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Keith Outten
06-25-2013, 1:52 PM
Smithfield Foods To Be Sold To Chinese Firm For $4.72 Billion (http://www.npr.org/blogs/thetwo-way/2013/05/29/187029237/smithfield-foods-to-be-sold-to-chinese-firm-for-4-72-billion)

The purchase values Smithfield Foods at $7.1 billion — a figure that would make the purchase "the largest Chinese takeover of a U.S. company," according to Bloomberg News.

In addition to Smithfield, the company's brands include Armour, Eckrich, Gwaltney, Kretschmar, and others. The company's roots stretch back to 1936, when the Luter family opened a packing plant in Virginia.

Is this what we get in return for patronizing American businesses that become so successful that they are sold to foreign interests?
We will be passing by their products in the grocery store from now on..........:(
.

Joel Goodman
06-25-2013, 2:09 PM
And the Chinese firm has a great food safety record.... NOT! I'll be joining you.

David Weaver
06-25-2013, 2:30 PM
I guess this is all just a fiscal lesson. Nobody saves any money in the US (as a whole, not saying there aren't anecdotal counter cases), not individuals and not businesses, and definitely not at the government levels - perhaps with the exception of state and local pensions. So when a company is bought out, it's western europe or asia coming up with the high bid. Domestic capital seems to be looking for higher gain in a shorter term and less old-line value companies. We'll be seeing this a lot for the next few decades, I'd bet.

I don't know anything about chinese ownership of those brands and what it will be like, but western european ownership was fairly kinds to relatives of mine who worked at companies bought out by continental europeans.

Those plants that process the animals, process the food and package it won't be going anywhere, though, and the ones that remain will still be staffed by domestic workforces, so the overall impact might not be as damaging as something like the loss of computer manufacturing was, and we can always look at the packages to see if they specify any foreign origin foods.

Right next to my grandparents' farm was an egg and broiler operation that was foreign owned 35 years ago, a huge one. I'd suspect a lot of us are buying products from locally located companies that are foreign or part foreign owned without knowing it. (strangely enough, the german ownership of that egg operation sold it back to US principals several years ago).

It's my opinion also that some of these ownership attempts from continental europe or asia don't yield what the investors think they will, and they end up taking a bath in everything more than we would've if we kept the companies domestically owned and ran them in the ground. You have to wonder what it is that the chinese see in the company to pay a 30% premium on the stock price. Their output is still going to have to go through the USDA, etc, for stuff grown and sold and packaged in the US. I think to some level, they're struggling just as hard to find decent places to put their money as we are struggling to save ours.

Chuck Wintle
06-25-2013, 2:45 PM
Smithfield Foods To Be Sold To Chinese Firm For $4.72 Billion (http://www.npr.org/blogs/thetwo-way/2013/05/29/187029237/smithfield-foods-to-be-sold-to-chinese-firm-for-4-72-billion)

The purchase values Smithfield Foods at $7.1 billion — a figure that would make the purchase "the largest Chinese takeover of a U.S. company," according to Bloomberg News.

In addition to Smithfield, the company's brands include Armour, Eckrich, Gwaltney, Kretschmar, and others. The company's roots stretch back to 1936, when the Luter family opened a packing plant in Virginia.

Is this what we get in return for patronizing American businesses that become so successful that they are sold to foreign interests?
We will be passing by their products in the grocery store from now on..........:(
.

i don't have a problem with foreign owned in most cases as we all buy products of foreign owned made in america, honda and toyota, bosch tools etc, the list is long. My problem is that chinese firms have a very slack attitude towards the consumer especially food producers. how can we be sure they will not start substituting chinese produced raw materials that are contaminated and then brought to north america?

Mike Cutler
06-25-2013, 2:47 PM
David

What they see, according to international newlines, is that they have a huge demand for pork products in China, in fact they can't keep up with demand, and Smithfield has a huge operation already in place. Not just domestic, but foreign markets also. So they will be exporting a lot of pork to China from the US to fill that demand. No operational start up. Just go.
That's a huge packing operation in Smithfield VA. I accidentally drove through their parking lot once, because a divided 4 lane road runs right through it. It's big.

David Weaver
06-25-2013, 2:54 PM
i don't have a problem with foreign owned in most cases as we all buy products of foreign owned made in america, honda and toyota, bosch tools etc, the list is long. My problem is that chinese firms have a very slack attitude towards the consumer especially food producers. how can we be sure they will not start substituting chinese produced raw materials that are contaminated and then brought to north america?

It'll be pretty hard to do that here with the USDA and FDA. (maybe it's just the USDA that's relevant). If anything in the US, our food is so sterile and so tightly controlled that it's hard to actually get things to market that we would want. Joel Salatin's talks about how much it costs him to get bacon to market are a good indicator of this, and how the hoops to jump through make $3 a pound bacon cost $9, etc.

David Weaver
06-25-2013, 2:55 PM
David

What they see, according to international newlines, is that they have a huge demand for pork products in China, in fact they can't keep up with demand, and Smithfield has a huge operation already in place. Not just domestic, but foreign markets also. So they will be exporting a lot of pork to China from the US to fill that demand. No operational start up. Just go.
That's a huge packing operation in Smithfield VA. I accidentally drove through their parking lot once, because a divided 4 lane road runs right through it. It's big.

That makes sense. Input costs aside (due to speculating and commodity prices aside), there probably isn't a place in the world where you get more calories of food per unit of currency. We can grow hogs and chickens in the US CHEAP and fast.

Brian Elfert
06-25-2013, 3:15 PM
A lot of people think this purchase will actually help farmers in America. The Chinese can't supply enough pork for their own needs so they need to import pork from the USA.

As long as the food is still made in the USA the plants will still be overseen by the federal government. Chinese ownership of American food plants doesn't mean suddenly quality control goes away and everyone gets sick from eating food processed there. I don't typically eat any of the brands mentioned by Keith, but they probably make store brands and generics too.

John Coloccia
06-25-2013, 3:56 PM
Is this what we get in return for patronizing American businesses that become so successful that they are sold to foreign interests?
We will be passing by their products in the grocery store from now on..........:(
.

Ditto. I'm proud to say that in the last year.....and probably 2 years, now....I have tried my best to avoid Chinese made products and US made products by Chinese companies. I think I had to buy some nail clippers made in China a few months ago because that's all CVS had, and I needed nail clippers now.

I'm pretty tired of exporting my companies and important garbage.

Phil Thien
06-25-2013, 4:00 PM
David

What they see, according to international newlines, is that they have a huge demand for pork products in China, in fact they can't keep up with demand, and Smithfield has a huge operation already in place. Not just domestic, but foreign markets also. So they will be exporting a lot of pork to China from the US to fill that demand. No operational start up. Just go.
That's a huge packing operation in Smithfield VA. I accidentally drove through their parking lot once, because a divided 4 lane road runs right through it. It's big.

(1) So why not just buy the PORK from Smithfield, why buy the entire COMPANY?

(2) What are the implications for what we (in the US) pay for pork, and other animal proteins?

ray hampton
06-25-2013, 4:05 PM
the names that Keith mention , the first two sell spam and bacon -sausage plus a numbers of other can goods

Brian Elfert
06-25-2013, 4:09 PM
the names that Keith mention , the first two sell spam and bacon -sausage plus a numbers of other can goods

Spam is Hormel, not Smithfield foods.

John Coloccia
06-25-2013, 4:11 PM
Spam is Hormel, not Smithfield foods.

Thank God. We have a grilled Spam tradition at the yearly clambake. I panicked for a minute.

