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?? Real wages still falling |
| Greg Mankiw takes a (late) shot at me ??
August 17, 2006
Still catching up..one for you, Brad
Back in March, I used Wal-mart as a good example of a non-manufacturing company creating dark matter. At the time, I wrote that Wal-mart was buying up stores overseas and applying "the business knowhow which made Wal-mart such a powerful and productive competitor in the U.S." These exports of business know-how would not show up in the international accounts as an investment, but they would bump up future profits.
Now, Wal-mart has sold its German stores, and its Japan stores don't look so hot either. Not much dark matter there..
Brad Setser nicely says:
I won?? gloat too much though
Go ahead and gloat, Brad. That's a good point for your view of the world, since I'd consider Wal-mart, along with Dell and a few other companies, one of the main leaders in supply chain management. And supply chain management has to be one of the main sources of dark matter, in my analysis.
Oh. well. At least my wife's knee is getting better after the operation.
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I wonder if Wal-Mart's German woes might give a window into measuring dark matter indirectly. If we presume that Wal-Mart's know-how has a value, this value will rise and fall like any other asset. The write down Wal-Mart took in the sale of its German subsidiary might correlate to the removal of this unrecorded asset. We could look at other international American business failures, and make some assumptions about the percentage of assets that go up vs. the percentage that go down.
Posted by: Patrick J. Walker at August 18, 2006 02:36 PM
I personally dislike Wal-Mart very much, except when I shop there and get the lowest prices. But, it seems that Wal-Mart will not be able to keep growing. Simply becuase people don??t like going there. It??s impersonal, and you don??t really support you local economy by shopping there. (Only if you count the great min. wage jobs given to it??s employees.) The fact is that we as American should stop viewing China as a threat and start viewing there consumers as opportunities. China has as many millionares as the United States, and as such, are the leading consumers of such luxery items as the 700 BMW??s. Companies that sell online should consider halving there website built into Mandarin, so that any Chinese upperclass housewife with a credit card can buy these products, and help bring more balance to the global economy. Some businesses such as Price Translations specialize in these website localization products, which include the translations of text, and building of new websites specifically targeting the Chinese audience. (www.pricetranslations.net) All we have to do is start selling value added products from America and Europe back to to China, then we can all prosper.
Posted by: John Price at November 7, 2006 03:43 PM