Calumet files Chapter 7

In article ,
says...

On Fri, 21 Mar 2014 00:29:35 -0400, Tony Cooper
wrote:
: On Thu, 20 Mar 2014 21:30:18 -0400, Robert Coe wrote:
:
: On Fri, 21 Mar 2014 11:43:07 +1300, Eric Stevens
: wrote:
: : On Thu, 20 Mar 2014 18:10:39 -0400, Tony Cooper
: : wrote:
: :
: : On Fri, 21 Mar 2014 09:08:09 +1300, Eric Stevens
: : wrote:
: :
: : On Thu, 20 Mar 2014 08:21:19 -0400, Usenet Account
: : wrote:
: :
: : On 20/03/2014 4:50 AM, Eric Stevens wrote:
: : On Wed, 19 Mar 2014 22:32:54 -0400, Robert Coe wrote:
: :
: : On Thu, 13 Mar 2014 12:31:07 -0400, Usenet Account
: : wrote:
: : : http://petapixel.com/2014/03/13/calu...s-zero-notice/
: :
: : That's very sad. (I've been pretty busy and hadn't heard about it until now.)
: : Calumet has been very good to CIPNE ("Commercial/Industrial Photographers of
: : New England"), whereof I think I'm still a member. Come to think of it, CIPNE
: : isn't doing too well itself, I'm afraid. Anybody who could spare a few hours a
: : month could probably take over as President, with the heartfelt gratitude of
: : the membership.
: :
: : But anybody who blames Calumet for screwing its employees should get a grip.
: : That's the way capitalism works, and is intended to work.
: :
: : Rubbish.
: :
: : That too is sad, but it's the way it is.
: :
: : But not the way it should be.
: :
: :
: : Employees should be considered as secured creditors, and IMHO should
: : have a level of protection.
: :
: : In an era where we see bank and wall street executives with gold and or
: : palladium parachutes, while the working class gets nothing? There has to
: : be some fairness. Don't give me that it's capitalism.. so sad too bad
: : nonsense.
: :
: : Of course it's not capitalism. It's nonsense to claim that capitalism
: : won't work unless you treat your employees that way.
: :
: : "Capitalism" is too broad a brush to use to describe this. What went
: : down was a strategic move by a company, and we can only guess what
: : determined that strategy. It's probably one of two things:
: :
: : a. Management refused to recognize the seriousness of the problem
: : until there was nothing else possible except closing the doors, and
: : that was probably forced by creditors. The "strategy", in this case,
: : is "do nothing and hope a miracle happens".
: :
: : b. Management was trying to find a bail-out solution and didn't want
: : to jeopardize their position by announcing intended closures or
: : lay-offs.
: :
: : In either case, it was bad strategy.
: :
: : Realistically, while it may seem unfair, what could have been gained
: : if the employees *did* have notice? Their jobs are gone either way.
: : It's not like they would have been able to put feelers out with other
: : camera stores in the area. They'll be drawing unemployment
: : compensation a little earlier.
: :
: : If the employees had notice, word would have leaked out into the wider
: : community and the business would have ground to a halt in a confused
: : shambles. They would still have been broke but their affairs would
: : have been in just that more of a mess.
:
: Translation: There wouldn't have been time for the officers to find a way to
: take care of themselves before the s*** hit the fan. Understand that I don't
: know that that's what happened in this particular case, but it IS a
: time-honored capitalist strategem.
:
:
: Calumet had, at the time of declaring Chapter 7, less than $50,000 in
: assets and between one and ten million in liabilities. That indicates
: a long-term slide downwards, not a sudden descent. There was time for
: any pre-planning the officers wanted to do without a need for an
: unannounced immediate closing.
:
: Capitalism, reduced to the barest definition, is simply an economy
: where businesses and resources are owned by individual people and not
: the government. A capitalist is a person who believes and
: participates in that type of economy.
:
: The premise that capitalism results in more people lining their own
: pockets at the expense of others just doesn't hold water. Look at the
: government officials in some of the African nations, Middle-Eastern
: nations, and Eastern European nations who have financially raped the
: citizenry of their nations. It's not the capitalists who have
: billions tucked away in Swiss banks.
:
: Calumet provided jobs and income to hundreds of employees over a 75
: year span. The income of those employees provided jobs and income to
: the many businesses who they patronized. The purchases by Calumet
: provided jobs and incomes to many vendors in those 75 years. That's
: what capitalism does.
:
: This isn't a failure of capitalism. It's a failure of a few
: individuals to successfully manage a business in a changing market.
: Other capitalists reacted more intelligently to the changing market
: and provided competition that Calumet couldn't keep up with.

