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Dell Settles With the SEC For $100M
Sri.Theo writes in with news of Dell's humbling settlement with the US Securities and Exchange Commission. The core of the complaint is that Dell took secret payments from Intel to keep AMD's chips out of Dell's machines. The SEC calls it "accounting irregularities" — Dell was dipping into this secret slush fund to bolster its results, quarter by quarter. At one point the payments from Intel made up 76% of Dell's quarterly operating income. "For years, Dell's seemingly magical power to squeeze efficiencies out of its supply chain and drive down costs made it a darling of the financial markets. Now it appears that the magic was at least partly the result of a huge financial illusion. ... According to the commission, Dell would have missed analysts' earnings expectations in every quarter between 2002 and 2006 were it not for accounting shenanigans. ... (Intel is expected to settle a long-running anti-trust case that has highlighted these payments in the next couple of weeks.) ... Michael Dell... and Kevin Rollins, a former boss of the company, agreed to each pay a $4m penalty without admitting or denying the SEC's allegations."
Dude! You're getting a cell!
There are no karma whores, only moderation johns
My company currently runs a dell shop, running a mix of vostros, optiplexs, and over $100,000 in Dell servers.
I have been having issue after issue with the power supplies in pretty much every dell I run. We really like to run the SFF style units and they use a specially sized power supply. Dell refuses to acknowledge that there is an issue even though I have a 25% failure rate in power supplies at the one year mark. They offered to give me a SWEET deal of $120 for a replacement power supply (on a $400 unit), down from the $150 list.
So Dell has screwed consumers over on systems with bad capacitors, screwed consumers over with bad power supplies, cheated their shareholders by falsifying earnings, and competed unfairly by accepting bribe money from intel. bad company, bad products.
I get the reason why they did it, so they are not "criminaly negigent" but seriously? 4 years of having to restate all their earnings and eveything is cool?
I get why, eveyone made a killing off the stock price jumps, but still, somone isn't getting jail time for this.
Only a $100M fine? Shows that crime _does_ pay time and again..
While it certainly appears, from TFA, that tales of Dell's l33t supply chain ninja-ness were fraudulently overstated, the sheer magnitude of their dependence on Intel's "rebates" makes me wonder if they were the only one.
During that period, whenever I went shopping(either for personal use, or doing comparisons for employer bulk purchases) Dell always had very competitive prices; but not wildly different from comparable stuff from HP and friends. Either Dell's supply chain management absolutely sucked goats through capillary tubing, or some of their competitors must have had similar slush funds to work with.
keep on buying MonopolisTel chips. AMD processors are just as good, cheaper and you don't support the Microsoft of the hardware world. There actually is a good alternative here.
VermIntel has a lot of shills online, who visit online forums/message boards trying to downplay or dismiss the vast amount of illegal activity they've been up to.
And no friends, this isn't just from 2003 onwards. There are many OEMs, resellers and industry analysts who knew they were doing the same stuff way back in the late 80's at least.
Look at the Nvidia (another anti-competitive corp) vs Intel lawsuit... making OEMs buy atom chips with their accompanying chipset CHEAPER than buying the atoms alone.
Then there's the Vista-capable lawsuit... guess what happened there? Intel had a ton of useless slow video chips but forced Microsoft to allow them to call it Aero (Vista) capable.
Remember how much Intel cheats on benchmarks? How much they pay reviewers? How they cripple non-Intel CPUs in their "industry standard" compiler?
Remember that Skype deal? http://slashdot.org/articles/06/02/13/2015236.shtml
The list goes on and on and on. This is just off the top of my head.
Microsoft (that worthless monopolist scum) gets a well-deserved "fart in their general direction", yet Intel walks scott free.
Intel has been accused and convicted multiple times on several continents. They only just pay a small fraction of the money they fraudulently and illegally made and they walk with nary a geek/nerd/joe sixpack the wiser. They still have a sterling reputation.
Intel = Microsoft (of the hardware world).
Let's see how many slashdotters and/or people of conscience can bring themselves to even acknowledge this.
BTW, I've been Intel and Nvidia-free since 2001. I'm working on the windows part. (I'm a gamer)
Science : Proprietary , Knowledge : Open Source
I'm sick and tired of seeing these ethics-free corporations buy their way out of trouble without actually admitting to wrong-doing. If they aren't willing to sign a public statement that says, "We broke the law, but we'll save everybody a lot of trouble and money by simply paying for our criminal acts", the state should prosecute them to the full extent of the law, and use the well-established cowardice of market traders to drive down the stock price with carefully-timed announcements, added charges and perp-walks for the CEO's.
Enough of this bullshit! It's time to take the Free World back from these conscienceless scumbags.
