Hurrah for governmental regulation!

[FunkyTown]

All right. I'm mildly angry. Not horribly angry, but annoyed.

Officials: Pfizer to pay record $2.3B penalty - Yahoo! News

This company was charged billions of dollars for selling prescription drugs for effects that the food and drug administration hadn't been able to prove they could be used for.

That company, upon finding the settlement, announced it would spend 34000% of that on acquiring a new company. The same day. They aren't even pretending to be chastened.

And look at the worlds most profitable companies:

Most Profitable - UAL (3) - FORTUNE

10 Oil Companies

An Airline Company(Yay! I have no problem with you).

4 Banks that were bailed out by taxpayers.

General Electric(Good on you, GE. I have no problem with you).

Pfizer - Who paid basically a pittance for endangering Americans.

Toyota(Yay, Toyota!)

Microsoft(Yay, Microsoft!)

So here's my problems... Oil companies were HALF of the richest companies in the world in a year when they reported record high costs. When is the free market going to drum them out of business with an oil company that charges less?

4 Banks that were bailed out made money hand over fist. I hope they pay back the money they got with interest to cover the taxpayers share.

And Pfizer.

I would say 15 of the 20 companies in that list needed to be smacked down as they became great on the backs of people they abused.

[Maxel]

Perhaps if we were allowed to drill on U.S. soil more (like open up more of Alaska), more oil companies would be able to open up and drive down prices through more competition?

Ultimately, I think it's going to require businessmen who are willing to stay out of filthy agreements with other companies to keep prices high- also will require more entrepenuers willing to look into practical (and economically sound) applications for other energy sources. I think if we let the government do it, though, things will get... worse.

[Just_A_Guy]

What's that Adam Smith quote about every time businessmen get together, they come up with a new way to stick it to the consumer?

[BenRaines]

If there was a better way to do it then I think someone would have developed it.

When I was much younger Sears was the largest retailer in the US. This was in the late 1970's. I was selling products to K-Mart at the time. K-Mart's goal was to become the largest retailer in the US to to dethrone Sears.

A very smart man out of Bentonville, Arkansas started with the philosophy that there were under served small towns throughout the country where he could bring better product at a cheaper price to those in small cities. Walmart was formed.

While K-mart had their eyes on Sears a small company grew and passed them both. Eventually K-Mart purchased Sears and even after that Walmart is the largest retailer in the US and distributes all over the world.

Small business employs more people than large companies. Government employs more than any one company. I say the problem lies in government employs more than anyone.

Anyone who is not in business to produce a profit will not be in business very long. Most people go in to business to make money, not lose it.

Ben Raines

[FunkyTown]

And while you're right, Ben - Nobody's going to go in to business to lose money - One has to ask 'How much is enough?'

If oil companies are making up the majority of big money and are posting record profits even during years that they have pushed prices to highs nobody had ever seen before, then it seems to me that there is collusion behind the scenes.

And forget oil companies for a moment - A company that endangered American lives by selling products for things that the government feels is too risky to have licensed them for was fined ostensibly for risking the lives and health of Americans. In the day they were fined $2 billion dollars, they dropped $68 billion acquiring a new company.

And they were fined enough that they decided the same day to swallow up a second company to push them to new heights.

At what point is it not okay to abuse the system for profit? Is it $90 billion dollars profit? $100 billion? A trillion dollars? Clearly, people are hurting by the skyrocketing prices of medicine and oil. So what's the answer? How do you combine compassion with economic competitiveness?

If there was a better way to do it then I think someone would have developed it.

When I was much younger Sears was the largest retailer in the US. This was in the late 1970's. I was selling products to K-Mart at the time. K-Mart's goal was to become the largest retailer in the US to to dethrone Sears.

A very smart man out of Bentonville, Arkansas started with the philosophy that there were under served small towns throughout the country where he could bring better product at a cheaper price to those in small cities. Walmart was formed.

While K-mart had their eyes on Sears a small company grew and passed them both. Eventually K-Mart purchased Sears and even after that Walmart is the largest retailer in the US and distributes all over the world.

Small business employs more people than large companies. Government employs more than any one company. I say the problem lies in government employs more than anyone.

Anyone who is not in business to produce a profit will not be in business very long. Most people go in to business to make money, not lose it.

Ben Raines

[Vort]

Officials: Pfizer to pay record $2.3B penalty - Yahoo! News

This company was charged billions of dollars for selling prescription drugs for effects that the food and drug administration hadn't been able to prove they could be used for.

