People with lots of muscle and little body fat are a very small minority of the population.
Not to the point of statistical insignificance. Furthermore a tool that purports to measure what constitutes healthy body composition should at a minimum be able to work for people who actually DO have a healthy body composition. Telling someone they are "overweight" when actually what happened is they found the squat rack means that it isn't a very good tool. It can't tell the difference between healthy amounts of muscle and unhealthy amounts of fat. You don't even have to go to extremes (I'm certainly not one) to find cases where BMI falls apart as a useful measure.
BMI has some utility but it's over used and misapplied quite a lot.
Yes even as a fraction of the population. I'm not saying BMI is without utility or that it doesn't apply to many people but it's misleading for probably somewhere north of 10% of the population. That's a significant amount for such a widely used tool.
You're a fairly extreme case. You're a wrestler and clearly do a lot of excersise etc. And you come out mostly OK.
I'm really not a particularly extreme case and there is plenty of data to support that. I'm probably more active than average but I assure you I don't work out enough to be considered an extreme case physically. I'm probably something like 70-90ith percentile. Somewhere between 1 and 2 standard deviations on the good side if you presume a bell curve. My point is that there are a non-trivial number of people like me - enough that BMI by itself is frequently misleading if you don't understand what it measures and where it isn't useful.
Especially overweight people actively deluding themsleves by claiming that BMI doesn't apply.
BMI is pretty useless for many people. Taking myself for example. I'm about 5'10 and weigh around 175-180lbs with body fat % somewhere in the low teens. I coach a wrestling team and I'm in reasonably good shape and stronger than average for my weight. If I were to cut to competition weight I would be 150-160 and I competed in college at 150 many years ago. Anything lower than that and I'd be well into unhealthy - certainly nothing sustainable. But according to BMI calculators I would have to get down to around 130lbs to be considered underweight. Last time I weighed that much I was cutting weight as a junior in high school and was under 6% body fat. You'd have to put me in a concentration camp or give me cancer to get me that low again. BMI calculators put me now at borderline overweight at my current weight and that description doesn't make sense. My waist size is the same as it has been since college and while I could shed about 5-10% of my body mass without ill effect that's hardly overweight. I'm not delusional about my weight - I actually have a better idea of my body composition than most people do. Basically BMI is too crude a measure to be much use for a large swath of the population. It does have some utility but it can be pretty misleading too.
If you think that then you would be wrong. Oh sure, there are insurance scams out there. But that is not the same things as insurance being a scam. Insurance is about mitigation of risk. Reducing the financial consequences of rare or severe events. Insurance is a very useful tool but if you don't use it properly then like most tools it might do more harm than good. People who are financially sophisticated typically have quite a lot of insurance and for good reason.
So by design, premiums MUST exceed payouts.
Not actually true. Premiums + Investment profits must exceed payouts over the long term. There are two parts to every insurance business. The premium payments you send in and then on the back end the insurance company invests those premiums. People don't typically see the investment side of the business but it's very important. Lots of insurance companies actually sell insurance at an underwriting loss but make a profit by investing the money. This isn't ideal from the insurance company's perspective but due to a competitive market it is sometimes necessary. There are more than a few insurance companies that have taken underwriting losses for many years in a row.
All insurance companies will take losses periodically but so long as they have sufficient reserves this is expected and acceptable. For risks where they lack adequate reserves insurance companies can get re-insurance (basically insurance for the insurance) for those events.
In reality, the only thing insurance protects you from that you couldn't do on your own are the extreme situations.
Insurance is for extreme events but it also can be to mitigate damage for events that you can afford to deal with. For example I have dental insurance. I am perfectly capable of paying out of pocket for any dental procedure I am ever likely to have but my dental insurance helps me mitigate the cost so pay a little up front to come out ahead in the long run. It ensures that the insurance company works when negotiating rates with the dentist so I get better rates than I could negotiate on my own.
Self driving cars also still need insurance; just not as much.
That is currently an unproven assumption. Possibly correct but also possibly quite wrong. It presumes that self driving cars will actually be safer than human driven cars which has yet to be established conclusively. It seems reasonable and probable but that isn't the same thing as evidence. If they do prove to be safer in real world usage then you are almost certainly right.
And a large portion of the insurance burden will fall to manufacturers instead of just on drivers.
The incidence of payment will still ultimately fall to the car owner. The manufacturers will pass on substantially all of the cost of the insurance in the purchase price of the car. Their margins are too thin to do otherwise for any length of time. Even the most profitable car companies (Toyota, Porsche) only make around 10% net margins and most make less.
Insurance companies will not be able to make the same kind of profit overall on large multinational car companies that they can on the public.
Whether or not that is true will depend on how the insurance products are ultimately structured. If they have to deal with just a few large car companies then you are probably mostly correct. But that isn't a certainty as much will depend on the legal framework that is developed around self driving cars.
However, the actual cost per transaction has steadily gone down for the credit card companies since credit cards were invented. Guess who soaked up that decrease?
The fact that average transaction cost has decreased as the networks have scaled up should surprise no one. That's just "good" business at least in the sense of profits. Yes the credit card companies have soaked up most of the improved margin. They are basically a quasi-monopoly so one should expect monopolistic pricing.
As for who soaked up the cost it depends on how big a player you are. I assure you that Walmart takes far less of a hit than your local mom-n-pop. Transaction volume matters. The banks and credit card processors get the biggest slice of the pie but large merchants benefit too. With size comes negotiating power.
Here in Canada, the cost of debit transactions has steadily increased, while the actual cost per transaction to the banks has decreased. It is likely the same in the US.
