MAC
03-02-2004, 02:32 AM
Despite being a fan of it, I must admit that trickle-down economics has an inherent flaw. It requires that you to accept that first the money must first pool at the top. It doesn’t just spring from the wallets of rich people, you know. They actually have to make it somewhere first. Luckily we live in a nation where acquiring money is frowned upon. You must hide it or spend it. But the spending at the top isn’t quite as evenly dispersed as the spending at the bottom. So even the best “trickle” is a small waterfall on one side eroding the rock below. From there the flow of money follows the fiscal path-of-least-resistance. It is diverted into all the cracks and crevices and usually remains just below the surface until it magically appears in the streams and ponds below. Then it’s necessary to take your bucket down to the spring to fetch what you can carry, or pump it, or dig a well near your home, etc. This is the part of trickle-down that most people don’t get. It is quiet possible stand right next to the thunderous spray of an economic waterfall and not even get moist. You actually have to go get some. And you need something to carry it in, because otherwise all you can have is what you can drink.
Ok, that’s enough long winded metaphors for today
I am actually writing this to point out something I am seeing because I am in a position to see it long before most of you.
I work for a company that builds products used by companies who extract raw materials for 90% of the other industries in the world.
I am the man who builds the shovel that is sold to the coal miner who digs the coal to fire the furnaces that smelt the metal to build the shovels. get it?
So here’s a warning.
The price of raw metal goods from the mills (domestic and foreign) has more than doubled in 3 months and they continue to climb this month.
I can’t even get a quoted price that’s good for 24 hours. I have spoken to men who’ve been doing this for 40 years and they all tell me it happened in the late 70’s right before the oil shortage. My company is borrowing money and buying what ever we think we need for the next many months so we can maintain a reasonable price for our customers. Hell, even scrap stainless was $0.68/# last time we hauled it off (2 months ago) that’s 4 times what I was getting for it this time last year. We’ve had to reconfigure all our pricing to account for this dramatic rise in raw materials. Steel fluctuates 20-30% all the time.....but 100%+???
Our best steel prices for the last few years came from S. Korea. Bush’s tariff on import steel was supposed to do that in, but nothing changed until he removed the tariff late last summer when it began to rise. In the last year the Chinese have underbid the Koreans on everything, although their products aren’t quite as good they’re cheap enough to win customers. China is also poised to get more oil form Siberia, one way or the other.
Ok, enough import talk here’s the synapses.
I am betting you WILL see this increase soon in your daily life. It will be reflected in the price of everything eventually.
My opinion after some consideration is that we’re possibly about to have a noticable climb in inflation to match the elevated property values, minimum wages, medical benefits, tax cuts, etc.
I don’t know what good it’ll do you but something to consider is that when the dollar inflates you want to be in debt. When the dollar deflates you want to have them in your pocket.
Anyway, just thought I’d tell you that the wave has hit my end of the economy and I’m on my tip toes wondering how long I can tread water.
Ok, that’s enough long winded metaphors for today
I am actually writing this to point out something I am seeing because I am in a position to see it long before most of you.
I work for a company that builds products used by companies who extract raw materials for 90% of the other industries in the world.
I am the man who builds the shovel that is sold to the coal miner who digs the coal to fire the furnaces that smelt the metal to build the shovels. get it?
So here’s a warning.
The price of raw metal goods from the mills (domestic and foreign) has more than doubled in 3 months and they continue to climb this month.
I can’t even get a quoted price that’s good for 24 hours. I have spoken to men who’ve been doing this for 40 years and they all tell me it happened in the late 70’s right before the oil shortage. My company is borrowing money and buying what ever we think we need for the next many months so we can maintain a reasonable price for our customers. Hell, even scrap stainless was $0.68/# last time we hauled it off (2 months ago) that’s 4 times what I was getting for it this time last year. We’ve had to reconfigure all our pricing to account for this dramatic rise in raw materials. Steel fluctuates 20-30% all the time.....but 100%+???
Our best steel prices for the last few years came from S. Korea. Bush’s tariff on import steel was supposed to do that in, but nothing changed until he removed the tariff late last summer when it began to rise. In the last year the Chinese have underbid the Koreans on everything, although their products aren’t quite as good they’re cheap enough to win customers. China is also poised to get more oil form Siberia, one way or the other.
Ok, enough import talk here’s the synapses.
I am betting you WILL see this increase soon in your daily life. It will be reflected in the price of everything eventually.
My opinion after some consideration is that we’re possibly about to have a noticable climb in inflation to match the elevated property values, minimum wages, medical benefits, tax cuts, etc.
I don’t know what good it’ll do you but something to consider is that when the dollar inflates you want to be in debt. When the dollar deflates you want to have them in your pocket.
Anyway, just thought I’d tell you that the wave has hit my end of the economy and I’m on my tip toes wondering how long I can tread water.