America's Biggest Milk Producers Are Going Bankrupt • Hacker News Board

Re: America's Biggest Milk Producers Are Going Bankrupt

#141

Post by scandox » Tue, Jan 07, 2020, 4:05 PM UTC

ghaff wrote: post #133

scandox wrote: post #130

Earlier quoted context omitted.

> But actually, defined benefit schemes are less risky and far more appropriate for the average dummy than defined contribution schemes. Well, yeah because defined benefit actually makes some kind of commitment on what you're going to get, whereas defined contribution just tells you what you'll give, right? I mean it's all in the name. DC is just "give us yer money and sure we'll do our best for you, as long as our f…

Well, it's more than that. With defined contribution you can invest in a reasonably diversified pool of assets and, while there are no guarantees, you will most likely come out OK over a long period of time. The bigger problem is that unsophisticated investors may overly invest in risky assets that don't pan out or they don't invest at all/borrow against savings/etc.

Ok. But even with a sensible investment strategy a major economic decline close to your retirement can result in you getting a lot less than you expected, right? It just seems to me a pension should principally offer a reasonable level of certainty (to those that choose to have it).

Re: America's Biggest Milk Producers Are Going Bankrupt

#142

Post by brain5ide » Tue, Jan 07, 2020, 4:06 PM UTC

Accujack wrote: post #134

alistairSH wrote: post #127

Earlier quoted context omitted.

No, Tucker Carlson is not news. He's a pundit/commentator who has a talk show. Neither is John Oliver. I'd almost say they're flip sides of the same coin, except Carlson trends WAY right (often right into conspiracy theory land) and Oliver is more center-left.

Oliver is a journalist, though. That's why Snowden granted him an interview first, before anyone else in the world. Sure, he's humorous, but he's not offering his opinions except in the most general terms. He follows facts, not hype.

I thought he was a comedian.

Re: America's Biggest Milk Producers Are Going Bankrupt

#143

Post by lm28469 » Tue, Jan 07, 2020, 4:08 PM UTC

t0ddbonzalez wrote: post #92

m463 wrote: post #14

Earlier quoted context omitted.

There's lots of evidence milk isn't as good for you as the dairy industry advertises.

> " There's lots of evidence milk isn't as good for you as the dairy industry advertises." lol at this ridiculous comment. Present the evidence please. How many millions of years do you think mammals have been drinking milk for?

How many millions of years do you think _adult_ mammals have been drinking milk _coming from other mammals_ for?

Re: America's Biggest Milk Producers Are Going Bankrupt

#144

Post by bregma » Tue, Jan 07, 2020, 4:08 PM UTC

hamstercat wrote: post #128

gruez wrote: post #120

Earlier quoted context omitted.

How would this work? If the company goes bankrupt and sold all its assets, who will you take the money from?

The money is supposed to be invested in part by the employee and the employer at the time of payroll. This money is then moved to a fund, impossible to be touched by the company forever and ever. The fund invests the money, it grows, and then you can get an income in retirement after many years. The same could be done by the employee itself by just saving part of his paycheck and investing in a mutual fund, but most…

So, what happened at Nortel?

Re: America's Biggest Milk Producers Are Going Bankrupt

#145

Post by uhtred » Tue, Jan 07, 2020, 4:08 PM UTC

klipt wrote: post #5

lalos wrote: post #2

The invisible hand at play, specially if it is true that plant based milk are taking away market share from the milk industry. Hope the government doesn't bail out or protect the industry against what the free market demands.

Whole milk is still recommended by pediatricians for toddlers, I imagine plant based milk is not nutritionally equivalent.

I drink unflavored, unsweetened soy milk. Just two ingredients, soy beans and water. It tastes great when made properly, and is very nutritious, high protein and good fats, calcium etc

Re: America's Biggest Milk Producers Are Going Bankrupt

#146

Post by dmix » Tue, Jan 07, 2020, 4:08 PM UTC

achow wrote: post #122

sp332 wrote: post #3

A counterpoint: these companies were recently bought by private equity firm KKR Co, the same company that loaded up Toys 'R Us with debt and then liquidated it. https://mobile.twitter.com/rhinosoros/status/121424602712711... This bankruptcy filling might just be negotiation in the courts to reduce pension obligations.

>..these companies were recently bought by private equity firm KKR Co Not KKR. In 1995, Borden was acquired for $2 billion by Kohlberg Kravis Roberts & Co. (KKR), which proceeded to sell off pieces of the company to various buyers. Washington, D.C.-based ACON Dairy Investors, LLC purchased the company in 2017. https://www.bevnet.com/news/2020/borden-dairy-co-files-for-b... [Edit] Not sure whether the twitt narrative…

There have been studies showing private equity does more good for dying businesses than bad. Congress attacked them heavily during the 2008 crisis and they were the first companies called in to congress to answer "tough questions". But it turns out they didn't cause the crisis and that more companies are better off after PE acquisition (ie, they got turned around for the better and created greater economic production had they not existed). Basically most of those companies would be dead without PE as they are often the only solution left, even if it often seems on harsh terms.

