Question for Elementary Economics

[Econ101]

MORE DIVERSION FROM THE ECONOMIC PHONY!


Elementary, you said the difference between the cash price and the formula price is proof of market manipulation. HOW CAN THAT BE when the cash price and formula price are based on seperate weeks? The supply and demand factors driving the price one week could easily change by the next week. Where did anyone say anything about a "two week" difference. There is only a "one week" difference. Another of your damn lies.

It's a cold hard fact that supply and demand factors that affect cattle markets change from one week to the next. It's also a cold hard fact that formula and cash cattle that are delivered in the same week are priced on seperate weeks. You can't argue that fact so like the true phony you are, you just toss out some rambling crap you made up and try to impress your mindless followers with it.

EXPLAIN WHY THE FORMULA PRICE AND CASH PRICE SHOULD BE THE SAME WHEN THEY ARE PRICED ON SEPERATE WEEKS AND QUIT DANCING???

Are the supply and demand factors that affect cattle prices the same from week to week? YES OR NO?

You can answer that simple yes or no question can't you?


Provide me one example where you proved me wrong on anything. JUST ONE! BRING IT you cheap talker! Show me where you have ever backed a position you have taken WITH SUPPORTING FACTS! JUST ONE!


Your diversion is obvious!


I don't care about your unsupported "OPINION" on Australian and New Zealand imports, you are wrong about that too. They do benefit U.S. producers by adding value to our surplus 50/50 trim. You are simply too ignorant of this industry to understand that while we add value to the chuck and round, we import cheap lean trimmings to add value to a virtually worthless product. Packers pay accordingly just as they do according to boxed beef prices. If they didn't, their competition would.



~SH~

It is your assumption that the demand for two seperate weeks can not be managed by the packers, not mine. If they have the tools and the market power to combine two week's worth of supply into one supply function, then there is no difference. They obviously do have that power. Having supply delivery overlap, inventory, and captive supplies purchased over their needs all allows this. Ask Agman, he possibly makes the calculations on these items. Since you don't believe anything anyone says except Agman, why do you ask me these questions?

Please stop the name calling. Your characterizations of anyone knowing anything but you is another thing you and Agman might want to discuss.

Your imports argument is more of a dogfood argument than anything else. Quite personally, I like good cuts of meat and I will pay more for quality than the credit you give. There is a reason it is called trim. If the packers want to put 50/50 trim into hamburger, then it is for their own benefit, not the producer's. Imports may make beef at the store a little cheaper (that too is debateable) but it has no benefits to the producers. Cheaper grocery store prices do not necessarily benefit domestic producers. It certainly does not when it is the result of imports.

Let us argue your (ignorant) argument on Choice/Select benefits on a seperate string. Can we not call names and all the juvinile stuff on it? Will you have enough of a case without the name calling?

 

[Anonymous]

Elementary: "It is your assumption that the demand for two seperate weeks can not be managed by the packers, not mine. If they have the tools and the market power to combine two week's worth of supply into one supply function, then there is no difference. They obviously do have that power. Having supply delivery overlap, inventory, and captive supplies purchased over their needs all allows this."

"IF" .....more speculation!


Three problems with this conspiracy theory:

1. If packers had this ability, why wouldn't they use it all the time?

WHAT FACTORS ALLOW FOR SELECTIVE PERIODS OF MARKET MANIPULATION?

2. Packers have to get cattle bought against the other packing companies. Nobody is locked into one packing company or one pricing mechanism within that packing company.

3. If the formula price is better, THE BLAMERS SHOULD HAVE SOLD ON THE FORMULA PRICE. Perhaps the reason they didn't is because their cattle would not have paid well on the grid.


You have nothing to support your baseless market manipulation conspiracy theories but your biased "OPINIONS", "THEORIES", "SUPPOSITION", and "CONJECTURE".

You got nothing but statements unsupported by fact. The ultimate phony!

Elementary: "Your imports argument is more of a dogfood argument than anything else."

That's right, if we didn't add value to all the surplus 50/50 trim from all those choice Y3 carcasses, it would be dogfood value and producers would be paid accordingly.

Elementary: "Imports may make beef at the store a little cheaper (that too is debateable) but it has no benefits to the producers."

You are absolutely wrong on this like you are with most of your baseless opinions.


~SH~

 

[Econ101]

Elementary: "It is your assumption that the demand for two seperate weeks can not be managed by the packers, not mine. If they have the tools and the market power to combine two week's worth of supply into one supply function, then there is no difference. They obviously do have that power. Having supply delivery overlap, inventory, and captive supplies purchased over their needs all allows this."

"IF" .....more speculation!


Three problems with this conspiracy theory:

1. If packers had this ability, why wouldn't they use it all the time?

WHAT FACTORS ALLOW FOR SELECTIVE PERIODS OF MARKET MANIPULATION?

2. Packers have to get cattle bought against the other packing companies. Nobody is locked into one packing company or one pricing mechanism within that packing company.

3. If the formula price is better, THE BLAMERS SHOULD HAVE SOLD ON THE FORMULA PRICE. Perhaps the reason they didn't is because their cattle would not have paid well on the grid.


You have nothing to support your baseless market manipulation conspiracy theories but your biased "OPINIONS", "THEORIES", "SUPPOSITION", and "CONJECTURE".

You got nothing but statements unsupported by fact. The ultimate phony!

Elementary: "Your imports argument is more of a dogfood argument than anything else."

That's right, if we didn't add value to all the surplus 50/50 trim from all those choice Y3 carcasses, it would be dogfood value and producers would be paid accordingly.

Elementary: "Imports may make beef at the store a little cheaper (that too is debateable) but it has no benefits to the producers."

You are absolutely wrong on this like you are with most of your baseless opinions.


~SH~

1.) If criminals own guns, why don't they use them all the time? If they are not using them when they are not committing a crime does that exonerate them? What a useless argument.

2.) You ignore market power. If one company controls most or even a large amount of the buying power in a market, then they can use it to influence prices. To use a simile, just as in an electric monopoly (don't get it confused with monopsony) the more market power you have, the more restricted you are in being able to discriminate in price. Sure, in the utility market, you can have the same argument that you make, that there are other forms of electricity production (generators, running private lines, windmills, treadmills in the rec. room hooked up to generators) but it just an argument to get around the abuse of market power abuses. Pickett established the fact that Tyson/IBP was a major market buyer whose buying impact affects the market (just plain old logic, SH).