I've calculated my velocity with such exquisite precision that I have no idea where I am.
They both get caught.
They both get punished.
Yet, they are teflon, and seem to come out unscathed. Still monopolists, too. (sad sigh)
All I can do is continue to use AMD and Linux, advocate AMD and Linux.
Wish Intel and Microsoft would fade away....
Uh, Linux geek since 1999.
"In its statement on the SEC settlement the company played down Mr Dell's personal involvement, saying that his $4m penalty was not in connection with the accounting-fraud charges being settled by the company, but was "limited to claims in which only negligence, and not fraudulent intent, is required to establish liability, as well as secondary liability claims for other non-fraud charges."" --TFA
Yes, because a deal that represents anywhere up to 76% of the companies quarterly earnings is SO likely to not have had Mr. Dell's personal and close attention when the deal was brokered with Intel. Oh, and gosh golly, it really must have slipped his mind when he was reviewing the shareholder reports before they got submitted.
"Sorry about that negligence and those pesky SEC and their rules. Oh, and I can keep my job too because I f'ing said so (notice the company isn't called Shareholder Computer Corp). Sincerely, M. Dell."
They colluded and engaged in a conspiracy in violation of SEC laws and they get a fine?
A fine? This is beyond pathetic. The SEC may possibly be the worst organization on earth.
He should have shut the company down and given the money back to the shareholders.
Qxe4
I'm really frustrated with settlements. They seem to circumvent several basic principles of justice:
I've heard arguments for settlements such as, "We're not sure we could get a conviction. This lets us get at least a modicum of justice" Well if you're not sure, then maybe you shouldn't be trying to prosecute? It's for a jury to decide what's a just punishment, not the prosecutor.
Or, "It lets us safe the legal expense of prosecuting." Well, if the system is so broken that cases can't be fought within the financial means of the government, then shouldn't it dawn on someone that it's way broken for individual citizens with limited financial resources?
America was founded with some beautiful ideals, but I don't have a lot of respect for those who have evolved its legal practices.
I'm guessing that would mean more work for the accountants.
Someone flopped a steamer in the gene pool.
no offense intended, but why would anybody be a "dell shop"? Sure, pick up a couple here and there, but what do they offer outside of:
1. Green + Purple plugs so you don't plug the mouse and keyboard in wrong.
2. Charcoal grey cases, so they don't look like whiteboxes (which they are).
For half the price you could have tonnes of "standby's" and be way further ahead. If you really wanted to use your money wisely, become a mac shop.
Right now, when a family member or friend asks me what type of computer to get, I start my reply with, "I wouldn't buy anything from Dell". But after that, I don't have much useful advice. Just knowing that Dell is an unreliable reseller of PCs isn't exactly the answer that they are looking to find out. I would recommend paying a little extra for reliability, but what manufacturers and resellers are reliable? If someone seems open to it, I recommend system76.com, but most are not. What say you, slashdot reader?
Dell was able to cut a deal with Intel, which isn't a crime. The SEC got all bent out of shape because of the lack of disclosure, but if Dell disclosed the sweet rebates they got on Intel processors, do you think Intel would give them the deal next time? No way!
It wasn't harmful to Dell stockholders until all of this was disclosed, and Dell stock went down the drain (OK, Dell stock was going down the drain anyway, but this didn't help). Oh, and then Dell started selling AMD-based systems, so I guess AMD was glad the deal was brought out in the open.
So now if Dell convinces a supplier to cut a great deal, but the supplier says "only if you don't tell everyone, or they'll ALL want the same deal" does Dell say, "No thanks, we'll pay the higher price."???
I need trepanation like I need a hole in the head.
This seems like a Rube Goldbergian way of doing business.
You'll probably want to sit down for this.
Most of the business world based on lies, because most of the business world depends on marketing. And marketing, once you break it down, is manipulation. Why does your girlfriend want a common blood stained rock on her finger to symbolize fidelity? Why do some people spend two hundred dollars on a steak one night, instead of cooking one for themselves every night for a month? Why did everyone think that home prices should outpace inflation for eternity? Because businessmen are very good at lying to you, and conning you into buying things - ideas, products, services, status - that are worth far less than you think they are. That's where the money is.
When men thought capitalism could lead to liberty, the world was radically different. Manufacturing was just hiring enough people to hand-make everything that you could sell. There was no automation, no assembly lines. Laissez faire makes sense when it's hard to hide cheating. Plus, most of the population believed that charging interest was a mortal sin, because making money without working was immoral.