Howard Garner
06-25-2013, 4:12 PM
"the names that Keith mention , the first two sell spam and bacon -sausage plus a numbers of other can goods"

Wrong in one case.
Hormal (of Austin, MN) makes Spam, not Armour or any of the other mentioned companies.

Howard Garner

ray hampton
06-25-2013, 5:02 PM
"the names that Keith mention , the first two sell spam and bacon -sausage plus a numbers of other can goods"

Wrong in one case.
Hormal (of Austin, MN) makes Spam, not Armour or any of the other mentioned companies.

Howard Garner

you are right about my spam, Armour are a well-known name

David G Baker
06-25-2013, 6:25 PM
Smithfield Foods does not have a great history of treating their employees descent. I can't believe that this sale will happen. Some one is definitely asleep at the wheel. We will be passing by their products in the grocery store from now on as well.

Scott Shepherd
06-25-2013, 8:07 PM
As a fellow Virginian, I feel Keith's pain. Smithfield is a part of Virginia. It's not just a business that sells meats, it's an entire town. The people that make it up are normal, salt of the earth, country folk. People that would give you the shirt off their back, even if they needed it. I want pass up their products because they will be a Chinese company, I will pass on their products because of the way they have sold out their employees. Like mentioned previously, you almost can't stop buying Chinese products. I always laugh out loud when I see someone say "Ford and Chevy" are "American made cars", but Honda and Toyota aren't.

It's a real shame that they sold their employees down the river for a hefty bag of gold. I reward people that treat their employees good, no matter where the product of origin is. I believe that's all we have left. Support those that treat people well and walk away from those that don't. One day, it'll pay to be a good, ethical business that rewards in employees and customers with good service.

glenn bradley
06-25-2013, 8:39 PM
I had heard the rumblings on this one and dreaded the possibility that it would go through. This isn't about wanting pork products. Shame on us.

Keith Outten
06-25-2013, 10:27 PM
Besides the possible changes that may be ahead for the 46,000 employees I really feel that we should never allow certain services to be controlled by foreign companies. In particular we need to protect food, water and electrical services.
.

Brian Elfert
06-25-2013, 10:32 PM
It is almost impossible to avoid Made in China products unless you're willing to not buy some items or spend a lot of time searching. Is it really better to buy something made in Mexico, Thailand, Vietnam, or other countries rather than China?

I try to buy Made in the USA when I can, but I won't avoid a purchase because the item is not Made in the USA. I recently was looking for a hot glue gun. I sought out the Arrow hot glue gun because it was supposed to be Made in the USA and is a nice product. It turns out they moved production to China recently. I still bought it because it was better made than the other cheaper Chinese hot glue guns. I don't use a hot glue gun enough to justify a $75 to $100 made in the USA model.

Phil Thien
06-25-2013, 10:45 PM
Besides the possible changes that may be ahead for the 46,000 employees I really feel that we should never allow certain services to be controlled by foreign companies. In particular we need to protect food, water and electrical services.
.

I know other countries have limited their imports of US foods like rice, feeling they need to protect their domestic production.

Michael Moscicki
06-26-2013, 12:58 AM
Smithfield's headquarters will remain in Virginia, according to a press release announcing the deal this morning. The companies also said that Shuangui will not close any Smithfield facilities, and will leave all employee agreements — and the existing management team — in place.

At least for now, no employees will be layed off and no factories will be shut down. Now once you stop buying their products, well who knows. Remember that they still have to pay taxes on U.S. earnings and the pork is processed in US factories with pork from American farmers.

As long as it's Made in the USA, I don't care what country the parent company is located in. It's more important that the average American has a job rather than where the CEO that reaps the profits is located.

Do I like the fact that a Chineese company is buying it? No, but why punish the 46,000 American factory workers for something that is out of their control?

Stephen Cherry
06-26-2013, 6:02 AM
There is plenty of blame to go around. People buying the iphones, ipads, etc, and the Grizzly tools, they have given the red chinese the money to buy the ham company. One thing about blame is that it's always easy to blame someone else, while it's important also to look at yourself.

Keith Outten
06-26-2013, 6:47 AM
Grizzly is an American company that imports from overseas. This is a different situation than an American company that is sold to a foreign company and because it involves food products. Purchasing machines is a win/win situation no matter what the source. Machines provide the means to manufacture which is why China has become such a major player in the world. As American manufacturing has decreased over the years so has our ability to provide for ourselves. At the same time we now have lost a majority of our baseline jobs and we have become a consumer nation.

Personally I feel threatened when large American companies purchase farmland here, the idea of just a very few corporations controlling our food supply is not a comfortable one to me. If foreign companies were purchasing our farms I would consider that a more dangerous situation. If the foreign company is in a Communist country the situation becomes even more intolerable.

The blame game is a waste of time because the American people are responsible for everything that happens here.
.

Jim Matthews
06-26-2013, 9:15 AM
There is plenty of blame to go around. People buying the iphones, ipads, etc, and the Grizzly tools, they have given the red chinese the money to buy the ham company. One thing about blame is that it's always easy to blame someone else, while it's important also to look at yourself.

Thank you for clearly stating this.
The Chinese companies profit from this, and thereafter Central bankers invest the profits.

Securing a stable, safe and palatable food supply is a reasonable thing to do in a country with both cash
and a history or food riots. I note a rising shrill tone coming from this board, and our netizens that is unnerving.

It's a publicly traded company that was for sale. They want to export American products.
Neither sounds like a bad thing to me.

It's not as if they're buying up companies to jack up prices for domestic consumption.

Jim Matthews
06-26-2013, 9:20 AM
This is reactionary, political and clearly in violation of the Sawmillcreek charter.

This sort of thing is why so many of us left Lumberjocks to come here.
Defending the wholesale shipping of jobs (Grizzly) overseas as a win-win,
but decrying the export of domestic products makes no economic sense.

Given that the mods and administration are actively engaged in this worries me greatly.

We're a bunch of hobbyist woodworkers blessed with the occasional submissions of genuinely talented professionals and gifted amateurs.

I do wish Sawmillcreek would adhere to this charter.

David Weaver
06-26-2013, 9:26 AM
Grizzly is an American company that imports from overseas. This is a different situation than an American company that is sold to a foreign company and because it involves food products. Purchasing machines is a win/win situation no matter what the source. Machines provide the means to manufacture which is why China has become such a major player in the world. As American manufacturing has decreased over the years so has our ability to provide for ourselves. At the same time we now have lost a majority of our baseline jobs and we have become a consumer nation.

Personally I feel threatened when large American companies purchase farmland here, the idea of just a very few corporations controlling our food supply is not a comfortable one to me. If foreign companies were purchasing our farms I would consider that a more dangerous situation. If the foreign company is in a Communist country the situation becomes even more intolerable.

The blame game is a waste of time because the American people are responsible for everything that happens here.
.

Keith, I agree with you about the land. When it's land that has a chance of being taken out of productivity for manipulation, that's a problem. There have been a few very wealthy individuals buying gobs of land in the west and midwest, too. Ted turner comes to mind. I don't know that he's actually done anything to this point that's problematic, but the issue is the same as any other monopoly type situation, the ability to manipulate, even if it isn't used right away, always manifests itself at the worst time.

I think the USDA really likes CAFOs and larger packing companies and corporate farms, because it's a lot easier per animal for them to keep track. I don't think it's good for anyone else other than the USDA and the large operations, though. And when they streamline food production for more tracking, convenience, shorter turn around time and more inspection and paperwork, it makes it hard for the small local producers to offer something at a reasonable price.

