Caterpillar is the toast of Wall Street tonight. Quarterly results released earlier in the day reveal a 10% drop in sales. That's the bad news.
The good news is a 50% jump in profits!
Oh ya baby, it's gonna be a feeding frenzy at the bonus trough this year for the corner office boys in Peoria. They are obviously geniuses and deserve every penny of the multiple millions grateful shareholders will shower upon them.
What's the secret? Simple; fuck the workers. The management wizards have managed to lop 10,000 workees off the payroll in the past year. Not that a job at Cat is any great shakes for the folks who remain. It's not that hard to scare a bunch of dumbshit welders into major contract give-backs once they've seen you shut a few plants down just to let the workforce know you're serious.
Over the past few years the management team at Cat has magically transformed thousands of $30/hr jobs into $15/hr jobs. That money adds up! That is some masterful management savvy alright!
While Caterpillar can't afford to pay its workers a decent wage, they've got billions upon billions just lying around to spend on share buy-backs. Short of firing up cigars with hundred dollar bills, share buy-backs have to be about the most non-productive use of corporate cash known to economics. But the shareholders love it!
Elsewhere in the world 'o Cat, Reuters has the tale of the great Shanghai shakedown. That's where the brilliant Cat management team spent almost $700 millions on a Chinese equipment maker and then wrote most of it off within a year.
How is such a thing even possible? Well, they were obviously outsmarted. Having grown overconfident after bullying their workforce for years, they totally overestimated their own intelligence. Given that at least half a dozen senior Cat managers are making over $5 million per year each, you can only conclude that the IQ bar isn't set very high in their corporate culture.
But don't expect that little half billion dollar faux pas to slow down the feeding frenzy at the bonus trough or the relentless grinding down of their workers wages.