It is unquestionably the same in the US at least until fairly recently. However that is a problem resulting from a lack of competition. There is no meaningful competing network so you tend to see monopoly pricing. Annoying and a tad unfair to be sure but not at all surprising. Here in the US some legislation was passed a few years ago that substantially cut debit card processing fees. They still are probably higher than they might be in a truly competitive market but the market is regulated to some degree. Whether that is a good thing or not I leave as an exercise for the reader.
This is why things like bitcoin are interesting. Bitcoin itself is a boondoggle but some of the technology involved might result in future transaction processing tech that could increase competition potentially. Only time will tell.
That's a misconception surrounding bitcoin. Transactions are NEVER free of cost. You can find ways to reduce the cost of transactions but they are never free. You have to consider exchange rate risk, opportunity cost, time value of money, transaction coordination, in some cases counterparty risk, technology risk and more. If you want to have a system as wide spread and convenient as the credit card system, there is a TON of cost in building and maintaining that. People have a mistaken idea that bitcoin transactions are free because they forget about risk and the time value of money and opportunity cost. Bitcoin is seemingly cheap because it piggybacks on the internet and computers people already own (sunken costs) but it is a false economy.
Banks make a lot of money passing the money around.
Yes they do because passing money around is a valuable activity and they make it easier than it would be otherwise. Imagine how much of a pain it would be to send money to Europe from the US if you didn't have a bank to facilitate the transaction. It would be a huge and expensive problem.
Creating money out of thin air; the banks are going to have a field day creating their own currency.
Umm, they already do that via the Federal Reserve and similar mechanisms in other countries.
I can see the block-chain tech being useful for various applications, including some financial ones. I don't think Bitcoin itself will be among the useful applications. But that's ok. Proof of concept technology is a valuable thing and while I think Bitcoin is fatally flawed it seems to be a good proof of concept.
nonsense, trend for last three years of electronics manufacturing is actually coming back here.
I'm IN that industry and no it isn't. Not in any important way. Labor rates in China are rising but that is just pushing some of the business to other locations, mostly not in the US. The supply chain is all in China and other parts of eastern Asia and the importance of that cannot be overstated.
the difference in labor is of no import any more, very little human labor involved.
If you believe that then you have no idea what you are talking about.
china is going into major recession soon, their chains of supply are going to break down
Oh so you are able to predict the future now too? Spare me...
Labor is a small component of that. In terms of labor time, we are talking roughly 10-13 hours (studies in 2012 demonstrated this).
Cripe, I could have given you a pretty good estimate of the labor required. (I'm an industrial engineer and an accountant and I do this for a living) The labor costs are meanigful but they would be 4-5X larger here in the US. What is FAR more important is that the product is made almost literally right next door to the companies that make the components. There is NO equivalent supply chain here in the US and developing one isn't going to happen. Having your suppliers nearby is a big deal.
With a US wage differential, one adds roughly $150 dollars in cost.
So you are suggesting Apple add 25% to the cost. Are you aware that Apple's net margins are approximately 25%? Basically you are suggesting Apple sell this product for breakeven prices. Remember that the vast majority of the profit in that supply chain goes to Apple so you are (intentionally or not) suggesting Apple take a huge reduction in profits on their most important product. To say that is a bad idea is to state the obvious. By the way, people have looked into the cost of an All American iPhone and the results aren't pretty. You'd possibly be looking at an iPhone that might cost $2000 retail.
2. The $150 in cost is not borne entirely by consumer. Rather, it is split by everyone in the transaction including investors and other suppliers.
Since Apple takes almost all the profits in the supply chain you are either suggesting Apple take a bath or that consumers pay more. Neither of those are likely. I can assure you that the margins at Foxconn and the others aren't fat and there isn't a lot of room for them to accept smaller margins if they want to stay in business. It is highly unlikely their net profits are above 10% - very typical for manufacturing companies.
3. Competitive effects would be muted by tariffs and tax incentives against foreign or offshoring competitors.
So you are suggesting protectionist taxation to enable inefficient US companies to compete? That is a stupid and ultimately counterproductive idea. We did that with steel during the Bush presidency and all it accomplished was to raise prices on products that use steel like cars. Raising tariffs on any product ultimately forces the consumer to bear the added cost. It also has all sorts of detrimental effects on companies in affected areas not to mention the fact that it would likely violate all sorts of WTO and other trade agreements. Tariffs and tax incentives to prop up companies that cannot compete are generally a hugely bad idea.
your little two-bit company's experience not relevant, large scale manufacturing of electronics IS and can be done in the USA.
Sorry my friend but I'm in the industry and I make my living from global sourcing of electronics. I've worked in Fortune 500 companies doing global supply chain analysis and sourcing. Pretty much ALL large scale assembly of electronics is done outside the US. We have some chip fabs and we do some specialty work in some vertical industries but if it involves any meaningful amount of labor it is almost always done in countries with low labor rates. (in other words not the US) The supply chains for the components are largely in Asia so it is most economical to do assembly there as well especially given the cheap labor. That's not an opinion. It's a fact. You believe that large scale mfg of electronics can be done in the US but to believe that you have to ignore the last 30 years of evidence. Your ideology is not based in fact.
supply chain is global, anything can be sent to USA
Not economically it can't. Shipping them across the ocean for final assembly is a LOT more expensive than assembling them first and then shipping a finished product. It's generally far cheaper to assembly an iphone in china than it is to ship a screen + a circuit board + a shell + the rest and then assemble in the US with higher labor rates.
apple is also a hardware design company and has things built
Apple is a software company that sells their software in a pretty box. I've already linked to Steve Jobs himself saying so explicitly. They manufacture almost nothing tangible themselves and have no particular expertise in manufacturing. They outsourced their manufacturing because they don't make their profits from it. Apple designs nice hardware to help sell their software but almost nobody would pay a premium for a Macintosh running Windows without OSX. The iPhone hardware is no better than any number of Android phones and nobody would pay premium prices for an iPhone running Android. Apple does design because nobody would buy their products if they were poorly designed. That just gets them in the game.