In today's world, people often have no idea of what they are buying. Bonds in financial markets are purposefully inscrutable. Required company filings are mangled beyond comprehension. As proof of this, just look at the subprime meltdown. One guy in California figured it out, and had to beg Goldman Sachs into creating the instrument that would allow him to short the housing market bonds. They had gotten so good at selling, and so bad at actually analyzing the market, that Wall St conned itself into trillions of dollars of debt. Luckily, "main street' - ie, the people who actually perform economic work - were there to bail them out. And Wall St, since a few of them had figured it out early, was busy selling the debt to public entities like schools, county governments, and retirement funds because they were easy marks.
And now, since a company's value is perceived to be the things Wall St says about it, you have a totally fucked up system, where companies are trying to seek the approval of these greedy, useless motherfuckers, who wouldn't know a day's work if it hit them in the mouth with a sledgehammer. We have an entire industry - the financial system - that doesn't perform any useful work. It's like a cancer on the economy, but one that's very successful in centralizing wealth into their own corner. We could replace all of the banks, insurance agents, and ratings agents with totally transparent branches of government, and get on with the business of really innovating - new technology to improve the world, not just figments of financial imagination, repacked and resold to sucker after sucker. But for some reason the American people think that would be the end of the world. Socialism! Communism! The loss of liberty and freedom and democracy!
I wonder who gave them that idea.
54% of the Senate is lawyers. The rules are not made to achieve justice, but to delay the case long enough to pad the bill.
4 million dollars from Michael Dell - now THAT HAS GOT TO HURT. I'm going to send that fat boy some fucking ramen to tide him over.
Fascism trolls keeping me up every night. When I starts a preachin', he HITS ME WITH HIS REICH!
"The company neither admitted nor denied guilt as part of the settlement--a common phraseology in such deals."
How about a big FUCK YOU to Securities and Exchange Commission and the US Department of Justice! How about you dig a little deeper, get the dirt on the direct involvement by Michael Dell and the other board members during the 4-year period and put these schmucks in San Quentin Federal Penitentiary. If you can't find the evidence, just use your powers of Extraordinary Rendition to send a few of these folks over to the Middle East or Africa, a little water boarding, pull of some fingernails and you could get just enough information to find hard evidence to try and convict these people.
I could name a dozen good computer companies who disappeared during this time frame due to Dell's stellar rise in the computer market though shenanigans like this. Good computer companies that produced better products when under because they didn't cook their books like Dell did and didn't take bribes from Intel.
Like another poster said, the pure computer companies that did survive like HP (previously Compaq), Acer, etc. might have been involved in this also.
Intel did just settle the record breaking $1.4 Billion USD to the European Union's commission for violating anti-trust regulations or having to pay $1.2 Billion USD to AMD previously in a similar settlement.
I'm still glad to see that the NY State case against Intel is still on-going and it would be great if other states and companies jump on this bandwagon for lynching Intel since these guys have been playing some dirty games for a long time. Time to hold Execute Officers directly responsible for criminal and immoral decisions directly liable for their actions and orders. Too bad that our government is in the pocket of big corporations and that no real sanctions will be taken against these business scumbags.
Dell's success is now forever clouded by this and I think that looking at their shady little deal with Intel, I wouldn't put it past them if there was one going on right now with Microsoft for operating systems. Dell just did pull Ubuntu Linux OSes computers from their web site just as Linux is getting more acceptance by people due to Google's Android mobile OS success in the mobile market and also the upcoming tablet computer revolution. Microsoft isn't playing in this field and they are scared since they cannot compete.
Here's a way to give the consumers better competition and get rid of a shady computer manufacturer: Seek punitive damages that are two thousand+ times the actual damages (set actual damages at an amount equal to Intel payoffs to dell). Everyone wins, except Dell, and good riddance.
....such matters benefit the SEC but the end consumers who were hurt by it never see anything returned to them in compensation, though stock holders might.
Hmm, I think we should all quit doing business with the USA. The Russian and Itallian Mafia vendors are more honorable. At least they don't periodically fsck up the whole world economy the way the Yanks have a habit of doing.
Excuse me, but please get off my Pennisetum Clandestinum, eh!
Who stuck with Compaq/HP when Dell was cheaper? I had client after client after client show me the Dell loss-leaders in comp magazine ads, and I stuck with what was at the time a better, if ultimately sinking, ship. After this disclosure about Dell, I feel a bit exonerated.
If only I could mod you to 6....
Intel allegedly pays Dell not to use AMD chips?
Intel's payments allegedly make up 75% of Dell's quarterly operating income?
This doesn't add up. That would mean that Intel was not making any profit from one of their biggest customer, but would even be LOSING money by doing it?
Right. That kind of deal would be AMD's dream.
I think it's possible to acknowledge the truth of a lot of what you've said without the final conclusion necessarily being to sing the Internationale.
