Globalization,

technology, &

logistics

World mysteries

Why is inflation low while (i) interest rates are also low and (ii) oil prices are high?

Why is return on capital at record highs?

Why is there a ‘housing bubble’?

Marx’s view

The class struggle under capitalism is between those who own the means of production, the ruling class or bourgeoisie, and those who labor for a wage, the working class or proletariat.

Communist Manifesto, 1848.

Historic Image: the manifesto

Historic Image: Santa Klaus Marx

Was Marx’s prophecy correct?

Not really, Mr. Marx!We’re under a temporary transition.

Emerging economies are catching up…

…and not only on low-skilled labor.

Why rates are so low & so is inflation?

Excess liquidity has created a housing bubble.

The largest foreign aid program in world history?

How sustainable is this picture?

Karl Marx’s revenge

Nikon’s stunning gallery

• Nikon found out that many flickr users had incredible images, & sponsored a “stunning gallery” website in which they could be displayed.

• Nikon later gave out 200 of its new D-80 for free, for it’s pick of best photographers.

Karl Marx Revenge (From Daniel Pink)

The means of production, in the form of computers, are now in the hands of the workers, often literally, “cheap enough to buy, small enough to house and easy to operate”

Blogging…

Bloggers have repeatedly outflanked the mainstream media on US domestic political news.

Glenn Reynolds, a law professor at the University of Tennessee, with no background in the media, gets half up to half a million page views a day for his blog, instapundit.com.

“Talented people need organisations less than organisations need talented people.”

Daniel Pink, Free Agent Nation: How America's New Independent Workers are Transforming the Way We Live, 2001.

Squeezing out efficiency

Michael Dell• Born 1965• US$ 17.000.000.000,00

Net worth

(4th richest american, Forbes 2005)

• Dell sales: US$49 Billion (2004)

Squeezing out efficiencyDell’s color laser printer

5110cn

Dell started offering printers circa 2004

When mentioning that “the printer business has high profit margins, Dell responded”:

“We’ll fix that.”

From The Economist print edition, Technology's Mr Predictable: Michael Dell's money-making machine has further scope for growth, Face value column, Sep 22nd 2005

Why is this course important?

Because the mindset has changed from large margins should be strived for towards the view that large margins should be fixed.

We’ll fix that

FORBES 2005 Top 10

1. Bill Gates Microsoft (linux, openoffice, Ajax, etc) 2. Warren Buffett 3. Paul Allen Microsoft (linux, openoffice, Ajax, etc) 4. Michael Dell Dell (fixing it) 5. Larry Ellison Oracle (web2.0, ajax, etc) 6. Christy Walton Wal-Mart (fixing it) 7. Jim Walton Wal-Mart (fixing it) 8. S. Robson Walton Wal-Mart (fixing it) 9. Alice Walton Wal-Mart (fixing it) 10. Helen Walton Wal-Mart (fixing it)

Wal-Mart

• 8th largest trade partner of China.

• 1.8 Million employees

• $315 Billion revenue

• 1945: Walton’s five and dime

• No promotions (ELP)

• Profit: >$11 Billion

Controversy

• Lowered world inflation by 0.5%?

• Use of foreign labor

• Low wages

• Health benefits

Controversy: Wal-Mart is accused of lowering costs at the expense of its

employees, but that is probably an

exaggeration.

Controversy: Wal-Mart is also accused of employing alien foreigners, but that is probably also an exaggeration.

Controversy

Of course, Wal-Mart’s headquarters deny any wrongdoings

INDIVIDUALS are empowered to create and distribute information globally

COMPANIES are working under an explosion of new work and technology standards

COUNTRIES are opening up under non-ideological views, with enormous global economic consequences