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

Re: What caused all the supply chain bottlenecks?

#211

Post by greendesk » Thu, Oct 28, 2021, 9:00 PM UTC

joe_the_user wrote: post #119

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…

Given the 'hundred year crisis', I think we have fared relatively well from a purely economic point of view... Covid was essentially "Sars II". If Sars1 had had the qualities needed to be a world wide epidemic, we'd be looking 10-100x the casualties. Sars1 happened a decade ago. Calling this a "hundred year crisis" seems wholly disingenuous. This event was forecast by quite a few people, the world was terribly unprep…

I have a tidbit on the following: >> we'd be looking 10-100x the casualties.

Viruses conform to the distribution of deadliness-vs-reproduction rate. For Sars 1 to spread widely, it has to be less deadly. There are limits to how a virus can both be deadly and contagious.

But just a tidbit on this statement.

Re: What caused all the supply chain bottlenecks?

#212

Post by makomk » Thu, Oct 28, 2021, 9:01 PM UTC

joe_the_user wrote: post #119

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…

Given the 'hundred year crisis', I think we have fared relatively well from a purely economic point of view... Covid was essentially "Sars II". If Sars1 had had the qualities needed to be a world wide epidemic, we'd be looking 10-100x the casualties. Sars1 happened a decade ago. Calling this a "hundred year crisis" seems wholly disingenuous. This event was forecast by quite a few people, the world was terribly unprep…

The original SARS didn't have the qualities needed to be a world-wide pandemic, though, and one of the big obstacles to that was that it was just too deadly. Not only do people who are so sick they have to be hospitalized not go out and socialize and spread the disease, all the hospitalizations and deaths gives a whole bunch of really obvious starting points for contact tracers - instead of only knowing about a tiny fraction of cases, most of them are highly visible and those people's contacts can be tracked down and isolated before they become infectious.

Also, a lot of governments did take suitable precautions in case Covid was more like the original SARS early on and just got flak for it. This was particularly visible here in the UK, where Public Health England and the government had already planned for another SARS or MERS-like virus and introduced really aggressive testing and contact tracing early on in case this was it. They just got attacked in the press for not continuing that once it became clear this wasn't like SARS and it wouldn't work - and then once they gave in and reintroduced testing and contact tracing as a measure, they were attacked again because (predicatably) it wasn't that effective and the media fuelled endless badly-informed conspiracy theories about the testing and contact tracing program only existing to funnel money to their pals.

Re: What caused all the supply chain bottlenecks?

#213

Post by WJW » Thu, Oct 28, 2021, 9:02 PM UTC

patrickyeon wrote: post #83

> Only founder led companies and family owned businesses can stand up to the immense pressure from the dogmas of modern finance. How about worker-owned companies, co-operatives, and collectives? I totally agree the problem is that with the finance people steering the ship there's incentives to push up your short-term performance and collect bonuses and watch your publically-traded stock value go up. So don't go publi…

The fact that there are so few of these types of company around probably means that they have trouble surviving in a world where the competition is supported by modern finance.

Re: What caused all the supply chain bottlenecks?

#214

Post by chernevik » Thu, Oct 28, 2021, 9:03 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 suppose it depends on what we're talking about, but probably not. LIFO and FIFO are book accounting concepts, and business decisions aren't (shouldn't be) based on book.

For example, almost every successful company is valued at some multiple of book equity, because book equity doesn't (and shouldn't, and can't) incorporate any notion of growth. Tesla's book value per share is something like $27/share, which reflects the cars it has sold and the ones in process. It trades at $1077, which reflects hopes for cars that it will sell.

LIFO and FIFO are just book accounting methods for tracking costs of production. They tell financial statement readers how management puts the cost of unit production into inventory values on the balance sheet, and how inventory values are translated into Cost Of Goods Sold on the income statement. They really aren't the right basis for business decisions like pricing or production.

I don't know what he means by "companies now use FIFO or LIFO accounting" as if this is some innovation. These have been the _only_ choices under GAAP for . . . a century? Longer? Letting companies use Next In First Out for financial statements would be inviting management to manipulate its balance sheet and earnings through its cost assumptions. Of course a company will use up-to-date cost information for pricing decisions, but they've always done that.

Accounting is really a language of its own. It provides a lot of useful information, but you have to know how to use it and what to use it for.

Re: What caused all the supply chain bottlenecks?

