Pyramid Comment

This journal takes an alternative view on current affairs and other subjects. The approach is likely to be contentious and is arguably speculative. The content of any article is also a reminder of the status of those affairs at that date. All comments have been disabled. Any and all unsolicited or unauthorised links are absolutely disavowed.

Thursday, June 11, 2009

Growing Decline

Recession Completed The unemployed create nothing though as potential consumers without funds they become an increasing liability. Growing queues of unemployed create only a burden to any system in any country and this is a totally unsustainable ideology. Capitalism.

  • The ethos that seems to drive business is the maximisation of profits. Less annual profit than the previous year perversely defines negative growth. The return can still be 'healthy', but compared to the previous year is interpreted as imminent failure rather than simply not quite so much profit as before. A business can still be 'in profit', though it is perceived in business terms to be moving downward. The concept of growth is a total misconception.
  • A shareholder profit cannot be returned so the the investment becomes negative and the business is suddenly in decline. Share values are the measures of success or failure. A business may on paper be worth more, though actually unchanged in its true value. The share 'value' can be a dreadful guide to the accurate position.
  • Efficiency is equated with profitability however well a business may have grown since the previous year. If growth is not perceived as enough, any actual growth is then regarded as an indicator of a failure to achieve. Targets, however unrealistic, that had been set and not realised demonstrates a failing business even though that business may in reality be successful.
  • The other side of the employment coin is the drive to minimise a work force and the consequential reduction in the wage bill. Profits can only move upwards (all things being equal, which they are not) if the wage bill is reduced.
  • The maximisation of output and minimisation of input are inevitable partners in any business (marriage) model. The population growth with the reduction in the work force (though more work for each of those in that reducing work force) move in opposite directions.
  • Problems for any business model can only escalate as less work becomes available for the incessant growth in population.
  • Industries that produce consumer goods that nobody can afford to buy as they have no work or money shows the non-sustainable ethos of the entire system. Growth to sustain growth. There is no 'new' money.