Supply Chain Shortages Continue Around the World. Get Used to It
nytimes.com
nytimes.com
E.g. for many electrical products I see that the stock has shifted to resellers, you can look on octopart (assuming part is large enough to be tracked). What's hard to evaluate is how real the shipping shortage is. It may be partially people demanding more pay, or it may be entirely a shortage.
My experience with lean/JIT in the manufacturing space shows when it is actually done at every level your business starts hemorrhaging money waiting for parts to arrive. Each step of the process unless perfectly foretold adds 1-3 weeks in a good quarter. It is actually the local preference that we keep more spares than we do, but accounting says no.
If you read the fine print with how Toyota implemented lean you find out that they made their partners contractually obligated to keep inventory, not themselves. Inventory was still kept but who paid the tax bill and who paid upkeep changed.
I learned it was much better to deal with CEO/investors grumbling about $$$ tied up in backstock than Type A Sales Manager + CEO/investors wondering when the f^ck a single critical component would let us restart the production line to launch an overdue product. I don't miss that job! There was also the "Google the new CEO on his first day and find out he's under SEC investigation for withholding payments to his previous corp's suppliers to pad the balance sheet for buyout" but that is another story entirely!
This way they don't have to cash out for whole containers at a time. Sure they'll have to pay for more declarations, but overall it's usually worth it, especially if the goods can sit there for a year or more.
Our customs systems here is totally not made for this new world though.
That would just make things worse.
I don't know why people demand even more "free market" when governments spent 40 years giving more power to the private sector.
ERCOT also didn’t know it was shedding natural gas compressor station circuits when performing rotating blackouts, causing a cascading failure when natural gas generators were starved of fuel. That’s just plain ol’ incompetence.
And despite all that incompetence, they were much better at maintaining the power supply than north Georgia. That would seem to imply that the system is even better than the performance gap would indicate.
If you want them to in-house more production, allow all of them to write-off 100% of capital equipment purchases in the first year.
This taxation is why corporations often prefer to lease rather than own, and why they often pay out dividends rather than using the money to collect assets.
These taxes reduce the amount of money you can spend on capital equipment, inventories, and facilities, which reduces your maximum rate of growth.
All of these are the reasons that software businesses are so heavily advantaged by the tax code. They don't have to pay taxes on (much) capital equipment or inventories, and the smaller facilities are also beneficial from a tax perspective.
I mean, yes, but not really. They're not a meaningful portion of their revenues. Typically it's around 1% of the acquisition cost of the item inclusive of any fees required to get it in your inventory. This is akin to complaining about paying BWC taxes which are about 1% of your payroll. If they're a real hardship to your business, your business has more problems than holding excess inventory.
>Corporations are taxed on assets that they accrue (increases in total holdings are taxed as 'profit'). This applies to inventories, capital assets, and real estate.
and
>you did already pay taxes on holding that inventory.
Inventories are taxed as property which is, in general, about 1% of the cost (to the company) of the item.
You're conflating income and property taxes. What your describing in your previous posts is an income tax, which is the tax paid on the net income associated with an asset. However, you have to dispose of the asset to pay that tax. Until then the asset is property and it's only subject to property tax.
Normal accounting disclaimer applies. Definitely get an accountant and don't take accounting advice from the internet.
Most jurisdictions don't have the asset taxes you're describing. Some do, in which case inventories cost extra to hold each and every year.
>"You're conflating income and property taxes. What your describing in your previous posts is an income tax, which is the tax paid on the net income associated with an asset. However, you have to dispose of the asset to pay that tax. Until then the asset is property and it's only subject to property tax."
No, when a company uses its revenues to buy stuff and hold onto it, the government counts the value of that stuff as profits, and taxes are paid on that 'income' in the fiscal year of acquisition. The assets are then gradually depreciated (with the depreciation treated as a loss). If the assets are sold off, income taxes are assessed against sales in excess of the depreciated value, and losses are assessed (along with corresponding write-offs) against sale values below the depreciated value of the asset.
