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Animats

Oh?

U.S. Steel is for sale for $7 billion. One-sixth of Twitter's sale price.

U.S. Steel was once the largest company in the world.

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> U.S. Steel was once the largest company in the world.

You're talking about practically ancient history. "In 1902, its first full year of operation, U.S. Steel made 67 percent of all the steel produced in the United States. About 100 years later, as of 2001, it produced only 8 percent more than it did in 1902, and its shipments accounted for only about 8 percent of domestic consumption." https://en.wikipedia.org/wiki/U.S._Steel

The federal government did try to break up U.S. Steel... in 1911.

I think that's kind of the point. Us steel had a 120 year run without being toppled. This isn't exactly a new phenomenon.

It's hard to guess where Apple or Google will be in 100 years

> Us steel had a 120 year run without being toppled.

Um, no? It didn't magically go from 67% to 8% in the year 2001. It had already declined. In fact, it started to decline quickly: "Because of heavy debts taken on at the company's formation—Carnegie insisted on being paid in gold bonds for his stake—and fears of antitrust litigation, U.S. Steel moved cautiously. Competitors often innovated faster, especially Bethlehem Steel, run by Charles Schwab, U.S. Steel's former president. U.S. Steel's share of the expanding market slipped to 50 percent by 1911."

> It didn't magically go from 67% to 8% in the year 2001.

In fact, it never did that. It went from x million pounds of production to 1.08*x million pounds of production. It also went from 67% domestic market share to y% domestic market share.

Gluing a couple sources together it looks like US domestic steel production was worth $90 billion in 2020 and U.S. Steel has a revenue of $21 billion in 2021. That said, this is a volatile market and 2021 had 20-30% higher sales than 2020 and 2022.

I was talking more about company lifespan given that US steel is up for sale.

If you want to talk specifically about average company time in the Fortune 500, that has been going down

"Company lifespan" is a stupid metric. Any given company can hold on as best it can or be driven into the ground in a few years, depending on what management and the board does with it. There's no rule in business that says "oh, too old, time for you to go out of business now."

I agree, that's why I think it was a stupid metric for the author to use as the basis of their article. It doesn't matter if average F500 company age is increasing when the average time on the f500 is decreasing.

This is all beside the fact that company age itself is meaningless when you have a history full of mergers, acquisitions, and even reverse mergers or takeovers.

That's really incredible. In the same time period the US population grew from about 80 million to 330 million. Roughly a quadrupling of the population and yet they only produced 7% more steel. Feels more like a company that was run overly conservatively and basically grew old and died.

It’s a company that got nuked by foreign competition and technology changes in the 70s. Then it reinvented itself on a smaller scale in the 90s.

End of the day, steel is a capital intense, low margin business dominated by Asian competition.

You may have a point but you should argue against the data in the article rather than one anecdote.

The best Counterpoint is that the average time of a company being part of the Fortune 500 is declining over time. This means that there's greater turnover and disruption. a Fortune 500 company today is less likely to still be a Fortune 500 company tomorrow then most of the history of the Fortune 500.

This tells a different story than the article which focuses on the average age of companies including time not part of the Fortune 500.

It would be interesting to run the same analysis for the Fortune 100 and the fortune 500 to 400 companies

https://www.aei.org/carpe-diem/only-52-us-companies-have-bee...

Also, not sure Twitter's price is a great example of a reliable value.

You were being downvoted but I had the same thought — not as a statement about Twitter but because the circumstances of the sale were so controversial.

By the time Twitter will live long enough as U.S. Steel right now it will highly likely be even cheaper. If even exist at all.

Just have to suffer for a few decades under their boot, until a seismic shift in industry can undermine their dominance?

I have the feeling in the very near future a controlling amount of Twitters debt could be purchased for 7B

No way it happens before the 24 election. Musk with his Space company, his commanding lead on EV infrastructure and what is still a sizable pop culture megaphone has the US leadership by the balls in some respects.

He may, until he overdoes or otherwise flames out. The dude is too volatile and has nobody able to talk him down.

If he overdoses the stock of a company that is listed in major indexes will crash. Thats a big deal and people will move heaven and earth to care for him because of that. Not to mention all the other things I mentioned: those things can't go away or the US is in big trouble so they will find a way to keep him going

debt does not offer control over company. if it were, it would have been called differently

They are implying Twitter will default on their debt and the debt owners will take what's left of the companies assets - the company.

Elon’s titter shares are backed with his assets (mainly Tesla stock), so I dont see how titter will default unless tesla stock gets heavy heavy beating (which it surprisingly endured pretty well so far)

Twitter has not defaulted so far because elon can just pour money in and cut expenses - which he has been doing since taking over

No, Twitters 12.5 billion in debt is backed by Twitter. Money that Elon personally borrowed to buy Twitter, but Twitter is not on the hook for, is backed by Tesla. Elon defaulting won't affect his ownership of Twitter (because he pledged Tesla shares) and Twitter going to zero won't affect Elons other investments (unless he voluntarily adds more money to Twitter).

It's hard to build a revenue stream by cutting expenses.

This time it's different, though. In the age of computing, nobody will be able to step up to IBM — they control the entire industry. This is only going to be more true now that they have consolidated their control over the consumer computer market with the Personal Computer.

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