I like the way John Kay put it in "The Long and the Short of it: A Guide to Finance and Investment for Normally Intelligent People Who Aren't in the Industry"
http://www.amazon.co.uk/Long-Short-Investment-Normally-Intelligent/dp/0954809327
Something like: The financial markets are like a (needed) utility to which the owners decided to attach a casino for fun and a little profit on the side. Eventually, the casino outgrew the utility and when the casino went bust, we users of the utility were forced to bail it out because we need the utility.
Marketing can give you some boost but it basically can only amplify what is fundamentally true and good about a product.
That only works if the customer can see what's good and true about a product. The financial companies do their best to make that impossible. Many retail goods companies do it too, eg. Apple censoring their own forums whenever they have a problem with a product.
The truth usually only appears after major meltdowns.
Small companies aren't immune either, some of the most bare-faced lies I've ever been told were by small companies (who actually had practice meetings to see who can lie the best when the lie is an 'important' one).
No sig today...
PS: That 'perfect steak' was probably dropped on the floor at some point...and in the small restaurant business the hygiene rules are for losers.
No sig today...
If you buy a used car which you knew was stolen, then you are guilty of handling stolen goods and not only will you lose the car if the police find out, but you will also be punished for committing the crime.
The only problem is when people unwittingly bought a stolen car, the police will usually go easy on them in that case but they will still lose the car.
http://spamdecoy.net - free throwaway anonymous email - avoid spam!
I would love to know how much upper level management & the CEO were making, including bonuses, during this period.
Yes, but AMD isn't clean either.
I've often been called a "troll" here for stating this simple fact, but AMD invented a certain "megahertz myth" that's a half truth and for a time invested massively in marketing based on that.
I once bought a notebook with an AMD CPU labeled "2200+", which was meant to imply it was faster than an Intel Pentium 4 with a 2200 MHz clock. That could be, for that specific benchmark AMD created, but it was not true for my own applications. For me, that "2200+" actually meant about "1500-".
It's one thing to state that a computer's performance does not depend on CPU clock alone. It's an entirely different thing to create a fake number and pretend that this number is an exact measure of performance.
In the end, the almighty market fixes things up, but not before innocent people waste money. AMD has stopped with that fraudulent practice of inventing fake numbers to pretend having superior performance. It's obvious now that it backfired on them, but many people, me included, bought computers with inferior performance based on those fake numbers.
Is this like sweeping dirt under the rug, or offshoring steel mills to China & Pakistan where almost-smart Americans no longer have to see the visible pollution that goes into manufactured products we use every day. As long as it's not happening in our backyard or where we can see it, it's good for the environment.
The problem, I think, is the analogy is both true and incomplete. Well before banks were attached to casinos, they were already in a situation with questionable underpinnings. The problem goes like this:
You take a bank that's multinational (or at least, very big national). By being spread out across one or more nations, it has a risk pool closer to the average of the nation(s). When it comes time to give a home loan in Fooland, though, the situation is local. If Fooland is simply a bad place to give home loans (ie, a significantly high foreclosure rate), local banks will tend to be much stricter about who they accept and work harder to verify that the applicant is actually viable because they understand the situation and a few foreclosures could bankrupt them potentially.
Meanwhile, a multinational bank is much more lax because it see its as more financial secure (having much more capital and in raw numbers able to support many more foreclosures). The problem is, while this holds generally true, clustered foreclosures inherently drive down the price of homes. Ie, each Fooland with 10% of homes foreclosured results in a flood of new homes. However, people are inherently unlikely to move to Fooland even if home prices drop; people tend to move because of better jobs, and strict local banks and a now much more strict multinational are doing anything but spur job growth for the new cheap homes. Besides, if there were plenty of good local jobs, it's unlikely that there'd be that 10% foreclosures given the investment homes are seen as.
In short, the problems run a lot deeper than some casino-ish action. Local banks can't magically spur economic growth by being more generous with business loans as easy money alone simply spurs inflation (ie, the appearance of but not actual growth). And simply feeding the home purchase demand isn't a solution (it can lead to recessions and even deflation). Government involvement might not be the answer either except in areas where there's a known need for development for long-term stability or security (defense, energy, food, etc). Certainly, though, some level of regulation is warranted given the unintended consequences of conglomeration.
Eurohacker European paranoia, gun rights, and h
My baseline suggestions would be:
That, and two very important points.
Hard drives are the most unreliable part of modern PCs.Replace the hard drives once they're out of warranty. All you need is a good quality USB2 hard drive and HD Clone. Keep the old drives somewhere safe as your second line disaster recovery if you lose old data. If you have a lot of friends and family to look after, the small cost of your duplicator is easily amortised.
