US Steel Sold

[StarTech]

Oh my I just realized it is now 33F outside, we going to have a heat wave today......

Maybe I get the frozen wrench off the outside work bench today.

 

[SHB]

China has a massive steel manufacturing capacity and is the world’s largest producer, US Steel is ranked 27th in terms of steel capacity world wide. Competing with the Chinese is difficult, they don't have the labor and environmental restrictions that the rest of the worlds producers face, and given the blurred lines between business and government they don't even have to make a profit. So China prices steel at whatever it takes to get the volume they wish to produce, or to drive targeted competitors out of the market. The risk is Nippon Steel will take US Steel’s intellectual property and spread it across their many facilities, focus their investments on Nippon’s facilities in India, then when the economy slows gradually close the US facilities due to “their high operating cost”. I would guess that US Steel is doing this because they are getting hammered on energy costs & environmental regulations and the ESG movement is drying up their access to capital. So it’s make the best deal they can, or gradually go out of business. The government should demand that US facilities receive a perpetual minimum percentage (say 25%) of Nippon Steel’s annual capital / R&D expenditures and maintain a domestic steel production capacity of TBD tons / year or face economic penalties so severe that they would go out of business.

 

[7394]

not when the mob (mean guvment) is destroying the country intentionally.

 

[bertsmobile1]

China has a massive steel manufacturing capacity and is the world’s largest producer, US Steel is ranked 27th in terms of steel capacity world wide. Competing with the Chinese is difficult, they don't have the labor and environmental restrictions that the rest of the worlds producers face, and given the blurred lines between business and government they don't even have to make a profit. So China prices steel at whatever it takes to get the volume they wish to produce, or to drive targeted competitors out of the market. The risk is Nippon Steel will take US Steel’s intellectual property and spread it across their many facilities, focus their investments on Nippon’s facilities in India, then when the economy slows gradually close the US facilities due to “their high operating cost”. I would guess that US Steel is doing this because they are getting hammered on energy costs & environmental regulations and the ESG movement is drying up their access to capital. So it’s make the best deal they can, or gradually go out of business. The government should demand that US facilities receive a perpetual minimum percentage (say 25%) of Nippon Steel’s annual capital / R&D expenditures and maintain a domestic steel production capacity of TBD tons / year or face economic penalties so severe that they would go out of business.

That can quickly become counter productive
Post WW II the Aust government decided we needed a better steel industry thus BHP took over every steel making facility and basically bled each factory dry plus gobbled up billions in government aid.
Because they had a monopoly on steel they also bleed the heavy manufacturing sector dry .
To prove they were advancing the nation they made a lot of tonnage of low grade low profit products like Reo Rod .
There was no actual investment to the point that the 2nd hand backwards forwards primary break down mill transferred to Australia during WW II to roll 4" thick armour plate is still being used today.
The largest blast furnace is 1/3 the size of Kobe Steels research furnace .

If there is any technology transfer it will be the other way Americans think they are so great when in reality they are lagging way behind the rest of the world when it comes to manufacturing technology,
US steel is failing because it was being run by over paid under performing accountants in order to squeeze the maximum dividends out of the minimum capital on behalf of the investment companies that own it ( and most of the rest of the US manufacturing industry )
It takes the same number of man hours to run a 36,000 ton furnace as it does to run a 6,000 ton furnace but the former is 6 times more productive
Your arguments are the same facile ones I used to hear from Australian managers to justify off shoring Australian production .
China pays a premium price for all of their imports and gets the minimum price for their exports
What they do with their steel is to buy ore & coal from various sources, including Australia & mix them up so what comes out of the furnace is the bare minimum specification ( often under specification ) steel which requires the least cleaning .
They process it in massive furnaces that are dedicated to a single product thus bringing in massive economies of scale and of course everything is continuous cast then direct rolled thus requiring no reheating , no descaling .
Scrap heat is recovered from every where possible to generate not only internal power but enough to export to the grid

australias Whyalla steel plane has never ever run at a profit & sucked up government subsidies like a deranged vacuum cleaner .
When it closed down plans were well under way to convert the site into shopping malls & residentila high rise .
The Gupta stepped in , bought the plant from the liquidators and set about to do a $ 1,000,000,000 upgrade to the facility when his major financier went belly up.
He managed to refinance and pay back the $ 430,000,000 in 2 years . Right now he is undergoing a $ 3,000,000,000 redevelopment of the plant over the next 6 years as he changes over from plain carbon steel ti high nickel alloy steel which was his original plan 3 years ago
Steel prices have been at an all time high for the past 3 years so if USS can not make a profit then that says a lot about the quality of USS management

Sanjeev Gupta pays last instalment on Whyalla steelworks lifeline loan

A $430m refinancing deal struck when the collapse of Greensill Capital threatened GFG’s local business has taken almost two years to pay off.

www.afr.com

 

[RaulMcCai]

Our financial investors are selling out America just to make quick short term profit.

