[LINK] A Comparison between Pig Farming and Mining.
tomk at unwired.com.au
Mon Apr 2 14:56:44 EST 2012
There are two schools of thought when running a piggery.
School of thought process number one.
Select the largest and fattest pigs to be slaughtered first, this
results in higher return by volume (makes the numbers look good, NOW).
Alternative School of thought.
Take the largest and fattest pigs and make them the breeders of the next
generation of bacon.
In the 3,599 years of mans recorded agricultural history, experience has
taught man that it is common sense to make the largest and healthiest
animals the seed stock for increasing future profitability and from that
seed stock build additional sustainable wealth.
Mining showed weaker profits in 2009-10, with OPBT decreasing $11.9b
(18.8%), EBITDA decreasing $15.8b (21.5%) and IVA decreasing $19.1b
(17.9%). The percentage decreases in these aggregates are the highest of
all the Total selected industries. The Mining industry was impacted in
2009-10 by lower commodity prices, which was the primary driver in these
Even with declining profits, Mining remains the largest contributor to
OPBT (18.9%) and EBITDA (17.9%), but has dropped to be the second
largest contributor to IVA (from 12.8% in 2008-09 to 10.6% in 2009-10 of
Total selected industries).
Depreciation and amortisation is a significant element of the cost
structure of Mining, and represented 13.3% of its total expenses in
2009-10, the highest proportion of any selected industry.
In 2009-10, Mining had the highest capital expenditure ($45.6b), highest
wages and salaries per employee ($117,500), highest sales and service
income per person employed ($1.06m) and profit margin (33.4%) of all the
Seed stock, long term value
Pre-packaged Ribs, short term value.
The Question that the left should be asking is, how can we use the
Mining companies as seed stock for increasing commercial opportunities
(therefore consolidated revenue) and decreasing unemployment (and
consequent social welfare costs).
I believe the other day I suggested that the Mining Companies might be
interested in a scheme whereby they were required to invest in
entrepreneurial, regionally based start-ups that would create a truism
of the seed stock concept.
Appropriate investment would increase their involvement in the
community, improve their public relations image, help stem the flow of
young people away from regional communities and no doubt increase their
Of course derogatory "It's his fault" is so much easier than being
entrepreneurial and creating a solution.
I have learnt that Australia is predominantly a land of Social Welfare
enabled Tall Poppy harvesters all armed with well sharpened scythes.
They've got the gold, let's just take it.... Yeah! Lynch Mob. Yeah Yeah
I seem to remember a similar movement in Russia abut 95 years ago. I
think it was called Marxism. How did that turn out ? I believe that the
oligarchy continued by merely changing it's ruler and that those rulers
were at least as (if not more) blood-thirsty than the previous
Taxing the rich always sounds good in theory by those that don't
understand the fundamentals of economics. Yet history has shown us that
short term (one term political or Board of Directors appointment,)
profit taking is always bad for the economy, the country and people.
Our only saving grace is the two party political system whereby the
virgin voters create balance by voting for the other guy, about every 12
years. Just in time to fix the extremes of the incumbents mistakes.
Let us not re-enact Les Miserables. We're the lucky country. Yes, some
are more lucky than others. But probably because they stopped whinging
and got off their arses and actually had a go....
(Les Miserable? The Peasants starved when they discovered that the
cupboards were not actually self replenishing.)
I have no relationship to the mining industry.
I hold no shares in the mining industry.
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