Get a large can of dust blaster and clean out the ventilation of laptops periodically (depending on environment). Component life can roughly double for each 10 degreee C fall in temperature, and removing dust from internal heatsinks can often achieve that.
From scarped cliff or quarried stone she cries "A thousand types are gone, I care for nothing, no not one."
Why isn't anybody commenting on the Intel side of this story? After all, they were the ones paying the bribes, or whatever you want to call that.
Having suffered from Intel's legal belligerence in the past, I know that they are pretty good at getting their will done. But, are not two parts required for this, er, illicit transaction to take place? What about the other? Doesn't Intel hold a position much more akin to a de facto monopoly in the PC and server markets than Dell? Isn't paying to keep the competition under sea level a pre-requisite for someone accepting to be paid for the same?
Intel is no longer the disruptingly innovative company it once (4004) was. It is a large evil behemoth for whom laws don't apply, they get their way every time and crush whoever they don't like. Nothing against large and going after you don't like; it's the evilness of their ways what I have a problem with. I'd be more than happy if the Governments looked at them more carefully, after they seem to have humbled Microsoft enough. Aren't those guys the largest part in the word "wintel"?
Here's why some of us still believe in a free market (though not completely Laissez Faire):
What makes you think the goverment will be any less corrupt than the corporations you rail against? What makes you think greedy people won't still game the system from within the government? What makes you think the governmnent beauracracy will be competent/good at the job?
In a market, you at least have the possibility of multiple different corporations competing against each other - so if you don't want to do business with Dell, you can go to some other computer seller.
If, on the other hand, you "replace all of the banks, insurance agents, and ratings agents with totally transparent branches of government," then you have granted a single entity (the government) with a monopoly. Don't think the government is doing a good job? Too bad, there's no one else to go to. Government decides to set interest rates at 20% on your home or business loan, because Congress has spent too much money on something else and needs to generate more revenue? Too bad, there's no one else to go to.
Monopolies are almost never a good thing (the one exception I can think of at the moment is the military - I'm pretty happy there's no private armies, navies, and air forces out there; but I can't really think of anything else where I want to see a monopoly).
You also don't need to keep standing for this, the reality is going to hit.
Most of LIFE is based on lies, on perception, on deceit, this is not only business, we start our lives and immediately people lie to us and at the minimum they only tell us half the truth, so this is not limited to business or politics, it is the entire existence.
Marketing is manipulation, so is schooling. So are relationships.
Why do you get your girlfriend that blood stained rock anyway? So she wants one, don't give it her. She is manipulating you into giving you things, well you are giving them to her to manipulate her as well. Do you want something from her? Probably yes, otherwise why is she your girlfriend? What is fidelity anyway? What does it matter if you have sex with people other than your girlfriend as long as there are no diseases transmitted and unwanted pregnancies on the side that would eat your resources she wants you to spend on her?
Why are our lives so routine, that when we do afford to spend time outside of the routine some asshole says we mustn't, we shouldn't go to a restaurant? I am a vegetarian, the stake analogy is lost on me, but my salad costs in a restaurant so much, I could feed myself for a week for that money completely just eating home.
Here is where you start diverging from the truth: why did everyone think that home prices should grow and grow, your answer is businessmen are lying to you.
Here is the truth: your government is lying to you, and that is why the home-prices were expected to go up forever. Your government knows the manufacturing and production is going down, to keep the 'GDP' from falling and to keep it raising, your government created a policy of keeping you in debt indefinitely, and they7 are using the businesses for this purpose. Your government creates inflation, who else? It is printing and borrowing and it is setting up corporations to get you to buy mortgages you cannot afford. What is Freddy and Fannie but exactly that - manipulation of the housing market, manipulation of the mortgage market to keep the selling/buying going where in fact the housing prices should be falling they were rising due to the government manipulation.
And even as the government was manipulating you, its representatives who are directly responsible for inflation and manipulation were saying nonsense like this
July 2005
INTERVIEWER: Ben, there's been a lot of talk about a housing bubble, particularly, you know [inaudible] from all sorts of places. Can you give us your view as to whether or not there is a housing bubble out there?
BERNANKE: Well, unquestionably, housing prices are up quite a bit; I think it's important to note that fundamentals are also very strong. We've got a growing economy, jobs, incomes. We've got very low mortgage rates. We've got demographics supporting housing growth. We've got restricted supply in some places. So it's certainly understandable that prices would go up some. I don't know whether prices are exactly where they should be, but I think it's fair to say that much of what's happened is supported by the strength of the economy.
July 2005
INTERVIEWER: Tell me, what is the worst-case scenario? Sir, we have so many economists coming on our air and saying, "Oh, this is a bubble, and it's going to burst, and this is going to be a real issue for the economy." Some say it could even cause a recession at some point. What is the worst-case scenario, if in fact we were to see prices come down substantially across the country?