Your "barest definition" of capitalism is too bare. Capitalism relies on the
creation of corporate entities that can act as though they were individuals or
groups of individuals, while insulating their owners from much of the
financial liability that individuals would have to assume. In effect, the
people strike a bargain with a corporation's owners, based on the assumption
(the hope, really) that in the long run the societal benefit (in economic
activity, jobs created, etc.) will be worth the risk.

There are two major problems with the way capitalism is practiced today (at
least in the U.S. and probably elsewhere):

- Governments are far too reluctant to pull the plug on corporations that no
longer serve the public interest well enough to justify their existence.

What mechanism would you propose for "pulling" this "plug" that would be
more effective than the market?

Sometimes a corporation behaves so egregiously that the government that issued
its corporate charter should simply cancel it and revert the corporation to a
proprietorship or an unlimited partnership.

And what happens to the shareholders?

The company's stock price would
probably fall to near (or even below) zero, but the owners would have had it
coming. And the threat of such an action would be a powerful motivator to
promote good corporate citizenship.

If it is no longer a corporation then it has no shares and the pieces of
paper that formerly were shares become worthless. As for the notion
that such threat would "promote good corporate citizenship", if the
corporation is behaving in an egregiously antisocial manner, the
shareholders are likely to be among the last to know.

- Corporations, at least in the U.S., have routinely (and almost always
successfully) promoted, almost as a constitutional right, the notion that
governments have no business competing with the private sector, even in cases
where the latter are behaving in a monopolistic manner and screwing the
public.

When has the government in the US succesfully competed with the private
sector?

But in fact the U.S. Constitution favors no economic system over any
other. Even socialism or communism would be constitutional, though I'm not
advocating either system. What I am suggesting is that public-sector
corporations should be created to compete with the private sector whenever the
latter exhibits a self-interested indifference to the public good.

What would you suggest as such s "public sector corporation" and how
would it operate?

And where
is it written that even good corporations should be insulated from any form of
public ownership?

Corporations are almost always publicly owned.

Corporations aren't reluctant to seek public "bailouts",
willingly trading bonds or ownership stakes to get them. But when things turn
good, they howl if the Government wants to keep its stake long enough to make
a profit on the public's investment.

Please provide an example of such "howling".

Enough ranting. It's not that I'm an actual economist or anything. :^)

On Sat, 22 Mar 2014 10:38:49 -0400, Robert Coe wrote:

--- snip ---

: Calumet provided jobs and income to hundreds of employees over a 75
: year span. The income of those employees provided jobs and income to
: the many businesses who they patronized. The purchases by Calumet
: provided jobs and incomes to many vendors in those 75 years. That's
: what capitalism does.
:
: This isn't a failure of capitalism. It's a failure of a few
: individuals to successfully manage a business in a changing market.
: Other capitalists reacted more intelligently to the changing market
: and provided competition that Calumet couldn't keep up with.

Your "barest definition" of capitalism is too bare. Capitalism relies on the
creation of corporate entities that can act as though they were individuals or
groups of individuals, while insulating their owners from much of the
financial liability that individuals would have to assume.

You are talking about a limited liability company (LLC). Capitalism
has never relied upon these.

In effect, the
people strike a bargain with a corporation's owners, based on the assumption
(the hope, really) that in the long run the societal benefit (in economic
activity, jobs created, etc.) will be worth the risk.

