Capitalism Success, Criss Reform

The contents provided by Yale University Open Course.

During the "subprime mortgage", the global economy recession
affected everyone, especially subsidiary countries of U.S.A,
such as Taiwan exported goods to U.S.A.

Etymology:
Capital means head and cattle.
The word "Capital" was invented by Karl Marx in the communist manifesto.

Philosophy:

1. Market Society is only the ideology. Capitalism is based on try and error, and so does the article.
2. Existentialism: The modern society ensembles a gargantuan machine. We are like the bolt, nut, machine components to  maintain it running.
3. Society Revolution Communist Manifesto (Karl Marx); Les Miserables (Oliver Twist).
4. Why didn't the machine reduce working time for employees ?
5. Does Iraq War stimulate the economy? Think about WWII. During the WWII, how did America get through the great recession? Did the war change the role of women? Rise the feminism and civil right.

War : Mother of Invention       Invention : Mother of War
  
   WWII:
   Silicon Valley--> Semiconductor 
   Jet Fighter (Frank Whittle)--> Jet Airliner
   Atomic Bomb--> Nuclear Plant
   Cold War:
   Satellite--> GPS
   According to the Pentagon, if we can transfer the technology of military into
   private entrepreneurs, it will benefit and stimulate economy.

Here is my interesting discovery:

New York:U.S.A=U.S.A:World
=General Motor(or Toyota):Automakers
=Microsoft:Software
=Yankees:MLB(without salary cap)
All those companies can face the problem is (too big to fail)1.

Sedan + Sport Car => Coupe
Ford Model T + Tractor => Jeep
Jeep + Sedan => SUV
MSN + Blog => Facebook
PDA + MP3 Player + Cell Phone => Smart Phone

The following is the highlight of Yale University Open Course "Capitalism"

Lec1: Labor Intensive --> Capital Intensive

  What's the capital??
  Spider:Web = Fisherman:Fishing Net
  The spider weaves the web is the closest intuitively to capital.


  The above photo is " Center Pivot Irrigation ".
  This is highly capital intensive, lower labor intensive.
  The " Center Pivot irrigation " is serious  the impact for environment,
  contrast to labor intensive almost doesn't damage the soil.

  Seed Drill:Seed = Manipulator:Nut
  This is what happened in the agriculture and then in the industries.

[Book Reference]

A Failure of Capitalism
Communist Manifesto
Farewell to Alms
The Bottom Billion
The Constitution of Capital & The Road to Serfdom
The Mystery of Capital
The White Tiger
Think You for Smoking
Wealth of Nations

[Key Word]
IPO= initial Public Offering
The fly in the ointment

Lec2: World Demographic Transition

1. The world demographic transition is as nearly as clockwork, and happened in a consequential fashion so there are temporal offsets.
2. Demographic Transition

   Phase
   a: High Birthrate      High Deathrate
   b: High Birthrate      Low  Deathrate
   c: Low  Birthrate      Low  Deathrate
   Explanation:
   b:
   due to clean water, household hygiene, higher calorie, and modern medicine
   which were improved.
   c:
   tend to a lot of capital and tend to be short on cheap labor,
   because too young to work and to old to work were too many.
   This is the interesting of capitalism, improving the means of production will
   be more important.

3.The dynamic of world trade which is such an important part of capitalism is a way of arbitrating
   between early and late phases in the world demographic transition, so that cheap labor
   maximized its value by being combined with capital from "Phase c".

[Key Word]
www.gapminder.org

Lec3:

1. Buyer too big: General Motor, Toyota buy tires form Good years...Seller too big: Microsoft.

Lec4:  Karl Marx, Joseph Schumpeter, and an Economic System Incapable of Coming to Rest.

   Howard Head:
   What would happen if we took the aluminum wafer with which we're building ariplanes, and
   make a ski from it?

  1.Marx images that his relatively abstract analysis of capitalism is scientific, so he thinks it is
     predictive force.

  2.Monopoly capitalism
     a.Direct competition eliminated or trivialized  miserable
     b.High barriers to entry, power to punish entrants
     c.Substitution difficult
     d.Vertical integration from raw material, finished goods to dealership.

     Standard oil
     U.S Steel in 1890s
     Regulated Airlines
     Big Pharms

     [Key Word]
     Creative Destruction
     Demographic Transition

Lec5:

Lec6:

Lec7:

Lec8: The Case of Kodak and Polaroid

  Kodak and Polaroid
  Both companies were dramatic success and then dramatic failure.

Are you familiar with it ?
  " You press the button, we do the rest " . The slogan of Kodak.
  What an irony propaganda.The digital camera would finish the all the process,
  from the photo taken to upload to your blog.


  The above photo is Polaroid camera which is the instant film.
  Polaroid is the company which produced instant film,
  after you take the photo and wait for a while and then you can see the picture.

  Kodak                              Polaroid                         Digital Camera
  The best picture           The fastest picture     The best and fastest picture
 
  As the digital camera come into the market, both companies were eradicated by  
  consumers.Take a look at the high-end DSLR, the function of ISO, White Balance, Continuous shot,
  high definition, and so on. You no longer buy the film again and again, just "Memory CARD".
  The film was replace by CCD or CMOS as well as Memory CARD.
 
  1. Conventional Camera:Film = Razor:Blade = Printer:Ink Cartridge
  You would find all the second items are expendable.
  You take a photo need to buy the film, using the conventional camera.
  The film, blades and ink cartridge are where the money are.
  So as the engineer (Steven J. Sasson) invented the first digital camera,
  it is smart and convenient  but don't tell anyone , said the senior manager.
  P.S: CAD (Computer Assist Design)
  The designer didn't buy papers and pens to draw the draft, all you have to do is
  buy a PC or Notebook, install CAD software(CATIA, Pro/E, UG, SolidWork...).

  **Strategy** Printer & Razor
  Most of us try to minimize the initial cash outlay, when we buy something and then you need
  pay a mount money to maintain it.

  2. The lawsuit of Kodak and Polaroid
       As Kodak company cooperated with Polaroid to manufacture camera,
       Kodak  stole the instant film technology.

  3. The engineers who create devices are forced out of top management and
       replaced by people who are general managers.
  a. the problem of ego
  b. the engineers wanted to research and develop the perfect product,
      and then ignore the demand of consumers.

Lec9: Guest Lecture Jim Alexander (former CEO of Enron )

  When did morality get replaced by efficiency?
  Nice guys get washed away like snow and rain.

  "Money Business"
  Cash
  Marketable Securities
  Non-Exchange Traded Derivatives

  1. Enron used their own price curve to control the value of energy resource.
  2. Enron is a high quality firm. Everyone thinks it's a good firm.
      You don't have to worry about it.
      Because you don't have much time and enough intellect to understand it.
  3. Lay was someone who always operated from 30,000 feet.
      A big picture guy, all about strategy.Never get into the operating details.
      Never really wanted to know anything.
      If you produced consistent results, there were absolutely no questions asked.
      * I think that's how the fraud accounts made.

  [Key Word]
  Balance sheet
  Income Statement

[Key Word]
Division of Labor
Porter Five Forces  Analysis
Too Big to Fail

[Reference]