It's not investors.
And interestingly it is the LAW~!!
Th officers and directors of all publicly traded corporations owe a fiduciary duty to the shareholders. The duty is enforceable at law. If they don't hold true to the duty they can be sued in a derivative shareholders action and forced to disgorge the lost profits from their personal funds.
The duty can be described like this: Officers and directors must increase shareholder value. It is a harsh mistress. There are no alternatives.

So if China comes along and offers to buy a company for more than the current stock value of the company, guess what? They gotta sell to them. That's the law.
If the officers and directors refuse they will be sued by the shareholders.

 

[RaulMcCai]

Americans think they are so great when in reality they are lagging way behind the rest of the world when it comes to manufacturing technology,

No one in the USA thinks that. We all know that we have let manufacturing slip away and our manufacturing is all but non existent.
And it is all because of one thing. Just the one thing.
Some time in the 70s we started sourcing US military hardware from foreign suppliers. That began the decline of American Manufacturing. Prior to that and subsequent to WWI and WWII the USA was the apotheosis of manufacturing. The military bought everything they use from American manufacturers and That meant that American manufacturers had to be able to produce the best most precisely made products which set of capabilities bled over into the rest of everything else we made. "MADE IN USA" was the sought after imprint the mark of finest quality, and the world beat a path to our door.

But with the change in military acquisition policy And the lax enforcement of laws that give preference to US manufacturers We lost the edge that made us the best. And then globalism took the rest.
Now we are lucky if we can make automobile floor liners.

 

[bertsmobile1]

It's not investors.
And interestingly it is the LAW~!!
Th officers and directors of all publicly traded corporations owe a fiduciary duty to the shareholders. The duty is enforceable at law. If they don't hold true to the duty they can be sued in a derivative shareholders action and forced to disgorge the lost profits from their personal funds.
The duty can be described like this: Officers and directors must increase shareholder value. It is a harsh mistress. There are no alternatives.

So if China comes along and offers to buy a company for more than the current stock value of the company, guess what? They gotta sell to them. That's the law.
If the officers and directors refuse they will be sued by the shareholders.

That is not actually true .
The job of the directors ,is to ensure that the business is being run in a sound mannar and that the investors funds are not being misused, that is the actual law.
However investment funds got a court ruling that directors had to increase the value of the shares and this happened under Regan
latter still investment companies won another court case because the actual earnings were well short of the projected earnings.
The US amd in particular Wall St has forgotten that a share is a share , not a 100% secure government backed bond so if the company makes a profit you investment entitles you t a share of that profit.
If the companuy makes a loss then you share that as well, that is how the system legally was set up to work
However year in year out regulations were relaxed and government after government failed to rein in corperate greed, particularly in the investment sector who by the way get very generous tax consessions.
A board is not obliged to accept any take over offer, they can reject it when it becomes what is called a hostile take over .

And in keeping with the subject matter of this forum, go back and look at what the board of B & S did to protect the board and senior executives during the bankrupticy .
We have a similar problem down here that we hope to solve by forcing companies to pay bonuses to executives & directors in 10 year excuitable script so if the company is not there in 10 years, neither is their bonus
needless to say it is being fought tooth and nail.
The problem is in the company law, the duty of the board & managers to the COMPANY has bees superseded to the duty to the shareholders.
The you get to travesties where the O'Bama government bailed out the boards of the banks that had traded illegally ( all of the board members should have been doing jail time ) while hanging the customers who no fault of their own had bad loans lost every thing they owned while 2 years latter the same criminals were back paying themselves multimillion dollar bonuses

Nippon Steel will probably make USS a profitable business again however now 100% of that profit will go to Japan.
Thus making USS workers Japanese slaves in their own country .

Under capitalism theory a business that is badly run should fail , get liquidated and it's assets get acquired by another better run business weather that happens or not depends just how mush money that business funnels into your very corrupt political system .

 

[PTmowerMech]

If ran my household like the US government I would be homeless. It is not just one political party either that is at fault for the mess we are in; it is all of them. Just look how they sit of their fat backsides and do nothing until the very last minute. Most of us got to work at things all the time not just at the minute. Most of the year I work my backside off. Now of course there a month or so there is nothing to do in the business but that when doing most my personal stuff like home repairs.