There are two major problems with the way capitalism is practiced today (at
least in the U.S. and probably elsewhere):

- Governments are far too reluctant to pull the plug on corporations that no
longer serve the public interest well enough to justify their existence.
Sometimes a corporation behaves so egregiously that the government that issued
its corporate charter should simply cancel it and revert the corporation to a
proprietorship or an unlimited partnership. The company's stock price would
probably fall to near (or even below) zero, but the owners would have had it
coming. And the threat of such an action would be a powerful motivator to
promote good corporate citizenship.

- Corporations, at least in the U.S., have routinely (and almost always
successfully) promoted, almost as a constitutional right, the notion that
governments have no business competing with the private sector, even in cases
where the latter are behaving in a monopolistic manner and screwing the
public. But in fact the U.S. Constitution favors no economic system over any
other. Even socialism or communism would be constitutional, though I'm not
advocating either system. What I am suggesting is that public-sector
corporations should be created to compete with the private sector whenever the
latter exhibits a self-interested indifference to the public good.

No thank you. Whether you realise it or not, you are advocating that
without any possibility of appeal governments take my money and use it
to compete with me and my neighbours.

Further, the idea that one side in the game also provides the referee
is abhorrent.

And where
is it written that even good corporations should be insulated from any form of
public ownership? Corporations aren't reluctant to seek public "bailouts",
willingly trading bonds or ownership stakes to get them.

It takes _two_ willing parties to do a deal.

But when things turn
good, they howl if the Government wants to keep its stake long enough to make
a profit on the public's investment.

Enough ranting. It's not that I'm an actual economist or anything. :^)


It would be best if we stayed with photography. :-)
--

Regards,

Eric Stevens

On 3/22/2014 10:38 AM, Robert Coe wrote:


snip


- Governments are far too reluctant to pull the plug on corporations that no
longer serve the public interest well enough to justify their existence.
Sometimes a corporation behaves so egregiously that the government that issued
its corporate charter should simply cancel it and revert the corporation to a
proprietorship or an unlimited partnership. The company's stock price would
probably fall to near (or even below) zero, but the owners would have had it
coming. And the threat of such an action would be a powerful motivator to
promote good corporate citizenship.

- Corporations, at least in the U.S., have routinely (and almost always
successfully) promoted, almost as a constitutional right, the notion that
governments have no business competing with the private sector, even in cases
where the latter are behaving in a monopolistic manner and screwing the
public. But in fact the U.S. Constitution favors no economic system over any
other. Even socialism or communism would be constitutional, though I'm not
advocating either system. What I am suggesting is that public-sector
corporations should be created to compete with the private sector whenever the
latter exhibits a self-interested indifference to the public good. And where
is it written that even good corporations should be insulated from any form of
public ownership? Corporations aren't reluctant to seek public "bailouts",
willingly trading bonds or ownership stakes to get them. But when things turn
good, they howl if the Government wants to keep its stake long enough to make
a profit on the public's investment.

Enough ranting. It's not that I'm an actual economist or anything. :^)

What you say makes eminent sense in a perfect world, where there is no
chance that the party in poser would use that power for political advantage.




--
PeterN

On 21/03/2014 04:29, Tony Cooper wrote:
On Thu, 20 Mar 2014 21:30:18 -0400, Robert Coe wrote:

On Fri, 21 Mar 2014 11:43:07 +1300, Eric Stevens
wrote:

: If the employees had notice, word would have leaked out into the wider
: community and the business would have ground to a halt in a confused
: shambles. They would still have been broke but their affairs would
: have been in just that more of a mess.

It seems to me unlikely that the employees would not have seen the
writing on the wall. Bricks and mortar photo stores are a dying breed.
You only have to look around inside one to see why. Smartphones have
annihilated the point and shoot market, digital zapped print processing.

People are in there playing with new expensive kit tying up experienced
salespeople to help choose their kit and then blatantly looking on their
iPhone to see which website has it for the cheapest price. The same
thing that also killed Jessops and Jacobs in the UK. The former even
offered to match online prices but it didn't save them(*).

