Thursday, February 1, 2018

Mike Murphy — Jeff Bezos’ fortune tops $120 billion as Amazon shares surge after hours

Raising eyebrows.

The controversy now is whether Amazon is a monopoly/monopsony extracting economic rent?

Jeff Bezos’ fortune tops $120 billion as Amazon shares surge after hours
Mike Murphy | Editor


Matt Franko said...

Prices are low there Tom.... no rent....

Kaivey said...

I read in the Guardian years ago how the British government looked into it and said that Amazon was not working against the public interest as their prices were so low.

Now half of US sales go through Amazon and it could create problems in the long run. Amazon now sell food and are going into pharmaceuticals and health care too. If they end up with most of the US sales and their workers are on rock bottom wages they could end up with hardly any customers.

Noah Way said...

The business model is everyone works for you at wage slave rates and they all buy your products with company scrip. Amazon puts businesses out of business with low prices, eliminating competition, and then dominates the market where they can charge whatever they want.

Low prices are the problem, not the solution. Consumerism is based on cheap disposable crap. People should be actively employed / engaged in creating far fewer durable, well-made products that last instead of filling up landfills with single-use crap.

The entire system is upside down, and only for profit. I refuse to buy on AMZ.

Tom Hickey said...

Prices are low there Tom.... no rent....

The rent is actually fairly high to sellers, but they pay it for the vast exposure that Amazon provides.

The business model that Bezos adopted in based on rent. He set out to contract a monopoly and was willing to invest and run at a loss for years to gain market dominance, and investors supported the strategy.

Bezos did not take money out of the company directly, but relied on making himself wealthier through a rising stock price.

Amazon's rise was also greatly benefitted by tax law favoring online sellers, since they did not pay state tax. This advantage allowed Amazon to put many smaller local firms out of business, e.g., book stores.

This is a predatory business plan that is based on monopoly and monopsony rent.

Like Walmart the business plan is based on hard work for low wages.

Kaivey said...

Do you know, Noah, the first thing that opened my eyes to how the world is run was the book by Michael Rowbotham called The Grip of Death: A Study of modern money, debt slavery, and destructive economics. (it's not a book about MMT, but it inspired the founders of Positive Money).

In the book I learnt for the first time how banks create money out of nothing and how workers did not earn the money to buy the products they made stifling capitalism. Micheal described how modern capitalism makes cheap, shoddy goods that don't last which is a huge waste.

Another eye opener, though, was how we make fridges in Germany, Italy, and England (and anywhere in Europe) and they are exported all around Europe so we have ships passing each other on the oceans carrying the exactly the same products, but just made by different companies. So we have British made fridges going to Germany, and German made fridges going to Britain. This happens with all different products going all over the oceans all passing each other in ships.

What a waste, and capitalism prides itself on efficiency. This waste is paid for by the public, of course, and the elite do it because it very profitable for them. The intense competition makes people work their nuts off.

Micheal describes a world where we could be working only three to four days a week making durable products in our own countries for domestic use. He says that if we transformed banking people could take time off from work for a few months, or a few years without being penalized financially. Then we could retrain if we were fed up with our jobs and go back to university or technical college. Or even take a few months off work to do DIY on the house, or to spend time with the new baby.

But what do we have instead, a hell hole with people going ten to a dozen, machinery going 24/7 , the world being churned extracting more and more night and day like there is no tomorrow.

What we could have had but what we have instead? And we have half the electorate voting for the parties of the ruling elite who then turn them into slaves because they have been brainwashed to believe in the protestant work ethic and that There Is No Alternative.

Noah Way said...

Define efficiency. For many it is maximum ROI without regard for anything else. The problem is the value system, the only measure is money, which makes money the only value. How many times have you heard that we can't have something because it "costs too much"?

Tom Hickey said...

Efficiency is doing things right. Effectiveness is doing the right things.

To paraphrase Drucker in The Effective Executive.