RANDOM THOUGHTS

WHO OWNS WHO?

If you read the article, I linked to on Saturday you read that a Korean company Youngone is the majority owner of outdoor research. I quote;

“Outdoor Research has been majority-owned by Youngone since

2014 (though the company wouldn’t confirm whether it manufactures at KSI); KSI is the factory owned by Youngone and they make footwear and apparel”.

Did outdoor research have the mukluk over boots made there for the marine corpse? Regardless when a foreign entity is the primary owner of an American company is it still an American company? Regardless the foreign entity takes all of the profits from the American company’s bank account as it chooses.

As you can see when foreign entities own American company’s they reap American dollars. When American company’s buy large quantities of product made for them in foreign countries, they pay them, the producers with American dollars.

Of all the currencies in the world the most valuable is American dollars. But you already knew that.

Due to the coronavirus American dollars are not flowing into China. That represents a major problem for China, for both the prosperous part of the population and the government.

The prosperous part of the population consists of businesspeople who are capitalists. While the government is communist the people who run the country are also capitalists and they do not want to see the flow of funds diminish but the funds will do just that. The reality is that these Chinese people have worked very hard to improve their lot in life and now they are facing a destructive force they cannot control.

If you have read the articles, I linked to in the last two newsletters it is obvious how devastating economically this virus has hit China. However, today I read that it is in South Korea and Italy.

I keep thinking Rome was not built in a day but it sure collapsed in a short period of time, is this what we are seeing?

If so many of the factories in China are shut down for any length of time that will mean a shortage of goods as we go into the year, that is of course if the virus is gotten under control.

Will all of this encourage some of these companies to consider becoming home grown manufacturers all over again. Wishful thinking on my part.

They will explore other third world countries before thinking of the USA for manufacturing again, if they do. Remember the Chinese have developed a very knowledgeable work force, so they put out quality products. Going into new territory means a learning curve and the quality will go down, also, the quality of the fabrics has been diminishing for several years anyway.

Today I read that the stock market is taking a dive, at this time it is down 1000 points. Why because the multinational companies are suffering. Are they to big to fail, hell no, if you screw up you pay the piper? The multinationals are probably losing money in all areas of their operations.

There is something to be said about being a small company. One or two people control it, so decisions are made quickly and efficiently to serve the best interest of the company. If you make something that doesn’t sell you end production quickly.

We in the USA have good fortune because we have the very best medical service in the world and the CDC to become involved in things such as this virus.

That should give some of some of these company’s food for thought for their futures that is to say reestablishing manufacturing back in the USA. Again wishful thinking on my part.