Fast Track Trade. look it up, president has the power
Fast track trade authority is an authorization given by congress to the president for a limited time to negotiate a trade deal which Congress still has to approve with an up or down vote. It does not give the president any sort of authority to force companies to manufacture goods inside the US.
Trump said he would 'get' Apple to make their products in America, not 'make' Apple. There's a difference. He's not going to force Apple to come to America but convince them.
There is virtually nothing a US president can do to "convince" companies to make decisions like that. Getting Apple to move production back to the US will require a sea change in macro-economics and supply chains for manufacturing. A president could maybe make things a tad friendlier but most of the relevant obstacles are well outside the control of a president. We build plenty of stuff in the US. The manufacturing sector in the US is somewhere around $3 Trillion annually and growing. Worrying about where Apple builds its phones kind of misses the big picture.
He's going to improve the business tax codes which Tim Cooke has said is a driving force for Apple to make their products overseas. Trump's statement is not so outlandish as some world make it to be.
The tax codes have almost NOTHING to do with why Apple builds their products in China. They could drop taxes to zero and it wouldn't matter because it would still be cheaper to assembly elsewhere. The actual reasons are in approximate order of importance: 1) The supply chain for electronic assembly is in Asia. Most of the parts are made there and the companies that assemble them are there. Making an equivalent supply chain in the US is economically impossible at this point without heavy government subsidies which would violate all sorts of trade agreements. 2) Labor costs in china for assembly work are substantially lower than in the US 3) The companies who build the vast majority of consumer electronic products are located in Asia and are Asian companies 4) Labor and environmental regulations in places like China are substantially less stringent. This is not a bad thing but it does matter for where to make products. Matching the lack of regulations in some of these places would be a bad idea. 4) China is a critical market for a company like Apple to grow. The US market is important but saturated and future growth will need to come from the other 95% of the world population.
Donald Trump says he'd like to make Apple "start building their damn computers and things in this country instead of other countries."
He can like whatever he wants but it's not possible for a lot of reasons. 1) Labor costs are too high in the US to be competitive on assembly work of that scale. I know this because I run a company that does contract assembly of electric products. Even Apple's profit margins aren't fat enough to make that possible. 2) The supply chain for all the components does not exist in the US. That business left the US a looong time ago. 3) Apple is actually a software company. If you put Android on their gear, nobody is going to pay a premium for it. The margins on their product are decidedly not in building the computer and Apple has no particular manufacturing expertise. 4) Apple doesn't build their computers. They hire other companies to do it. Same with Dell, HP, etc. The companies that actually build these things aren't US companies. 5) The president doesn't have the authority to do that and even if he did it would be a REALLY stupid idea. The only thing he would accomplish is to make it difficult for those companies to compete. Samsung isn't going to start building their machines in the US. Manufacturing goes where the costs are lowest and frequently that is not in the US thanks to high labor costs and in some cases regulations.
If Trump (or anyone) thinks this is a good idea, why start or stop with Apple?
It isn't a good idea and Trump is pandering. He knows perfectly well that it isn't possible, practical or a good idea. But he's more than happy to lie to people too dumb or ignorant to understand supply chain economics.
Because if you did, you'd have NOTHING to do with Clinton.
Where did I say I do? I didn't vote for her husband and she wouldn't be my first choice even within her own party. Though I'd vote for her over pretty much any of the republicans currently running which speaks more to how bad they are than anything else.
in other words, Hillary! LIED.
A politician lied. Gee, I'm shocked. If you can find one that didn't I've got some unicorn farts to sell you. No I don't think the Clinton's are honest. But I prefer their brand of dishonesty to some of the others. Isn't that twisted? I've seen the Clinton brand of BS and while it has a strong odor I'll take it over Bush or Trump any day.
She can't be trusted, full stop. A vote for Hillary is a vote against your interests because the only interests Hillary has is in what is good for her.
I don't trust Hillary but I trust the goons on the right even less because their interests are routinely directly contrary to my own as well as to what I consider good public policy. All politicians act in self interest and to presume otherwise is dangerously naive. I presume they are acting in self interest and just try to find someone who isn't too obviously a crook and whose interests and positions are closest to mine. I am fully aware that no politician is likely to be what I consider a perfect choice.
Whether a vote for Hillary is against my interests depends very much on what my interests actually are. No Hillary is not my first choice for president among those running but among that crowd she wouldn't be my last choice either. I agree with some things she says and disagree with others. There are some idiots running who say basically nothing I agree with.
"Tech Industry Compromise"? Is that some sort of euphemism for the tech industry capitulating to a vicious threat from the government?
Did anyone really think the discussion would be something other than: Government: "Give us a backdoor or we will audit and regulate you into oblivion, not to mention issue endless National Security Letters" Tech CEOs: "Umm, ok... Just don't make it public"
Thing is, people are fleeing a system controlled by 6 corporations in favor of a new system controlled by only 1.
With apologies to Grand Moff Tarkin, I think you overestimate their chances. Netflix getting a distribution monopoly is a highly improbable outcome. They don't own the copyrights to most of what you can watch through them and that matters a lot. Could they undermine the business model of traditional networks? We can only hope... I think Netflix can succeed without being the gatekeeper for all video content which is good because it isn't likely to happen.
