What caused all the supply chain bottlenecks? • Hacker News Board

Re: What caused all the supply chain bottlenecks?

#61

Post by fidesomnes » Thu, Oct 28, 2021, 7:34 PM UTC

_Algernon_ wrote: post #28

spookthesunset wrote: post #4

Or maybe attempting to shut down large swaths of world economy for an indefinite amount of time wasn’t such a good idea? In the timescale of months to years all business becomes “essential”. Sure shut it down for “just two weeks” but a year or more? What did people think would happen?

Have you forgotten the state of Italy and New York (among others) at the start and middle of 2020? There were literal trucks full of dead bodies in the streets because they couldn't be buried fast enough. How do you envision the time between march 2020 and the point where herd immunity through vaccines / infection would have been sufficient would have gone without a lockdown? I'll take a lack of a few non-essential l…

this is how effective propaganda works

Re: What caused all the supply chain bottlenecks?

#62

Post by xondono » Thu, Oct 28, 2021, 7:35 PM UTC

While I agree that a lot of companies have been screwing up the supply chains and their providers (cough automotive cough), maybe we should not build extra widgets just to support events that happen 1 out of every 100 years.

Not every system is a critical system, not all systems require spare capacity.

Re: What caused all the supply chain bottlenecks?

#63

Post by joe_the_user » Thu, Oct 28, 2021, 7:35 PM UTC

I believe the claim is completely defensible and ultimately correct.

A) This was a multi-factoral event certainly but all of these other factor are "immediate causes" which can themselves be traced to absolute maximum return on equity as a more final cause.

B) No doubt "hard to restart" process are were involved. But the world relies on single-source, hard to restart, large scale production of many things today because these produce the highest returns for those who invest in them and the lowest prices for those who buy from them. And both kinds of actors have been willing to just stop producing rather than doing something that might be costly to keep production going (and they decided they didn't want backup before this for the same reason).

C) Supply lines that stretch around world exist as a combination of economies of scale and "labor market arbitrage" and both these are driven by return, even though "labor market arbitrage" doesn't increase efficiency or robustness.

D) Chip manufactures put money into "up-date" chip processes, notably leaving the sorts of chips actually used in cars woah fully under-invested and generally many sorts of lack of robustness can be traced down to money flowing only to the normally profitable. Shutting down production isn't necessarily that bad for a company - they don't wages and they can start back up once things stabilize. It's much less disastrous than making a bunch of stuff and not being able to sell it. Clearly, that thinking is guiding a lot of decisions.

Re: What caused all the supply chain bottlenecks?

#64

Post by cmenge » Thu, Oct 28, 2021, 7:35 PM UTC

ben_w wrote: post #49

cmenge wrote: post #11

Hm, seems like a monocausal 'explanation' of a complex problem - or let's say a mere opinion with little background information. Given the 'hundred year crisis', I think we have fared relatively well from a purely economic point of view... So, yes, some problems may exist but I think we have witnessed a surprisingly resilient system, given how optimized everything is and how unprecedented the issue is. I don't know i…

If it was just one item, such as graphics cards, I wouldn’t be particularly concerned. The problem is it’s a bit of everything, a mere 11-ish years after the Great Recession, which was itself “supposed” to be a once-a-century economic catastrophe.

I was trying to be a bit dramatic there...

Sure, it affects everything and given the complex interconnections and dependencies within production chains / networks, the cause-and-effect relationships are hard to understand and cause for concern. But given how complex and decentralized things are, I am still amazed we haven't seen worse effects (yet). I doubt that spare capacity in logistics alone would make a huge difference, because you'd also need spare parts, materials and manufacturing capacity, all of which are part of the same network.

Re: What caused all the supply chain bottlenecks?

#65

Post by rajin444 » Thu, Oct 28, 2021, 7:37 PM UTC

elsonrodriguez wrote: post #37

silent_cal wrote: post #12

Earlier quoted context omitted.

Sweden

What about Sweden? https://ourworldindata.org/explorers/coronavirus-data-explor...