Brian Elfert
06-26-2013, 9:30 AM
I, for one, would buy American made products if production on most items hadn't been shifted overseas. Some items I will spend the time to look for Made in the USA, but things like nail clippers I won't spend a ton of time looking for Made in USA. Of course, American consumers are responsible for most of the shift overseas. American consumers will most often buy the cheapest item so manufacturers make stuff in places where their cost is less so they can sell for less. There is a bit of a resurgence in consumers looking for Made in the USA right now.

Moving production to China is not always about the lowest price for the consumer. Sometimes it is about more profit for the seller. Sears has moved production of their Craftsman mechanic's tools to China, but the price didn't go down any. I will no longer buy Craftsman since they moved production to China. I want Made in the USA mechanic's tools as much as possible and I can get decent Chinese made tools for less elsewhere if I wanted to go that route. Americans are still to blame for companies wanting higher profits since the stock market punishes companies that don't make more and more profit every quarter. Investors today look at the short term and never look at the long term downsides of shifting everything to China.

David Weaver
06-26-2013, 9:38 AM
It's funny nail clippers are mentioned. I actually went out to find western-world nail clippers because every pair I'd found made in china were either soft or very poorly cut. Ended up adding a plain jane pair of giesen and forsthoff clippers to an order from a straight razor shave place (admittedly, not the kind of place most people are already ordering from) and they are so much better than the half dozen chinese pairs of garbage we have floating around the house that it would've been cheaper just to get the good ones first. They were only 6 or 7 bucks (the G&F pair made in german) for a pretty large one, they are sharp and everything on them is tight and lines up perfectly.

Brian Elfert
06-26-2013, 9:50 AM
I think the USDA really likes CAFOs and larger packing companies and corporate farms, because it's a lot easier per animal for them to keep track. I don't think it's good for anyone else other than the USDA and the large operations, though. And when they streamline food production for more tracking, convenience, shorter turn around time and more inspection and paperwork, it makes it hard for the small local producers to offer something at a reasonable price.

If a small producer can't compete they will have to move onto doing something else for a living. There were dozens or hundreds of car manufacturers in the USA in the early 1900s. A few of the car manufacturers got really large due to mass production and economies of scale while the rest got bought out or closed up shop.

John Coloccia
06-26-2013, 9:53 AM
It's funny nail clippers are mentioned. I actually went out to find western-world nail clippers because every pair I'd found made in china were either soft or very poorly cut. Ended up adding a plain jane pair of giesen and forsthoff clippers to an order from a straight razor shave place (admittedly, not the kind of place most people are already ordering from) and they are so much better than the half dozen chinese pairs of garbage we have floating around the house that it would've been cheaper just to get the good ones first. They were only 6 or 7 bucks (the G&F pair made in german) for a pretty large one, they are sharp and everything on them is tight and lines up perfectly.

I normally use German made clippers, but I was out and about and needed a set NOW. I play guitar, and I'm pretty fanatical about keeping the nails on my left hand trimmed very short, especially the thumbnail. It cracked back in 1998 or so, and has been split down the back ever since. Through years of keeping it ridiculously short, it's finally back in one piece as of last year. LOL. Too much information, I know. I have a set in my laptop bag, backpack, one in every car, in every bathroom, etc. Yes, those German ones are great. The Chinese ones are absolute junk and I ended up using them and then throwing them out. Garbage.

David Weaver
06-26-2013, 10:05 AM
It is amazing how something as simple as nail clippers can be completely screwed up by people who could care less whether or not what they make is any good.

They should be given the same title we use to refer to third world stuff elsewhere with the suffix "-shaped objects"

"nail clipper shaped objects".

It's only out of a complete lack of appreciation for quality that consumers allowed themselves to be sold garbage for $5 instead of quality for $6 or $7.

Pat Barry
06-26-2013, 12:14 PM
Welcome to the new world order of global enterprise. It won't be long before the made in America is gone entirely. Maybe some assembly in USA but fabrication elsewhere. It is inevitable because we as consumers demand the lowest possible price and you can't have that with American wages. It will always be cheaper if purchased from oversea's.

Brian Elfert
06-26-2013, 1:23 PM
It's only out of a complete lack of appreciation for quality that consumers allowed themselves to be sold garbage for $5 instead of quality for $6 or $7.

I appreciate quality. Let's say I did need a set of nail clippers and went to CVS/Walgreens/Walmart/Target for a set of nail clippers. It is likely that they only carry low quality models made in China, Mexico, or similar. I don't usually have a choice to pay $1 or $2 more for a better set made in the USA or Europe. If I want something better made in the USA or Europe than I might be ordering online and then paying as much in shipping as the item cost. Maybe a beauty supply place might have the good clippers, but I have never set foot in one of those places.

All Chinese made stuff is not junk. There is plenty of good stuff coming from China. I would like to buy Made in the USA stuff to keep the money in the USA and to keep Americans working.

Many American factories are highly automated to reduce labor as much as possible. Some third world countries have such cheap labor they can produce stuff completely by hand with no automation for less cost than making the same item in a totally automated factory in the USA.

John Coloccia
06-26-2013, 1:33 PM
Welcome to the new world order of global enterprise. It won't be long before the made in America is gone entirely. Maybe some assembly in USA but fabrication elsewhere. It is inevitable because we as consumers demand the lowest possible price and you can't have that with American wages. It will always be cheaper if purchased from oversea's.

I'm going through this now, actually. I have a new product coming out, and I have to decide where everything's coming from. Pretty much everything I possibly can is sourced from the US, including the printed circuit boards, but I'm somewhat forced to go into Taiwan for some components, and China for others (because they're simply not made elsewhere!). It greatly increases the cost to stay local...more than doubles it, actually. The bare PCB alone costs me $10 Made In The USA....and it's about $2 if I want to go to China. I can go down the list and it's the same for everything. On a product that has a $150 or so price tag, this adds up very quickly. I don't care...it is what it is, but I'm going to do it for as long as I can and as long as the US actually still makes things.

David Weaver
06-26-2013, 1:34 PM
You're right, a Sally store might have good ones. They definitely have good clippers, which is another thing I found out about the hard way.

All chinese stuff isn't junk, and all american stuff isn't good (there is less american junk than there used to be, though, because there's no reason to pay high labor prices to make junk here now). There's some middle stuff that's not that great now, like in one of the other threads here about danaher-made craftsman stuff and how it's dropped in quality in the last 20 years, and how suppliers like klein have let quality slip.

In my case, though, the difference is stark for the clippers, but you're right, the order has to be coordinated with something else. You just can't know what's good from china until you actually see it and use it for a while.

Mujignfang planes and their HSS irons are fabulous, though, as long as you pay mind to the specs when you order (they have some oddballs, like planes with irons that are too narrow, etc).

ray hampton
06-26-2013, 2:16 PM
IF you want to buy a good pair of nail clippers then buy a a set of wire cutters [either side cutters or end cutters ] I cut my nails with the wire cutters because of the bad nail clippers problem

Keith Outten
06-26-2013, 2:38 PM
It's a publicly traded company that was for sale. They want to export American products.
Neither sounds like a bad thing to me.

It's not as if they're buying up companies to jack up prices for domestic consumption.

Jim,

At this point we aren't sure what they're intent is, once they own the company they could decide to export 100% or double prices.
Clearly they don't have to purchase a company in order to purchase or export the companies products.
.

Keith Outten
06-26-2013, 2:49 PM
This is reactionary, political and clearly in violation of the Sawmillcreek charter.