Private equity firms aren't all just corporate raiders of the 1980s that certain politicians try to spin them as.

That's not to say that small towns selling off public services to them is a good idea. Or any other public/private partnership bullshit that is sold as 'free markets' when its the mostly just politicians and their wealthy connections being complete vultures creating things that are nothing like markets.

The book "King of Capital" has a really good overview of the history of private equity:

https://www.amazon.com/King-Capital-Remarkable-Schwarzman-Bl...

Re: America's Biggest Milk Producers Are Going Bankrupt

#147

Post by LatteLazy » Tue, Jan 07, 2020, 4:12 PM UTC

eldavido wrote: post #132

LatteLazy wrote: post #110

Earlier quoted context omitted.

Sorry in advance, this is a bit of a rant... The problem is not defined benefit vs defined contribution really, it's that companies are not really required to fund defined benefit. There are 1001 third party companies (normally insurers) who will happily underwrite a defined benefit scheme (so if the employer goes under the pensions are fine). But that would mean employers actually making pensions contributions that…

I take the status quo as my starting point. McClatchy just had pension trouble. So does my home state of Illinois. So does this company, apparently. You seem to think it's possible to just magic a large-scale change in human behavior into existence. It isn't. I think DC+social security is a pretty fair compromise. You're never going to starve if you totally screw up. There's also Medicare to help pay medical expenses…

I strongly agree about the "mix of the two". Though social security is just a defined benefit scheme that's bankrupt and replying on a political bailout so I'm not sure I'd include it.

The big issue here though is how to make either work for the average person? A defined benefit scheme where the employer is fiddling the books will fail. A defined contribution scheme where the management company is charging fat fees and pushing risky investments will fail. Can we really trust the majority of people with no financial acumen to tell the difference?

I feel like both require the user to swim with sharks right now...

Re: America's Biggest Milk Producers Are Going Bankrupt

#148

Post by thatfrenchguy » Tue, Jan 07, 2020, 4:18 PM UTC

eldavido wrote: post #137

alistairSH wrote: post #131

Earlier quoted context omitted.

The insurance company is effectively acting as a giant escrow account on behalf of the employees/retirees. The employer pays into the account at whatever rate is required to fully fund retirements. The insurance company manages those funds. If the employer goes bankrupt, the funds are not accessible by raiders/PE firms.

This already exists. It's called a 401(k).

Except 401(k)s are crazy underfunded: https://www.marketwatch.com/story/this-is-the-average-401k-s... (look at the median)

Re: America's Biggest Milk Producers Are Going Bankrupt

#149

Post by ghaff » Tue, Jan 07, 2020, 4:19 PM UTC

scandox wrote: post #141

ghaff wrote: post #133

Earlier quoted context omitted.

Well, it's more than that. With defined contribution you can invest in a reasonably diversified pool of assets and, while there are no guarantees, you will most likely come out OK over a long period of time. The bigger problem is that unsophisticated investors may overly invest in risky assets that don't pan out or they don't invest at all/borrow against savings/etc.

Ok. But even with a sensible investment strategy a major economic decline close to your retirement can result in you getting a lot less than you expected, right? It just seems to me a pension should principally offer a reasonable level of certainty (to those that choose to have it).

The thing is that pensions aren't magic money trees. They're invested in the market just like anything else. So if there's a major economic decline close to your retirement, they may well become insolvent. Maybe they'll be bailed out (with basically other people's money) or maybe they won't be. (Pensions also don't really protect you if inflation spikes.)

Individual investors do have the option of investing in things like treasuries and annuities. Of course, in an economic collapse, all bets are off. But if you're willing to put up with low returns (maybe 3%), you can invest your money pretty safely.

Re: America's Biggest Milk Producers Are Going Bankrupt

#150

Post by md2be » Tue, Jan 07, 2020, 4:21 PM UTC

matheweis wrote: post #45

There are a handful of local milk producers and distributors in multiple states that by most appearances are doing well, for example: AZ: https://www.danzeisendairy.com/ WA: https://www.twinbrookcreamery.com/ To me, this (the unwinding of the large consolidated food companies) is largely a good thing.

Yep - Walmart the largest buyer of milk now owns their own farms and uses milk as a loss leader. Dean Foods former CEO was an alleged crook. Their packaging and advertising looks like it came out of the 1970s. Here we are in the Keto / Intermittent fasting era - and they failed to provide a cream. These folks gave up long ago. Expect a nice bounce back.