Does testing for causality matter or is it another fish?
Agman continually brings up the point that Taylor never tested his "theories" for causality and that this is a prerequisite of the plaintiffs (Pickett) to win the point that Taylor's calculations were correct. An understanding of the question shows that the causality point is just another fish for the unknowing who take the bait. When you really understand the issue, you will see that this point is just another argument to lure you away from the truth.
What is causality? Causality is a relationship between two events. Here is another definition that you can find on the web at:
http://pespmc1.vub.ac.be/ASC/CAUSALITY.html
(or Causation) A process linking two or more events or states of affairs so that one brings about or produces the other. One event is the cause of another if (a) the event occurs prior to the effect, (b) there is an invariant conjunction of the two events and (c) there is an underlying mechanism or physical structure attesting to the necessity of the conjunction. Since (c) is not always demonstrable in empirical data the requirement may be replaced by tests assuring that no third variable controls both or mediates between the two events. Without this weaker test, a cause may be termed spurious and genuine otherwise.
Agman is fond of pointing out that under testimony Taylor agreed he did not test his reasons that Tyson may want to alter the normal supply/demand outcome with marketing agreements and manipulation based on their buying strategy. The question is, do the reasons one may wish to manipulate the market need to be tested for causality or is that just a superfluous exercise?
To know the answer to that question you have to know the reason you test for causality and whether or not that reason is applicable. Causality is usually determined on a set of data with mathematical calculations. These calculations determine whether or not there is a cause and effect from the stated actions on the set of data. The only problem with the argument that causality must be determined is that first you must determine if indeed that is the correct question.
In the Pickett case, the reasons that Taylor gave for Tyson wanting to manipulate the market have no relevance or causality to the way they manipulated the markets. They were possible reasons for Tyson benefiting from their actions, not necessarily the way that was exercised and hence were not them selves causative. Agman is smart enough to know this, after all, he has the trial transcripts. When Agman brings up the point that Taylor did not test what he calls his "theories" (another word for reasons), he is bringing up a lawyer trick of making an issue out of something that was never the issue in the first place; the causative factor was Tyson's willingness to discriminate against the sellers in cash market for a greater gain, not the reasons they would do it. That gain was a lowering of the total market price for cattle paid by discriminating against the cash market in selective periods of time.
This above argument is similar to the marketing agreements argument. Marketing agreements can be legal, but their abuse can be illegal, just as guns can be legal, but their use in a crime could be illegal.
If you take the argument SH makes, that there are times when the cash price is higher than the captive supply price, you have to do an analysis to determine whether or not there is a significant difference between the two over periods of time. Those were the calculations that were done by Taylor. The results showed a depression of the cash market (due to discrimination against the cash market) of approximately 5%. This reduction of prices paid of 5% included ALL the times that the cash market was higher than the captive supply price. In other words, the reduction of the overall price paid for cattle that was calculated included the times that the cash price was higher. This shows that the arguments that SH makes has already been accounted for in the calculations. They are just anomalies in a data set, not statistically significant.
The next argument that is articulated is that there was no real benefit to Tyson to manipulate the market since they did not profit from the manipulation in the same amount of the calculated damages. Of course anyone who has knowledge of economics knows that this argument on its face is wrong. Deadweight losses make this a reality to all market manipulation schemes. SH readily admits that during the Tyson manipulation time periods, the average profit per head went up from a long term average of $3.88 to over $26.00 per head all the while cattle prices to producers was being driven down. This calculation itself shows how much more profit Tyson earned by the scheme they executed during the time it was executed. The real payoff came later, when this depression of the cattle prices lead to a reduction in the amount of cattle produced in the U.S. and the BSE crisis in Canada that led to an artificial shortage of beef on the market.
As I said before, beef is inelastic. The group of meats which includes chicken and pork (fish to a lesser degree) is more inelastic than beef alone. Here is a website in elasticity:
http://www.investopedia.com/university/economics/economics4.asp
When the supply of beef is restricted, along with pork and chicken, the price of all three go up more than the loss in revenue from less supply. Tyson benefits off of this phenomena, not in beef, where prices are currently passed on to the producers, but in poultry and pork, where increases in price are held by Tyson due to the market structure in those businesses. It is interesting to me that the ERS, which is supposed to just provide data to policy makers, has come out with the AMI in regards to Harkin's call to action in the meats industry. Here is the quote and source:
"AMI continues to oppose any expansion of existing authorities that would adversely inhibit producers and packers' ability to respond to the demands of consumers in a highly competitive market place. Coincidentally, USDA's Economic Research Service has repeatedly researched and recognized the value of the current structure and has not recommended an expansion of authorities."
Source: http://www.ellinghuysen.com/news/articles/28966.shtml
The ERS is making a policy decision that they know is wrong. Jim McDonald knows the structure of the poultry and pork industries, the main mechanism for the benefits to Tyson for the economic frauds against cattle producers.
Agman, you have been called out in your positions. You either don't know what you are talking about or you deliberately misleading people on this board as to the merits on the Pickett case. If you disagree with the above points, let us discuss them.
This isn't the first time I have called your hand, Agman. It is time to be truthful and mislead no more. It is time you admitted you are fishing with fake lures.
I hope we can continue the discussion on these points with civility. If you think I am wrong, let us discuss the issue further on this forum. If anyone else has some input, let us all try to stick to the points without the name calling. If you don't understand something, just ask. If you want to divert and try a little fishing with your own lures, start another thread. Remember, everyone has an opinion. It may be right, or it may be wrong. They are still entitled to their opinion. I will respect everyone's opinion but will argue (arguing is just a form of communication if done correctly nobody gets bloody) my view if I see it differently until I understand another's view or develop mine further.