>"Normal accounting disclaimer applies. Definitely get an accountant and don't take accounting advice from the internet. "
I completely agree with this, especially since tax law varies widely, even between Canada and the USA.
This is not quite right, though it is mostly correct in describing depreciation. When you purchase a depreciating asset it has a book value that is depreciated over time. That book value is not counted as income and definitely not as net income (profits), though it will appear with other assets on the balance sheet. You've essentially converted one type of asset to another, there is no gain or loss there to tax.
For depreciating assets, the depreciation is deductible because it represents a loss in value of the asset. In general, this can be taken when the depreciation is realized. If you dispose of the asset you pay taxes based on the deprecated value, like you've described.
It's important to realize that corporate taxes are almost exclusively on net income, that being the money left over after the business has done all of it's financial activities.
“The 100-day reports make clear: more secure and resilient supply chains are essential to our national security, our economic security, and our technological leadership. The work of strengthening America’s critical supply chains will require sustained focus and investment.”
https://www.whitehouse.gov/wp-content/uploads/2021/06/100-da...
> Please no. The last thing we need is another bunch of half-baked regulations passed because a bunch of people who don't know what they're talking about demanded "something must be done!" in response to some temporary crisis. COVID will subside eventually, dysfunctional regulations have much greater staying power.
Pick your poison: either capital decides to build a sufficiently resilient supply chain or they get subjected to "half-baked regulations." They're not going to do the former, so say hello to the latter.
Do nothing and profiteer during the next crisis is not an option capital should be permitted to take.
Sell high buy low. I just don't know what to sell at the moment.
> It might do well in these crises, but if it can't survive the times where everything works well, then it doesn't help.
See also: all the new US N95 respirator manufacturers that popped up during the pandemic. Now they're laying off most of their staff and most will likely go bankrupt, because their customers went back to buying cheaper Chinese masks as soon as they could.
In the last week, I've read several more doomsday articles like this one warning us it's going to get worse before it gets better, and both Apple and Toyota have been mentioned as now having to delay releases or scale back sales targets.
We could call this system “tariffs”.
Something that doesn't make sense about political discussions around tariffs (at least in the U.S.) is that it seems like the overwhelming narrative is that "tariffs are bad for business, so we shouldn't have them if we can possibly avoid it". We don't talk that way about other taxes. If you said "we shouldn't have corporate income taxes because they're bad for business" the Republicans would mostly nod along, and the Democrats would say, "Wait, hold up there. Of course they're bad for business, but the point is to raise revenue to pay for other things. Governments need revenue from somewhere." But then when it comes to tariffs for some reason it's treated differently and Democrats are suddenly on board with lowering taxes, with the whole debate being in the context of whether protectionism versus free trade is better for local business (with both major parties mostly leaning towards free trade), and the aspect of revenue isn't even part of the discussion.
I'm not so deeply read on this, but I'd imagine this is why things like brexit and tariffs get sold but result in everyone being net worse off.
So land taxes, VAT, and income taxes are good; capital gains taxes are middling; sales taxes and luxury taxes and tariffs are bad. Tariffs are among the worst in this hierarchy because their incidence is - to an economist - arbitrary. In classical economics, specialization is good, and industries should go to whichever country is most efficient at providing them. Any sort of national tariff interferes with that: to the extent that the tariff succeeds at collecting revenue, it does it by making consumers choose an inferior product (in the sense that without the tariff, they would've chosen differently).
I'd expect the political rebuttal to that is "But national security - we want to make sure all our homegrown industries are competitive and we can make complete supply chains within our borders." I suspect there's an element of Lake Wobegone self-deception in there though: people think that they're better at everything than they really are. When nations cut themself off from the global economy, they often think that they've made themselves self-sufficient right up until a foreign power that's been trading the whole time shows up in your capital city with a fleet of gunboats to forcibly open your country to world markets.