BERNANKE: Well, I guess I don't buy your premise. It's a pretty unlikely possibility. We've never had a decline in house prices on a nationwide basis. So what I think is more likely is that house prices will slow, maybe stabilize: might slow co
You can't handle the truth.
How much do you want to bet that Intel will also get a gentle slap on the wrist? And all of us paid more for CPUs than we should have for years, thanks to this collusion.
These executives don't believe in a free market, they believe in scamming their customers at every opportunity.
Oh but I'm sure that consumers will target Intel and Dell for boycotts to ensure that they know that their activities are unacceptable. Right?
Well said.
You seriously misunderstand the history of subprime mortgages, and the relationship between government regulatory failure and the current economic crisis. If derivatives weren't legalized in the Financial Services Modernization Act of 1998, there would have been no subprime crisis. If Glass Steagall was in place, the ponzi scheme financiers came up with - originating bad loans, marking them as AAA when they were packaged with subprime loans, and selling them to unsuspecting buyers - would have been more difficult to pull off. And, if investment houses were firewalled separately from regular banks, we could have let them collapse without fearing larger damage to the economy.
The argument that you entirely miss is that if the rules weren't there in the first place, corporations wouldn't seek government permission to fuck people over. They would just fuck people over without fear of punishment.
In order to operate, markets have to have rules, just like any other system. The market is not self-aware, and has no built in morality. The only thing protecting anyone from the economic warfare of other nations, or of exploitation by their fellow citizens, is their own government. It is the rise of the supremacy of law over the rights of kings, holy men, and landowners that has made civilization flourish. (The scientific method is the real reason for our success, because it equalized and democratized how to establish what was accepted as fact.) So when the kings, holy men, and landowners work their way into the government and mutilate the law, you don't say that law is broken. You say the current system of law is ineffective.
I swear, if libertarians were mechanics, they'd throw away cars for having a flat tire.
USSR. I was born there, I lived there, my parents and their parents lived their and here is where you are even more delusional - believing that such a monstrosity, as a centrally planning government, can remain 'transparent branches of government' and do something that is actually good for the people rather than for 'people' who work there.
The main difference between the communism of the USSR and plutocratic capitalism is PR. You still have a small minority of the population directing where money will be spent, and who it will benefit, without any recourse of the population at large to affect change. One of those classic cases of the triumph of capitalism is farming in the USSR, before and after ownership was allowed. What every professor didn't say is anything about Trofim Lysenko, who turned all of Russian agriculture into an experiment based on fraudulent work. Now, if he had competition, you're absolutely right: the market would have dominated the government solution. But let's suppose instead of one man, it was a consortium of corporations very invested in his particular theory. They would also, if uncontrolled by a government, have enough power to silence critics and impose their production methods on society to the same result.
The need for a third party actor, democratically controlled by the majority, for fostering competition and regulating the market is the most crucial element of a successful economy.
And who said they had to be centrally managed? Each county could have their own banks with completely open books, subjected to Federal oversight to guard against abuses and embezzling. The same goes with insurance agents. It works pretty well for fire protection, emergency services, and policing. There are major problems to be addressed, for sure, but if they were the function of a corporation with deep ties to non-elected officials, you have no chance of throwing them out. As long as they can be affected by a vote, there can be change.
OK, Dell cuts a secret deal with Intel for exclusivity. As a result, Dell sells computers more cheaply than its competitors, and makes larger profits. Dell reports the larger profits without being frank about where they are coming from. The customers get cheaper computers. Who is harmed? Dell's competitors and AMD... but there's nothing wrong with making a deal which harms one's competitors. As far as I can tell the profits Dell stated were quite real; I don't see why there's all this indignation over possible violation of securities rules.
You seriously misunderstand the history
- except that it is you, who does not understand history or economics or politics or people.
If government was not in business of creating monopolies in preferred industries the market would have taken care of problems of bad banks and bad loans, and this has nothing to do with morality. Your problem is that you believe everybody must receive 100% of justice every time and I do not see this as viable. This means that market is amoral, it has nothing to do with morals, it is only a balancing act. Your company screws some people, the word gets out and people move to competitors. Governments kill off competitors by introducing regulations that are aimed at the actual monopolies that governments create, but in reality those monopolies are already powerful enough not to care about any regulations, that's just a small cost to them, but to small competition it is the difference between existing and not existing.