3.) Does the formula price EVER make the price in the market go up compared to the cash price? Tyson had a mandate via the P&S to not discriminate against the cash market for essentially the same time/date of price determination and delivery. Pickett evidence showed that they did that. They jury believed it. Tyson had ample opportunity to discount this claim backed by the evidence presented by the plaintiffs to disprove this accusation, and were even asked to provide this (I would presume) in the discovery process with the formula pricing payouts compared to what they were offering in the cash market and they declined to do that. The plaintiffs, even without this gun, proved Tyson's guilt with the powder burns on their hands in the form the plaintiff's witnesses. Tyson just wants to hide behind the no gun, no crime theory. Sometimes the preponderance of evidence requires no gun. It was the jury's decision to make that determination and they did.

In answer to the second part of the question 3): It is not the market participants with their purchasing habits to make sure Tyson/IBP follows the law. It is Tyson's responsibility. On one hand packer backers want to make the argument that even the plaintiffs stated that Tyson's had a legitimate reason for having captive supply. On the other hand Tyson wants to blame the producers for allowing them to use it to shoot the mareket. What a sham.

 

[agman]

Elementary: "It is your assumption that the demand for two seperate weeks can not be managed by the packers, not mine. If they have the tools and the market power to combine two week's worth of supply into one supply function, then there is no difference. They obviously do have that power. Having supply delivery overlap, inventory, and captive supplies purchased over their needs all allows this."

"IF" .....more speculation!


Three problems with this conspiracy theory:

1. If packers had this ability, why wouldn't they use it all the time?

WHAT FACTORS ALLOW FOR SELECTIVE PERIODS OF MARKET MANIPULATION?

2. Packers have to get cattle bought against the other packing companies. Nobody is locked into one packing company or one pricing mechanism within that packing company.

3. If the formula price is better, THE BLAMERS SHOULD HAVE SOLD ON THE FORMULA PRICE. Perhaps the reason they didn't is because their cattle would not have paid well on the grid.


You have nothing to support your baseless market manipulation conspiracy theories but your biased "OPINIONS", "THEORIES", "SUPPOSITION", and "CONJECTURE".

You got nothing but statements unsupported by fact. The ultimate phony!

Elementary: "Your imports argument is more of a dogfood argument than anything else."

That's right, if we didn't add value to all the surplus 50/50 trim from all those choice Y3 carcasses, it would be dogfood value and producers would be paid accordingly.

Elementary: "Imports may make beef at the store a little cheaper (that too is debateable) but it has no benefits to the producers."

You are absolutely wrong on this like you are with most of your baseless opinions.


~SH~

1.) If criminals own guns, why don't they use them all the time? If they are not using them when they are not committing a crime does that exonerate them? What a useless argument.

2.) You ignore market power. If one company controls most or even a large amount of the buying power in a market, then they can use it to influence prices. To use a simile, just as in an electric monopoly (don't get it confused with monopsony) the more market power you have, the more restricted you are in being able to discriminate in price. Sure, in the utility market, you can have the same argument that you make, that there are other forms of electricity production (generators, running private lines, windmills, treadmills in the rec. room hooked up to generators) but it just an argument to get around the abuse of market power abuses. Pickett established the fact that Tyson/IBP was a major market buyer whose buying impact affects the market (just plain old logic, SH).

3.) Does the formula price EVER make the price in the market go up compared to the cash price? Tyson had a mandate via the P&S to not discriminate against the cash market for essentially the same time/date of price determination and delivery. Pickett evidence showed that they did that. They jury believed it. Tyson had ample opportunity to discount this claim backed by the evidence presented by the plaintiffs to disprove this accusation, and were even asked to provide this (I would presume) in the discovery process with the formula pricing payouts compared to what they were offering in the cash market and they declined to do that. The plaintiffs, even without this gun, proved Tyson's guilt with the powder burns on their hands in the form the plaintiff's witnesses. Tyson just wants to hide behind the no gun, no crime theory. Sometimes the preponderance of evidence requires no gun. It was the jury's decision to make that determination and they did.

In answer to the second part of the question 3): It is not the market participants with their purchasing habits to make sure Tyson/IBP follows the law. It is Tyson's responsibility. On one hand packer backers want to make the argument that even the plaintiffs stated that Tyson's had a legitimate reason for having captive supply. On the other hand Tyson wants to blame the producers for allowing them to use it to shoot the mareket. What a sham.

Packers are not blaming producers for allowing marketing agreements. They are merely stating a fact that the initiative to use marketing agreements was the brainchild of very progressive producers who tired of subsidizing the production of below average product. That is an undisputed fact and it is the best thing that happened in this industry. Absent that change the quality of beef would continue to erode as it did for at least two decades which was primary to the erosion in beef demand from 1980-1998. Blamers did nothing to alleviate the problem. Rather turn run around was a joint effort of very progressive producers and packers working together. If you have FACTS to dispute this please bring them to this forum.

 

[Econ101]

Agman, I have never, never, never, argued against more efficient price mechanisms. Formula pricing may bring efficiencies to the beef markets and probably do when used properly and not abused to capture supply away from the price setters of the market. The fraud is not that there is formuala pricing, but that formula pricing was used as a form of captive supply to thin the cash market. Any discrimination between the formula cattle and the cash price could substantiate these claims. I said could because I was not at the trial. The jury was. It was their responsibility to answer that question with the evidence presented.

It doesn't really matter who came of with formula pricing or captive supply pricing. The tools of the fraud could have been made up accidentally and there may even be some evidence pointing to that conclusion. The tools of the fraud, just like a gun, are not the issue. They are just fish. If the captive supply was used to depress the cash market, then the gun was fired and it shot the market. Tyson was holding that gun. Everyone knows it.