That's not a fair comparison. Most covid deaths are from those already past the average life expectancy. There's a very good chance they were going to die soon anyways. Not to mention you have to account for cancer patient + covid, etc.

https://www.reuters.com/article/us-health-coronavirus-europe...

Re: What caused all the supply chain bottlenecks?

#66

Post by [deleted] » Thu, Oct 28, 2021, 7:37 PM UTC

motohagiography wrote: post #43

It's a policy problem. Truth is hard to determine because the delays are the effect of upstream decisions. There were internet anecdotes about California port policy preventing drivers from picking up loads (allegedly the owner operator law changes that hit Uber also hit truck drivers as well), federal policy changes reducing the time drivers can spend at the ports and number of loads they can take each day, but it w…

[deleted]

Re: What caused all the supply chain bottlenecks?

#67

Post by ladyattis » Thu, Oct 28, 2021, 7:37 PM UTC

evilotto wrote: post #33

He's right to point out that the obsession with RoE is a big part of the problem. He's wrong to suggest that the billionaire class and founders will solve the problem if we only trust them and let them keep their money. Founders have just as much incentive to optimize the excess out of the system, they just call it "disruptive innovation" by which they mean tweaking how the system works so that they can squeeze out p…

Yep, the capital owning class just doesn't care if their businesses go into shock because they already have their cash in hand. They'll never go back to pre-ROE days because they'd have to live with less money and worse less control. While they still have personal reserves in the billions they can decide the fate of their ventures but if say 20% of their current cash was on the balance sheets of corporations with boards that don't vote their way most of the time then they're forced in the medium to long term acceptance of their policies. This isn't an argument for a return to traditional corporate power because they bungled so many things (GM and the rest of Detroit got their rear ends handed to them by the Japanese and their application of JIT).

Rather, it seems like to me the reliance of having a few owners or a few institutions with consolidated power in the form of money or assets is a recipe for disaster. If anything, it's time to disperse the wealth and responsibility of production to as many firms as reasonably as possible. I'd rather have 20 smaller companies making the same thing than 3 big ones that supposedly make them cheaper due to scales of economy which imo is wrong and that most big firms are in diseconomy of said scales now (prices imo reflect this). Basically, we need to both economically and politically Switzerfy the economy (more dispersed institutions, less central control where reasonably possible).

Re: What caused all the supply chain bottlenecks?

#68

Post by philwelch » Thu, Oct 28, 2021, 7:37 PM UTC

tgb wrote: post #21

Is "NIFO" really the right way to do accounting? If you sell the government one aircraft carrier, the cost of producing a second one will be much lower, so NIFO doesn't seem to fit there.

I think NIFO applies only to variable costs. Fixed costs are fundamentally different.

Also, low-volume items like aircraft carriers are probably a bad example. Aircraft carriers are ordered and built in small, specific quantities; I think it makes more sense to account for building a single aircraft carrier as a construction project rather than as a unit of mass production. Almost like you were building a small airport, thousands of units of housing, and a nuclear power plant.

Re: What caused all the supply chain bottlenecks?

#69

Post by hk1337 » Thu, Oct 28, 2021, 7:37 PM UTC

What's the deal with writing 20+ consecutive tweets instead of a blog post and tweeting the link to the blog post?

Re: What caused all the supply chain bottlenecks?

#70

Post by ootsootsoots » Thu, Oct 28, 2021, 7:38 PM UTC

flurie wrote: post #45

The buried lede is an assertion that a tax on unrealized capital gains will cause reduced private ownership of large companies, resulting in a reduced ability to handle 100-year flood events. Along the way, there are a bunch of other assertions that serve as prerequisites, like the idea that these companies can cultivate better employee loyalty and plan for longer horizons. How much do we know about how true that is,…

Behind every big corp is a well armed government and police apparatus

Given how many Fortune 500 companies have died even in prosperous times since the list started, I’m gonna file this away as “manufacturing consent to maintain the status quo.”

Corporations are not literal machines or organisms. They’re a social acquiescence given the reality of biological need at scale. The logistics are necessary; the behavior is necessary; the ownership angle is propaganda.