(*) A handful of their shops in the premium locations have reopened
under new management and the same Jessops name.

Translation: There wouldn't have been time for the officers to find a way to
take care of themselves before the s*** hit the fan. Understand that I don't
know that that's what happened in this particular case, but it IS a
time-honored capitalist strategem.

A method widely adopted by bankers cut from the same cloth as the
infamous Fred the Shred who totally destroyed RBS requiring a massive
taxpayer bailout to prevent the global banking system collapsing and
still walked away with all his severance pay and pension entitlements.

Calumet had, at the time of declaring Chapter 7, less than $50,000 in
assets and between one and ten million in liabilities. That indicates
a long-term slide downwards, not a sudden descent. There was time for
any pre-planning the officers wanted to do without a need for an
unannounced immediate closing.

It tends to suggest that the directors were guilty of trading whilst
insolvent which would be an offence in the UK.

This isn't a failure of capitalism. It's a failure of a few
individuals to successfully manage a business in a changing market.
Other capitalists reacted more intelligently to the changing market
and provided competition that Calumet couldn't keep up with.

Actually I think it is a failure of capitalism in that people these days
buy the cheapest online and screw over the honest dealers. High streets
are now increasingly half empty or worse still occupied by charity shops
selling tat and payday loan sharks stolen goods.

--
Regards,
Martin Brown

On 23/03/2014 00:37, Eric Stevens wrote:
On Sat, 22 Mar 2014 10:38:49 -0400, Robert Coe wrote:

And where
is it written that even good corporations should be insulated from any form of
public ownership? Corporations aren't reluctant to seek public "bailouts",
willingly trading bonds or ownership stakes to get them.

It takes _two_ willing parties to do a deal.

No it doesn't. Try negotiating on price with a ticking bomb on the table
and a gun held to your head, when you have toothache with a dentist, or
bleeding to death with a US medic...

The banks were "too big to fail" and as such were able to completely
screw over the tapayers in a "heads we win tails you lose" scam.

Shareholders never halt the increase the remuneration for CEOs in an
unending spiral whilst simultaneously laying off workers to drive wages
for the peons down. US and UK CEO to median wage ratios are obscene.

It is no surprise that they all sit on each others remuneration
committees and make trite claims like "we are all in it together".

--
Regards,
Martin Brown

In article , Martin Brown
wrote:

: If the employees had notice, word would have leaked out into the wider
: community and the business would have ground to a halt in a confused
: shambles. They would still have been broke but their affairs would
: have been in just that more of a mess.

It seems to me unlikely that the employees would not have seen the
writing on the wall. Bricks and mortar photo stores are a dying breed.
You only have to look around inside one to see why. Smartphones have
annihilated the point and shoot market, digital zapped print processing.

exactly. if the employees couldn't see what was happening in the
industry and that business has slowed down, then they were either in
denial or not paying much attention.

People are in there playing with new expensive kit tying up experienced
salespeople to help choose their kit and then blatantly looking on their
iPhone to see which website has it for the cheapest price. The same
thing that also killed Jessops and Jacobs in the UK. The former even
offered to match online prices but it didn't save them(*).

the stores aren't offering any reason to pay a premium so they go away.
no loss. why pay more for less?

This isn't a failure of capitalism. It's a failure of a few
individuals to successfully manage a business in a changing market.
Other capitalists reacted more intelligently to the changing market
and provided competition that Calumet couldn't keep up with.

Actually I think it is a failure of capitalism in that people these days
buy the cheapest online and screw over the honest dealers. High streets
are now increasingly half empty or worse still occupied by charity shops
selling tat and payday loan sharks stolen goods.

it isn't a failure at all.

other sellers are offering the same product for less money, so either
the stores need to cut their prices to match or they need to offer
services to justify their higher prices. either way, the consumer wins.

In article , Martin Brown
wrote:

It takes _two_ willing parties to do a deal.

