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Strategies & Market Trends : ahhaha's ahs -- Ignore unavailable to you. Want to Upgrade?

To: GraceZ who wrote (7675)	3/13/2006 1:59:43 PM
From: ahhaha	Respond to of 24758

It seems to me that the large US corporation is moving towards a shell whose only function is to allocate capital between small independent firms. XOM is a noteworthy example of exactly that. Basically the gist is that the environment that favors large firms ceterus paribus are: * low costs of organizing and a slow ramp up in those costs as the number of transactions scales. The advantage of keeping broad capability in-house comes from efficiency of information distribution OVER AN AREA. It's a difficult concept to explicate. Consider, how can one implement say, JIT, when one is dependent on the non-coordinated and non-timely means and ends of external suppliers? The old school did so through the maintenance of inventories, but that seems to go in the opposite direction in that it shrinks info per unit area. It seems to me, in the US we're moving in the other direction from this. Much of the higher cost is coming from government regs. We can't even begin to discuss anything efficient where socialists demands rears its ugly head. * situations where it is less likely for the entrepreneur to make large mistakes (known business models) So many business models have been rendered obsolete in the last five years I've lost track. Has it always been this way or is there a higher entrepreneurial risk now than there was say ten years ago? Much higher because there's more capital available so more experiments are tried. One isn't justified in comparing what occurred between 1968 and 2000 in the US(the rise of the degenerate liberal world) with anything else. One has to compare the '50s with the contemporary era. * better pricing of production factors with scale, economies of scale. With electronic markets and greatly reduced costs to do small transactions it seems that price models for materials are flatter than they've ever been. That's due to the continuing addition of low cost reasonably skilled labor to the world's labor pool. It seems to me we entered another cycle where it is better to contract out to small than it is to have these functions in house. That's too general of a statement. What I can't really discern is if this is a cyclical change or a structural one. More likely neither, but most likely true individually. Individual companies in a group are undergoing major structural changes while none are going through cyclical changes. Cycles come when economies are monolithic as when under the socialist whip. Consider stocks. There is no meaning to the averages. What we have is an on-going bull and bear market in various stocks. Stock groups have lost meaning too. There are companies going in all sorts of directions and they're all in the same industry.