Tuesday, October 13, 2009

Continued Consolidation...

I've written a few dozen times, this century and the last, that as the downturn commences, we'll see corporate consolidation, funded by taxpayer subsidies. The biggest corporations will be able to pay the best bribes, to get free bailouts, and they'll use the power of those funds to destroy their smaller competitors.

This will allow bankrupt mega corporations to thrive and to destroy profitable corporations. After all, if you don't have to earn a profit to stay in business, you can undercut everyone. If the federal government is giving you many millions in free money, you can use that to buy out profitable businesses, then shut them down.

Here's a Bill Hatch reporting on this very phenomenom.
Dairy Industry Goes Down the Tubes

This is nothing but another public gift to banks. If dairy cost/price ratios continue along the same dismal path to keep profits high for Dean Foods/DFA investors, all it will really achieve is to allow mega-dairies to pay down enough debt to borrow more to buy smaller dairies to produce more milk at a loss until the banks again go to Congress for more taxpayer funds to get bailed out again so that even fewer, larger mega-dairies can again restore their credit and buy more cows, until the next time.

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