This sort of thing is why so many of us left Lumberjocks to come here.
Defending the wholesale shipping of jobs (Grizzly) overseas as a win-win,
but decrying the export of domestic products makes no economic sense.

Given that the mods and administration are actively engaged in this worries me greatly.

We're a bunch of hobbyist woodworkers blessed with the occasional submissions of genuinely talented professionals and gifted amateurs.

I do wish Sawmillcreek would adhere to this charter.

Jim,

Grizzly isn't shipping jobs overseas, the company has been an importer as long as I can remember. If anything Grizzly has created jobs here in America that did not exist before the company was established.

Exporting food is like selling golden eggs, allowing a foreign company to purchase a major food producing company id like selling the golden goose. I'm all for selling food to China but not the company that produces the food.

This subject has nothing to do with politics, its about economics and consumer safety. In fact we could be talking about table saws but I see food as a much more important issue since we have to eat in order to survive.
.

Scott Shepherd
06-26-2013, 2:50 PM
As a side note, I have a friend that just got back from China. They outsource products to China daily. He was telling me that as he walked around and met people, they all said "Where is all the work, things have really slowed down from the USA". His response was "Your prices have doubled. People came to China because the cost of doing business was low, people didn't have jobs, and there was a class of people will to do the work for less. Now those people have had children, and those children didn't grow up without things, so they aren't as willing to work for next to nothing as their parents were."

He told me that the cost to do business in China has caught up with the prices in Mexico, so it would make more sense to buy from Mexico now because it wasn't a 4 week boat ride to get the items.

I suspect you'll see more and more coming back. Apple's new MacPro is going to be built in the USA, so the trend seems to be reversing or at least slowing down.

Brian Elfert
06-26-2013, 3:07 PM
Would folks buy from an American manufacturer if Grizzly wasn't importing less expensive tools from overseas? Grizzly may have created jobs at their HQ and distribution centers, but how many jobs have been lost as Delta and Powermatic quit producing in the USA?

I know a guy who works for a company that designs and sells some sort of electronics. His job is to interface with the factories in other countries that actually make the stuff. They used to manufacture in Mexico so he went to Mexico at least one week a month and was home for the weekend. Manufacturing was moved to China five or six years ago and now he has to go to China regularly. When he goes it is a two or three week trip due to the cost and time to get there. He is away from home a lot. I haven't seen him for a few years so I don't know if they are still in China.

Brian Elfert
06-26-2013, 3:15 PM
I'm not convinced the federal government will allow this to go through. I don't think the Chinese buying one food manufacturer is all that bad. It is when they start buying up a whole bunch that is becomes an issue.

If the Chinese control a lot of the food supply what happens if we get into a war with China? The first thing they do is choke off the food supply or poison the food or something similar.

John Coloccia
06-26-2013, 3:39 PM
Would folks buy from an American manufacturer if Grizzly wasn't importing less expensive tools from overseas?

Actually, I don't think they would. They would do what they used to do and simply not buy the tool. Look at a hobbiest woodworking shop today and compare that with a shop from 30 years ago. Look at Norm Abram's shop. In the 80's, we all looked at his shop and absolutely drooled at the collection of tools that were simply out of reach. We used to make fun of him for it. What did he really have? A 14" bandsaw, a modest drill press, a bench top jointer, and bench top planer, and a Unisaw. A couple of routers? Maybe a bench top mortiser, but I distinctly remember him mortising with the drill press. A modest drum sander. There was a hand held belt sander kicking around. At some point, he got some dust collection.

I didn't know anyone that had ANYTHING like that except professional cabinet shops. They were too expensive, and people simply did without. Now look at a typical hobbiest shop. This is all commonplace machinery, and with the exception of the Unisaw is very modest by today's standards. I have about 6 or 7 routers in my shop alone (maybe only one or 2 made in China, incidentally).

I'm really not sure how much imports have cut into the market for US made goods. I think it's more a matter of maximizing profits. I wish someone in the US would make a decent, $1500 woodworking drill press. It doesn't exist. I'm not going to spend $1000 on some cheaply made import, I don't care how heavy it is and what color you paint it. I think part of the lament is that as prices have dropped, quality has also plummeted and there's now a huge vacuum between expensive junk and very expensive, world class equipment.

I'm not really sure why companies like Delta and Powermatic started trying to compete with the cheap import market. Talk about diluting your brand. Who here feels good about blindly purchasing a Delta or Powermatic tool? How about Dewalt? You used to buy the brand. The new leader in "buy the brand" is SawStop. I would bet dollars to donuts that if SawStop introduced a 17" bandsaw tomorrow, WITHOUT the brake technology, they could charge a premium over other Taiwanese imports and it would fly of the shelves because of the reputation they've built for quality and service.

So I'm rambling about, but as I look back at what I wrote I realize that a big part of the ill feeling here isn't just loosing the physical manufacture of the product. That stings, but what stings even more is actually loosing the ability to create and support great products, even if they're made overseas. Given the know-how, we could aways ramp back up here and produce if we needed to, but we seem to be loosing control of that as well.

David Weaver
06-26-2013, 3:44 PM
I think you're right john. It's eliminated the middle of the market more or less, but the majority of people buying the grizzly tools wouldn't buy tools at 2 times the cost because a whole shop would pretty much be unattainable.

I had a friend whose dad was big into car restoration, but he did most of the work by hand with the exception of mundane things like drilling and grinding. He loved norm's show, but every time we turned it on and norm went to the OSS, which he did all the time, this guy's dad would go nuts "nobody has that in their shop!!! that's what I hate about this show, nobody has the stuff!!".

And a minute would go by and he'd be fine again, loved the show just like the seconds before the OSS appeared. The OSS really set him off.

Norm did sell a lot of drill press mortising attachments for delta, though. I've seen a few in person in friends' shops that have really never been used.

The only folks I can remember having that kind of stuff locally in the 1980s were a few folks like United captains who had more money than they knew what to do with, and too much time on their hands. My dad had one of the more well outfitted shops I ever saw because it was income producing (not furniture, but trinkets) and he had a 12" bandsaw, a couple of combination belt/disc sander, a small router table and a belt grinder. His shop is still income producing, he marvels at the stuff in mine and then calls me names. I can't blame him.

John Coloccia
06-26-2013, 3:53 PM
Oh, and I almost forgot about Festool. Talk about targeting a market and taking it over. Why do I have to go to Germany for that sort of quality? Why don't we have a Festool here? Why didn't Delta take over that market? It's not like there isn't a market for this sort of stuff. US companies made a conscious decision to go after the junk market. Surely it's not cheaper to manufacture and import from Germany, is it? Having worked in Germany for several months, I have a hard time believing that they could even make a bologna sandwich less expensively than we could, yet they have the market and we don't.

Lie-Neilsen is doing fine. So is Veritas. The market is there and it hasn't been destroyed by imports. We've simply let it go. Maybe it was too hard. Maybe we just don't have the drive to attend to the boring details anymore...easier to just target the low end where no one really expects perfection.

Brian Elfert
06-26-2013, 4:32 PM
If Delta decided to open a factory in the USA selling the same type of tools at the same quality level and price as Festool would they sell? I doubt it at this point as Festool has the brand name and reputation in that market. I still the folks who only buy Made in the USA might buy the Delta brand tools. I personally have a lot less problem buying German tools than I do buying Chinese tools.

Is there a market for a $1500 drill press? I bought a General drill press made in Canada about 7 or 8 years ago and I thought that was expensive at around $800. It would have to be a pretty fancy drill press to pry $1500 out of my wallet.