Again, differences in quality can be a reason for differences in price. That has never been in question. When GIPSA did not require that the beef industry show the payout sheets of formula pricing with independent testing to make sure that it was in fact correct (this goes to the sidebar discussion Mike brought up) and there was no evidence of the price setting cash market discrimination, they became a part of the fraud of incompetence or corruption also. JoAnn Waterfield can not escape that criticism and neither can her economic advisors or the committee that oversaw the flawed panhandle studies or lack of document collection for the Pickett manipulation time period.

The evidence required is quite simple. What was the real money that changed hands between the producer (or feeders; ie suppliers) and the packers based on? If formula cattle are graded after the hide comes off then the answer to that question is quite simple. Anyone (or their representative) who has an interest in seeing this grading to make sure of its accuracy should be welcome in the plant. That would be anyone selling fat cattle. I don't know the particulars of the business in this respect, but Mike's posting of lawyer arguments did give a little indication this was not allowed.

If cattle buyers did not know how cattle grade until after the hide comes off why in the world did they use the cash market as a price setter for the formula cattle? It seems a little biased to begin with. Don't tell me they didn't shoot the cattle market because they didn't know if the bullet was going to come out straight. That just will not fly. Weren't they told never to point a gun at anyone? That was another one of GIPSA's failed jobs.

Thanks for setting SH straight, but a lot of his posts could have been avoided if you had answered the question of imports when I asked you.

 

[Big Muddy rancher]

Agman, I have never, never, never, argued against more efficient price mechanisms. Formula pricing may bring efficiencies to the beef markets and probably do when used properly and not abused to capture supply away from the price setters of the market. The fraud is not that there is formuala pricing, but that formula pricing was used as a form of captive supply to thin the cash market. Any discrimination between the formula cattle and the cash price could substantiate these claims. I said could because I was not at the trial. The jury was. It was their responsibility to answer that question with the evidence presented.

It doesn't really matter who came of with formula pricing or captive supply pricing. The tools of the fraud could have been made up accidentally and there may even be some evidence pointing to that conclusion. The tools of the fraud, just like a gun, are not the issue. They are just fish. If the captive supply was used to depress the cash market, then the gun was fired and it shot the market. Tyson was holding that gun. Everyone knows it.

Again, differences in quality can be a reason for differences in price. That has never been in question. When GIPSA did not require that the beef industry show the payout sheets of formula pricing with independent testing to make sure that it was in fact correct (this goes to the sidebar discussion Mike brought up) and there was no evidence of the price setting cash market discrimination, they became a part of the fraud of incompetence or corruption also. JoAnn Waterfield can not escape that criticism and neither can her economic advisors or the committee that oversaw the flawed panhandle studies or lack of document collection for the Pickett manipulation time period.

The evidence required is quite simple. What was the real money that changed hands between the producer (or feeders; ie suppliers) and the packers based on? If formula cattle are graded after the hide comes off then the answer to that question is quite simple. Anyone (or their representative) who has an interest in seeing this grading to make sure of its accuracy should be welcome in the plant. That would be anyone selling fat cattle. I don't know the particulars of the business in this respect, but Mike's posting of lawyer arguments did give a little indication this was not allowed.

If cattle buyers did not know how cattle grade until after the hide comes off why in the world did they use the cash market as a price setter for the formula cattle? It seems a little biased to begin with. Don't tell me they didn't shoot the cattle market because they didn't know if the bullet was going to come out straight. That just will not fly. Weren't they told never to point a gun at anyone? That was another one of GIPSA's failed jobs.

Thanks for setting SH straight, but a lot of his posts could have been avoided if you had answered the question of imports when I asked you.

Your saying that the USDA inspectors and graders are committing fraud? They do ythe grading.

 

[agman]

Agman, I have never, never, never, argued against more efficient price mechanisms. Formula pricing may bring efficiencies to the beef markets and probably do when used properly and not abused to capture supply away from the price setters of the market. The fraud is not that there is formuala pricing, but that formula pricing was used as a form of captive supply to thin the cash market. Any discrimination between the formula cattle and the cash price could substantiate these claims. I said could because I was not at the trial. The jury was. It was their responsibility to answer that question with the evidence presented.

It doesn't really matter who came of with formula pricing or captive supply pricing. The tools of the fraud could have been made up accidentally and there may even be some evidence pointing to that conclusion. The tools of the fraud, just like a gun, are not the issue. They are just fish. If the captive supply was used to depress the cash market, then the gun was fired and it shot the market. Tyson was holding that gun. Everyone knows it.

Again, differences in quality can be a reason for differences in price. That has never been in question. When GIPSA did not require that the beef industry show the payout sheets of formula pricing with independent testing to make sure that it was in fact correct (this goes to the sidebar discussion Mike brought up) and there was no evidence of the price setting cash market discrimination, they became a part of the fraud of incompetence or corruption also. JoAnn Waterfield can not escape that criticism and neither can her economic advisors or the committee that oversaw the flawed panhandle studies or lack of document collection for the Pickett manipulation time period.

The evidence required is quite simple. What was the real money that changed hands between the producer (or feeders; ie suppliers) and the packers based on? If formula cattle are graded after the hide comes off then the answer to that question is quite simple. Anyone (or their representative) who has an interest in seeing this grading to make sure of its accuracy should be welcome in the plant. That would be anyone selling fat cattle. I don't know the particulars of the business in this respect, but Mike's posting of lawyer arguments did give a little indication this was not allowed.

If cattle buyers did not know how cattle grade until after the hide comes off why in the world did they use the cash market as a price setter for the formula cattle? It seems a little biased to begin with. Don't tell me they didn't shoot the cattle market because they didn't know if the bullet was going to come out straight. That just will not fly. Weren't they told never to point a gun at anyone? That was another one of GIPSA's failed jobs.

Thanks for setting SH straight, but a lot of his posts could have been avoided if you had answered the question of imports when I asked you.

Data from cattle sold on formulas or grids are made available to the producer. The grade is not determined by the packer but USDA graders. To suggest or imply otherwise is simply wrong. Why is it that you claim Tyson was guilty when other packers used identical or similar contracts. Contrary to plaintiffs many claims the evidence also showed that Tyson was the major buyer in the cash market. Purchase records clearly showed they did not withdraw from the cash market. They were not always the price leader either as originally claimed by the plaintiffs. Under testimony plaintiff's witnesses under oath said that the price leader varied amongst different packers. That is as expected as they have different needs and have different inventory postions.

