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Salesforce cut hundreds of employees Monday

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Re: Salesforce cut hundreds of employees Monday

#41

Post by za3faran »

cheriot wrote: post #3
cs702 wrote: post #2

Every company wants to cut spending on people, services, and facilities, because revenues are slowing down, costs are rising, and there's more uncertainty about the near term future. The people who lose their jobs, in turn, are forced to cut their spending, contributing even more to the ongoing revenue slowdown at companies that sell to consumers. The service providers who see their billing examined with a microscope…

> many consumers without savings are at risk of financial ruin Yes. This is the reason for having a better social safety net. There's no reason a normal business cycle should "ruin" normal people that did not take excessive risks.

While I agree that we should have a good social safety net, these cycles should in no way shape or form be normal. Something is obviously fundamentally broken.

Re: Salesforce cut hundreds of employees Monday

#42

Post by stjohnswarts »

za3faran wrote: post #41
cheriot wrote: post #3

Earlier quoted context omitted.

> many consumers without savings are at risk of financial ruin Yes. This is the reason for having a better social safety net. There's no reason a normal business cycle should "ruin" normal people that did not take excessive risks.

While I agree that we should have a good social safety net, these cycles should in no way shape or form be normal. Something is obviously fundamentally broken.

Waxing and waning of economies is something that happened since civilization started. No one has fixed it yet, and people a lot smarter than you and I have tried. If the human race was more altruistic than greedy, it would probably be possible, but we aren't. Until that changes, this is just what happens.

Re: Salesforce cut hundreds of employees Monday

#43

Post by gruez »

fnordpiglet wrote: post #39
gruez wrote: post #33

Earlier quoted context omitted.

> Well - artificially inducing a recession to make people poorer so they can’t afford to buy things as a way of reducing shipping container rates and backlogs is a pretty ass backwards way to run a society. The fed isn't doing this because they want cheaper shit from china. They're doing it to keep inflation under control. A result of making money more expensive is lower shipping container rates, but that's not the p…

Yes. Increase shipping capacity and reduce gasoline costs. These frictionful costs make up the entirety of inflation at the moment. It’s not just cheaper shit from China - although cheaper stuff necessarily is deflationary. Food is a global commodity and it costs 4x more to ship it now than it did 3 years ago. That cost is passed to consumers. Increasing the cost of borrowing decreases economic activity by essentiall…

>Yes. Increase shipping capacity and reduce gasoline costs.

Easier said than done. How do you do this without driving more inflation in the meantime? If supply chains are constrained, deploying a bunch of oil drilling equipment is going to make it worse.

>This is worse than inflation IMO - if you make less money how is that different than things costing more?

What's bad about inflation goes beyond just "inflation was 10% so people are 10% poorer". Inflation hinders trade and financing (why would you sign a 5 year contract when you don't know what prices will be in 5 years?), discourages saving/investment, and adds inefficiencies throughout the economy as everything has to be constantly repriced. Also, failing to contain inflation when there's an expectation of a certain inflation rate leads to higher borrowing costs (for both private and public lenders), because lenders don't want to be wiped out by inflation.

>That can be achieved by lowering interest rates which stimulates capital investment in supply side expansion and facilitated demand by lowering the marginal cost of credit facilities.

That's absolutely bonkers. There's already too much dollars chasing too few goods, and your solution is to unleash even more dollars?

Re: Salesforce cut hundreds of employees Monday

#44

Post by gruez »

willcipriano wrote: post #36
gruez wrote: post #33

Earlier quoted context omitted.

> Well - artificially inducing a recession to make people poorer so they can’t afford to buy things as a way of reducing shipping container rates and backlogs is a pretty ass backwards way to run a society. The fed isn't doing this because they want cheaper shit from china. They're doing it to keep inflation under control. A result of making money more expensive is lower shipping container rates, but that's not the p…

> Do you have any better ideas for stopping inflation? Not only be concerned with it when it begins to impact wages.

Source for this assertion being true?

Re: Salesforce cut hundreds of employees Monday

#45

Post by willcipriano »

gruez wrote: post #44
willcipriano wrote: post #36

Earlier quoted context omitted.

> Do you have any better ideas for stopping inflation? Not only be concerned with it when it begins to impact wages.

Source for this assertion being true?

"So in principle, it seems as though, by moderating demand, we could see vacancies come down, and as a result—and they could come down fairly significantly and I think put supply and demand at least closer together than they are, and that that would give us a chance to have lower—to get inflation—to get wages down and then get inflation down without having to slow the economy and have a recession and have unemployment rise materially. So there’s a path to that."

https://www.wsj.com/articles/transcript-fed-chief-powells-po...

Had a decade of asset inflation, that was fine. A quarter or two of wage inflation and everyone loses their minds.

Re: Salesforce cut hundreds of employees Monday

#46

Post by taylodl »

za3faran wrote: post #41
cheriot wrote: post #3

Earlier quoted context omitted.

> many consumers without savings are at risk of financial ruin Yes. This is the reason for having a better social safety net. There's no reason a normal business cycle should "ruin" normal people that did not take excessive risks.

While I agree that we should have a good social safety net, these cycles should in no way shape or form be normal. Something is obviously fundamentally broken.

What are you talking about? This cycle is well-known and follows a roughly 7 year pattern and has done so since the start of the industrial era 200 years ago. Even prior to that there were economic cycles in the years 1000-1700. Whether these cycles should leave ordinary people in financial ruin is a completely different matter.

Re: Salesforce cut hundreds of employees Monday

#47

Post by juve1996 »

fnordpiglet wrote: post #40
juve1996 wrote: post #32

Earlier quoted context omitted.

Artificially inducing and propping up an economy with cheap cash led to this. Now we have no choice. Inflation hurts the poor just as much as this does.

If my income drops by $10 is that materially different than the price going up by $10 instead? In the end I have a $10 deficit. By letting supply and demand work itself out and making sure the friction for supply meeting demand is minimal (I.e., shipping and fuel costs low and capacity high), inflation would disappear as suppliers met the demand induced by any excess liquidity in the market. The world has an amazing…

I think the train that this is transitory has left the station. Demand is still high and inflation rates are not going down despite shipping costs plummeting in recent months.

Obviously the Fed can go overboard. But the economy is no longer based on fundamentals and an inflationary spiral would be a major problem. I can't blame the fed for taking the action they are.

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