David Weaver
06-26-2013, 4:50 PM
There's probably a small market for it. The trouble is, if the margin is the same as a $600 chinese drill press that you can sell 20 of, which one supports the current environment (where you buy magazine ad space and travel to trade shows) better?

I'd imagine if you built a $1500 drill press in the US and your volume was a tiny fraction of the importers, the only way you'd get into magazine reviews would be purchasing a lot of ad space.

If delta only ever made stuff the quality of festool and already had that reputation, they could probably sell at the same price. If the quality was the same, that is, and all other aspects were.

Most people who have picked up the hobby in the last 10 years have just about zero regard for their brand, though, me included. I've not used a single decent delta tool, though I have two ( a midi lathe and a fixed bed jointer).

There is an enormous gap in the story about getting delta parts, how many times the brand has changed hands, etc vs. festool, though.

If a brand like sioux tools decided to market woodworking tools, there might be more luck. You'd have trouble looking back and finding too much junk, but it's been an industrial brand.

Brian Elfert
06-26-2013, 8:04 PM
Since Delta shipped all production overseas I would be unlikely to consider a Unisaw, or anything else they make. Delta still seems to charge a premium price for a product now made overseas like everyone else. A big reason I got a Unisaw was because they were made in the USA at the time. I think Jet at the time was every bit as good except maybe the fence for less money.

I got rid of my Unisaw when I converted my basement shop to a finished basement.

Jim Matthews
06-26-2013, 9:31 PM
I'm no expert, but I did live in China for three years plus (1989-1992) and the growing concern then was for food sufficiency.

There's precious little arable land in China, and ever fewer willing to farm it.
There's significant pressure on the market to produce more food that is safe.

Enter Smithfield - a brand known for it's quality and (thanks to the USDA) safety.
The purchase of Smithfield is clearly an attempt to do three things:

Spend some of the dollars earned selling other things in the US.
Increase the supply of pork to a market that can't get enough at home.
Calm concerns about tainted products from recent events.

"Although this deal is clearly part of a broader strategy by corporate China to, er, beef up its global presence, the primary reason for acquiring Smithfield is domestic.
The Chinese love pork and as their incomes soar they want it more than ever.
A domestic herd of 476m pigs, around half of the global pig population, already seems insufficient;
China has been a net importer of pork since 2008."

- The Economist, 1st June, 2013

It's important to note that the Smithfield group was purchased for not just the $4.7 Billion US price, but also an additional $2.4 Billion in debt.

"... once they own the company they could decide to export 100% or double prices."
How is that any different than the current management? It's not as if Smithfield is the only producer of pork products.
Domestic consumption (http://www.porknetwork.com/pork-news/latest/Chinese-and-US-Pork-Consumption-and-Production-212986741.html) of pork has been flat for decades, even with a growing population.

I would submit that this is a rare deal; where we get repatriated dollars, shareholders can sell a debt-laden company at a premium price, and for once Americans sell something to the Chinese.

Before we cry foul (or in this case, pork) we should ask the principles involved - the farmers supplying Smithfield.
http://modernfarmer.com/2013/06/what-american-hog-farmers-think-of-the-china-smithfield-deal/

Mike Cutler
06-26-2013, 9:38 PM
(1) So why not just buy the PORK from Smithfield, why buy the entire COMPANY?

(2) What are the implications for what we (in the US) pay for pork, and other animal proteins?

Phil

I don't claim to understand it fully,but the general gist was that they were buying control of the production, and not competing for an import contract. If they were to import in the amounts they stated,they would end up driving the prices up on themselves over time.
Apparently they expect their domestic pork consumption to increase by billions of pounds in the next decade.They are the largest individual consumers of pork in the world.
Never having raised a pig, I can only assume that it was more financially advantageous to purchase an already established production stream,than start one from scratch in China?

Phil Thien
06-26-2013, 10:19 PM
Phil

I don't claim to understand it fully,but the general gist was that they were buying control of the production, and not competing for an import contract. If they were to import in the amounts they stated,they would end up driving the prices up on themselves over time.
Apparently they expect their domestic pork consumption to increase by billions of pounds in the next decade.They are the largest individual consumers of pork in the world.
Never having raised a pig, I can only assume that it was more financially advantageous to purchase an already established production stream,than start one from scratch in China?

Exactly.

I think Ross Perot would say the new giant sucking sound we will hear will be all our pork going to China.

Next we can all expect to pay more for pork, and other animal proteins.

Keith Outten
06-26-2013, 10:42 PM
Thirty years ago we bought Craftsman tools and machines because they were all we could afford. I remember wanting a 15" planer but the cost of a Delta or a Williams and Hussy put both of these companies in the commercial tool category. I never met one amateur woodworker that owned a 15" planner or a cabinet saw for that matter.

Then Grizzly started mailing their catalogs and all of a sudden a whole new world of machines became affordable. I ordered a 15" planner just days after I got my first Grizzly catalog and I still have the planner today. Its old and has literally hundreds and hundreds of running hours on it but it still does the job. One week after I received my new planer I ordered a Grizzly dust collector, it took me that long to admit that it would be impossible to use the planer without a dust collector. That dust collector is still in my shop and it must have thousands of hours on it now, some days it runs continuously when I am running my CNC Router or my laser engraver.

My point is I would never have purchased a Delta, PowerMatic or any of the American machines because of the price tag, those companies never lost a sale from me. Secondly they were not selling any machines to amateur woodworkers in those days, it was the gradual reduction in the industry over the years and very bad business decisions that caused them to lose their commercial customers.

Case in point.....look what Black and Decker has done to the companies they purchased. They have ruined what used to be some of the finest tools in this country.

Now lets get back to the topic of "FOOD", tools are not as important as this topic. When Greed starts to threaten our food and water supply we have serious problems. Electricity drives our business and what little manufacturing we have left so it is an industry that we need to protect by placing the Electrical Generating Companies back in the public utility category where they can be controlled by the State Corporation Commissions once again IMO.
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John Coloccia
06-26-2013, 10:53 PM
It's one thing to export a product. It's quite another to export the means of production. I'm as conservative as it comes, and I believe in free markets and capitalism, however that is WITHIN my own country. I don't want foreign interests in charge of our means of production of anything...and especially not my food supply. Frankly, I don't care what China's problems are. Companies, the US, and US citizens particularly should have a bit more sense when it comes to turning over our soil to foreign interests, and especially to countries which are hostile to us, launch cyber attacks on us, and otherwise undermine out interests domestically and internationally, including playing games with their currency. Our policy towards China in particular is rather suicidal and is doing nothing but setting us up for an inevitable war...either economically or otherwise.

You don't give away the farm hoping that you'll have a teat to suck off of when you want it. It's stupid and it does nothing but set up an inevitable conflict when the foreign interest conflicts with your own. We can't possibly be this stupid. If they need pork, we can export all the pork they want. There's no reason to own it. They know what they're doing...we don't or we don't care.

Just my humble opinion.

Keith Outten
06-26-2013, 11:12 PM
Asking farmers if they are in favor of a deal that would open up a market that represents one third of the world population is like asking a wolf if he wants to guard the sheep herd.

Several years ago China started buying concrete in mass. Not only did the price of concrete go through the roof it got to the point that it was a crap shoot as to whether we would get enough concrete for our projects. Even the largest General Contractors had problems ordering concrete and none were able to guarantee in writing that they could meet a schedule. The contract price of a building often had clauses with flexible pricing where concrete was concerned.

