I am curious about anthropologist – I have 2 questions.

First, where are you getting your data from? Do they account for the lag between graduation and finding a "real" job and a temporary job to pay the bills until then? (off of the top of my head, I would think a lag of 6 to 12 months would be right)

Second, what do you mean by "working retail"? I ask, because I know many retailers who hire anthropologist to study their shoppers. So while "retail", it is not the low paying "Do you want fries with that" type of job.

Which is kind of sad.

Graduating with a degree in Fine Arts from your local state school still leaves you with a ton of debt, poor job prospects, and a high chance of default. The only good thing is that you are ahead of the people who took got a degree in the Preforming Arts.

If they are going to apply it private colleges they should also apply to state colleges as well.

This is true. Operational costs are also higher. Working off a hunch here – not hard numbers.

Return on Investment = (Revenue - Costs) / Investments.
Year 1 = (200-100)/500 = 20% ROI
Year 5 = (220-100)/(500+200) = 15% ROI
I am not sure what you are trying to say here. I think you are confusing investments, a balance sheet operation, with costs, an income sheet operation. If I take 700m in cash and buy 700m of cable equipment, gold, land, or government T-bills I haven't accrued any costs. I have moved assets from one part of the balance sheet to another.
Depreciation of assets is another thing. That hits the income statement and is considered to be part of operations. In theory depreciation should match it's usefully life, meaning ROI would be correct. Of course estimations in the real world have issues.
However, in any event, using your methodology, we are back at 26%. Which is standard for cable but fat for most business.
On to AT&T. I have to ask – what competition are you talking about? I grew up with a municipal owned telco. They were a monopoly and they gouged us. Sure, there was AT&T and another municipal owned telco 30 miles away, but they could not offer us any services. There is no reason to think that 100 local monopolizes would be subjected to competitive forces just because there are 100. What broke the market wasn't other monopolizes but new technologies – the cell phone, and latter VOIP.

To your question

Let see, the US has 1. Above average costs, 2. Below average speed, and 3. Higher than average profits. So I don't know this.
Let me ask, why would Comcast expand?
Can they expand out into new areas? Nope. All of the markets have been colonized.
Can they expand up by offering better services? This assumes that any costs associated with building better services can be matched raising the prices. Normal firms expand until their marginal costs equal their marginal revenue. They must keep prices low. Not monopolies. They expand until their average cost equals their marginal revenue. Higher prices, lower output, and more profit.

I would recommend reading up on Jean Tirole won the Nobel Memorial Prize in Economic Sciences this year for work in this area. Different solutions gets different results. I have not found the perfect article yet, but here is one.

http://www.economist.com/news/...

It would depend on the question being asked.

If we want to know if the cable business has fat margins, we want to know how the "real" business is really doing. Yes, the CFO could load up the balance sheet with debt while doing share buyback, causing the profit margin to fall into the single digits. However, the fact that different CFOs chose different levels of debt does not affect if they have monopoly pricing.

Besides, Verizon and Comcast only break out their segments at the operational level, as required by the SEC. If you operate at the profit margins you need to disentangle cell phones and amusement parks.

As for time, feel free to go back 5 years. I have. The cable divisions have fat margins. My gut tells me this has always been true.

Now, maybe you are saying for investors net profit margin is better than operational income margin. Maybe. It is the more popular number. I will point out that while the net profit margin (or better yet, the earning yield) does a better job on returns, operational income margin is a better predictor of a company's health. A classic sign that a company is getting into trouble is when net profit and operational income margin goes in different directions. This could indicate deteriorating fundamentals, increasing leverage, accounting fraud, etc.

Personally I have found few unimportant numbers in the financials. It is knowing how to use them.

Copied from a different part of this thread:

For Comcast, yes, their amusement parks, tv shows, movies etc have a profit of 17%. Then look at this: http://www.cmcsa.com/annuals.c... - annual report, page 122.
      Their cable operations – which is what we are talking about – has operational margins of 26%. Much fatter than the other lines of business.

I would use "operational income margins", not profit margins. This gives you a better apples to apples comparison. Besides, some companies break out operations by segments.
Time Warner Cable: 22%
Version – Wired segment – 22%
Century Link – 14%
Comcast – Cable segment – 26%

“Natural Monopoly” was coined by economist, not politicians. They are not saying that monopolies are natural, rather that there are many different types of monopolies, and that natural monopolies are a particular type.

