsight Moderator
Aston's Blog
MWWB |
Dennis Collins
Mindsight Moderator
Post Number:
1853
Registered: 06-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, May 03, 2006 - 01:47 pm: | |
7-10% is a pretty big profit margin on the kind of volume that the oil companies deliver. General Motors operates closer to 5%. And if GM has a major recall, they have to eat the loss. If somebody worries that Iran might withold their petroleum, the oil companies are allowed to make the public pay for that speculation.
All of my life (and I mean that quite literally) I have seen the oil companies raise prices during the final week of May, the first week of July, and the final week of August. But every year they deny that it has anything to do with the increased holiday travel.
They can say whatever they want and anyone who chooses can believe them but for my part...
Don't shit a shitter.
Dennis Collins
Moderator
www.theunrealmccoy.com |
Pacwriter
Unity Member
Post Number:
2356
Registered: 04-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, May 03, 2006 - 02:13 pm: | |
anyone care to investigate profit margins for large drug comapnies?
How about the fact that Federal Tax income for the year is up 15%?
For really high profit margins check out funeral homes.
And, going back to oil -- how many folks have stocks in oil companies? You think they are complaining?
Gouged - oil companies are just one that does it and gets away with it. You can't even complain if your cell phone triples their rates, you are locked into a contract. Pay your cable bill lately? Look at their profit margins.
Buy jewerly? check out their markups Same for furniture.
Coke and Pepsi prices range from 79 cents a two-liter to 1.39 for the same thing. But go to a resturant and they charge you 1.59 for a glass 3/4 filled with ice.
Come on folks, oil companies are one industry making money but their profits are what they are because of VOLUME. You think Pepsi is making any money off the PeeDee River water they are pumping in South Carolina for their Aquafina bottled water? What is the profit margin on a bottle of water they strain the cloride out of the city water coming from that muddy river?
Don't you think gallon compared to gallon that the water costs more and has a larger profit margin than gas?
I like the higher gas prices. Really, I have some stocks and I want people to get out of their cars. Ride a bike, get a scooter, take a bus - maybe life will be less frustrating than rushing like a mad-hatter to burn more gas going a dozen times a week to Walmart to buy junk made in china.
http://www.perrycomer.com
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Tom Elkins
Hsympothai Member
Post Number:
435
Registered: 01-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, May 03, 2006 - 02:37 pm: | |
Dennis -
As I recall, GM is currently showing huge losses (not profits). Not comparable, to be sure. But Exxon-Mobil's 9% is far from spectacular, and its return on invested capital is even less so. Unfortunately, we are a nation of economic morons who are easily riled by large numbers.
Tom Elkins
NORTH of TEXAS
www.authorsden.com/tomelkins |
Fred Dungan
Unity Member
Post Number:
1625
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Wednesday, May 03, 2006 - 04:35 pm: | |
Pacwriter,
I, too, believe in capitalism. However, laissez faire capitalism amounts to giving large corporations a license to steal. That's why Republican President Theodore Roosevelt pressured Congress to enact the anti-trust legislation which put the screws to Standard Oil and brought the price of gasoline down to the 25 cents per gallon it was when I was a kid. Just like Theodore Roosevelt, I believe that commerce needs to be regulated in order to ensure fair pricing and competition. Oil man George W. Bush doesn't like regulation because it would hurt his cronies. Obviously, his friends aren't any friends of ours.
http://www.fdungan.com |
Dennis Collins
Mindsight Moderator
Post Number:
1860
Registered: 06-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 08:13 am: | |
During my career with GM I sat in on hundreds of budget meetings and my experience was that everything was based on forecast. If you forcasted a profit of three million dollars and only make two million dollars, it's reported as a one million dollar loss.
I don't for one millisecond believe that the oil companies operate on a 9% profit margin. My guess would be that it's roughly double that. It's all in the way you spin the numbers.
Explain how United States Steel pays zero income tax.
Am I cynical? I wonder why that would be?
Dennis Collins
Moderator
www.theunrealmccoy.com |
Tom Elkins
Hsympothai Member
Post Number:
441
Registered: 01-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 09:51 am: | |
I believe you are overly-cynical, Dennis, and in one instance incorrect.
In the past four quarters, US Steel has set aside 300 million for income taxes. As I'm sure you know, tax "set asides" must be deposited with IRS.
Secondly, ALL budgets are based on projections. That's how you budget. But actual profits are based on results. To be sure, there have been nefarious corporate activities, and they are being dealt with. There have also been nefarious politicians, clergymen, teachers, policemen...even, God forbid, writers.
In light of the corporate exposures in recent years, today's CEO's and Directors have all manner of agencies looking over their collective shoulders, including a NY prosecutor whose activities are at least as questionable as those he is prosecuting.