Government is running gigantic ponzi schemes by being involved in economics and monetary policies in the first place. Whoever gets the first cut of the money printed/borrowed by the government wins, whoever is the last in line loses. Ponzi schemes are in everything - from social security, where first people to get it paid the least into it, where taxes always went up and payouts always went down, where the old age was always pushed up and which was always used as a piggybank to run wars and projects, to the printing of money itself - government does not produce any single thing of value, how can it be in business of printing money, especially once it unpegged the fiat currency from a valuable enough commodity like gold, that has been the standard of currencies for thousands of years.
All of the regulations that government sets upon the market end up manipulating the market in ways that are either predictable or not, and definitely in more ways than one way that is touted as the reason for the regulations themselves.
Your thinking is too shallow, you believe regulations are necessary, and that is your problem. Regulations are created by people after the fact of some problem, thus regulations are always late. Regulations rely on systems to stay the way they were before the regulations were introduced, thus regulations are useless because the only thing they create is an extra step for a monopoly to think of to move right around them. Regulations are often created by the monopolies in the first place, there is a reason there are so many lobbyists in the government, those people write the regulations, they change the laws.
The reason why those people are doing it, is to protect the interests of the monopolies, and the reason this will not get fixed is the reason government creates monopolies in the first place - they get the recycled money back into their campaigns/contributions/bribes.
I argue that governments kill economies, they don't help economies in the long run, they cause inflation, they get countries into wars instead of doing their job: protecting the country by the minimum necessary force and keeping themselves out of economics but doing the policing work. Police and justice system - that is the referee you are talking about, that's all that's needed.
Governments create gigantic moral hazards, like FDIC, like Freddy and Fannie, like Medicare, like Guaranteed Loans for anything, student loans, car loans or home loans, anything at all introduced by a government that has the word 'guaranteed' on it is bullshit and will end up removing some balance from the market by creating moral hazards and increasing prices.
Most importantly, there is nothing on this very notion of 'guaranteed by government' that is any different from the marketing you despise so much, because in reality government can guarantee nothing.
This entire idea that something is guaranteed by the government and thus it is going to be solid, will stay solid is bullshit, it is all about perception and lies you were talking about earlier.
You can't handle the truth.
So, in effect, the SEC has stated not just Dell, but Intel is guilty of unfair competition with AMD. If AMD doesn't jump on this with both feet, and sue the electrons off Intel and Dell, they're missing a bet. Their guilt has already been established.
So in your imaginary world, could I sell poisoned candy to children? How about poisoned woodchips for their playground? How about coal mining methods that poisoned the school water supply?
In the civilized world, regulations prevent things like these from ever being legal. They define weights and measures, test and certify building materials, and make sure that fly-by-night companies don't sell substandard products and take the profits to the Caribbean, leaving someone else to bear the cost of their negligence.
With your fascination with no regulations, you may have been at home in the Victorian era. Slavery, children as young as 4 working mills, mines, blacking factories, dying young from simple exposure to the chemicals they worked with. Child prostitution. Everyone else was working sixteen hours a day for little pay, getting dumped in a ditch if they were seriously injured on the job, people burning to death in locked buildings... and no government regulations to get in the way and slow down the economy. No annoying fire safety standards, housing standards, workplace safety standards...
And, since you seem to be preoccupied with the red herring about fiat currency, just take a look at a history of bank panics.
http://en.wikipedia.org/wiki/List_of_banking_crises
Notice how there's a huge gap when regulations about bank activity and leverage were put in place after 1933. Savings and loan deregulation was followed by a crisis. Repealing laws against derivatives and the deregulation of financial firewalls was followed a crisis.
The market is irrational, and so are you if you have blind faith in it.
So in your imaginary world, could I sell poisoned candy to children? How about poisoned woodchips for their playground? How about coal mining methods that poisoned the school water supply?
- you'd have to rethink that statement right now, because nothing STOPS you from doing that immediately, today, and it happens all the time. Just a while ago there was a melanin in baby formula sold, a bunch of kids died. Some poor schmuck got shot in China by the government for this, some driver, obviously not the person truly responsible. So that shows that with regulations and with corrupt government, you get the same thing happening and then punishment is doled out to people only marginally involved while the guilty parties go free.
Maybe you should go back to my comments and reread them, because you are obviously incapable of understanding what is written.
Government's role as a cop/jailer/minimum military is essential in 'my imaginary world', and it is the ONLY role that is required. Sell baby formula with melanin in it and cause some deaths? Here is a nice long sentence if not a death sentence and your assets are confiscated. We shouldn't let murderers go unpunished, or was I not clear on this fine point?
Violate your own best industry standards and cause a massive oil spill? OK, but now you are facing a class action lawsuit from the government on behalf of the people, who collectively own the ocean. So it should be - government's role as a system maintaining justice and ability to punish must be concentrated upon, while all other rules and regulations are business of the industries.