To your point about the water supply, I think you are missing the point. There are competing water firms out there (oddly, Enron was one of them) but that does not really matter. A city could have dozen water firms but only one is going to serve you. They are the sole provider to you unless you move to another town. (I would classify moving to another part of town to switch water companies as a high “transactional cost”, which is a classic sign of a monopoly)

What you want to do is pull out a book on game theory. If the stable condition of a system is to have one dominate player you have a monopoly. I will point to 19th century London. They had two private water companies, each running a separate pipe under each home. You can have competition but it is not stable in this case. One company drove the other out of business, dug themselves a deep economic moat, and reaped the profits.

For AT&T is there any particular aspect you wanted me to look at? I am assuming you are referring to MCI and the 1974 antitrust suit. Because what I take away from that is that to break a deeply entrench monopoly like AT&T you need a radical change in technology (fiber optics, digital switching equipment), government action, and 20 years. I would counter with Carlos Slim, one of the richest men of the world and while not technically a monopoly, nobody can seem to dislodge his phone operations.

For Comcast, yes, their amusement parks, tv shows, movies etc have a profit of 17%. Then look at this: http://www.cmcsa.com/annuals.c..., annual report, page 122.
  Their cable operations – which is what we are talking about – has operational margins of 26%. Much fatter than the other lines of business.

Industries that have fixed high capital costs and low margin costs tend to be natural monopolies. See water, sewer, etc. for some classic examples. For most of the US, cable companies are natural monopolies.

Monopolies tend to gouge their customers which is bad. The only way around that is by government action, regulation, etc.

However, it is better to avoid both monopolies and government. It would seem to me that NY might be one of the few places in the US where the density of the population is dense enough to lower the capital costs so there would be no natural monopoly. If so then all one has to do is to free the market.

I think we agree on many things - we have slightly different solutions - but I have 2 questions about your comment.

Why do you think that the concept of natural monopolies are dubious? It is not the size that makes a market a natural monopoly, it is the structure. Classic examples are water, sewer, and (before interstates) railroads. These are very large markets but they tend towards a "winner takes all" situations where one is only left with a single provider.

Second, why do you think that Comcast Cable financials are normal? The cable division has an operating margin close to 25%. That seems generous to me, more so that most utility companies tend to have a much lower operating margin.

But is the capital costs of laying fiber high on a per capital basis?

I suspect it is a lot lower than laying it to my brother-in-law's home, which is in the middle of farmland – nearest neighboring home is over a mile away. Apartments are cheaper to wire than single family homes. City homes are cheaper to wire then suburb homes. Each step has shorter runs, so while laying fiber is cheaper by the mile in farmlands, you get more hook ups in denser places.

Correct me if I am wrong, but it is already a monopoly. If so, then they are already extracting as much profits from customers today.

And I suspect that it is a natural monopoly, though I would think N.Y. would be one of few places where a natural monopoly could be broken. Natural monopolies occur when a company has high fixed capital costs and low marginal costs to add new users. I would think that NY has to population density to mute this issue.

Back to the issue at hand. Since we have a natural monopoly , many municipalities try to redress this issue by requiring the cable company to pay back some of its benefits to the community. Payments (taxes) to city hall, community access shows, free basic cable to public offices, broadcasting city meetings, etc. Off all of these options, won't the best option be free internet? If the community at large has to bear the burden of a natural monopoly shouldn't the community at large benefit from it?

Personally, I believe the city should build out the last mile of fiber optic to consumer homes then auction off bandwidth to various cable / internet / phone companies.

No.

A bankruptcy judge has wide powers reduce or cancel liabilities ($1,000) and sell assets (private information.) IIRC during the dot com bust consumers where trying to claw back their personal information while creditors wanted to sell it to the highest bidder. The creditors won. Now, IANAL and this is old, so take it for what it is worth.

Yes, good catch. Thanks. Darn small screen, auto correct.

In some cases, yes it is. And I consider myself a mild liberation.

There are cases of "natural monopolies" where left to itself the market tends to narrow down to a single provided. Look for industries that have high fixed capital costs to start up but low marginal costs after that. Network effects help too. If that is the case, then you often need government regulation to ensure a well-functioning market. Now, what type of regulation is complex.

Jean Tirole won the Nobel Memorial Prize in Economic Sciences this year for his work. Different types of solutions get you different types of answers.

http://www.economist.com/news/...

I would be o.k. if the city owned the last mile, much in the same way they own the last mile of sewer and water lines.