That company, upon finding the settlement, announced it would spend 34000% of that on acquiring a new company. The same day. They aren't even pretending to be chastened.

Let's see...$2.3 billion x 340 = $782 billion

So you're saying that Pfizer is paying 782 BILLION DOLLARS to buy a company?!

Sorry, that's not within the realm of believability. I think you must be an order of magnitude or so off.

Just Googled it...are you speaking of the Wyeth buyout? At $68 billion, this would be just under 30 times (or 3000%) more than the penalty. But this acquisition was announced at the beginning of the year, so that doesn't qualify as an action taken in defiance of the ruling against them. I think you have some of your facts confused.

[bytor2112]

Why the anger with oil companies??? Let's say you purchased shares of XOM (Exxon) 09/02/2000....price per share was $41.00....today your shares would be trading at $68.18.

Contrast that with the evil computer company known as Apple. 09/02/2000, share price = $31.72. Today you could have sold your shares for $165.18. EEEVVVIIILLLLL!!!!!!

[john doe]

Hey, no fair talking sense here. Let's just judge people based upon our emotions and class warfare.

[Moksha]

Perhaps if we were allowed to drill on U.S. soil more (like open up more of Alaska), more oil companies would be able to open up and drive down prices through more competition?

Royal Dutch Shell is already making big profits in Alaska. Is the idea of a national reserve of oil a bad idea when there are profits to be made in the here and now?

[BenRaines]

I would say that most people have an investment and benefit from big oil companies. If you have a company pension, work for a state or local government or even a smaller company as an employee that has any kind of a retirement plan then you are a beneficiary of big oil. If you own or have an interest in an S&P 500 fund you are an investor in big oil and pharmaceutical companies.

Funkytown, I am not getting down on you but on the biased reporting that makes large companies look like they are making money for a select few when most Americans invest in those companies one way or another.

Ben Raines

[Guest]

So here's my problems... Oil companies were HALF of the richest companies in the world in a year when they reported record high costs. When is the free market going to drum them out of business with an oil company that charges less?

Not gonna happen. Why?

1.) Oil is not an inexhaustible resource. You need an oil well to get oil - and most of the feasible-to-harvest oil is either a.) in a country under a dictatorship, in a war, or where oil resources is owned by a government, all under a cartel, or OPEC, and b.) protested against by environmental activitists. This means that there is no such thing as a free market when it comes to oil.

2.) Demand is increasing. Okay, let's review the law of economics - price in "free market" is controlled by 2 factors - supply and demand. When supply is higher than demand, the price goes down. When demand is higher than supply, the price goes up.). With India and its 1.2 billion population going industrialized, the demand for fossil fuel is greatly increased. Meanwhile, supply remains the same - at the start of the Iraq war, supply was lower due to diminished production from Iraq and affected areas.

Which is really wild - because the USA still have a lot of feasible-to-harvest oil but the government will not allow them to be harvested due to environmental reasons. Yet, America still runs on fossil fuel (tell the semi trucks, airlines, GM to stop using fossil fuel and see what happens). So, you import oil. It's like saying, I'm going to buy a dog. But, I don't want him peeing on the grass because it kills the grass... so, I'm going to have my dog pee on the neighbor's grass instead coz, I mean yeah it kills the environment, but heck, it's not in my yard! Fact is, it is probably best if the US produces their own oil instead of buying the oil from other countries because the US is more "environmentally conscious" than, say, Venezuela. So, each gallon of gas in your Prius would have caused much lesser harm to the environment if it was "proudly harvested and EPA regulated in the United States of America".

And another thing on this thing about profits. Businesses calculate everything using percentages. Trust me, I have to write a gazillion programs for this! If you have a gallon of oil that costs $1 you find $1 from your couch, car, beg, or borrow, so you have $1 capital. You gnash your teeth and you can't sleep at night because you just got your $1 stuck in an investment. So, you figured, all this gnashing better be worth 10% profit margin! So you sell the oil for $1.10 and voila, somebody bought it, thereby giving you 10 cents profit. (okay, okay, there's tax, etc. etc., but let's just make this simple, shall we?) Now, let's say the demand for the gallon of oil increased. So, you beg and borrow some more gnash your teeth some more because now, you just got $5 of your hard-earned cash stuck on this investment (increased cost)! So, because you're not greedy at all, you're just this nice guy trying to make a buck, you don't increase your PROFIT MARGIN. All you want is STILL 10%. So, you sell your oil for $5.50 and wow! Somebody bought it! YOU JUST MADE 50 CENTS!