Listening to the classical economists in this case is a lot like listening to a paperclip optimizer complain about all the non-paperclip production that wastefully divert resources away from more paperclips. They have a point, but only from a perspective that leaves a lot of important stuff out.
> When nations cut themself off from the global economy, they often think that they've made themselves self-sufficient right up until a foreign power that's been trading the whole time shows up in your capital city with a fleet of gunboats to forcibly open your country to world markets.
That's a straw-man, though. I don't think anyone in favor of tariffs or protectionism is advocating for a pre-Meiji like economic isolationism.
Also military vulnerability is not the sole territory of protectionism:
When nations make themselves over-dependent on the global economy, they often think that they've made themselves competitive right up until a foreign power they've outsourced their gunboat production to cuts them off from their just-in-time supply of spare parts and shows up to their capital city with a fleet of gunboats to forcibly subject them to a new political or ideological regime.
Whichever it is, the point is that tariffs are the worst way to coerce change in an economy. There's no guarantee they will have anything like the effect intended, because the point in the economy where they're levied (importing X) is completely different from the point in the economy we're trying to change (locally making X). Even if they do, the costs of the change can be incredibly high. If you want to promote local production, just subsidise local production. It's generally a bad idea, but the least worst by a long mile.
Another important point is that outsourcing as-actually-implemented isn't usually seeking "efficient production," just labor arbitrage.
> If you want to promote local production, just subsidise local production. It's generally a bad idea, but the least worst by a long mile.
I'm also fine with subsidies, but often that seems more difficult to sustain politically. It seems like tariffs and subsidies go hand in hand rather than be an either/or policy (e.g. use tariffs to fund the subsidies).
Pretty much any arbitrage is an economic inefficiency being exploited, whether it's financial (information inefficiences), shipping/merchants (geographic & local preference inefficiencies), storage (time preference inefficiencies), outsourcing (labor), etc. And in the course of exploiting it, it makes the inefficiency go away.
I think the key points are 1) that's not the kind of thing the word "efficiency" typically brings to mind, and 2) there are quite valid political reasons to want to discourage that kind of "efficiency."
Japan still did a lot better for itself than most other places that western gunboats showed up in the high colonial age. Is this not because it had a healthy political economy, and could meet foreign demands while still continuing "national" development?
The Union won the Civil War despite almost alienating Great Britain and coming within a hair of war with the Brits multiple times. The Confederates were the free trade power supported by Europe throughout the entire war. As Ulysses Grant said during the final days before the Confederate surrender, "The British mark was on every battlefield of the war." Didn't work out for the free-trading Rebs the way that they hoped, but them's the breaks.
It's not actually the 'own' that people think it is. Free trade is not a cheat code for permanent global domination. It's effective but it has limitations and weaknesses. The type of arrogance that leads to the belief that it grants an aura of invincibility is just hubris.
The nations that use autarkic measures are not just stupid morons who are and were doomed to lose ahead of time: that's just believing our own Atlanticist war propaganda too much. Make no mistake, the modern sea powers have come very close to defeat and humiliation many times over the last couple centuries, and one of them was effectively annihilated (the British) in part due to the tidal wave of Asian nationalism.
Among other economic effects, VATs do not incentivize vertical integration. With a traditional sales tax, corporations can avoid paying the tax by bringing all the suppliers in-house so that there's no transaction to tax. With a VAT, it's all the same: either you pay the tax or you pay the supplier and the supplier pays the tax.
This is precisely to prevent your easily spotted mistake of promoting vertically integrated companies.
Ehhh, I guess it is neutral if your expenses are the same as your revenue. That is no profit.
VAT is calculcated on 'the value you add'. What you owe is that amount minus the VAT paid on your expenses.
In your Apple example, the consumer pays the $1000 plus the 5% VAT to Apple, and Apple sends the 5% VAT to the IRS. If Apple bought components for that phone that included VAT, the supplier providing the components sends that VAT to the IRS, and Apple can claim that VAT from the IRS.
Apple pays 5% on the value it added, not on its profits on the phone.
