Wal-Mart "poisons the well"

It looks like Wal-Mart is going after consumer electronics like it did toys, in what one Wall Street reporter called a poisoning the well strategy.


As he points out, using plasma tvs for a loss leader does not seem like such a sound idea, and the stock market seems to agree. All this does is push the vicious cycle, as other retailers counter. And as other retailers counter, they will push suppliers to reduce costs as well as reduce their own costs (labor) to make up for lost margin. This means more out-sourcing to third world nations by the vendor companies where labor is cheap.

Wal-Mart and its cronies claim it is good for America because it keeps prices low to save people money, but the cost of those prices are people working for low end employers (like Wal-Mart) while we import everything from China.

I also find it interesting following the news that Wal-Mart backed organizations literally paid pro-Wal-Mart bloggers that I see comments on the stock blog where I found this to sound like they are quoting company PR. Are these folks getting paid to troll the net for evil Wal-Mart bashers (like me) and post pro-Wal-Mart comments? A couple of years ago, I would have thought that the idea sounded insane. Now I wouldn't be surprised.