Apple will be the gatekeeper for music, and Netflix for video.
I think Google, Amazon and more than a few others may have something to say about that. I've had a Netflix subscription twice now and both times I dropped it because the cost outweighed the value. Netflix had a large catalog of movies I've either already seen or don't care about and searching for new stuff was painful to say the least. There were movies I wanted to see that routinely were not available through Netflix. I don't really care about their original programming and I'm hardly the only one. Honestly I've found Amazon Prime to be a better value.
The big fight here is over new content. Netflix is creating their own, and it's being extremely well received.
Being well received does not equal a monopoly nor does it necessarily equal profits.
Viewership numbers are vital within the TV industry. For years, the networks have relied upon ratings to make money — higher numbers mean higher ad revenue. The most important part of the ratings system is that individual networks can't just claim whatever viewership they want; third-party companies like Nielsen control the stats.
So they built a business model based on ad revenue which presumes everyone else is using the same business model. Now someone else has a business that isn't dependent on ad revenue and is eating their lunch. Cry me a river. The networks provide crappy programming through a distribution model that nobody likes and then are shocked that customers are looking for alternatives. Good grief, what a bunch of tools...
Either Netflix will make money on their products or they won't. The advertisers are the ones that will hold their feet to the fire regarding the credibility of the data Netflix provides regarding viewership. If the ad networks are fine with it, then why on earth would I care?
They're comparing one company's total future raw material value to another's present stock value? And you think that's interesting?
Sure. Present stock value is a consensus estimate of the Net Present Value of all future free cash flows of a company. In both cases you are looking at an estimate of the future prospects of the company.
The measure in question is the total *possible future value* of the company.
Correct. That is what is being measured in both cases, albeit with a different measuring stick.
Early adopters took tremendous risk, there is millions of hours of effort and billions of dollars of investments supporting the bitcoin ecosystem.
Bullshit. They put some time in but the creators of bitcoin had no capital at risk at any time. The only thing they had was opportunity cost which in this case was pretty minimal. They wrote some software in their spare time and put it out there. There hasn't been "billions of dollars of investments" or anything close to it. They made a fictional currency piggybacking on existing internet infrastructure and computers and then convinced others it had value. It was a brilliant scheme in part because they managed it without putting any of their own capital at risk.
Now USERS of bitcoin have taken on considerable risk. Exchange rate risk, counterparty risk, volatility risk, technology risk, etc. But the founders took as close to no risk as is possible in the real world.
I always find it funny that people have fault with the fact that early adopters own most of the Bitcoin. The Microsoft founders also hold most of the Microsoft stock. So do the Apple founders, etc. What does that have to do with anything?
The Microsoft founders took actual risk. Same with Apple's founders. They could have easily gone bankrupt if things had gone badly. Whoever created bitcoin didn't take any actual risk other than whatever time they spent making it. They merely created it and then convinced others to use it but at no time did they have any of their own capital at risk.
has become something even worse: a system completely controlled by just a handful of people.
It was that from day 1. People who got in early have lots of bitcoins. Anyone with lots of the market in anything will be able to strongly influence that market.
The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system."
There never was any reason to think Bitcoin would be better than the existing financial system. People believed in bitcoin for ideological reasons rather than pragmatic ones for the most part. It appeals to certain ideologies and people who are trying to hide their activities, often for illicit reasons.
I think that's an unfair characterisation of what SpaceX has done/is doing.
SpaceX is doing some great work in lowering cost to orbit and improving rockets in a variety of ways. The importance of that cannot be overstated. But they are most decidedly NOT at the frontier of human exploration. Rockets to orbit is a solved problem. So is landing rockets on land. We can get better at it and do it cheaper (which is what they are doing) but we've done it before. They are incrementally improving work that has already been done in other projects. They're making the technology better and cheaper and more accessible.
Landing an intact first stage after it was travelling 6,000mph the other direction is pretty groundbreaking.
We've landed rockets on the ground before. Hell we've done it on other planets before. Yes it is very impressive but it's a new wrinkle on ground that has already been covered.
Propulsive landing of a space capsule for re-use is pretty major too.
Yes it is, though they haven't done that yet.
Then there's the Raptor engine, most of the way through the development with some components already tested to a high degree. A full-flow gas-gas staged combustion engine and a large one at that. No-one's built an engine like that before.
Incremental improvements to mostly already existing technologies. They are like Apple making what was already there better and more accessible and more reliable. (and unlike Apple, cheaper) I don't mean to sound like am minimizing what they are doing. It's awesome, important and badly needed. But it isn't work on the frontier of human knowledge for the most part. What SpaceX is doing is lowering cost to orbit. That is a very important piece of the puzzle but SpaceX by itself isn't going to get us to Mars any time soon. They aren't working at all on the thousands of other problems that will have to be solved to enable a Mars mission and they can't because there is no business case for it. One day hopefully there will be and the work SpaceX is doing now is a key piece of making that possible.
Except for Apple, what with their $205 billion dollars in cash on hand...
Apple has cash (not enough for a Mars mission) but if they said they were going to Mars their stock would plummet faster than you could say "shareholder lawsuit". Companies cannot do things which have unknown ROI, distant if any payback, huge costs and unquantified risks. Doesn't matter how big the bank account is, they can't do it because they can't show how they'd make a profit doing it.
A realistic Mars mission is probably going to cost north of a trillion dollars and I'm not even counting all of the R&D costs.
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People with lots of muscle and little body fat are a very small minority of the population.