Today concrete is reasonably available but the price never came down.

The problem we must address is that Americans are spoiled rotten where food is concerned. Our supermarkets would be considered luxurious by most of the humans on this planet and we take them for granted. Our Farmers have always done a fabulous job of keeping the stores full of food at very reasonable prices and the shelves have been full since World War II. If you know anyone who was alive during WW2 ask them about the food supply and what it was like to be hungry.

I don't think it is wise to gamble with our food or water supply or let greed become part of the equation.
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Greg Peterson
06-27-2013, 10:52 AM
Putting constraints on the free market is a slippery slope. Being that it is self-regulating, meddling in the affairs of the market is counter productive.

David Weaver
06-27-2013, 11:03 AM
Asking farmers if they are in favor of a deal that would open up a market that represents one third of the world population is like asking a wolf if he wants to guard the sheep herd.
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Things like that got us the sugar lobby and 15% ethanol mandates, which aren't really good for consumers (and in the latter, which aren't good for consumers' cars). I agree with that. I come from a long line of farmers, and my parents are still landowners (as in, someone else farms our land). What's good for landowners and farmers isn't always good for consumers.

Separate and aside and as part of the spoiled theme, I wonder if anyone older than me (i'm shy of 40 a few years) has noticed just how much more meat we eat than we did 30 years ago. My family wasn't poor, my parents were the first college educated generation to leave the farm and we were comfortable growing up, but we didn't eat meat the way we do now, and back then there were still a lot of diversified farms out my way. There are still some, but most people have either gone all animal or all row crop, and the quality of food has suffered even though some of it does taste better when it's worse for you (corn finished beef sure does taste better than grass fed beef, which tastes like beef tasted when I was little and we picked the cow we wanted to get half of).

Anyway, until the ethanol issues and economic collapse (which made commodity speculation and holding more attractive), meat was cheaper as a percentage of income that I can ever remember. Corn was also about $1.75 a bushel, and a lot of farmers were barely getting by. I don't know what the people raising hogs or chickens think about the grain prices, it probably doesn't help them out, but meat still isn't too much more than it was back then and we've passed nearly a decade of inflation between. Long story short, I remember having meat at every meal except sometimes breakfast, BUT it was never in the gargantuan quantities like we eat meat now. It's not unusual to go to a restaurant and notice that the entree might have a pound of meat on it. I just don't remember that being the norm 30 years ago when I was little. I don't remember portion sizes being as big as they are now in general, either, but meat is part of the equation that costs a lot compared to just giving people more starches at restaurants.

We have gotten so good at making cheap meat that we are producing it more cheaply than third world countries. If the prices go up too much, I'll just eat less of it.

Mel Fulks
06-27-2013, 11:37 AM
David,changes of the kind you mentioned change our perceptions about the products. When I was young chicken was not cheap and was widely considered mainly for "Sunday dinners". A few years back I saw a tv interview where a reporter ask a mom on welfare how they got by on such a small amount of money. Answer: "we eat a lot of chicken".

David Weaver
06-27-2013, 12:13 PM
After I asked my question about meat consumption, I went out looking for a chart describing it. I found something from NPR that says beef consumption has actually dropped since 1980, but chicken and turkey have gone way up.

Imagine that a lot of that has to do with the changes in bird genetics and how they are raised and fed now.

The net effect of the chart was that meat consumption has gone up some, but it appears that the real increase happened from somewhere around 1950 to 1980 and my mother was just cheap with our meat portions in the 1970s and '80s! She does and always did like to save money, though.

Keith Outten
06-27-2013, 12:23 PM
We have had publicly regulated utilities for probably a hundred years in America. While I am not suggesting that we interfere with general commerce I am in favor of regulating water, electricity and food products.

The deregulation of the power generation industry is a perfect example of a mistake we made. The industry is nothing like it was in the past when it was controlled by the State Governments. Privatizing the Power Companies made them less efficient and certainly less reliable. Building new power generation plants has almost come to a standstill and we aren't able to keep an excess of electricity on the grid like we use to years ago. The cost of building a power plant is easily borne by the public and extremely risky for a private business. Today we patch the T&D system rather then replace and upgrade. There is no debate necessary as to the condition of our national electrical grid.

We have been subsidizing the American Farmer for decades, in some cases we have paid farmers not to plant certain crops so this isn't anything new. It would just be an extended layer of protection that we need to make sure our food supply is not ravaged by foreign companies.
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Pat Barry
06-27-2013, 12:41 PM
David, now I'm confused. Here I've been thinking you are much older than you just stated (shy of 40 a few years), mostly because your picture reminds me of the styles in fashion in the 70's. I thought that was your high school senior picture circa 1978 or so, therefore I was thinking you were probably my age. None the less, I do agree that the availability of meat products is so much more now than it was then. Our family, like yours, got by on a reduced meat diet (hamburger helper anyone?). Now it seems an excess driven by portion sizes, fast food restaurant proliferation, more selection diversity at the grocery stores, the relative price of meat dropping (it seems) compared to other foods, etc. I don't want my food coming from China. We have enough recall issues due to E Coli, salmonella, what not right here in the USA. God only knows how bad it would get if our pork came from China.

David Weaver
06-27-2013, 1:36 PM
Yeah, I'm 36...that picture is Harley Race. I've been trying to think of something better for an avatar, because Harley race could kick my butt no matter how old he is now.

I only use the avatar because I admire the true tough guy pro wrestlers from the territory days before wrestling got ruined by steroids and turned into a soap opera.

Pat Barry
06-27-2013, 2:09 PM
So that's why you look so familiar. I remember "Handsome" Harley Race wrestling Verne Gagne on All Star Wrestling. LOL

David Weaver
06-27-2013, 2:15 PM
I didn't notice you're in MN. MN was big in the territory days from what I've seen.

We even have an Ole anderson on this board, a famous guy from up your way, but his name wasn't really ole anderson (last name was rogowski).

Anyway, that's why that's my avatar. Still contemplating what else to use.

Pat Barry
06-28-2013, 2:04 PM
Yeah we had Vern Gagne, Mad Dog Vachon and his brother, the Crusher, the Bruiser, Baron vo Rashke (the Claw Master), Haystack Clahoon, Andre the Giant, even our then future Governor himself, Jesse the Body Ventura. The good old days of wrestling every Sat night were great. By the way, keep Harley Race as your avatar, that's the way we know you now.

Dick Latshaw
06-28-2013, 3:49 PM
Yeah we had Vern Gagne, Mad Dog Vachon and his brother, the Crusher, the Bruiser, Baron vo Rashke (the Claw Master), Haystack Clahoon, Andre the Giant, even our then future Governor himself, Jesse the Body Ventura. The good old days of wrestling every Sat night were great.

And don't forget Whoopee John. Oh, wait......

Frank Drew
06-29-2013, 12:33 AM
Geez, what a bunch of nervous nellies!

There is absolutely, positively no chance in h-e-doublehockeysticks of our running low on food in this country. The very idea is preposterous; we're killing ourselves with excess calories -- hello! the obesity epidemic, anyone?

We throw away or waste more food than most countries actually consume. If the Chinese, oh, sorry, the Red Chinese, want to pay top dollar in order to eat more pork, fine, let them get the heart attacks! (Maybe we can sell them Lipitor, which surely has a higher margin than pork on the hoof.)

And Jim is right, IMO: this is a political topic that under any other guise would have been quickly shut down. IMO.