If they buy $500 in components from upstream suppliers and sell the phone for $1000, they’ve added $500 of value (on which they’ll remit VAT), but not achieved $500 of profits on that phone. (They have labor and other overhead.)
I don't know if it is true but I make this prediction: High transaction taxes correlate with or even cause expensive government projects, excessive public sector employment and excessive welfare.
Edit: Greece was the first country that popped into my mind. I didn't know anything about the tax situation in Greece and simply googled "greece has excessively high income taxes" only to find this article: https://www.intereconomics.eu/contents/year/2011/number/2/ar...
Summary: Greece indeed has an impressively high progressive income tax. Young people aspiring to salaried jobs want to work in the public sector to decrease distance to the government. Half the households are self employed to avoid high income taxes and social contributions because of their high distance away from the government.
The problem with that argument is that in a modern globalized world, what you're often doing is buying products at a lower cost because the negative externalities aren't reflected in the price. Products are often cheaper in countries with few environmental regulations and exploitative labor practices. Free trade can be a race to the bottom.
The general argument that tariffs between countries that are roughly equal in terms of wages, regulations, human rights, and so on causes more economic harm than the revenue it generates seems plausible though.
maybe we can tax long chain logistic to hell and back instead.
Also tariffs cost a fortune to the economy and generally depress consumption a lot more than they boost employment. One reason is investors are very wary of capitalising local production baed on tariffs that could disappear at any time. It's a very precarious basis on which to build a business. The increased costs to customers per job can be hundreds of thousands of dollars.
I'm absolutely no fan of subsidies, they're a terrible distortion of incentives, but they're many, many times less godawfully wasteful than tariffs. It's also much easier to see where the money goes and measure success (or, more likely, failure).
How long until your favorite restaurant gets rid of servers? You will order through a screen at your table, then they will conveyer belt your food to you.
Automation isn’t going to happen like that, although I am unsure what the obstacle is for something as basic as fast food.
All the tech is there. Automatic burger machines have been here since the 70s. Ordering can be done through a phone app. Where is the bottleneck?
Now if selling hamburgers can not be automated I would like to know how something more complex like political strategism or software engineering or market analysis is supposed to be automated.
I’m not familiar with the US, but here in the UK we’ve had fairly low unemployment for a while, in particular long term unemployment was under 400k, most unemployed were between jobs. We also had a lot of unfilled positions. The skills gap was and still is a pressing problem.
Somebody will bring up strong AI. I’ve been hearing about that being imminent my entire life, no joke, and I’m 55 in a few weeks.
Not so clear how to foster redundancy coming back in at that level.
To continue your analogy it's like the world's supply chains stopped colocating their own servers, shedding unused capacity, in favor of AWS. Sure, there will be a hiccup under unexpected load, but new instances will spin up soon enough and meanwhile you've saved a ton of money, resources, and energy when demand was low.
Do you think it's due to changes in technology? political beliefs? or overpopulation?
Today homes are out of reach for middle class because we have a population of 3.9 million in los angeles, but have a zoning capacity of only 4.2 million. It's not exactly rocket science how to fix this mess. Legalize building housing and housing will appear to satiate demand.
https://la.curbed.com/2015/4/8/9972362/everything-wrong-with...
I am not sure that the average is the appropriate measure to use when looking at societies and well-being.
Can the poorest live respectably and participate meaningfully in their local communities? How are we doing on that?
Cars are safer and last longer (and cost 2x as much). Some forms of medical care are better (surgery). TVs have more resolution and increasing sources of media leads to more mouth agape consumption at home.
Other than that, I can't see any advantage to now over then.
The risk if we bring an overly heavy hand of government is greater issues on other areas. Sure they'll make sure computer chips are available but maybe at twice the price or half the quality as factories just need to hit volume numbers, or potential to. It might stop new entrants as e.g. now they have to build a factoryfor twice the actual sales capacity and that cost doesn't make sense. And surely a bunch more.