#215

Post by yalogin » Thu, Oct 28, 2021, 9:03 PM UTC

What? This turned from a supply chain to don't tax the rich post. I completely disagree with it. A good CEO will be able to do both look at the long term and deliver shareholder value. Yes, the growth could be slower but it is on the CEO to convince the board and investors that its a good thing. Either way, now that this issue is front and center, CEOs will not be blamed for planning ahead, so we can happily tax the rich? His logic not mine.

Re: What caused all the supply chain bottlenecks?

#216

Post by fullstop » Thu, Oct 28, 2021, 9:06 PM UTC

silent_cal wrote: post #201

fullstop wrote: post #41

Earlier quoted context omitted.

Their COVID death rate is 10x their neighbors, per capita. [1] 1. https://www.businessinsider.com/sweden-covid-no-lockdown-str...

No it isn't: https://ourworldindata.org/coronavirus/country/sweden?countr...

I specifically said "death rate" and "per capita".

Your source here is comparing two countries, one of which has 67 million people and the other which has 10 million and showing totals and not per capita, which is a worthless comparison.

Additionally, I don't consider Great Britain a neighbor of Sweden.

Re: What caused all the supply chain bottlenecks?

#217

Post by SkittyDog » Thu, Oct 28, 2021, 9:06 PM UTC

simonh wrote: post #172

SkittyDog wrote: post #123

Earlier quoted context omitted.

In the terms "economic rent" and "rent seeking", the concept of rent is not specific to assets. Rent paid to landowners was the original inspiration for the terminology, but in actual usage it refers to any economic behavior that extracts value without creating new value. • https://en.m.wikipedia.org/wiki/Rent-seeking Notably, this usage does not include "providing liquidity", so most of what hedge funds and private…

Liquidity is a service customers pay for. It’s not clear to me that’s unproductive work. More efficiently allocating capital can absolutely improve productivity. Some activities classed as renty can be economically beneficial. It’s not all pure usury, but activities that seek to increase rent revenue without increasing the value provided are a problem and that’s the ‘rent seeking’ part. I’ve no problem with fair valu…

I'm not arguing whether the definition is valid, just correcting the previous poster's misuse of some well-established economics jargon.

Re: Liquidity... The fact that a service is immediately useful to somebody (and has a willing customer) does not prove that it's a net productive behavior for the society, as a whole. That's just how the field of economics defines it, and the practioners widely agree that "providing liquidity" falls into that category.

Now, it sounds like you may be trying to defend the morality of rent-seeking behavior... If that's the case, I wish you good luck in your argument, with somebody besides me. I have no dog in that fight.

Re: What caused all the supply chain bottlenecks?

#218

Post by gruez » Thu, Oct 28, 2021, 9:07 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…

> 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 profit for themselves.

>I think economists call it rent-seeking.

Are you saying all "disruptive innovation" rent-seeking? Or only certain kinds? If a founder was able to "optimize the excess out of the system" by providing a better consumer-facing experience (eg. amazon), why shouldn't they be rewarded with profits? Is there any room for profits without being called a rent-seeker?

Re: What caused all the supply chain bottlenecks?

#219

Post by legitster » Thu, Oct 28, 2021, 9:08 PM UTC

Grakel wrote: post #191

legitster wrote: post #158

No, no, no! Stockpiling is not a solution to a bottleneck! In the grand scheme of things, having a couple weeks of extra inventory on hand will not help you weather a 100 year storm. But it will increase waste - inventory that you have to throw away when there are defects or when they become obsolete. Imagine trying to predict the run on lumber, and the solution was to have kept a bunch of lumber sitting in yards rot…

Quite the opposite, the lumber industry has been selling greener and wetter wood year after year. If they would stockpile the quality would increase, and they could build a cushion to fluctuating demand.

Haha! Point taken.

Re: What caused all the supply chain bottlenecks?

#220

Post by xyzzyz » Thu, Oct 28, 2021, 9:08 PM UTC

mfer wrote: post #60

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…

> I don't know if a slight price increase in graphics cards is the key issue to worry about at this point. The price increase in graphics cards isn't related to this. GMs trouble selling cars because they don't have enough chips to finish off the cars is a problem related to the pandemic and planning like the posts on Twitter note. The lack of new cars available has driven up prices on used cars. This is all supply c…

There were many more global pandemics in last 130 years. There were multiple global flu pandemics that were within the same order of magnitude of severity as Covid-19, eg. the Hong Kong flu of 1968 killed more people than Covid-19 had on per-capita basis.

It is not deadly global pandemics that are unprecedented, it’s the lockdown response to them that is.