The company has been expanding aggressively overseas to capture business in fast-growing emerging markets such as Brazil and China. Revenues from what the company calls its growth markets were up 20% in the first quarter from a year earlier, compared with 2% growth in the Americas. Such markets now account for 19% of IBM's total revenue.
While the outsourcing will be provided by IBM, it will be done off-shore. Which means my job is going over-seas...and then they wonder why the "economy" is doing so bad...if we don't have jobs or money to buy your products, we won't...and even though you take my job over-seas and pay them my salary...guess what, they won't buy your products either...because they are over-seas....so any cost savings will be eliminated by the fact that we are without jobs and cannot afford your products.
And the irony of all this is that its business as usual for this supposedly non-profit corporation which had to cut/outsource its resources and to cut cost so that upper management can continue non-profiting ...ya..sure.
After you have done this process to customer personnel and then to your own employees ruthless seems like an old habit that keeps on giving to their execs with incentives to offshore even more American jobs. Welcome to the brave new world of transnationals and globalism; and its just really getting getting started as global cost pressures remain unchecked.
Bartels expects to see 10% to 12% sales growth in software and 6% to 8% growth in the company's hardware revenue. But IT services, such as outsourcing, consulting and systems integration, that make up the majority of IBM's sales likely decreased yet again compared to the same quarter last year, or at best remained flat, Bartels says. "We're going to see some growth overall, but IBM is still firing on only two out of three cylinders," he says.
One of my fondest big bleu recollections is that of actually commencing my RIP (retirement in place) after THEY stopped caring and over five years before the actual layoff. I still remember the day. I dutifully responded to the manager's message to call early Monday, only to be put off until the other end of my previously planned trip. When the real call came, I was driving along the interstate at the destination, and it fell upon me to console him. I said, "Is there anything I can say to make this easier for you?" He replied with deafening silence, but I really did try to feel his pain.
I'm no expert, and I avoid Holiday Inn Express, but here's my very best parting advice: 1. If you can possibly back out of leaving the business, do it now. Salary beats pension every day of the week, especially if you're retiring the way I did. Otherwise, the health deductions will soon exceed the pension, and you will suddenly owe THEM money every month. Do the math. 2. For especially important retirement advice, take your friends to lunch early and often. 3. Don't believe everything you read just because it's written down. ;<)
Again, congratulations! Best wishes for many more years of health, happiness and pro$perity.
The jobs were cut all across the United States and some in Canada. What locations and communities had job cuts? Nobody knows because IBM no longer gives out that information. Now IBM has decided that it will no longer inform employees, the government, communities, the media, or stockholders how many employees work at IBM in the United States.
From now on only the global headcount number will be reported. It is clear why IBM is doing this. The US employee population is shrinking due to off shoring. IBM is also displacing US workers with foreign workers (at lower pay) brought in to work on US client accounts. Meanwhile headcount in India and other countries is increasing.
In fact, IBM India had an employee population of 94,000 in 2008. At the end of 2009 IBM USA had an employee population of 105,000, down 30,000 in just a few years. But with IBM no longer giving out headcount by country we will not know when IBM USA goes below IBM India in headcount. Is this important?
Employers will have to make these added tax payments, because they will no longer be able to deduct from their taxable income that part of their outlays on prescription drugs for retirees that will actually be paid for by government in the form of a 28 percent federal subsidy. It does seem odd to have allowed corporations to treat as a tax-deductible expense an expense they did not actually have, as the Medicare Modernization Act of 2003 allowed them to do. The recent health care bill has removed that oddity. ...
In his remark, Mr. Fronstin states in prose an economic theory that economics professors explain to their students by means of simple algebra. Namely, employers provide their employees health benefits not out of the kindness of their hearts, but as a coolly calculated substitute for paying workers more cash take-home pay to attract and retain them. After all, in an effort to attract and retain workers, an alternative to offering them health benefits would be simply to offer them more cash. ...
Promises to active workers to cover the cost of some of their health care after retirement are part of the “health benefits” that substitute for cash take-home pay in setting their total compensation — what economists call the market price of labor. By contrast, an employer’s outlays on healthy care of former workers who have already retired do not enter the total compensation packages with which employers seek to attract or retain workers.
Editor's note: In IBM's case, the company promised lifetime retiree medical while reducing employee pay, then later reneged on that promise as a way of boosting current earnings, and thereby increasing executive bonuses. ...
Of course, that total compensation of the prospective or currently active employee may or may not include a promise to provide that new worker, too, with health benefits after that worker has retired. Corporations are free at any time to offer or to stop offering such retiree health benefits to new workers. (Editor's note: Or, in IBM's case, to drastically reduce or eliminate promised retiree health benefits to existing workers.)
"But dependency on government has never been bad for the rich. The pretense of the laissez-faire people is that only the poor are dependent on government, while the rich take care of themselves. This argument manages to ignore all of modern history, which shows a consistent record of laissez-faire for the poor, but enormous government intervention for the rich." From Economic Justice: The American Class System, from the book Declarations of Independence by Howard Zinn.
What we’re now seeing are accusations of a third form of fraud. We’ve known for some time that Goldman Sachs and other firms marketed mortgage-backed securities even as they sought to make profits by betting that such securities would plunge in value. This practice, however, while arguably reprehensible, wasn’t illegal. But now the S.E.C. is charging that Goldman created and marketed securities that were deliberately designed to fail, so that an important client could make money off that failure. That’s what I would call looting.