I do think certain items should be deemed essential and local production encouraged, off the cuff but 30% needs to be domestically sourced type thing. Like what we saw with medical equipment in the early days of covid. When times get tough, countries get selfish fast and a nation needssome level of protection for adverse events. But forcing business to over deliver capacity seems likely to bring in a whole other level of issues and likely cronyism.
At least in my non-expert view we shoot should ensure the most basic survival items like food, essential medicine and energy have significant redundancy. After that, we need to take the risk to allow capitalism to do what's its best and and create efficient production or I suspect we will being greater issues in replacement of the ones we solve.
These shortages are also primarily due to behavioral shifts which redundancy will not correct. Demand for suburban housing skyrocketed since no one wanted to live in the city. Services spending shifted to goods. Global travel halted. Everyone wanted to redo their flooring in the same 3 months. Everyone stopped buying cars, and now everyone wants one to get out of the house or for that new home they bought during the pandemic. I mean, you could pay up to hedge against all of these, but I'm pretty sure 40 years of hedging would have not been a wise investment.
Now I do agree with creating redundancies for critical goods as a hedge against geopolitical tensions, but that's a different story.
But who shut down their entire economy? The US laid off maybe a little over 10% of the workforce at its maximum, by the looks, so that's not entirely shut down even at maximum hyperbole.
There were also companies that kept workers on the payroll despite being essentially shutdown for weeks even without access to PPP money.
That may seem obvious to you and I. Hence my question.
> But the unemployment rate would have been massively higher than it was had the government not stepped in with loans (essentially grants) to encourage companies to keep people on the payroll through the lockdowns.
Would it? What models showed that, and how much higher is massively?
> There were also many companies that kept workers employee on the payroll despite being essentially shutdown for weeks.
There were many companies that that stayed open.
I think it seems obvious to everyone, and anyone saying the entire economy was shutdown was just being hyperbolic. Everyone who lived through it knows that they were able to buy groceries and that their power and lights stayed on.
>Would it? What models showed that, and how much higher is massively?
Something like 12 percentage points according to this paper [1].
>There were many companies that that stayed open.
Right. But my point is that unemployment rate isn't everything when discussing what percentage of the economy shutdown. Many people were receiving paychecks despite their company being essentially closed for business.
1. https://home.treasury.gov/system/files/226/Job-Preservation-...
The shutdown was an order of magnitude smaller than the entire economy.
However it also wasn’t an order of magnitude less. According to this WSJ report [1], lockdowns took at least 1/4 of the economy offline.
1. https://www.wsj.com/articles/state-coronavirus-shutdowns-hav...
I say this because the virus could've been 5X more lethal and to young people to boot. Then we might have actually truly shut down, and we'd be in a much worse spot now. There's no rule that the pandemic virus doesn't have to be much more lethal next time.
Ebola is spread by contact, not in the air, so it's not a good comparison. (Especially because it can spread very quickly even given that it doesn't spread through the air.)
Worst case would be a highly lethal, airborne virus with a long delay between infection and death.
I’m sure it’s not completely impossible, but neither is a massive radiation burst from a nearby supernova.
“I believe that viruses tend to become less pathogenic,” says Burtram Fielding, a coronavirologist at the University of the Western Cape, South Africa. “The ultimate aim of a pathogen is to reproduce, to make more of itself. Any pathogen that kills the host too fast will not give itself enough time to reproduce.” [1]
[1] https://www.smithsonianmag.com/science-nature/how-viruses-ev...
There is no hard and fast rule that a virus will evolve to be less lethal or/and less infectious, just a noticeable downward trend in other instances. Well I'm still waiting for a downward trend even with the vaccination efforts.
Smallpox.
>What about viruses that are designed rather than evolved?
Biopreparat(tm) Smallpox.
- Pre-symptomatic transmission
- Early immune evasion and suppression
- Strong inflammatory/cytokine response
The issue today is it's more profitable to sell at rock bottom prices 95% of the time and be out of stock 5% of the time, then it is to sell at a higher price always (to pay for the buffer).