I operated my own corporation for 31 years, albeit small. For many items there are at least two ways to declare them: as an "expense" if you want to lower your profit (and pay less taxes), or as a depreciable "assett" if you want to increase your profit (and attract investors). IRS and the SEC don't care which you do. There are also large non-cash deductions which all businesses may (and should) take, including depreciation and amortization. Even "good will" can be set up as a figure on the corporate balance sheet, and amortized over 15 years. I find it ludicrous to measure a company by the amount of income taxes it pays. If you had a choice between paying $10,000 or $5,000, which would you chose?
That's my lesson for the day. No applause, please.
Tom Elkins
NORTH of TEXAS
www.authorsden.com/tomelkins |
Stephen Lodge
Wandering Member
Post Number:
134
Registered: 06-2004
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 09:54 am: | |
Thank you, Tom.
Steve
Novels by Stephen Lodge:
"Shadows of Eagles"
"Charley Sunday's Texas Outfit!"
"Nickel-Plated Dream"
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Bill Nelson
Unity Member
Post Number:
1942
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 10:33 am: | |
There is also an element of supply and demand (summer vacation travel), a legitimate function of capitalism. I know supply can be manipulated to excuse price increase, but, that's the good old American way. Rentals on condos at the beach are more expensive in the summer...those greedy time-share holders.
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Tom Elkins
Hsympothai Member
Post Number:
442
Registered: 01-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 11:20 am: | |
Yes, Bill. During the years I was a "greedy capitalist" the company owned my cars, maintained them, and depreciated them. It paid my country club dues until Carter put a stop to it. It paid my travel expenses to the mainland (while I lived on Maui) as long as the trips were business related (I took side trips to visit my parents out of my own pocket). My expense account included business lunches, although never the "three martini" variety Carter described.
There are perks that come with owning a business. But I was the one who took the risk. I could've gone belly-up...almost did a few times. My employees were guaranteed a paycheck, and they could always quit. The owner can't (then he's no longer the owner). Those perks are well-known, approved and carefully scrutinized by IRS.
Summer vacation "travel" wasn't a perk for me. Free accomodations depended on who I knew and what I had to trade.
Tom Elkins
NORTH of TEXAS
www.authorsden.com/tomelkins |
Fred Dungan
Unity Member
Post Number:
1640
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 01:28 pm: | |
All economic progress comes at the expense of the workers. That's true in all economic systems - capitalist, socialist, and communist. The only question is how fast and at what expense. The fact is that today's workers don't make as much as workers did 20 years ago despite the fact that production per worker has remarkably increased. In other words, the average guy is getting screwed and believe me HE KNOWS IT! Go ahead and spin it any way you want, the fact is that if capitalism loses the support of the silent majority it is forever doomed the same way that Communism was doomed when it lost the support of Soviet workers. Think about that the next time you try and justify an injustice.
http://www.fdungan.com/bushwhacked.htm |
Bill Nelson
Unity Member
Post Number:
1944
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 01:47 pm: | |
Tom,
I, too, owned my own business. I practically lived on my legitimate expense account. My, auto, all running and maintenance expense, most meals, some of the booze, hotels, airfare etc. were all paid for by Uncle Sam. That took care of about 80% of my day. Then I paid as little tax on my regular income as the law allowed. I had a good tax accountant. My conscience was clear as a bell.
I don't make the laws, I live under them. Big corporations don't make the laws either--they do influence them through lobbies and donations--so how are you and I different than the oil companies?
Some people, maybe Fred, I don't know, see a crook behind every move they make. I don't. I see it as good business management.
I know there are many unscrupulous people out there, but there are some ministers, priests, school teachers, doctors and policemen that get caught in various and sundry no-no's, too. It's all part of our society. |
Tom Elkins
Hsympothai Member
Post Number:
443
Registered: 01-2005
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 02:22 pm: | |
I think we're on the same page, Bill. Fred, if capitalism is doomed, and communism is doomed, and socialism is a demonstrated failure, and if workers get screwed under any system, what then? No question workers do better in a capitalist economy than any other. Plus, they are free...and they are not under the others.
Tom Elkins
NORTH of TEXAS
www.authorsden.com/tomelkins |
Fred Dungan
Unity Member
Post Number:
1641
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 04:05 pm: | |
Unless they worked for Enron, right Tom?
http://www.fdungan.com/bushwhacked.htm |
Fred Dungan
Unity Member
Post Number:
1642
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 04:10 pm: | |
What I'm trying to get across is that any system can become oppressive. The gap between rich and poor is widening in the United States, not shrinking. When I was a kid, I would come home and tell my Mom if I saw a homeless person. I would do the same thing if I saw a limousine. Nowadays, both are commonplace.
http://www.fdungan.com/bushwhacked.htm |
Bill Nelson
Unity Member
Post Number:
1945
Registered: 10-2002
Rating: N/A
Votes: 0 (Vote!) | | Posted on Monday, May 08, 2006 - 04:11 pm: | |
Enron is not typical. It's like a bank robbery. Most (of the tens of thousands) companies run a good ship. Those guys were simply crooks who screwed a bunch of people. They are thieves, not businessmen.That kind of thinking is like, a Chinaman stole my shirt, ergo, all Chinamen are theives. Simply not so. |
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