The main moral you should draw from the charges against Goldman, though, doesn’t involve the fine print of reform; it involves the urgent need to change Wall Street. Listening to financial-industry lobbyists and the Republican politicians who have been huddling with them, you’d think that everything will be fine as long as the federal government promises not to do any more bailouts. But that’s totally wrong — and not just because no such promise would be credible. For the fact is that much of the financial industry has become a racket — a game in which a handful of people are lavishly paid to mislead and exploit consumers and investors. And if we don’t lower the boom on these practices, the racket will just go on.
The news media's incessant focus on the Tea Party is creating a badly distorted picture of what most Americans think and is warping our policy debates. The New York Times and CBS News thus performed a public service last week with a careful study of just who is in the Tea Party movement. Their findings suggest that the Tea Party is essentially the reappearance of an old anti-government far right that has always been with us and accounts for about one-fifth of the country. The Times reported that Tea Party supporters "tend to be Republican, white, male, married and older than 45." They are also more affluent and better educated than Americans as a whole. This is the populism of the privileged. ...
Asked about raising taxes on households making more than $250,000 a year to provide health care for the uninsured, 54 percent of Americans favored doing so vs. only 17 percent of Tea Party backers. This must be the first "populist" movement driven by a television network: Sixty-three percent of the Tea Party folks say they most watch Fox News "for information about politics and current events," compared with 23 percent of the country as a whole. The right-wing fifth of America deserves news coverage like everyone else, and Fox is perfectly free to pander to its viewers. What makes no sense is allowing a sliver of opinion to dominate the media and distort our political discourse.
The mortgage investment that is the focus of the S.E.C.’s civil lawsuit against Goldman, Abacus 2007-AC1, didn’t contain any actual mortgage bonds. Rather, it was made up of credit default swaps that “referenced” such bonds. Thus the investors weren’t truly “investing” — they were gambling on the success or failure of the bonds that actually did own mortgages. Some parties bet that the mortgage bonds would pay off; others (notably the hedge fund manager John Paulson) bet that they would fail. But no actual bonds — and no actual mortgages — were created or owned by the parties involved. ...
As it considers its financial reform options, Congress’s first priority should be to end the culture that “financializes” every economic outcome, that turns every mortgage or bond issue into a lottery — often with second- and third-order securities that amount to wagers on wagers of numbing complexity. ...
The government would not look fondly on Caesar’s Palace if it opened a table for wagering on corporate failure. It should not give greater encouragement for Goldman Sachs to do so.
As a top honcho of American Airlines recently explained: "We have an industry that is too fragmented, with too many competitors, and with different ideas of capacity, pricing, and strategic activity," Golly, "many competitors... with different ideas of capacity, pricing, and strategic activity" is precisely what Adam Smith hailed as the perfect model of free enterprise.
Meanwhile, here comes Glenn Tilton, top dog at United Airlines, who has long been a podium pounding evangelist for the gospel of merging airlines to restore consistent profits. Well, yeah, Glenn, glom every airline into one or two, and you can extort all sorts of profits from your customers. It's called monopolization, and any goober can make profits from that rigged deal.
Of course, Glenn's business model is the oil industry, where he helped merge Texaco into Chevron. That one hardly benefited consumers or our country. At United, Tilton has shown that his only business skill is abusing others – he's knocked down his own employees, slashed service, and socked his customers with ridiculous fees. Now he wants to take over US Airways and bring his executive magic to that company.
Who needs theses self-serving slugs? Thank goodness they're not trying to run a hot dog stand in New York City – the competition would kill them!
More than that, reform actually should hurt the bankers. A growing body of analysis suggests that an oversized financial industry is hurting the broader economy. Shrinking that oversized industry won’t make Wall Street happy, but what’s bad for Wall Street would be good for America. ...
Remember the 1987 movie “Wall Street,” in which Gordon Gekko declared: Greed is good? By today’s standards, Gekko was a piker. In the years leading up to the 2008 crisis, the financial industry accounted for a third of total domestic profits — about twice its share two decades earlier. These profits were justified, we were told, because the industry was doing great things for the economy. It was channeling capital to productive uses; it was spreading risk; it was enhancing financial stability. None of those were true. Capital was channeled not to job-creating innovators, but into an unsustainable housing bubble; risk was concentrated, not spread; and when the housing bubble burst, the supposedly stable financial system imploded, with the worst global slump since the Great Depression as collateral damage.
So why were bankers raking it in? My take, reflecting the efforts of financial economists to make sense of the catastrophe, is that it was mainly about gambling with other people’s money. The financial industry took big, risky bets with borrowed funds — bets that paid high returns until they went bad — but was able to borrow cheaply because investors didn’t understand how fragile the industry was. And what about the much-touted benefits of financial innovation? I’m with the economists Andrei Shleifer and Robert Vishny, who argue in a recent paper that a lot of that innovation was about creating the illusion of safety, providing investors with “false substitutes” for old-fashioned assets like bank deposits. Eventually the illusion failed — and the result was a disastrous financial crisis. ...
But the fact is that we’ve been devoting far too large a share of our wealth, far too much of the nation’s talent, to the business of devising and peddling complex financial schemes — schemes that have a tendency to blow up the economy. Ending this state of affairs will hurt the financial industry. So?
The emails also show other Goldman officials cheering the news that some mortgage-related securities were being downgraded by credit-rating firms in late 2007. Top trader Michael Swenson said that as a result of the downgrades, certain payments Goldman owed to investors would "go to zero." "Sounds like we will make some serious money," responded another executive, Donald Mullen.
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