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Is It Time to Rethink Globalized Supply Chains?

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Re: Is It Time to Rethink Globalized Supply Chains?

#201

Post by chillacy »

abathur wrote: post #189
asdfman123 wrote: post #149

Earlier quoted context omitted.

How do you build in redundancy, though? If China makes widgets for $0.13 a unit and the US makes widgets for $0.15 a unit, how do you incentivize people to buy some of them from China, and some of them from the US? It seems like the logic of free trade and specialization dictates it's mostly all-or-nothing. That's a genuine question, by the way. I'm curious.

Like Chaos Monkey, but with import/export bans and/or tariffs?

Yea I was thinking that there is some sort of parallel to datacenters, where it's lowest latency to route everyone to their closest DC but in practice people usually route a certain percentage of traffic to standby datacenters which are farther away to make sure they're still working.

You lose some efficiency but gain in resilience. Nowadays big internet companies have all sorts of Disaster Recovery plans.

Re: Is It Time to Rethink Globalized Supply Chains?

#202

Post by generatorguy »

stormdennis wrote: post #173
wongarsu wrote: post #74

Earlier quoted context omitted.

We had the same problem back in 2011 when floods in Thailand wiped out almost all of the world's hard drive manufacturing capacity across all manufacturers. It took almost two years for prices per GB to fall back to pre-flood levels. Relying on only one country seemed as foolish then as it seems now, but we haven't learned the lesson yet.

Plus all these once a century storm and flood events seen to be happening more regularly in recent years.

i work on hydro electric power stations and often see drawings showing the 50, 100, 500, 1000 year flood water levels at some structure such as the powerhouse or intake. The civil engineers design the plant to withstand the 500 year flood. I've personally seen the 100 year flood level occur at about 7 different projects, and I only work on site at 1 project per year generally.

Re: Is It Time to Rethink Globalized Supply Chains?

#203

Post by Retric »

clairity wrote: post #192
Retric wrote: post #186

Earlier quoted context omitted.

I am convinced a low tariff of ~3% on all goods and services to every country is a good idea. But that’s never what happens, you get a huge mix of zero to insanity based on which industries have political power. As such a blanket ban on tariffs became a rallying cry. Food is often used as the counter example, but IMO domestic production is less valuable than a multi year stockpile.

why 3%? to overcome inflation? and why on everything instead of grossly disadvantaged industries? i haven't spent much time thinking about such details, so curious about the rationale.

It’s extremely expensive to grow bananas’s in Canada, so the correct response is to import them not add a huge subsidy. The point is to encourage domestic production, but not to the point of stupidity.

Further, unlike a direct subsidy it’s adding tax revenue.

Re: Is It Time to Rethink Globalized Supply Chains?

#204

Post by acd »

Yes agree that its time to rethink global supply chain. Actually its time to rethink the whole economy. Economist now say we need to consume more to keep the economy going. But the earth is warming due to global warming. When we consume more we also consume more energy to make those things.

Thus what economist the current economy need and what the environment need is disconnected and not in harmony.

We need to reinvent into a circular environmentally friendly economy where we put the environment first.

Re: Is It Time to Rethink Globalized Supply Chains?

#205

Post by lutorm »

jimbob45 wrote: post #16

Counterpoint: YKK (look at your zipper) relies on absolutely no one else for its supply chain [0]. This could easily be seen as a waste by those who would say YKK should just source its metal from the foundry down the street. It's easy to do a quick thought experiment in your head to think about how feasible it might be for every company to vertically integrate the way YKK has. On the other hand, YKK can't get jerked…

SpaceX is also very vertically integrated. This is a real strength if you are iterating quickly on your designs.

Re: Is It Time to Rethink Globalized Supply Chains?

#206

Post by Retric »

sigstoat wrote: post #196
Retric wrote: post #186

Earlier quoted context omitted.

I am convinced a low tariff of ~3% on all goods and services to every country is a good idea. But that’s never what happens, you get a huge mix of zero to insanity based on which industries have political power. As such a blanket ban on tariffs became a rallying cry. Food is often used as the counter example, but IMO domestic production is less valuable than a multi year stockpile.

> domestic production is less valuable than a multi year stockpile nobody is going to stockpile food or consumer goods when you're demonized for charging more for them when the demand goes up. there's no way to do anything but lose money on it.

Governments used to maintain grain stockpiles in case of famine. A modern equivalent could be run for vastly less than current farm subsidies. Especially if stocks where rotated and mostly refilled in years of massive surplus.

PS: At the extreme end Honey can be stored for thousands of years at room temperature.

Re: Is It Time to Rethink Globalized Supply Chains?

#207

Post by jameslevy »

mc32 wrote: post #122
tvanantwerp wrote: post #36

I feel like the problem is less that supply chains are globalized, and more that they aren't redundant. By that I mean, there's too much reliance on China as the primary producer/exporter for countless industries and products. Having just one nation account for such a large share of manufacturing introduces single points of failure. It would be wise to have multiple sources for any given good, especially if it's esse…

Tim Cook is was hailed as a supply chain guru. But even he likely didn’t weigh pandemics high up on the concern list enough to have supply chain redundancy. For what appears to be a 1/100 year event I’m not sure it would make sense for most companies anyway.

It may be best to no longer think about pandemics as a 1/100 year event.

Re: Is It Time to Rethink Globalized Supply Chains?

#208

Post by asdfman123 »

shas3 wrote: post #155
asdfman123 wrote: post #149

Earlier quoted context omitted.

How do you build in redundancy, though? If China makes widgets for $0.13 a unit and the US makes widgets for $0.15 a unit, how do you incentivize people to buy some of them from China, and some of them from the US? It seems like the logic of free trade and specialization dictates it's mostly all-or-nothing. That's a genuine question, by the way. I'm curious.

The incentive has already been created by Covid-19 exposing the vulnerabilities and need for decentralization. Diversification will emerge such that the next time there is a shock companies that diversified will survive, while others fail. Some industries will not learn because they will be bailed out, others like consumer electronics have probably already learned their lessons.

What I mean by incentive is the concrete, day-to-day purchasing decision incentives. I know why it might be a good idea, I just don't know how people could accomplish it.

Re: Is It Time to Rethink Globalized Supply Chains?

#209

Post by 6510 »

Spooky23 wrote: post #134
victor9000 wrote: post #106

Earlier quoted context omitted.

What problems have you encountered that others should avoid?

Over the years, I have run into: - Counterfeit components, like memory out of spec that creates scaled failures. - Fake products from the channel. - Fundamental mistruths with regard to how services are delivered. - Poor operational practices for maintaining SLA, especially for off-shored services. Those ops folks will move mountains to meet the minimum standard of "up", but will allow problems to fester. - Fraud. Fa…

I read when having bicycle frames made in Taiwan you get the best price/quality ratio if you have a permanent onsite observer in the factory. That guy doesn't really do anything but they wont cut corners if he is around.

Re: Is It Time to Rethink Globalized Supply Chains?

#210

Post by leereeves »

jagger27 wrote: post #177
fermienrico wrote: post #174

Earlier quoted context omitted.

Would you agree with Trump’s stance on reducing American reliance on Chinese manufactured goods? Trump has been doing that since his election.

Oh, is that what the tariffs are for?

Even the NY Times agrees with that.

> From tax cuts to relaxed regulations to tariffs, each of President Trump’s economic initiatives is based on a promise: to set off a wave of investment and bring back jobs that the president says the United States has lost to foreign countries.

https://www.nytimes.com/2019/08/13/business/economy/donald-t...

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