Just look how are doing on the immigration issue. They should have been working that years ago. We need our 40+ yr old immigration laws update to deal with the modern day issue; not the 70's and 80's issues.

As for our debit we need to both cut down on the spending at the same time stop all the tax loop hole cheats out there which would increase our revenue. Everybody should be paying their fair share. So far in my lifetime we only had one time the US has been out debit and that was when Jimmy Carter was president. And the very next president put us right back in debit.

The government collects enough money. They don't have a taxing problem. They have a spending problem. That $33+ trillion debt comes from both sides of the isle. Up until Biden, the GOP held the record for the most money spent, and the amount of debt ceiling increases. FWIU, it's about equal now.
What did "we the people" get for the $8 trillion Trump/Pelosi/Ryan spent? What did we get for the $6 trillion that Biden/Pelosi/McCarthy spent?

The bill. With interest.

Like what @bertsmobile1 stated about Reagan (and where this big spending started), we have a dollar that's worth about 80% less now than when he took office. According to this, $100 today was worth $387 in 1980.
Injecting $30 trillion of new money into the economy in that short of time, it's a wonder the USD is still around.
BRICS is slowly but surely making a name for itself. If all of those countries decide to abandon the USD, our goose is cooked.
Fiscal Conservatism is almost dead in this country. Most voters, for some reason, seem to think that charisma and funny one liners is somehow a presidential qualification. So regardless of their monetary ideology, we get people who think that it's OK to just print more money.

 

[bertsmobile1]

Well PT, I would challenge that assertion
If you look at the total tax take per annum as a percentage of the countries GDP you will see it is about 1/2 of what it was when Regan was the president
The military is about 3 time the size and the social security budget is way bigger as we all get older
So allowing for inflation the government is doing more with substantially less and that is the same for most Western countries
If you can find a graph of total tax take vs GDP you will see the curve took a big dive under the Regan government
And if you chart company tax vs GDP vs executive salaries vs wages over the same time you see company tax take a dive , wages take a dive and salaries skyrocket .
This of course totally disproves the "trickle down" effect.
Another interesting chart is inherence tax vs executive incomes , you would expect them to follow roughly the same path but again the salaries have had a steep climb while the tax has takes a massive dive as those with the money find ways to avoid the tax rules .
This is why fixed rate tax on everyone and fixed rate turnover taxes on all businesses , including the finance sector is vital and churches should be included in the businesses .

 

[PTmowerMech]

Well PT, I would challenge that assertion
If you look at the total tax take per annum as a percentage of the countries GDP you will see it is about 1/2 of what it was when Regan was the president
The military is about 3 time the size and the social security budget is way bigger as we all get older
So allowing for inflation the government is doing more with substantially less and that is the same for most Western countries
If you can find a graph of total tax take vs GDP you will see the curve took a big dive under the Regan government
And if you chart company tax vs GDP vs executive salaries vs wages over the same time you see company tax take a dive , wages take a dive and salaries skyrocket .
This of course totally disproves the "trickle down" effect.
Another interesting chart is inherence tax vs executive incomes , you would expect them to follow roughly the same path but again the salaries have had a steep climb while the tax has takes a massive dive as those with the money find ways to avoid the tax rules .
This is why fixed rate tax on everyone and fixed rate turnover taxes on all businesses , including the finance sector is vital and churches should be included in the businesses .

I'm of the influence that corporations and even small companies don't pay taxes. The consumer does.

With that said, there's obviously huge profits in which taxes are minimal to large corporations, compared to a small business. But is that so bad? Because there's a LOT of taxes being collected from that corporation and it's employee's. The government taxes the corporation and every employee. Those corporations and their employees do more for the country and the economy than the government. So I think it's highly unfair to tax them anymore than they're being taxed. Especially since a tax increase is going to keep wages down even further and potentially keep them from hiring more people.

The simple solution is for the government to stop borrowing any money from the federal reserve and learn to live within it's means. Stop funding retarded things like gender studies in Pakistan. A few years ago, our government funded a gay parade in Progue. They're always funded some political opposition candidate in some other country. They spend millions on reproductive research on things like worms.
They gave something like $1 million to study young people's cell phone habits. (or some BS like that)


The way to do it is to simply stop that kind of funding, learn to live within their means. Then if they want to add taxes, they can do something Ron DeSantis wants to do. Charge a fee/tax on people who are sending money out of the country. Mexicans alone send like $6 billion per year per year back to Mexico in wire transfers. (Pay Pal, Western Union and others)

After that, then they can see how much they need to tax everyone. Most folks don't have a problem with paying taxes. Where they get disgruntled is when they find out the retarded things the government does with their money. And constant see the national debt increasing in the trillions.