Not to the point of statistical insignificance. Furthermore a tool that purports to measure what constitutes healthy body composition should at a minimum be able to work for people who actually DO have a healthy body composition. Telling someone they are "overweight" when actually what happened is they found the squat rack means that it isn't a very good tool. It can't tell the difference between healthy amounts of muscle and unhealthy amounts of fat. You don't even have to go to extremes (I'm certainly not one) to find cases where BMI falls apart as a useful measure.
BMI has some utility but it's over used and misapplied quite a lot.
Not as a fraction of the population.
Yes even as a fraction of the population. I'm not saying BMI is without utility or that it doesn't apply to many people but it's misleading for probably somewhere north of 10% of the population. That's a significant amount for such a widely used tool.
You're a fairly extreme case. You're a wrestler and clearly do a lot of excersise etc. And you come out mostly OK.
I'm really not a particularly extreme case and there is plenty of data to support that. I'm probably more active than average but I assure you I don't work out enough to be considered an extreme case physically. I'm probably something like 70-90ith percentile. Somewhere between 1 and 2 standard deviations on the good side if you presume a bell curve. My point is that there are a non-trivial number of people like me - enough that BMI by itself is frequently misleading if you don't understand what it measures and where it isn't useful.
Especially overweight people actively deluding themsleves by claiming that BMI doesn't apply.
BMI is pretty useless for many people. Taking myself for example. I'm about 5'10 and weigh around 175-180lbs with body fat % somewhere in the low teens. I coach a wrestling team and I'm in reasonably good shape and stronger than average for my weight. If I were to cut to competition weight I would be 150-160 and I competed in college at 150 many years ago. Anything lower than that and I'd be well into unhealthy - certainly nothing sustainable. But according to BMI calculators I would have to get down to around 130lbs to be considered underweight. Last time I weighed that much I was cutting weight as a junior in high school and was under 6% body fat. You'd have to put me in a concentration camp or give me cancer to get me that low again. BMI calculators put me now at borderline overweight at my current weight and that description doesn't make sense. My waist size is the same as it has been since college and while I could shed about 5-10% of my body mass without ill effect that's hardly overweight. I'm not delusional about my weight - I actually have a better idea of my body composition than most people do. Basically BMI is too crude a measure to be much use for a large swath of the population. It does have some utility but it can be pretty misleading too.
Insurance, by design, is a sham and a scam.
If you think that then you would be wrong. Oh sure, there are insurance scams out there. But that is not the same things as insurance being a scam. Insurance is about mitigation of risk. Reducing the financial consequences of rare or severe events. Insurance is a very useful tool but if you don't use it properly then like most tools it might do more harm than good. People who are financially sophisticated typically have quite a lot of insurance and for good reason.
So by design, premiums MUST exceed payouts.
Not actually true. Premiums + Investment profits must exceed payouts over the long term. There are two parts to every insurance business. The premium payments you send in and then on the back end the insurance company invests those premiums. People don't typically see the investment side of the business but it's very important. Lots of insurance companies actually sell insurance at an underwriting loss but make a profit by investing the money. This isn't ideal from the insurance company's perspective but due to a competitive market it is sometimes necessary. There are more than a few insurance companies that have taken underwriting losses for many years in a row.
All insurance companies will take losses periodically but so long as they have sufficient reserves this is expected and acceptable. For risks where they lack adequate reserves insurance companies can get re-insurance (basically insurance for the insurance) for those events.
In reality, the only thing insurance protects you from that you couldn't do on your own are the extreme situations.
Insurance is for extreme events but it also can be to mitigate damage for events that you can afford to deal with. For example I have dental insurance. I am perfectly capable of paying out of pocket for any dental procedure I am ever likely to have but my dental insurance helps me mitigate the cost so pay a little up front to come out ahead in the long run. It ensures that the insurance company works when negotiating rates with the dentist so I get better rates than I could negotiate on my own.
Self driving cars also still need insurance; just not as much.
That is currently an unproven assumption. Possibly correct but also possibly quite wrong. It presumes that self driving cars will actually be safer than human driven cars which has yet to be established conclusively. It seems reasonable and probable but that isn't the same thing as evidence. If they do prove to be safer in real world usage then you are almost certainly right.
And a large portion of the insurance burden will fall to manufacturers instead of just on drivers.
The incidence of payment will still ultimately fall to the car owner. The manufacturers will pass on substantially all of the cost of the insurance in the purchase price of the car. Their margins are too thin to do otherwise for any length of time. Even the most profitable car companies (Toyota, Porsche) only make around 10% net margins and most make less.
Insurance companies will not be able to make the same kind of profit overall on large multinational car companies that they can on the public.
Whether or not that is true will depend on how the insurance products are ultimately structured. If they have to deal with just a few large car companies then you are probably mostly correct. But that isn't a certainty as much will depend on the legal framework that is developed around self driving cars.
However, the actual cost per transaction has steadily gone down for the credit card companies since credit cards were invented. Guess who soaked up that decrease?
The fact that average transaction cost has decreased as the networks have scaled up should surprise no one. That's just "good" business at least in the sense of profits. Yes the credit card companies have soaked up most of the improved margin. They are basically a quasi-monopoly so one should expect monopolistic pricing.
As for who soaked up the cost it depends on how big a player you are. I assure you that Walmart takes far less of a hit than your local mom-n-pop. Transaction volume matters. The banks and credit card processors get the biggest slice of the pie but large merchants benefit too. With size comes negotiating power.
Here in Canada, the cost of debit transactions has steadily increased, while the actual cost per transaction to the banks has decreased. It is likely the same in the US.
It is unquestionably the same in the US at least until fairly recently. However that is a problem resulting from a lack of competition. There is no meaningful competing network so you tend to see monopoly pricing. Annoying and a tad unfair to be sure but not at all surprising. Here in the US some legislation was passed a few years ago that substantially cut debit card processing fees. They still are probably higher than they might be in a truly competitive market but the market is regulated to some degree. Whether that is a good thing or not I leave as an exercise for the reader.