I did not set SH straight on anything. Imports are beneficial to U.S producers if you look beyond the import itself and look at the added value. That added value was not the sole ownership and benefit to packers as you have claimed. Producers benefited from higher prices than otherwise would have existed. The net is measured in +$$$$$.

An argument to the contrary is as phony and short sighted as Bullard's recent statement that producers did not benefit from the gain in beef demand from 1998-2002; all the gains went to packers and retailers. Even as uninformed as you are you cannot not be so naive as to support that statement which is born of ignorance or is just an outright lie.

I don't believe even you would honestly dispute these facts as not representing improved demand. In 1998 per capita consumption of beef was 66.7 pounds with a price paid to producers of $61.80/cwt. In 2002 per capita consumption was 67.6 with a price paid to producers of $67.50/cwt. Demand is being measured at the producer level.

For the quarter just ended per capita consumption was almost identical to that in the third quarter of 1998 and cash prices averaged $21.78/cwt higher than in 1998 measured at the producer level. If producers did not benefit where did their higher prices come from that they recieved? I guess Tyson and other packers were just generous!! Who does Bullard think he is kidding? Does he assume all producers are more ignorant than he and no one will challenge him for such an blatant untruth?

BTW, why did you not challenge his statement since it was made in Texas. Either you are not aware of the facts regarding demand in which case you should retract almost every statement and claim you have made on these forums or you encourage mistruths by your silence and encourage demagoguery from R-Calf leadership - facts be damned.

 

[Econ101]

Agman,

As to the other packers sometimes being the price leader or other packers sometimes not being sued by the plaintiffs, who cares? They might have their own day in court. If they were discriminating against the cash market I am sure they will have to answer for that themselves. It only takes a group of 4 packers to rotate. It is historical that this has happened already in packer history. If they rotated the role of price leader it really doesn't matter as far as the case against Tyson was concerned. Even if you are the largest buyer in the cash market you can still be discriminating against it. The plaintiffs sued IBP/Tyson. Let the other packers do their own defense. It is not a defense for cheating to say that everyone else was cheating. My kids try that one all the time. We don't let them get away with it. You are responsible for your own actions. Moot point.

As far as just outright trusting the USDA or anyone else for that matter, you gotta be kidding. Trust but verify. Verification could be very easy if it was allowed. If we were to trust the government on everything we would not have three seperate but equal parts of government. Our founding fathers knew it was a bad idea and history has proven it. It has been my experience not to trust the average politician anyway. Pareto said it best when he described the foxes and the lions. Congress has already spent the SS trust fund. There are only IOUs. Do you trust Congress? I could go on and on about this one. Trust but verify. If there is no way to put a check on USDA inspectors then they are not accountable. Trust but verify.

Imports of beef are beneficial to domestic producers? You gotta be kidding. Only an imaginative mind could make that one up. I believe in free and fair trade but that statement just goes too far. The net is not measured in positive dollars unless it is some kind of Enron accounting. When that trim is combined with Australian or New Zealand imports, there is more ground beef on the market. When there is more ground beef on the market, there is more price pressure on beef. If you can't even get that one right there is really something wrong with your reasoning. I did notice that you used a qualifier of "if you look beyond import itself........" to make the statements you made. We are talking about the imports, not discounting them and then making an analysis. Go read Sandhusker's post on this issue. Quite succinct. Imported beef is a substitute for domestic production. Period. When that substitute is used, the domestic producer gets less money. Period. Try to sell that one to any economist and you have a fool if they agree with you. If you want to argue that imported lean meat allows for more corn fed fatter domestic meat you still can not win that argument.

I don't listen to Bullard's statements. I barely know who he is. He is some R-CALF speaker or something. I haven't read anything he has written to my knowledge unless it was posted on this forum and I don't follow his arguments. I don't know what he looks like and I have never even tried to see him. I don't even know too many R-CALF people. Texas is a big state. I know quite a few people from Texas but I don't know everyone who visits and gives a speech. If you want to follow Bullard and argue over what he says, then find someone who does the same thing and talk to them. It is not me.

The reason that producers are getting high prices today is that there is low supply compared to the demand. Part of the reason there is low supply (and I don't claim it is the only reason, as it never is) because in previous years cattlemen have not recieved enough money to make them produce more. Producing more does not just happen. There is a biological cycle that is lengthy compared to the substitutes and compared to demand. A slide down the supply curve by downward pressure on prices has just this effect. It is these factors that help allow cattle markets to be manipulated downward instead of having more stable supply because of stable prices.
The elasticity of supply is inelastic.

By the way, I do appreciate your more sparse use of calling names and making judgements when someone does not agree with you compared to SH. Just a little more and we can have some real discussions.

Do you want to take your qualifier off of the import question?

 

[Murgen]

I don't listen to Bullard's statements. I barely know who he is. He is some R-CALF speaker or something. I haven't read anything he has written to my knowledge unless it was posted on this forum and I don't follow his arguments

ECON, why are you so defensive about knowing anything about RCALF?

In many of your posts, you deny knowing anything about RCALF or it's management, why is that?

"I don't listen to Bullard's statements", I guess not, you "barely know who he is"

"and I don't follow his arguments", but his arguments are your arguments, to a "T"

We all have problem following his arguments!

Check with Reader, she has some insight on "paid hacks"

 

[Anonymous]

Elementary: 1.) If criminals own guns, why don't they use them all the time? If they are not using them when they are not committing a crime does that exonerate them? What a useless argument.

Diversion from explaining what factors allow this "ALLEGED" market manipulation to occur. You don't know what factors allow "SUPPOSED"
market manipulation to occur at some times and not at others so you divert. True to your deceptive form!

This is not murder or armed robbery we are talking about, this is buying vs. selling fat cattle. What kind of fairy tale imagination could draw a comparison between the two?

Oh, never mind, almost forgot who I was dealing with here. Silly me!

Elementary: 2.) You ignore market power.

Diversion from explaining how there can be market abuse when Tyson needs to get the cattle bought against Swift, Excel, and USPB along with many level two packers with numerous pricing mechanisms.