No it doesn't. Try negotiating on price with a ticking bomb on the table
and a gun held to your head, when you have toothache with a dentist, or
bleeding to death with a US medic...

that's not negotiation.

On 3/24/2014 5:07 AM, Martin Brown wrote:
On 21/03/2014 04:29, Tony Cooper wrote:
On Thu, 20 Mar 2014 21:30:18 -0400, Robert Coe wrote:

On Fri, 21 Mar 2014 11:43:07 +1300, Eric Stevens

wrote:

: If the employees had notice, word would have leaked out into the wider
: community and the business would have ground to a halt in a confused
: shambles. They would still have been broke but their affairs would
: have been in just that more of a mess.

It seems to me unlikely that the employees would not have seen the
writing on the wall. Bricks and mortar photo stores are a dying breed.
You only have to look around inside one to see why. Smartphones have
annihilated the point and shoot market, digital zapped print processing.

People are in there playing with new expensive kit tying up experienced
salespeople to help choose their kit and then blatantly looking on their
iPhone to see which website has it for the cheapest price. The same
thing that also killed Jessops and Jacobs in the UK. The former even
offered to match online prices but it didn't save them(*).

(*) A handful of their shops in the premium locations have reopened
under new management and the same Jessops name.

Translation: There wouldn't have been time for the officers to find a
way to
take care of themselves before the s*** hit the fan. Understand that
I don't
know that that's what happened in this particular case, but it IS a
time-honored capitalist strategem.

A method widely adopted by bankers cut from the same cloth as the
infamous Fred the Shred who totally destroyed RBS requiring a massive
taxpayer bailout to prevent the global banking system collapsing and
still walked away with all his severance pay and pension entitlements.


I disagree.
Too much of the dealings at RBS was cut from whole cloth.





--
PeterN

On 3/24/2014 5:07 AM, Martin Brown wrote:

snip


Actually I think it is a failure of capitalism in that people these days
buy the cheapest online and screw over the honest dealers. High streets
are now increasingly half empty or worse still occupied by charity shops
selling tat and payday loan sharks stolen goods.


I'm sure you didn't mean to imply that online dealers are less honest
than brick & mortar dealers.

Having said that, it's the essence of capitalism, that as economic
conditions change, those who cannot adopt, fail. Yes it is indeed a
harsh concept that hurts many innocents. It is also important that
society have a safety net that includes retraining.

--
PeterN

On 3/24/2014 6:36 AM, Martin Brown wrote:
On 23/03/2014 00:37, Eric Stevens wrote:
On Sat, 22 Mar 2014 10:38:49 -0400, Robert Coe wrote:

And where
is it written that even good corporations should be insulated from
any form of
public ownership? Corporations aren't reluctant to seek public
"bailouts",
willingly trading bonds or ownership stakes to get them.

It takes _two_ willing parties to do a deal.

No it doesn't. Try negotiating on price with a ticking bomb on the table
and a gun held to your head, when you have toothache with a dentist, or
bleeding to death with a US medic...

The banks were "too big to fail" and as such were able to completely
screw over the tapayers in a "heads we win tails you lose" scam.

Which was one of the reasons banks were originally prohibited from
getting into non-banking businesses.



Shareholders never halt the increase the remuneration for CEOs in an
unending spiral whilst simultaneously laying off workers to drive wages
for the peons down. US and UK CEO to median wage ratios are obscene.


In theory, I own x% of xx corporation. I, together with the other
shareholders hire someone to manage the company. We are simply
investors. If the manager makes money for me, I will happily pay him.
Without me supplying the money and xx managing the company, there would
be no company. Since management is paid based upon financial success,
the Harvard B school teaching comes into play. Management makes
decisions that will produce immediate profits. Money that should be set
aside for future growth is not part of profits. therefore management has
a built in conflict between the long term good of the company, and their
pockets.


It is no surprise that they all sit on each others remuneration
committees and make trite claims like "we are all in it together".



--
PeterN