This is why things like bitcoin are interesting. Bitcoin itself is a boondoggle but some of the technology involved might result in future transaction processing tech that could increase competition potentially. Only time will tell.
The other point is that transactions are free.
That's a misconception surrounding bitcoin. Transactions are NEVER free of cost. You can find ways to reduce the cost of transactions but they are never free. You have to consider exchange rate risk, opportunity cost, time value of money, transaction coordination, in some cases counterparty risk, technology risk and more. If you want to have a system as wide spread and convenient as the credit card system, there is a TON of cost in building and maintaining that. People have a mistaken idea that bitcoin transactions are free because they forget about risk and the time value of money and opportunity cost. Bitcoin is seemingly cheap because it piggybacks on the internet and computers people already own (sunken costs) but it is a false economy.
Banks make a lot of money passing the money around.
Yes they do because passing money around is a valuable activity and they make it easier than it would be otherwise. Imagine how much of a pain it would be to send money to Europe from the US if you didn't have a bank to facilitate the transaction. It would be a huge and expensive problem.
Creating money out of thin air; the banks are going to have a field day creating their own currency.
Umm, they already do that via the Federal Reserve and similar mechanisms in other countries.
I can see the block-chain tech being useful for various applications, including some financial ones. I don't think Bitcoin itself will be among the useful applications. But that's ok. Proof of concept technology is a valuable thing and while I think Bitcoin is fatally flawed it seems to be a good proof of concept.
nonsense, trend for last three years of electronics manufacturing is actually coming back here.
I'm IN that industry and no it isn't. Not in any important way. Labor rates in China are rising but that is just pushing some of the business to other locations, mostly not in the US. The supply chain is all in China and other parts of eastern Asia and the importance of that cannot be overstated.
the difference in labor is of no import any more, very little human labor involved.
If you believe that then you have no idea what you are talking about.
china is going into major recession soon, their chains of supply are going to break down
Oh so you are able to predict the future now too? Spare me...
Labor is a small component of that. In terms of labor time, we are talking roughly 10-13 hours (studies in 2012 demonstrated this).
Cripe, I could have given you a pretty good estimate of the labor required. (I'm an industrial engineer and an accountant and I do this for a living) The labor costs are meanigful but they would be 4-5X larger here in the US. What is FAR more important is that the product is made almost literally right next door to the companies that make the components. There is NO equivalent supply chain here in the US and developing one isn't going to happen. Having your suppliers nearby is a big deal.
With a US wage differential, one adds roughly $150 dollars in cost.
So you are suggesting Apple add 25% to the cost. Are you aware that Apple's net margins are approximately 25%? Basically you are suggesting Apple sell this product for breakeven prices. Remember that the vast majority of the profit in that supply chain goes to Apple so you are (intentionally or not) suggesting Apple take a huge reduction in profits on their most important product. To say that is a bad idea is to state the obvious.
By the way, people have looked into the cost of an All American iPhone and the results aren't pretty. You'd possibly be looking at an iPhone that might cost $2000 retail.
2. The $150 in cost is not borne entirely by consumer. Rather, it is split by everyone in the transaction including investors and other suppliers.
Since Apple takes almost all the profits in the supply chain you are either suggesting Apple take a bath or that consumers pay more. Neither of those are likely. I can assure you that the margins at Foxconn and the others aren't fat and there isn't a lot of room for them to accept smaller margins if they want to stay in business. It is highly unlikely their net profits are above 10% - very typical for manufacturing companies.
3. Competitive effects would be muted by tariffs and tax incentives against foreign or offshoring competitors.
So you are suggesting protectionist taxation to enable inefficient US companies to compete? That is a stupid and ultimately counterproductive idea. We did that with steel during the Bush presidency and all it accomplished was to raise prices on products that use steel like cars. Raising tariffs on any product ultimately forces the consumer to bear the added cost. It also has all sorts of detrimental effects on companies in affected areas not to mention the fact that it would likely violate all sorts of WTO and other trade agreements. Tariffs and tax incentives to prop up companies that cannot compete are generally a hugely bad idea.
your little two-bit company's experience not relevant, large scale manufacturing of electronics IS and can be done in the USA.
Sorry my friend but I'm in the industry and I make my living from global sourcing of electronics. I've worked in Fortune 500 companies doing global supply chain analysis and sourcing. Pretty much ALL large scale assembly of electronics is done outside the US. We have some chip fabs and we do some specialty work in some vertical industries but if it involves any meaningful amount of labor it is almost always done in countries with low labor rates. (in other words not the US) The supply chains for the components are largely in Asia so it is most economical to do assembly there as well especially given the cheap labor. That's not an opinion. It's a fact. You believe that large scale mfg of electronics can be done in the US but to believe that you have to ignore the last 30 years of evidence. Your ideology is not based in fact.
supply chain is global, anything can be sent to USA
Not economically it can't. Shipping them across the ocean for final assembly is a LOT more expensive than assembling them first and then shipping a finished product. It's generally far cheaper to assembly an iphone in china than it is to ship a screen + a circuit board + a shell + the rest and then assemble in the US with higher labor rates.
apple is also a hardware design company and has things built
Apple is a software company that sells their software in a pretty box. I've already linked to Steve Jobs himself saying so explicitly. They manufacture almost nothing tangible themselves and have no particular expertise in manufacturing. They outsourced their manufacturing because they don't make their profits from it. Apple designs nice hardware to help sell their software but almost nobody would pay a premium for a Macintosh running Windows without OSX. The iPhone hardware is no better than any number of Android phones and nobody would pay premium prices for an iPhone running Android. Apple does design because nobody would buy their products if they were poorly designed. That just gets them in the game.