After all, you do understand that all safety and other regulations really come out of best industry practices, or do you believe that government is able to come up with the best ways of pumping oil out of the ocean safely? It can't even do one job right: make sure that its own employees are not already bought out by the industry and are literally and figuratively sleeping with it.
In the civilized world, regulations prevent things like these from ever being legal. They define weights and measures, test and certify building materials, and make sure that fly-by-night companies don't sell substandard products and take the profits to the Caribbean, leaving someone else to bear the cost of their negligence.
- this is what "the civilized" world likes to believe, but it does not make it true or right. What do government's officials understand about measurements? Nothing. They understand nothing about building materials or substandard products. All of this is about working competition. However government must make it a full time job - doling out justice and punishment to those, who abuse the trust. You build a house that collapses and kills people? Well, let's find out how you did such a wonderful job, if it can be shown that you did a substandard job and cut costs while not following the best standards of your industry - your company is dismantled, your profits are confiscated and you spend the rest of your life in jail. Sounds fine.
With your fascination with no regulations, you may have been at home in the Victorian era. Slavery, children as young as 4 working mills, mines, blacking factories, dying young from simple exposure to the chemicals they worked with. Child prostitution. Everyone else was working sixteen hours a day for little pay, getting dumped in a ditch if they were seriously injured on the job, people burning to death in locked buildings... and no government regulations to get in the way and slow down the economy. No annoying fire safety standards, housing standards, workplace safety standards...
- sounds dreamy. That is what capitalism and industrialization FIXED and that is what the government is going to CAUSE yet again, by killing an economy that was built by capitalism.
And, since you seem to be preoccupied with the red herring about fiat currency,
You can't handle the truth.
That only works if the customer can see what's good and true about a product. The financial companies do their best to make that impossible. Many retail goods companies do it too, eg. Apple censoring their own forums whenever they have a problem with a product.
You are seriously arguing that a company can hide anything now that internet forums abound? Apple censoring it's own forums was pointless on many levels, the foremost being that it obviously did nothing at all to keep people from hearing the story.
In the distant past you were probably correct, because a large enough company could collude with enough media entities to hide something. I have serious doubts that will ever be possible again. And that is what makes marketing only a component of product success (though an important one).
"There is more worth loving than we have strength to love." - Brian Jay Stanley
You are the irrational one if you think that governments do something that helps the long term economy rather than dis-balances and destroys it.
http://en.wikipedia.org/wiki/List_of_countries_by_GDP_(PPP)_per_capita
Find the first non-regulatory economy on the list. Don't worry. We'll wait.
Your point is that a country with a government that is supposedly implements regulations? What is that, some sort of a revelation for you?
My point is that all of them are destroying their economy in the process, and many countries have ceased to exist for this exact reason, if you don't understand that, you should look up a list of countries that just disappeared as countries only within the past 200 years, and I was born in one of them, it's not hard to find that example.
We are diametrically opposed to each others points of view, obviously, nothing to see here, move alone.
You can't handle the truth.
Your point is that a country with a government that is supposedly implements regulations? What is that, some sort of a revelation for you?
- should have previewed, but whatever.
I mean to say your point is that a country with a supposedly working economy implements regulations and I am saying all of them are manipulating their economies and will lead to creating imbalances.
A better example is Hong-Kong, where the HK dollars are created by three separate banks, so while the city itself also prints money, they can't turn up the printers like US or others do because obviously, people would flock away whatever government dollars they have and move into more sound private money. They have very little regulations and their economy is much stronger than of most other nations. At least they are trying to do this the right way.
Anyway, at this point this conversation became useless, I already made my point.
You can't handle the truth.
Ever wonder how there can be so many teenagers who think absolutely nothing of shoplifting? Look no further. They see crap like this over and over and make the rational decision to join the cheats rather than be cheated by them.
Morally speaking, when they steal from crooked corporations, it's hard to get terribly outraged. If only they could reliably know which corporations aren't crooked and avoid stealing from them. It's probably a short list these days.
If we alter the criminal punishment for individuals to be in line with corporate punishments, we could solve the employment problem. Just steal what you need/want and if you get caught, you have to work off 50-90% of the retail value and nobody thinks any worse of you.
Yep.
Now just waiting to see if the ARM netbooks continue to evolve to the point they become widely available, and easy to both install and run Debian on.
Then the x86 market can be competed with via ARM for netbooks and low power mobile computing.
Uh, Linux geek since 1999.
"Intel Corp (INTC.O) has agreed to stop using threats and bundled prices to hamper competition, settling charges that it illegally abused its market dominance in microprocessors, the Federal Trade Commission said on Wednesday."
http://www.reuters.com/article/idUSTRE6733I420100804
Uh, Linux geek since 1999.