Econ 101: the real victims of this depression are still the poor people

[pico]

sure you see parade of madoff's victims on cnn and cnbc 24/7, but those are small percentages of the population. the people who are getting screwed over the most are still the poor.

case and point. banks are in trouble, so they tighten up their credits to businesses. commercial papers and short term business credit windows are getting worse and worse. this credit crunch force companies to fire-sale inventory to maintain the cash flow...70% off at department stores for example. when you cut price to 50% you're breaking even (because there is overhead cost)...when you cut price to 70% that means they're selling products at cost (that means stores are eating the overhead cost).

and this starts a whole chain reaction. the next batch of people getting screwed over are the whole sellers (store suppliers). when whole sellers gets in trouble, they can't pay the factory and the middle men. the person on top will screw over the person below him (they call it account payable in accounting). the factory is pretty much at the bottom, so they're getting fvcked over by not receiving any money.

so how does the factory handle this loss? either they layoff workers or better yet, not paying working for months of back wages. so at the end, the workers are getting fvcked over the most. now you can argue that the unions or the gov can come in and fill in the gap. if you think about it, it is still your tax dollar. who pays taxes? the people.

in conclusion, the people who has the least means of defending themselves are getting fvcked over the most. that is econ 101. you'll never learn this in college.

[CS-Cedrick]

Great article sir, a reality not taken in consideration by most people throughout the globe, not only in the US.

[wild willy]

Pico good article I totally agree. You will be busy today answering all the post. Good job

[flyingillini]

Picoman 101

[Chi_archie]

great article and very true, living in the ghetto here...i see the effects first hand...and feel it as crime is up ect..

the big thing now, is stealing people's catalytic converters from underneath vehicles...this some precious metal worth a ton in there, that makes them worth quite a bit.

[pico]

one day people are going to steal man-hole covers and wires from the electric pole. imagine driving your car down a street and get stuck in a man hole because someone stole the cover.

[mmike032]

we have had an epidemic of copper wire theives here this past summer.
the SOBs were stealing wire out of air conditioners. Some thiefs even went as far as stripping all wires out of houses under construction. When you think about it, thats a lot of work to get some copper wire. why not just get a job. pays about the same and most jobs require less work than stripping all the wires out of houses.

[Devo]

I wouldn't say the poor people are getting screwed now, the difference is this has moved to the lower middle class. The true poor people know how to beat the system with free money. That's their job, to colect as much free money as they can, and there certainly is a lot to go around. It's the lower middle class, who want to work, even to jobs if they can, who are now getting screwed. No credit line in sight for them.