Fast Track Trade. look it up, president has the power
Fast track trade authority is an authorization given by congress to the president for a limited time to negotiate a trade deal which Congress still has to approve with an up or down vote. It does not give the president any sort of authority to force companies to manufacture goods inside the US.
He says he would raise taxes on businesses manufacturing outside the US. That seems like a practical and implementable, if stupid, plan.
The president has no control over tax rates on businesses. Congress controls that. The president can suggest but that's about all.
Anyway, that will be the least of your problems if you elect him.
True 'dat
Trump said he would 'get' Apple to make their products in America, not 'make' Apple. There's a difference. He's not going to force Apple to come to America but convince them.
There is virtually nothing a US president can do to "convince" companies to make decisions like that. Getting Apple to move production back to the US will require a sea change in macro-economics and supply chains for manufacturing. A president could maybe make things a tad friendlier but most of the relevant obstacles are well outside the control of a president. We build plenty of stuff in the US. The manufacturing sector in the US is somewhere around $3 Trillion annually and growing. Worrying about where Apple builds its phones kind of misses the big picture.
He's going to improve the business tax codes which Tim Cooke has said is a driving force for Apple to make their products overseas. Trump's statement is not so outlandish as some world make it to be.
The tax codes have almost NOTHING to do with why Apple builds their products in China. They could drop taxes to zero and it wouldn't matter because it would still be cheaper to assembly elsewhere. The actual reasons are in approximate order of importance:
1) The supply chain for electronic assembly is in Asia. Most of the parts are made there and the companies that assemble them are there. Making an equivalent supply chain in the US is economically impossible at this point without heavy government subsidies which would violate all sorts of trade agreements.
2) Labor costs in china for assembly work are substantially lower than in the US
3) The companies who build the vast majority of consumer electronic products are located in Asia and are Asian companies
4) Labor and environmental regulations in places like China are substantially less stringent. This is not a bad thing but it does matter for where to make products. Matching the lack of regulations in some of these places would be a bad idea.
4) China is a critical market for a company like Apple to grow. The US market is important but saturated and future growth will need to come from the other 95% of the world population.
Donald Trump says he'd like to make Apple "start building their damn computers and things in this country instead of other countries."
He can like whatever he wants but it's not possible for a lot of reasons.
1) Labor costs are too high in the US to be competitive on assembly work of that scale. I know this because I run a company that does contract assembly of electric products. Even Apple's profit margins aren't fat enough to make that possible.
2) The supply chain for all the components does not exist in the US. That business left the US a looong time ago.
3) Apple is actually a software company. If you put Android on their gear, nobody is going to pay a premium for it. The margins on their product are decidedly not in building the computer and Apple has no particular manufacturing expertise.
4) Apple doesn't build their computers. They hire other companies to do it. Same with Dell, HP, etc. The companies that actually build these things aren't US companies.
5) The president doesn't have the authority to do that and even if he did it would be a REALLY stupid idea. The only thing he would accomplish is to make it difficult for those companies to compete. Samsung isn't going to start building their machines in the US. Manufacturing goes where the costs are lowest and frequently that is not in the US thanks to high labor costs and in some cases regulations.
If Trump (or anyone) thinks this is a good idea, why start or stop with Apple?
It isn't a good idea and Trump is pandering. He knows perfectly well that it isn't possible, practical or a good idea. But he's more than happy to lie to people too dumb or ignorant to understand supply chain economics.
Because if you did, you'd have NOTHING to do with Clinton.
Where did I say I do? I didn't vote for her husband and she wouldn't be my first choice even within her own party. Though I'd vote for her over pretty much any of the republicans currently running which speaks more to how bad they are than anything else.
in other words, Hillary! LIED.
A politician lied. Gee, I'm shocked. If you can find one that didn't I've got some unicorn farts to sell you. No I don't think the Clinton's are honest. But I prefer their brand of dishonesty to some of the others. Isn't that twisted? I've seen the Clinton brand of BS and while it has a strong odor I'll take it over Bush or Trump any day.
She can't be trusted, full stop. A vote for Hillary is a vote against your interests because the only interests Hillary has is in what is good for her.
I don't trust Hillary but I trust the goons on the right even less because their interests are routinely directly contrary to my own as well as to what I consider good public policy. All politicians act in self interest and to presume otherwise is dangerously naive. I presume they are acting in self interest and just try to find someone who isn't too obviously a crook and whose interests and positions are closest to mine. I am fully aware that no politician is likely to be what I consider a perfect choice.
Whether a vote for Hillary is against my interests depends very much on what my interests actually are. No Hillary is not my first choice for president among those running but among that crowd she wouldn't be my last choice either. I agree with some things she says and disagree with others. There are some idiots running who say basically nothing I agree with.
"Tech Industry Compromise"? Is that some sort of euphemism for the tech industry capitulating to a vicious threat from the government?
Did anyone really think the discussion would be something other than:
Government: "Give us a backdoor or we will audit and regulate you into oblivion, not to mention issue endless National Security Letters"
Tech CEOs: "Umm, ok... Just don't make it public"
Thing is, people are fleeing a system controlled by 6 corporations in favor of a new system controlled by only 1.
With apologies to Grand Moff Tarkin, I think you overestimate their chances. Netflix getting a distribution monopoly is a highly improbable outcome. They don't own the copyrights to most of what you can watch through them and that matters a lot. Could they undermine the business model of traditional networks? We can only hope... I think Netflix can succeed without being the gatekeeper for all video content which is good because it isn't likely to happen.