David Weaver
06-29-2013, 9:02 AM
What part of it is political? It appears to be a post about a business transaction. Definition of political:

1. Of, relating to, or dealing with the structure or affairs of government, politics, or the state.
2. Relating to, involving, or characteristic of politics or politicians: "Calling a meeting is a political act in itself" (Daniel Goleman).
3. Relating to or involving acts regarded as damaging to a government or state: political crimes.
4. Interested or active in politics: I'm not a very political person.
5. Having or influenced by partisan interests: The court should never become a political institution.
6. Based on or motivated by partisan or self-serving objectives: a purely political decision.

Keith Outten
06-29-2013, 11:01 AM
Frank,

David is right, this is not a political discussion. We are talking about a commodity that is different in many ways from machines, clothes and such. Secondly I would be happy to see the Chinese purchase pork products from us as we could certainly use the help with the trade imbalance.

I don't think that allowing foreign companies to purchase our food providing businesses is in our best interest.
Is it possible that once they have the processing facilities they would start purchasing farms next. Then what?
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David Weaver
06-29-2013, 12:00 PM
As farms are corporatized at the wishes of the FDA or USDA (which certainly makes examining record keeping and implementing new requirements easier), it's not out of the realm of possibility that the chinese would buy and operate farms here.

I think I mentioned earlier in this thread that a German company ran a large chicken operation adjacent to one of my grandparents houses. In that case, the operation did ruin their drinking water, but it would've regardless of who owned it as there were no laws back then limiting how they dumped the chicken litter on their land.

I doubt there's a whole lot preventing chinese ownership of farming operations other than lack of familiarity with US ag (western europe at the time was a lot more similar, and still is).

Chris Hachet
06-30-2013, 8:48 PM
Smithfield Foods To Be Sold To Chinese Firm For $4.72 Billion (http://www.npr.org/blogs/thetwo-way/2013/05/29/187029237/smithfield-foods-to-be-sold-to-chinese-firm-for-4-72-billion)

The purchase values Smithfield Foods at $7.1 billion — a figure that would make the purchase "the largest Chinese takeover of a U.S. company," according to Bloomberg News.

In addition to Smithfield, the company's brands include Armour, Eckrich, Gwaltney, Kretschmar, and others. The company's roots stretch back to 1936, when the Luter family opened a packing plant in Virginia.

Is this what we get in return for patronizing American businesses that become so successful that they are sold to foreign interests?
We will be passing by their products in the grocery store from now on..........:(
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pone more group of products I will boycott...

Harry Hagan
07-01-2013, 5:08 PM
Is this what we get in return for patronizing American businesses that become so successful that they are sold to foreign interests?
We will be passing by their products in the grocery store from now on..........:(
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Thanks for the heads-up, Keith. That’s why we stopped buying Budweiser products when they sold out. BP is on the wrong list too!

Brian Elfert
07-01-2013, 7:11 PM
Thanks for the heads-up, Keith. That’s why we stopped buying Budweiser products when they sold out. BP is on the wrong list too!

Presumably no imported beer at all then? Where do you buy your gas that is made strictly with American oil by American companies? Most gasoline sold at retail is not refined by or made from oil pumped by the company with the name on the sign.

ray hampton
07-01-2013, 8:29 PM
Presumably no imported beer at all then? Where do you buy your gas that is made strictly with American oil by American companies? Most gasoline sold at retail is not refined by or made from oil pumped by the company with the name on the sign.

WELL THEN , who get the gasoline that are refine by your company ?

John Coloccia
07-01-2013, 8:44 PM
Presumably no imported beer at all then? Where do you buy your gas that is made strictly with American oil by American companies? Most gasoline sold at retail is not refined by or made from oil pumped by the company with the name on the sign.

I think the bitterness is when a company, that has been supported by us from the ground up, decides to sell out.

Brian Elfert
07-01-2013, 10:19 PM
I think the bitterness is when a company, that has been supported by us from the ground up, decides to sell out.

If you had a business and decided to sell would you take a lower offer from an American company, or the higher bid from a foreign company? If it is a public company there is a responsibility to the shareholders to take the highest bid with the least risk.

We all want our retirement funds to grow and a lot of that money is invested in the stock market. Now, I'm really not in favor of selling to foreign companies, but the board of directors is responsible to do the best thing for the shareholders. In fact, the board would probably be sued if they refused to sell to the highest bidder simply because they are not an American company.

John Coloccia
07-01-2013, 11:05 PM
If you had a business and decided to sell would you take a lower offer from an American company, or the higher bid from a foreign company? If it is a public company there is a responsibility to the shareholders to take the highest bid with the least risk.

We all want our retirement funds to grow and a lot of that money is invested in the stock market. Now, I'm really not in favor of selling to foreign companies, but the board of directors is responsible to do the best thing for the shareholders. In fact, the board would probably be sued if they refused to sell to the highest bidder simply because they are not an American company.

Me? I would take a lower offer from an American company, just like my products cost more and have less profit margin than some because I try to source my components responsibly. But whatever. The point of this thread is that we're aware of which companies are doing this so we can choose to avoid their products. The reason they choose the way they do is of no concern to me.

Keith Outten
07-02-2013, 9:30 AM
There are other companies that I can support who are local in my State or at least here in America other than Smithfield Foods or one of their subsidiaries. Sorry, I don't agree with the always sell to the highest bidder mindset. At the same time I don't believe that the lowest bidder is always the best choice either.

Someone mentioned the Smithfield pension fund. What happens to that fund if it changes hands and is managed by a foreign company? The employees who have been part of the pension plan probably had an understanding throughout their entire working life with Smithfield Foods that the company would manage their retirement system. A promise that was made should be kept not sold to another entity.
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David Weaver
07-02-2013, 10:23 AM
I don't know what will happen to Smithfield's interest in granting additional benefits, but far and away most rank and file individuals in the plan will never lose any of the benefits they've already accrued - unless the entire economy collapses.

The PBGC (pension benefit guaranty corp) generally guarantees those benefits already accrued up to given levels for each retirement age, and the guarantees are more generous for participants who have been receiving their benefits for a while than for someone who hasn't yet started to receive. The current age 65 guarantee (that is, if you start receiving benefits at age 65) is $57,477.24 (it's an indexed number, that's why it's odd). If there are more assets in the plan than the guaranteed level, even in a bankruptcy, those assets would be allocated to pay amounts above those guarantees.

The fund, regardless of ownership, remains the same. A pension fund is pretty much sacred ground to the IRS (IRS rules have it such that the fund can be used solely and only for the benefit of the participants of the plan) and the PBGC (because they guarantee the benefits and don't want to be on the hook for corporate chicanery), nobody screws with them.

As for additional benefits, whether it's smithfield or anyone else, the trend is to stop pension accruals or stop putting new participants into pensions. IF that hasn't happened already, it's probably something that will happen regardless of ownership. The only way to keep a pension plan attractive is to have a reasonably comfortable interest rate environment as well as increasing and stable investment markets. We haven't had either of those for a while now. The stock market returns have a much greater hand in the ability to provide pension benefits than most people would ever dream of.

Keith Outten
07-02-2013, 10:37 AM
The issue of the highest profit being an acceptable reason to sell might also apply here at SawMill Creek.
Why after ten years have I never sold our email list? I have been offered a huge amount of money countless times for our email listing and I have refused every offer. Some have offered more than I make in an entire year just for a copy of our list.

I refused because it's the wrong thing to do even though it is in my best interest financially which some would consider a good business decision. Very few of you would ever know that I was profiting from the sale of your information and it is actually a very common practice these days. But, that doesn't make it the right thing to do.