When ibp's profitability information was subpoenoed into court, their per head profits for this period of "SUPPOSED" market manipulation was $26 per head. Go ask your local locker plants how many of them can slaughter cattle for $26 a head and still manipulate prices?

The market manipulation conspiracy theory is nothing more than a baseless allegation unsupported by facts. After your many presentations of theory, opinion, conjecture, and supposition, it remains a conspiracy theory unsupported by facts. You have no facts to back this theory. NONE! PURE SPECULATION and nothing more.

Let me repeat, YOU HAVE NOT BROUGHT ONE STITCH OF PROOF TO BACK THIS MARKET MANIPULATION CONSPIRACY THEORY OF YOURS, NOT ONE. NOR HAVE YOU CONTRADiCTED ANYTHING I HAVE STATED WITH FACTS TO THE CONTRARY, NOT ONE!

Elementary: 3.) Does the formula price EVER make the price in the market go up compared to the cash price?"

Diversion from the fact that any of the plaintiffs could have sold their cattle in the formula market rather than alleging market manipulation because the formula price was better than the cash price.

The formula price changes continually. It can be higher or lower than the cash market depending on which direction the market is moving. If you knew anything about what you speak, you'd know that too.

Elementry: "Tyson had ample opportunity to discount this claim backed by the evidence presented by the plaintiffs to disprove this accusation, and were even asked to provide this (I would presume) in the discovery process with the formula pricing payouts compared to what they were offering in the cash market and they declined to do that. The plaintiffs, even without this gun, proved Tyson's guilt with the powder burns on their hands in the form the plaintiff's witnesses. Tyson just wants to hide behind the no gun, no crime theory. Sometimes the preponderance of evidence requires no gun. It was the jury's decision to make that determination and they did."

The burden of proof is not on that accused, the burden of proof is on the accuser. Anyone who knows anything about law knows that. How many times have I told you that? You still don't get it.

Elementary: "In answer to the second part of the question 3): It is not the market participants with their purchasing habits to make sure Tyson/IBP follows the law. It is Tyson's responsibility. On one hand packer backers want to make the argument that even the plaintiffs stated that Tyson's had a legitimate reason for having captive supply. On the other hand Tyson wants to blame the producers for allowing them to use it to shoot the mareket. What a sham".

There was no proof of any law being broken. Dropping your price to reflect your needs does not constitute market manipulation as the jury was led to believe. Judge Strom overruled the verdict as a matter of law and the 11th circuit upheld the decision. There was no PSA violation.

The packer blamers lost but you simply cannot accept that fact so you keep throwing out the same baseless allegations as if they had merit.

Nice job diverting all of my points because you didn't have an answer as if I could expect anything less from someone as "factually void" as you are.

Elementary: "The fraud is not that there is formuala pricing, but that formula pricing was used as a form of captive supply to thin the cash market. Any discrimination between the formula cattle and the cash price could substantiate these claims."

WAS USED TO THIN THE CASH MARKET???????

Formula pricing is not something packers initiate. They either have willing sellers or they don't have any formula cattle DO THEY?????

You act like this is something packers can initiate on their own. As most of the packer's needs are met in the formula market, naturally the price they offer for cash cattle will drop. SUPPLY AND DEMAND!

If the plaintiffs didn't like the price they were bid from Tyson, they should have sold to Excel or Swift or USPB. Nobody had a gun to their heads forcing them to sell to Tyson after Tyson lowered their cash price due to having their needs filled in the formula market. This is such bullsh*t!

As ibp's formula supply increased, their cash price decreased. A normal supply and demand reaction in the market that you packer blamers have somehow defined as market manipulation.

Elementary: " When GIPSA did not require that the beef industry show the payout sheets of formula pricing with independent testing to make sure that it was in fact correct (this goes to the sidebar discussion Mike brought up) and there was no evidence of the price setting cash market discrimination, they became a part of the fraud of incompetence or corruption also."

Yet another baseless conspiracy theory unsupported by fact presented by Elementary Economics.

Elementary: "If formula cattle are graded after the hide comes off then the answer to that question is quite simple. Anyone (or their representative) who has an interest in seeing this grading to make sure of its accuracy should be welcome in the plant. That would be anyone selling fat cattle."

"IF" FORMULA CATTLE ARE GRADED AFTER THE HIDE COMES OFF????

That's the whole premise behind grid pricing, why would you question "WHEN" they are graded? You are such a phony and you just proved it again.

The issue was never the grade of the formula cattle? More sh*t you threw against the wall.

You literally don't have a clue how this industry operates do you?

The graders are USDA inspectors and they are held accountable because they work for the government. They don't work for the packer or the producer and they are held accountable.

Elementary: "If cattle buyers did not know how cattle grade until after the hide comes off why in the world did they use the cash market as a price setter for the formula cattle?"

YOU DID IT AGAIN!

With that statement, you once again defined your ignorance of this industry. HOW THE HELL CAN YOU GRADE A CARCASS BEFORE THE HIDE COMES OFF?????? VIDEO IMAGING IS NOT ACCURATE ENOUGH TO GIVE YOU AN EXACT QUALITIY GRADE AND RIBEYE AREA!!!!

The base price has nothing to do with the discounts and premiums for quality. HAVE YOU EVER SEEN A GRID PRICING SYSTEM?????

The base price is established then the carcass premiums and discounts are added or subtracted from that base price. What better means of establishing a base price than from the cash market? Prior to the premiums and discounts, the base price would be just like the cash market in that you don't know exactly how the cattle will grade and yield until they are graded.

These grids offer premiums and discounts for quality grade (choice, select, etc.), Yield grade (ribeye in relation to backfat), and carcass size.

Once again, you have left absolutely no doubt as to your ignorance of this industry with that one.

Elementary: "When that trim is combined with Australian or New Zealand imports, there is more ground beef on the market. When there is more ground beef on the market, there is more price pressure on beef. If you can't even get that one right there is really something wrong with your reasoning."

Elementary: "Imported beef is a substitute for domestic production. Period. When that substitute is used, the domestic producer gets less money. Period. Try to sell that one to any economist and you have a fool if they agree with you."

At least with this issue I can understand your confusion.