Agman continually brings up the point that Taylor never tested his "theories" for causality and that this is a prerequisite of the plaintiffs (Pickett) to win the point that Taylor's calculations were correct. An understanding of the question shows that the causality point is just another fish for the unknowing who take the bait. When you really understand the issue, you will see that this point is just another argument to lure you away from the truth.
What is causality? Causality is a relationship between two events. Here is another definition that you can find on the web at:
http://pespmc1.vub.ac.be/ASC/CAUSALITY.html
(or Causation) A process linking two or more events or states of affairs so that one brings about or produces the other. One event is the cause of another if (a) the event occurs prior to the effect, (b) there is an invariant conjunction of the two events and (c) there is an underlying mechanism or physical structure attesting to the necessity of the conjunction. Since (c) is not always demonstrable in empirical data the requirement may be replaced by tests assuring that no third variable controls both or mediates between the two events. Without this weaker test, a cause may be termed spurious and genuine otherwise.
Agman is fond of pointing out that under testimony Taylor agreed he did not test his reasons that Tyson may want to alter the normal supply/demand outcome with marketing agreements and manipulation based on their buying strategy. The question is, do the reasons one may wish to manipulate the market need to be tested for causality or is that just a superfluous exercise?
To know the answer to that question you have to know the reason you test for causality and whether or not that reason is applicable. Causality is usually determined on a set of data with mathematical calculations. These calculations determine whether or not there is a cause and effect from the stated actions on the set of data. The only problem with the argument that causality must be determined is that first you must determine if indeed that is the correct question.
In the Pickett case, the reasons that Taylor gave for Tyson wanting to manipulate the market have no relevance or causality to the way they manipulated the markets. They were possible reasons for Tyson benefiting from their actions, not necessarily the way that was exercised and hence were not them selves causative. Agman is smart enough to know this, after all, he has the trial transcripts. When Agman brings up the point that Taylor did not test what he calls his "theories" (another word for reasons), he is bringing up a lawyer trick of making an issue out of something that was never the issue in the first place; the causative factor was Tyson's willingness to discriminate against the sellers in cash market for a greater gain, not the reasons they would do it. That gain was a lowering of the total market price for cattle paid by discriminating against the cash market in selective periods of time.
This above argument is similar to the marketing agreements argument. Marketing agreements can be legal, but their abuse can be illegal, just as guns can be legal, but their use in a crime could be illegal.
If you take the argument SH makes, that there are times when the cash price is higher than the captive supply price, you have to do an analysis to determine whether or not there is a significant difference between the two over periods of time. Those were the calculations that were done by Taylor. The results showed a depression of the cash market (due to discrimination against the cash market) of approximately 5%. This reduction of prices paid of 5% included ALL the times that the cash market was higher than the captive supply price. In other words, the reduction of the overall price paid for cattle that was calculated included the times that the cash price was higher. This shows that the arguments that SH makes has already been accounted for in the calculations. They are just anomalies in a data set, not statistically significant.
The next argument that is articulated is that there was no real benefit to Tyson to manipulate the market since they did not profit from the manipulation in the same amount of the calculated damages. Of course anyone who has knowledge of economics knows that this argument on its face is wrong. Deadweight losses make this a reality to all market manipulation schemes. SH readily admits that during the Tyson manipulation time periods, the average profit per head went up from a long term average of $3.88 to over $26.00 per head all the while cattle prices to producers was being driven down. This calculation itself shows how much more profit Tyson earned by the scheme they executed during the time it was executed. The real payoff came later, when this depression of the cattle prices lead to a reduction in the amount of cattle produced in the U.S. and the BSE crisis in Canada that led to an artificial shortage of beef on the market.
As I said before, beef is inelastic. The group of meats which includes chicken and pork (fish to a lesser degree) is more inelastic than beef alone. Here is a website in elasticity:
http://www.investopedia.com/university/economics/economics4.asp
When the supply of beef is restricted, along with pork and chicken, the price of all three go up more than the loss in revenue from less supply. Tyson benefits off of this phenomena, not in beef, where prices are currently passed on to the producers, but in poultry and pork, where increases in price are held by Tyson due to the market structure in those businesses. It is interesting to me that the ERS, which is supposed to just provide data to policy makers, has come out with the AMI in regards to Harkin's call to action in the meats industry. Here is the quote and source:
"AMI continues to oppose any expansion of existing authorities that would adversely inhibit producers and packers' ability to respond to the demands of consumers in a highly competitive market place. Coincidentally, USDA's Economic Research Service has repeatedly researched and recognized the value of the current structure and has not recommended an expansion of authorities."
Source: http://www.ellinghuysen.com/news/articles/28966.shtml
The ERS is making a policy decision that they know is wrong. Jim McDonald knows the structure of the poultry and pork industries, the main mechanism for the benefits to Tyson for the economic frauds against cattle producers.
Agman, you have been called out in your positions. You either don't know what you are talking about or you deliberately misleading people on this board as to the merits on the Pickett case. If you disagree with the above points, let us discuss them.
This isn't the first time I have called your hand, Agman. It is time to be truthful and mislead no more. It is time you admitted you are fishing with fake lures.
I hope we can continue the discussion on these points with civility. If you think I am wrong, let us discuss the issue further on this forum. If anyone else has some input, let us all try to stick to the points without the name calling. If you don't understand something, just ask. If you want to divert and try a little fishing with your own lures, start another thread. Remember, everyone has an opinion. It may be right, or it may be wrong. They are still entitled to their opinion. I will respect everyone's opinion but will argue (arguing is just a form of communication if done correctly nobody gets bloody) my view if I see it differently until I understand another's view or develop mine further.