Okay, now CNN comes in and says, WHOA... BIG OIL ANATESS MADE RECORD PROFITS! Well, duh! I just made 50 cents. But guess what, I INVESTED FIVE BIG BUCKS! My profit margin is still the same 10% - it is the measure of my risk. If I've had lost that investment, I would have been out FIVE BIG BUCKS!

Okay, so you see now why I can't buy this BS on BIG PROFIT OIL COMPANIES? People - demand is increasing at a very high rate. BP and Shell is now having to put in $5 instead of just $1 to meet the demand as evidenced by Funky's statement of HIGH COSTS. They are still making 10% margin. And whoopie, verrrrryyy eeeevvviiilll for making 50 cents! LET'S MAKE A NEW LAW OF ECONOMICS - YOU INVEST $5.00 YOU STILL MAKE 10 CENTS. Yeah. That makes sense. Why would I do that if I can get 10 cents just by putting in one measley buck?

You dig?

Edited September 3, 2009 by anatess

[Guest]

4 Banks that were bailed out made money hand over fist. I hope they pay back the money they got with interest to cover the taxpayers share.

I agree pending further detail on the matter.

Bank of America made profits. My husband got a raise. Whoopie! I mean, he was 1 of only 2 in his entire department that kept his job... so that was a big relief. So, Bank of America "supposedly" (unverified) tried to return the stimulus money and the government wouldn't take it.

Okay, I don't know if this is true, so somebody with information, please share!

I'm trying to get more facts on this but I just haven't had the time yet.

Edited September 3, 2009 by anatess

[Guest]

I would say 15 of the 20 companies in that list needed to be smacked down as they became great on the backs of people they abused.

I can't support this either. A consumer in a democracy is NOT FORCED TO BUY anything. Fool me once shame on you. Fool me twice, shame on me. Abused consumer only exists when a government uses their police power to take out consumer choice - which exists in America to some degree but Pfizer is not to blame for that - the government is (and I don't care how much Pfizer paid the government - it is still on the government's onus to make the law). And no - you can't cry ignorance, uneducated, don't know enough. If you haven't learned how to keep your money or spend it wisely, then the consequence is, you lose it.

Okay, those are my opinions on this issue. Hope it was fun reading.

[BenRaines]

Government has made over 4 billion dollars on repayment by 5 of the major banks that received funds from the government. They repaid the dollars received and then purchased back their warrants and paid interest on the money received in excess of 4 billion dollars. Government made money on the deal from those banks. The major ones.

Ben Raines

[john doe]

Well, that's not right. That's outrageous that they would make such a huge profit on the backs of the American consumer. We should demand they give that excess money back to the companies who paid it.

[JohnnyRudick]

If there was a better way to do it then I think someone would have developed it.

When I was much younger Sears was the largest retailer in the US. This was in the late 1970's. I was selling products to K-Mart at the time. K-Mart's goal was to become the largest retailer in the US to to dethrone Sears.

A very smart man out of Bentonville, Arkansas started with the philosophy that there were under served small towns throughout the country where he could bring better product at a cheaper price to those in small cities. Walmart was formed.

While K-mart had their eyes on Sears a small company grew and passed them both. Eventually K-Mart purchased Sears and even after that Walmart is the largest retailer in the US and distributes all over the world.

Small business employs more people than large companies. Government employs more than any one company. I say the problem lies in government employs more than anyone.

Anyone who is not in business to produce a profit will not be in business very long. Most people go in to business to make money, not lose it.

Ben Raines

Can't think of any businesses that can print their own money though.

Esp now that they have taken over the Fed so to speak.

Just a thought:mellow:

[BenRaines]

Please don't get me wrong I am not in favor of bigger government. Money was not given to the big banks. Banks borrowed it from the Federal Government with some very heavy fees to borrow and some had to give up significant ownership to get the funds.

All I am saying is lets be a little better informed about what the rescue funding was all about and Bailout is an incorrect term for what happened

Ben Raines

[georgia2]

Check out what Glen Beck says about the oil companies.

Oil companies are not owned by one or even a few. Stocks and bonds that are owned by most americans by way of their retirement mutual funds, 401 k, and similar financing. Companies making money is good for our economy. specially large companies because this is how most Americans can afford to retire! We lost so much of our retirement $$ in the plunge last fall, my husband is having to rethink being able to do so in March! The Saudi's are the ones getting rich off oil, not american companies.

[BenRaines]

Bank of America tried to return some of the funds but they wanted to modify the agreement so that they would not have to have so much in reserves. Government would not go for it so they were unable to return the funds at that time. They are trying again

Ben Raines