You have to look at the value of the various ground beef products. 50/50 Trim is worthless unless you blend lean ground beef with it to take it to at least a 70/30 level of 30% fat. The leaner it is, the more value it has.

50/50 is a stand alone product. You either lean it down or it's worth $.08 per pound. Your next challenge is to find a source of CHEAP lean trimmings. Why cheap? It has to be cheap or you cannot justify taking a product that is worth more (chuck and round) and grinding it up to add value to 50/50 trim. Cheap lean trimmings simply are not available in the U.S. to meet the supply of 50/50 trim. You either import it, or you reduce the value of 50/50 trim to dogfood because only a complete idiot would devalue the carcass by grinding the products that they have added value to.

If we can get to the point where you understand that you either find a cheap source of lean trimmings or 50/50 trim is worth $.08 per pound then we take the next step.

Obviously, if you take a product that is worth $.08 per pound and make it worth $1.00 a pound or more, you have added value to that product.

If the 50/50 trim is worth more due to the ability of a packer to add value to it by blending imported lean trimmings, then they pay accordingly for that product.

You are absolutely wrong on this issue Elementary as you are with most of your positions.



~SH~

 

[Econ101]

I don't listen to Bullard's statements. I barely know who he is. He is some R-CALF speaker or something. I haven't read anything he has written to my knowledge unless it was posted on this forum and I don't follow his arguments

ECON, why are you so defensive about knowing anything about RCALF?

In many of your posts, you deny knowing anything about RCALF or it's management, why is that?

"I don't listen to Bullard's statements", I guess not, you "barely know who he is"

"and I don't follow his arguments", but his arguments are your arguments, to a "T"

We all have problem following his arguments!

Check with Reader, she has some insight on "paid hacks"

Murgen,

I don't know r-calf's people and I haven't even read their stance. There is a rancher guy I do some business with and he is an r-calf person. I know this because he has an r-calf sticker on his truck. I think he is originally from Ohio, as that is what he has told me. I don't think he knows a whole lot about the things that are talked about on this board because I have asked him (I see him rarely).

If you know how I can get some extra pay for believing what I believe in then by all means bring them to me. I keep making the disclaimer about r-calf because I can see some positions they may take and why they might take them but I don't want anyone to think that I represent them in any way because I don't.

I see what is happening in the food industries and I don't like it. I was in FFA when in highschool and the creed starts with, "I believe in the future of farming with a faith born not of words but of deeds......". I look at my mom's cousin who farmed about 3500 acres in Louisiana and took on his parent's little country store when they passed away. He stopped farming. He says that he makes more money at the little store than he did farming and I think that is indicative of what we are seeing in this industry. The future of farming is quickly being captured by those with market power and control of the "bottlenecks" and levers of economic power (buying power).

Many of the benefits of the subsidies that have been given have not gone to the farmers. Many times they didn't even touch the money as it was already tied up with the bankers and others. Some of these people work really hard. They are not stupid. It is just what is happening in the industry.

I don't know if I believe any more that there is a future in farming that is worthwhile unless we stop the trend. Sure, there will always be farms and family farmers, but the value of their assets and labor is being siphoned away from them. It is not only in cattle. It is poultry, pork, and all of the row crops. If we (people in general) want to talk about food security and homeland security, maybe we need to re-think what we are doing.

My grandfather probably rode on a horse more than in a vehicle. He and his father were in the same type of battles over the same issues we see today. With this industrialization of the agriculture industries we are seeing more and more of the same type of abuses all in the name of "efficiency" where the only efficiency is the bean counting that agribusiness is doing. It isn't efficient to starve farming and I don't believe it is in the interest of the nation to give so much control to our food supply just a handful of companies who have inordinate influence over our government. Just look at how the BSE issue is being handled.

R-calf is just the cattle part of agriculture. By no means are they the only sector having these problems.

A cheap food policy based on agribusiness "efficiency" is taking us down a road that is not good, in my opinion, in the long run.

Secretary Johann's wife told me after I spoke to her on some of these issues and problems I saw with Tyson that "Tyson is pretty big on the hill" with a grimace on her face. That is too much control.

Elected and appointed leaders who are not willing to take on these kind of forces should step aside and let the real lions do their work.

 

[Jason]

From that last post Econ just step up be a man and say you support garanteed profit margins for family farms. The government has to set a size that makes it a family farm and then no matter how efficient or inefficient they are they are garanteed to make the average US household income.

I wonder what the US will do for crops when productivity falls?

 

[Econ101]

From that last post Econ just step up be a man and say you support garanteed profit margins for family farms. The government has to set a size that makes it a family farm and then no matter how efficient or inefficient they are they are garanteed to make the average US household income.

I wonder what the US will do for crops when productivity falls?

Jason, I would never support what you propose. However, the laws, rules, regulations, taxes, regulatory proficiency, and political leaders need to stop kissing corporations and the wealthy who donate money to them and their power base. That influence stinks.

Tyson has a heck of a presence on the hill and farmers little. If you hve been reading any of my posts you would understand that I am not for tilting it all towards the producer side, just enough to get the balance back. You are one to be speaking about govt. handouts. That is SH's or Agman's game to jump to the conclusion and say I support guaranteed profits to producers. Are you buddying up to them?

I sure don't support guaranteed profits to rich people. They have enough advantages already. Maybe that is one of the differences between you and I.

 

[agman]

From that last post Econ just step up be a man and say you support garanteed profit margins for family farms. The government has to set a size that makes it a family farm and then no matter how efficient or inefficient they are they are garanteed to make the average US household income.

I wonder what the US will do for crops when productivity falls?

Jason, I would never support what you propose. However, the laws, rules, regulations, taxes, regulatory proficiency, and political leaders need to stop kissing corporations and the wealthy who donate money to them and their power base. That influence stinks.

Tyson has a heck of a presence on the hill and farmers little. If you hve been reading any of my posts you would understand that I am not for tilting it all towards the producer side, just enough to get the balance back. You are one to be speaking about govt. handouts. That is SH's or Agman's game to jump to the conclusion and say I support guaranteed profits to producers. Are you buddying up to them?

I sure don't support guaranteed profits to rich people. They have enough advantages already. Maybe that is one of the differences between you and I.

It is a hoot for you to CLAIM you do not jump to conclusions. That is all you ever do. You never provide any support except one more phony accusation.

Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact. You are really over your head when you try to explain your version of the cattle cycle via price manipulation. What caused the cattle cycle prior to "marketing agreements"? Do you not know there has been a cattle cycle as long as inventory data has been maintained?

 

[Econ101]

From that last post Econ just step up be a man and say you support garanteed profit margins for family farms. The government has to set a size that makes it a family farm and then no matter how efficient or inefficient they are they are garanteed to make the average US household income.

I wonder what the US will do for crops when productivity falls?

Jason, I would never support what you propose. However, the laws, rules, regulations, taxes, regulatory proficiency, and political leaders need to stop kissing corporations and the wealthy who donate money to them and their power base. That influence stinks.

Tyson has a heck of a presence on the hill and farmers little. If you hve been reading any of my posts you would understand that I am not for tilting it all towards the producer side, just enough to get the balance back. You are one to be speaking about govt. handouts. That is SH's or Agman's game to jump to the conclusion and say I support guaranteed profits to producers. Are you buddying up to them?

I sure don't support guaranteed profits to rich people. They have enough advantages already. Maybe that is one of the differences between you and I.

It is a hoot for you to CLAIM you do not jump to conclusions. That is all you ever do. You never provide any support except one more phony accusation.

Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact. You are really over your head when you try to explain your version of the cattle cycle via price manipulation. What caused the cattle cycle prior to "marketing agreements"? Do you not know there has been a cattle cycle as long as inventory data has been maintained?

Agman, I learned about the cattle cycle in highschool. So what? Are you trying to say I don't know it exists? Stop jumping. The cattle cycle can be influenced and often is, by price. It is a longer term phenomena. That is exactly my point. The supply of cattle is relatively inelastic. I say relative because everything is relative. In this case the comparison is between prices and supply over time. I never said that Pickett's price manipulation was the cause of the cattle cycle. That was your jump. I said it influenced it. Can you honestly say that if prices were not depressed that there would not be more supply? Do prices affect supply or was Mike C. right?

Are you turning into SH? "Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact." It looks like you two trade lines all the time. Can't you come up with something more original?

 

[agman]

Jason, I would never support what you propose. However, the laws, rules, regulations, taxes, regulatory proficiency, and political leaders need to stop kissing corporations and the wealthy who donate money to them and their power base. That influence stinks.

Tyson has a heck of a presence on the hill and farmers little. If you hve been reading any of my posts you would understand that I am not for tilting it all towards the producer side, just enough to get the balance back. You are one to be speaking about govt. handouts. That is SH's or Agman's game to jump to the conclusion and say I support guaranteed profits to producers. Are you buddying up to them?

I sure don't support guaranteed profits to rich people. They have enough advantages already. Maybe that is one of the differences between you and I.

It is a hoot for you to CLAIM you do not jump to conclusions. That is all you ever do. You never provide any support except one more phony accusation.

Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact. You are really over your head when you try to explain your version of the cattle cycle via price manipulation. What caused the cattle cycle prior to "marketing agreements"? Do you not know there has been a cattle cycle as long as inventory data has been maintained?

Agman, I learned about the cattle cycle in highschool. So what? Are you trying to say I don't know it exists? Stop jumping. The cattle cycle can be influenced and often is, by price. It is a longer term phenomena. That is exactly my point. The supply of cattle is relatively inelastic. I say relative because everything is relative. In this case the comparison is between prices and supply over time. I never said that Pickett's price manipulation was the cause of the cattle cycle. That was your jump. I said it influenced it. Can you honestly say that if prices were not depressed that there would not be more supply? Do prices affect supply or was Mike C. right?

Are you turning into SH? "Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact." It looks like you two trade lines all the time. Can't you come up with something more original?

I did not say that you said the Pickett case caused the recent cattle cycle. What I said was that you have stated price manipulation is part of the cattle cycle. Have you forgotten your own posts?

You understanding of the cylcle is so shallow it is not even worth commenting on. Everytime you make a statement you dispaly for readers how little you know, not how much you know. What you don't know is much more relevant than what you claim to know. I will rephrase my question. If "marketings agreements" are synonymous with price manipulation then what caused the cattle cycle prior to marketing agreements or the level of packer concentratrion that exists today. If you even have to question whether Mike C was right then you are even less knowledgeable than you already appear. That would truly be a sad situation for any individual much less someone like yourself who professes to be an expert in supply/demand analysis.

Who was present, when and where were those closed door meetings in the Pickett case? Are you in denial of that scandalous statement you made? Is that why you have refused repeatedly to answer the question. If you cannot answer the question what does that make you?

 

[Econ101]

It is a hoot for you to CLAIM you do not jump to conclusions. That is all you ever do. You never provide any support except one more phony accusation.

Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact. You are really over your head when you try to explain your version of the cattle cycle via price manipulation. What caused the cattle cycle prior to "marketing agreements"? Do you not know there has been a cattle cycle as long as inventory data has been maintained?

Agman, I learned about the cattle cycle in highschool. So what? Are you trying to say I don't know it exists? Stop jumping. The cattle cycle can be influenced and often is, by price. It is a longer term phenomena. That is exactly my point. The supply of cattle is relatively inelastic. I say relative because everything is relative. In this case the comparison is between prices and supply over time. I never said that Pickett's price manipulation was the cause of the cattle cycle. That was your jump. I said it influenced it. Can you honestly say that if prices were not depressed that there would not be more supply? Do prices affect supply or was Mike C. right?

Are you turning into SH? "Your ignorance of business is astonishing. Your opinions are derived from ignorance not fact." It looks like you two trade lines all the time. Can't you come up with something more original?

I did not say that you said the Pickett case caused the recent cattle cycle. What I said was that you have stated price manipulation is part of the cattle cycle. Have you forgotten your own posts?

You understanding of the cylcle is so shallow it is not even worth commenting on. Everytime you make a statement you dispaly for readers how little you know, not how much you know. What you don't know is much more relevant than what you claim to know. I will rephrase my question. If "marketings agreements" are synonymous with price manipulation then what caused the cattle cycle prior to marketing agreements or the level of packer concentratrion that exists today. If you even have to question whether Mike C was right then you are even less knowledgeable than you already appear. That would truly be a sad situation for any individual much less someone like yourself who professes to be an expert in supply/demand analysis.