Selling at rock bottom prices 95% of the time and high prices 5% of the time (to pay for the buffer) is best, but currently illegal.
I once read an article with the thought experiment about what we should do if the productivity in everything we do doubled. We would have twice as much table salt. So what do we do? Well there are two options. Keep the table salt just in case. Downsize production immediately and use the spare capacity on something else.
The funny part in economics is that most of the time the "something else" is unemployment and so many economists believe that this is a good thing. Fans of the gold standard will talk about how you are supposed to suffer through the bust while forgetting that gold mining picks up and saved the day so many times even though it is wholly unproductive.
Whether it was the right thing to look for, I don't know. But "cheaper" is the word that has shaped the world in the last decades.
For example car companies are suffering from chip shortages. Maybe they should have stockpiled more? But on the other hand, the "parts bin" is the worst obstacle preventing innovation and integration in established manufacturers. Why do new companies like Tesla have way less electronic parts while legacy manufacturers have lots of separate boxes and wiring, all reducing reliability, increasing cost, space and mass. Because for a legacy manufacturer it makes more sense to use the same parts from the "parts bin" as for their previous model - it's just cheaper and faster, the supply chain already exists. https://www.youtube.com/watch?v=ZRkm6-bBk4U
If the pandemic has taught me anything it’s that our supply chain is extraordinarily resilient. Bend, don’t break.
Market competition can only work if there is sufficient independent suppliers in the market that a failure of one of them can be absorbed by the buffer expansion capacity of the others.
Drop below that and the efficiency gains of the market killing inefficient competitors are lost due to a shortage of supply.
Things are pretty good. A few items are still overly expensive like GPUs and rental cars. But most basics are back to normal.
Why use "fuckloads of capital" to build redundacy just so that toilet paper doesn't become scarce for a few weeks on the next 50 years.
It's very much like being in dependency hell, except that the dependencies themselves are also in dependency hell.
Edit: Shoutout to sourcemap.com, who are trying to solve this problem!
(I agree in general that microservices aren't all they're cracked up to be, but lack of typing isn't an inherent flaw in the concept.)
The early language designers too got excited at the thought of generalizing subroutines to be able to suspend and resume rather than return once (especially before the call stack, where activation records are naturally ephemeral), but this was wisely abandoned.
Later we see much interest in actor models, and they too are disergonomic, and a skeuomorphism from planning people.
What's important is note the nodes, but the dataflow between them: programming is plumbing not connecting increasingly complicated pipe fittings. Most people get this dead wrong, and microservice are just the latest misunderstanding. All it has over the others is the unhealthy synergy with Conway's law.
It's great as long as it works, but it also has the potential to blow up a small crisis to epic proportions.
The global order is slowly unraveling.
However, one thing that is easily missed is how shipping lines have been operating at a loss/narrow margins for years, e.g., Hanjin bankruptcy: https://www.wsj.com/articles/south-koreas-hanjin-shipping-fi.... Many of the major shippers are not interested in building out capacity right now (e.g., Maersk CEO has consistently messaged this: https://splash247.com/if-msc-ends-up-having-more-capacity-th... ). It makes sense: why would they when they know that inevitably shipping rates will fall and they will have excess capacity on their hands.
Instead, they are essentially adopting a wait and see approach. In the meantime, shipping customers pay more, the shipping companies strengthen their balance sheets and reward shareholders with fat dividends, and finally demand will settle down naturally.
What some fail to realize is that this will take a decent amount of time. In particular, no one expects easing of the shipping situation until 2022: https://www.joc.com/maritime-news/container-lines/hapag-lloy...
For instance, maybe Alice wants $5 worth of some resource, and if she gets it she'll be happy. Bob wants $5 of the same resource, and when he gets it he'll put some plan into action that makes $100 worth of some different resource available to Charlie. But there's a shortage, so Alice and Bob are in competition, and neither is willing to pay $6 for it.