Apple will be the gatekeeper for music, and Netflix for video.
I think Google, Amazon and more than a few others may have something to say about that. I've had a Netflix subscription twice now and both times I dropped it because the cost outweighed the value. Netflix had a large catalog of movies I've either already seen or don't care about and searching for new stuff was painful to say the least. There were movies I wanted to see that routinely were not available through Netflix. I don't really care about their original programming and I'm hardly the only one. Honestly I've found Amazon Prime to be a better value.
The big fight here is over new content. Netflix is creating their own, and it's being extremely well received.
Being well received does not equal a monopoly nor does it necessarily equal profits.
Viewership numbers are vital within the TV industry. For years, the networks have relied upon ratings to make money — higher numbers mean higher ad revenue. The most important part of the ratings system is that individual networks can't just claim whatever viewership they want; third-party companies like Nielsen control the stats.
So they built a business model based on ad revenue which presumes everyone else is using the same business model. Now someone else has a business that isn't dependent on ad revenue and is eating their lunch. Cry me a river. The networks provide crappy programming through a distribution model that nobody likes and then are shocked that customers are looking for alternatives. Good grief, what a bunch of tools...
Either Netflix will make money on their products or they won't. The advertisers are the ones that will hold their feet to the fire regarding the credibility of the data Netflix provides regarding viewership. If the ad networks are fine with it, then why on earth would I care?
They're comparing one company's total future raw material value to another's present stock value? And you think that's interesting?
Sure. Present stock value is a consensus estimate of the Net Present Value of all future free cash flows of a company. In both cases you are looking at an estimate of the future prospects of the company.
The measure in question is the total *possible future value* of the company.
Correct. That is what is being measured in both cases, albeit with a different measuring stick.
Early adopters took tremendous risk, there is millions of hours of effort and billions of dollars of investments supporting the bitcoin ecosystem.
Bullshit. They put some time in but the creators of bitcoin had no capital at risk at any time. The only thing they had was opportunity cost which in this case was pretty minimal. They wrote some software in their spare time and put it out there. There hasn't been "billions of dollars of investments" or anything close to it. They made a fictional currency piggybacking on existing internet infrastructure and computers and then convinced others it had value. It was a brilliant scheme in part because they managed it without putting any of their own capital at risk.
Now USERS of bitcoin have taken on considerable risk. Exchange rate risk, counterparty risk, volatility risk, technology risk, etc. But the founders took as close to no risk as is possible in the real world.
I always find it funny that people have fault with the fact that early adopters own most of the Bitcoin. The Microsoft founders also hold most of the Microsoft stock. So do the Apple founders, etc. What does that have to do with anything?
The Microsoft founders took actual risk. Same with Apple's founders. They could have easily gone bankrupt if things had gone badly. Whoever created bitcoin didn't take any actual risk other than whatever time they spent making it. They merely created it and then convinced others to use it but at no time did they have any of their own capital at risk.
has become something even worse: a system completely controlled by just a handful of people.
It was that from day 1. People who got in early have lots of bitcoins. Anyone with lots of the market in anything will be able to strongly influence that market.
The mechanisms that should have prevented this outcome have broken down, and as a result there’s no longer much reason to think Bitcoin can actually be better than the existing financial system."
There never was any reason to think Bitcoin would be better than the existing financial system. People believed in bitcoin for ideological reasons rather than pragmatic ones for the most part. It appeals to certain ideologies and people who are trying to hide their activities, often for illicit reasons.
I think that's an unfair characterisation of what SpaceX has done/is doing.
SpaceX is doing some great work in lowering cost to orbit and improving rockets in a variety of ways. The importance of that cannot be overstated. But they are most decidedly NOT at the frontier of human exploration. Rockets to orbit is a solved problem. So is landing rockets on land. We can get better at it and do it cheaper (which is what they are doing) but we've done it before. They are incrementally improving work that has already been done in other projects. They're making the technology better and cheaper and more accessible.
Landing an intact first stage after it was travelling 6,000mph the other direction is pretty groundbreaking.
We've landed rockets on the ground before. Hell we've done it on other planets before. Yes it is very impressive but it's a new wrinkle on ground that has already been covered.
Propulsive landing of a space capsule for re-use is pretty major too.
Yes it is, though they haven't done that yet.
Then there's the Raptor engine, most of the way through the development with some components already tested to a high degree. A full-flow gas-gas staged combustion engine and a large one at that. No-one's built an engine like that before.
Incremental improvements to mostly already existing technologies. They are like Apple making what was already there better and more accessible and more reliable. (and unlike Apple, cheaper) I don't mean to sound like am minimizing what they are doing. It's awesome, important and badly needed. But it isn't work on the frontier of human knowledge for the most part. What SpaceX is doing is lowering cost to orbit. That is a very important piece of the puzzle but SpaceX by itself isn't going to get us to Mars any time soon. They aren't working at all on the thousands of other problems that will have to be solved to enable a Mars mission and they can't because there is no business case for it. One day hopefully there will be and the work SpaceX is doing now is a key piece of making that possible.
Except for Apple, what with their $205 billion dollars in cash on hand...
Apple has cash (not enough for a Mars mission) but if they said they were going to Mars their stock would plummet faster than you could say "shareholder lawsuit". Companies cannot do things which have unknown ROI, distant if any payback, huge costs and unquantified risks. Doesn't matter how big the bank account is, they can't do it because they can't show how they'd make a profit doing it.
A realistic Mars mission is probably going to cost north of a trillion dollars and I'm not even counting all of the R&D costs.