Who was present, when and where were those closed door meetings in the Pickett case? Are you in denial of that scandalous statement you made? Is that why you have refused repeatedly to answer the question. If you cannot answer the question what does that make you?

Agman, I did not say that price manipulation was part of the cattle cycle. You are getting two things mixed up again. I said it influences the cattle cycle. When prices are depressed it reduces supply. As you know supply reductions only happen over longer periods of time. It is based partly on the biological reproduction cycle of cattle. You can't just have high prices and then have more supply. Cattle ranchers have to get mother cows, bulls, and allow them to breed and then allow those heifers to grow up and have more calves etc..... It is the nature of the cattle reproductive cycle that creates the lengthy time of supply responding to price. When prices are reduced because of price manipulation as shown to the jury in the Pickett case, the supply eventually shrinks. When that supply does shrink, it causes prices to go up. Then you get people like Tam saying that the U.S. can't supply enough cattle for the U.S.

I have never said that marketing agreements are synonamous to market manipulation. It can be. It doesn't necessarily mean causuality. You can have a gun in your closet and not be a criminal. If you take the gun out and shoot someone then you might be a criminal. They are not causative. Your actions are your actions. If packers are discriminating against the price setting cash market then there is evidence of market manipulation (call it whatever you want).

Discrimination based on real quality characteristics is not what I am talking about. For instance, if the formula pricing (or captive supply) includes differences per lb. for select vs. choice, you should see those same characteristics of differences in price per lb. in the cash market. If you do not, then there could be market manipulation. You forget, for market manipulation to make a difference, the cash price has to be some kind of price setter. For the formula cattle it is. There could be other kinds of discrimination that would be illegal under the PSA. If a packer discriminated against a set of cattle that had to do with factors other than the differences in the cattle themselves, as in Mike C.'s case, then that would be unlawful. If the actions against a person like Mike C. was intended to intimidate people like Mike C. then it creates damage to the market also in addition to the actions against a person like Mike C. .

As you can see, you can not just make the kind of blanket statements that you attribute to me, especially since I didn't make them. If you need clarification of what I am talking about, just post my comments and I will give you the clarification. I don't need you or any of the other packer backers going into the childish mode of calling names as you repeatedly lower yourself and do.

I have stated before numerous times that the marketing agreements themselves are not the manipulation. They are the tools of the manipulation. You keep trying to tie those together for some reason. Probably to make up an argument in your own head that you can win. It is probably better left in your own head than for you to keep trying that tactic here. You will only confuse yourself as you continually do. If things get too complicated for you, don't start calling names or saying how dumb, ignorant, or stupid someone else is or rant and rave. It only makes you look childish and proves you do not have a logical argument to back with.

This is about the third time I have had to explain this to you. If your reading comprehension and memory are so poor, I would say that you have NO advantage in having access to the Pickett transcripts while I do not.

I have made a scandolous statement about the either incompetence at GIPSA and hence the USDA or the corruption. I stand behind it. Results matter. Every cattle producer/agriculture producer in America gets paid (except those on the govt. programs) based on the fruits of his/her labor. The same should be expected from our regulatory agencies that are facilitating the frauds being perpetrated on the American farmer (rancher) through the cozy relationship that Tyson and other large agribusiness has on our government. In the case of Mike C. , for example, (I don't know all of the particulars completely) it was said that GIPSA settled his claim without his input and without calculating total damages. If this is true, then GIPSA is just minimizing the culpability of the packing industry and shielding them from damage awards. This would be a total fraud. GIPSA officials acting in this regard should be held personally liable for these damages with an efficient means of obtaining them. May be a little jail time would not be too much to ask for in the right circumstances. (I don't really know much about this case, I am just using it as an example). May be something like that would clear up that rat's nest of inefficiency and corruption in the USDA.

As far as the particulars of your last question, those answers are for a different forum. This government has the transparency of a lead wall. We need some sunlight.

Do you still say producers have a net benefit from imports? If you do, you might get a job at GIPSA as that is the kind of thinking they seem to like if you don't already work there.

 

[pointrider]

Say folks, I just had a thought. How about we try it this way.

Econ101, you start it off. List for us 1-2-3-4-etc what things need to happen in the future for the industry to actually be operating the way you would like to see it operate.

Then SH or Agman or someone else could take a turn and say, "Here's what I think the chances are that those activities or processes will actually occur and why. Also, here is how I think the industry will actually operate along the same subject lines as those proposed by Econ101."

I think this would offer an interesting change in direction for the dialog, don't you? You ready to start it off Econ101?

 

[Anonymous]

More Elementary Economics Insanity (EEI)!

Elementary Economics: "When prices are depressed it reduces supply."

Elementary Economics: "When prices are reduced because of price manipulation as shown to the jury in the Pickett case, the supply eventually shrinks."

WHAT?????

Supply is not influenced by price, price is influenced by supply.

Where did you go to school? Excuse me, did you go to school?

Another example of your ignorance.

Elementary Economics: "For instance, if the formula pricing (or captive supply) includes differences per lb. for select vs. choice, you should see those same characteristics of differences in price per lb. in the cash market. If you do not, then there could be market manipulation."

YOU DON'T KNOW THE VALUE OF THE CASH CATTLE UNTIL THEIR HIDE COMES OFF AND THEY ARE PRICED BEFORE THEIR HIDE COMES OFF.

Another example of your ignorance.


Keep posting Elementary Economics!



~SH~

 

[Econ101]

SH:

WHAT?????

Supply is not influenced by price, price is influenced by supply.

Where did you go to school? Excuse me, did you go to school?

Another example of your ignorance.

SH, If you were to get nothing for your cattle, how many would you keep producing? You need to think before you post.

SH:

YOU DON'T KNOW THE VALUE OF THE CASH CATTLE UNTIL THEIR HIDE COMES OFF AND THEY ARE PRICED BEFORE THEIR HIDE COMES OFF.

Another example of your ignorance.


Keep posting Elementary Economics!

SH, If there is so much of a problem with the cash market, why is it used as a base for the formula pricing? You need to think before you post.