The only answer to this question that matters to me is that I would know that I violated a promise I made here a very long time ago.
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Keith Outten
07-02-2013, 10:41 AM
David,

Its easy to use pension funds to pay off company debt, ask anyone who worked for the Airline Industry 15 years ago.
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David Weaver
07-02-2013, 10:57 AM
Airlines sometimes get special rules in pension funding (literally, in the regulations, a subsection is written below the regulations and applies only to airlines), but fiduciary requirements now don't allow you to just fill your pension with company stock and debt.

The benefits accrued for the smithfield folks are safer than anything else those individuals have, including their 401ks (which they could easily ruin with mismanagement or bad investment timing), their cars or their houses. It wouldn't matter if the company actually took all of the money and ran to mexico with it, the PBGC would pay the benefits and sue the company.

Airlines are sort of a special case because back then, they paid their pilots the moon and the plans themselves had pilots retiring at an early mandated age. The PBGC model doesn't fit that stuff very well.

I don't know what the airline payscale is now, but 10-15 years ago, I recall top of the payscale at united being somewhere in the range of $375,000. Airlines have always abused public money and public trust, and they've been allowed to because there is so much desire for the public to have access to them, but at the same time, the public and the regulators have zero interest in setting up a business model where individuals actually pay the full cost of flying and operating the airlines and airfields.

Harold Burrell
07-02-2013, 11:37 AM
The issue of the highest profit being an acceptable reason to sell might also apply here at SawMill Creek.
Why after ten years have I never sold our email list? I have been offered a huge amount of money countless times for our email listing and I have refused every offer. Some have offered more than I make in an entire year just for a copy of our list...

Wow...that is hard for me to fathom. I really appreciate your integrity, Keith.

David Weaver
07-02-2013, 4:59 PM
I think if someone offered me my annual income for the email list, I'd ask them if they wanted the whole site, and then I'd set up another called Lumbermill Crick. Only the people in Pittsburgh and rural areas (lifetime pittsburghers talk like rural folks, anyway, having grown up rural myself) would use the word crick, but hey.

I am glad, though, that my email wasn't given out. I get enough woodworking related emails for devices and material of all manners that I'd never buy in the first place.

Aleks Hunter
07-06-2013, 10:13 PM
I don't know about the Chinese being all that slack about food safety. Their inspections may be spotty, like ours are, but when someone uses tainted ingredients or adulterations in China, they get executed. Over here on the other hand, Stewart Parnellm the peanut guys whose peanut butter poisoned all those people five years ago, many of whom died, has yet to set foot in a jail.

David C. Roseman
07-07-2013, 9:41 AM
[snip]

The only answer to this question that matters to me is that I would know that I violated a promise I made here a very long time ago.
.

Thank you, Keith. You're a good man, tho sadly have no future as a successful politician. ;)

David

Jack Gaskins
07-19-2013, 9:01 PM
Funny how the Asians buy up American businesses like they are hanging on a hook in the dollar store YET the Chinese populous are dirt poor and almost starving. Pathetic! INMO, American businesses are selling because our government is mismanaging the our economy. Yeah, here comes Obama Care now our businesses can prosper and grow.............

ray hampton
07-19-2013, 9:14 PM
Funny how the Asians buy up American businesses like they are hanging on a hook in the dollar store YET the Chinese populous are dirt poor and almost starving. Pathetic! INMO, American businesses are selling because our government is mismanaging the our economy. Yeah, here comes Obama Care now our businesses can prosper and grow.............

can you name any nation where the majority of the people are not poor

Frank Trinkle
07-21-2013, 6:33 AM
can you name any nation where the majority of the people are not poor

Yup! Finland, Faroe Islands, Singapore, Sweden, Japan, and by majority...The United States of America.

paul cottingham
07-21-2013, 11:38 AM
Wow...that is hard for me to fathom. I really appreciate your integrity, Keith.
Amen to that.

Chuck Wintle
07-21-2013, 12:41 PM
yes its true they were supported but in the business world it all makes sense from a capitalist point of view. if its good for the shareholders then it must be ok...profits like this are short term and often managers are only taught to look from one quarter to the next. patriotism is very lacking in most businesses.

Keith Outten
07-21-2013, 1:41 PM
Although SawMill Creek is not for sale we receive offers on occasion from companies who are in the business of acquiring Internet Properties. Just last week we had an offer from another company to purchase The Creek which we considered but it will be refused in spite of the number of zero's in the offer.

The day will most likely come when I will no longer be able to continue as your host and when that day comes ownership of The Creek will pass to someone else or possibly to the Members of this Community. Today I am am good health and content to keep working for you folks so we will keep the lights on here for awhile longer.

Until then please help me pay the bills by becoming a Contributor, buying our Archive DVD's, hats and T-Shirts so I don't have to worry about our finances. We don't ask much in the way of donations each year so it is easy for everyone to help out, many hands make light work of the the job paying the bills. Donations lighten the load on my having to market banner advertisements which has become a job in itself these last few years and it takes a huge chunk of my time that I would rather be spending on your side of The Creek.

Sorry for the shameless plug folks, I rarely do this publicly as it is the side of this job that I dislike.

On the bright side I have signed another contract with our Internet provider that will increase our bandwidth by two and a half times. I am also considering bringing another server online that we might use to provide more SawMill Creek services. I have a meeting Monday morning to discuss some options for the new server as I would like to open a few more doors here that everyone would appreciate. The reason I am not sharing any specifics is because I don't have the expertise in this area so I need to get some help and good advice rather than spending our limited financial reserves on a reckless idea. Before we do anything or make any final decisions we will be discussing our options in the Lumber Yard Forum so you can share your comments, concerns and ideas.
.

jay gill
07-21-2013, 3:24 PM
The only answer to this question that matters to me is that I would know that I violated a promise I made here a very long time ago.
.

Keith, Thank you!

James White
07-23-2013, 9:38 AM
Although SawMill Creek is not for sale we receive offers on occasion from companies who are in the business of acquiring Internet Properties. Just last week we had an offer from another company to purchase The Creek which we considered but it will be refused in spite of the number of zero's in the offer.

The day will most likely come when I will no longer be able to continue as your host and when that day comes ownership of The Creek will pass to someone else or possibly to the Members of this Community. Today I am am good health and content to keep working for you folks so we will keep the lights on here for awhile longer.

Until then please help me pay the bills by becoming a Contributor, buying our Archive DVD's, hats and T-Shirts so I don't have to worry about our finances. We don't ask much in the way of donations each year so it is easy for everyone to help out, many hands make light work of the the job paying the bills. Donations lighten the load on my having to market banner advertisements which has become a job in itself these last few years and it takes a huge chunk of my time that I would rather be spending on your side of The Creek.

Sorry for the shameless plug folks, I rarely do this publicly as it is the side of this job that I dislike.

On the bright side I have signed another contract with our Internet provider that will increase our bandwidth by two and a half times. I am also considering bringing another server online that we might use to provide more SawMill Creek services. I have a meeting Monday morning to discuss some options for the new server as I would like to open a few more doors here that everyone would appreciate. The reason I am not sharing any specifics is because I don't have the expertise in this area so I need to get some help and good advice rather than spending our limited financial reserves on a reckless idea. Before we do anything or make any final decisions we will be discussing our options in the Lumber Yard Forum so you can share your comments, concerns and ideas.
.

Kieth,

When the time for that discussion comes. Will you please post a note of invitation in the General forum. So that those who do not visit the Lumber Yard on a regular basis may have an opportunity to participate.

Regards,
James