I've answered it several times; you just don't have a clue about real life business, is all. Typical for a generation that has the FEds bailing out thier 401K's and Wall Street gambling for decades now.
More on real economic history:
The Great Merger Movement
...from
The Tycoons, by Charles R. Morris.
Like this little footnote; it shows that there is nothing new under the sun, and certainly idiotic memes like 'Da Global Economy' being spouted as if it were some new thing by ignorant ass Bush Moonies and Welfare Street Journal tout sheet subscribers.
The bolded part was bolded by me; one of the main reasons for this boom in print media was due directly to the Rockefeller monopoly. Unlike other monopolies, John D. drastically
reduced lamp oil prices,and kept them low, rather than gouge the public, and with oil lamps selling for as little as 25 cents, this caused a great boom in education and literacy, since people of modest means suddenly had some kind of life after sundown, especially rural and small townfolks. The effects of this is one of the great overlooked influences on America, and it is one of the reasons, incidentally, that I actually respect old John D. and Standard Oil, as opposed to feckless thieves like Andrew Carnegie and J.P. Morgan and their ilk. Can't say much for his brother William or his other partners.. He wasn't thrilled with their extra-curicular financial piracy, either.
John D. also said: " Competition is a sin."
So, anyway, it was in this era that the idea of 'competition' was laid to rest as the stupidity it is when fixed costs are high, and it had to be removed so large companies and economies of scale could be financially viable as long term operations, and this is just as true today. Competition is for the little people, like 'O/O's' and 'Independents'. It died over a hundred years ago for the upper classes. Obviously they decided a long time ago that competition doesn't work, while spouting 'Capitalism Is Grand' to the gullible public.
And, in the end, these mergers were not fine examples of 'Capitalism at Work ' either; they were merely scams.:
Same source as above.
Fredrick Allen laid out this paper-shuffling and how the stock-watering
layed out, the lottery tickets that get peddled to the littlepeople, to let them pretend they're 'capitalists', too.
All the companies combined were worth $682 million, at a highly inflated estimate at that, and owed about $81 million in miscellaneous obligations, debts, payroll, etc. They gave Carnegie $303 million in bonds for his company, about 6 times what it was worth, of which he got two thirds. They then issued $510 million in preferred stock, and another $508 million in common stock, with Morgan taking $130 million or so of that for himself. Not a bad deal for only $25 million in new cash, eh? $1.4 billion for a company actually worth half that, and an out of pocket expense of $25 million, or about a 3.6% outlay. No risk at all here if it folded the next day. Only $303 million is secured by bonds, and those went to Carnegie, who would only be faced with getting his own company back, and since his company was grossly overvalued to begin with, a lot of other companies to boot. The only risk involved is on the part of the people who bought the heavily watered stock put on the exchange, i.e. The little guy who bought the lottery tickets would get soaked for his cash if the deal fell through and absorb the entire risk, a few of the business owners would lose a little profit while their companies were part of the combination, and the 'Capitalists' weren't risking so much as a dime of their own.