The price system doesn't give a reason to favor selling the resource to Bob. It's up to Charlie to notice the hazard before the transaction occurs and give Bob $1 to tip the scales in his favor--which is a challenging trick to pull off in a world that thinks that price alone should do the trick.
That said, my solution is equally unsatisfying. Saying that we should reconsider our assumptions about markets isn't the same as providing an improved set of assumptions.
If there is only demand for 10 machines but you need 11 machines in case of an emergency then the 11th machine will have to recoup all of its costs during the emergency. That's extremely expensive but consider this: the machine is paid off and ready to deal with a second emergency.
My company does test hardware for manufacturers. We have multiple project we're working on currently but we can't finish some of them simply because we can't get all of the components we need. Because of that these manufactures, can't produce their widget, because they can't test them before shipping. They are some of the biggest corporations in the world and even they can't help us get some of the stuff we need. If they can't get their widgets produced, companies that depend on them can't produce their widgets. If you go deep enough you will find out how everything depends on everything else.
Widget 1 is not being produced because it's missing Widget 2. Widget 2 is not being produced because it's missing Widget 3. Widget 3 is not being produced because it's missing Widget 1.
Catch-22
And for all we know, shipping companies are taking measures like this, but making more container ships doesn't just happen. I don't know nearly enough about ships to know if it's even possible to convert a cruise ship to a container ship, but at bare minimum, you'd need to remove all of the above-deck amenities and cabin space, and maybe that requires less time than building a ship from scratch, but it still requires time. It requires hiring people who live near your dock to do it. It requires getting trucks to haul off all the waste you're generating. It requires metal recycling or waste facilities to have the capacity. It requires space at the dock to park a ship while you disassemble it. How much time does it take to get all that in place? How much expense? At least in the short run (but short possibly meaning a few years here), this would cause more shortages, as existing capital, space, and labor was repurposed to building new capacity rather than keeping the existing pipes moving.
And similary, you can provide capital to small farmers: https://gosteward.com/
Hyperinflation is a catastrophe.
And even if you do... great, now you have it on a different ship. You still have to get it on land, typically onto a truck. So you need some kind of a crane. And those are pretty busy these days...
We recently bought a custom couch that was delayed 3 months sitting on a ship. I offered to haul it off the ship myself, which of course the government wouldn't allow.
...... good luck with that!
Now, I'm not saying I personally believe that, but I see a lot of folks twisting his words and it's getting tiring. Happy to be proven wrong if someone can show me a quote from him where he contradicts my interpretation of his comments.
Why do we not have price level targeting aka perfect price stability? (targeting the CPI index to always be at 100) Because we don't have negative interest rates.
A slow down in the rate of inflation is considered disinflation.
If you're driving through some country roads at 60mph you might have a transitory period where you pass through a 30mph section by some little hamlet; when you resume 60mph you're behind schedule (if you planned not expecting the 30mph section) sure, but you're still moving at 60mph again.
I've seen companies go from doing everything in house to outsourcing everything. It was ugly before covid, but now it might be sinking the ship. They used to retain the necessary talent, keep a stock of necessary $THING, and get things done on time and on budget. Now the MBA's see a way to cut costs on paper but it all ends up late and over budget. On to the next ship for them after this top heavy piece of shit sinks.
I'm sure there's a careful business calculus for not bringing people up from the bottom but goddamnit I used to see results, and happier coworkers.
Like it or not, Covid didn’t prevent the workers from going to work. Government mandates did.
Not defending the practice (it's always seemed a no-brainer to me that investing in your team is better in the long run than to outsource) but I think I see the logic. Outsourcing, like renting equipment, lets you scale faster with less capital and reduces your exposure to sudden downturns in sales. It's a superior strategy if you have only an extremely limited ability to predict your market (whether because your market is highly volatile, or because you're bad at forecasting.)
Back when we used to see those results and happier co-workers, it was accepted that it would take 10-20 years to properly establish and build a business. There was none of this crazy pressure to gravely over-extend from day 1 in an attempt to unicorn out before you turn 40.