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What caused all the supply chain bottlenecks?

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Re: What caused all the supply chain bottlenecks?

#481

Post by chii »

kqr wrote: post #87
rootusrootus wrote: post #59

Earlier quoted context omitted.

To be fair, once a century refers to average, it is by no means a guarantee that it will be a century before the next crisis.

To be even more fair, there's absolutely no reason to think these types of events are independent; there's good reason to believe they're positively correlated. This means once one happens the chances of it happening again soon are greater than before it happened. (But if you're lucky and it doesn't happen again the chances decrease further, giving you an average of 100 years between them again.)

> This means once one happens the chances of it happening again soon are greater than before it happened.

or more likely, it happens, but because of prior experience, the event is no longer as calamitous as the first time.

Looking at the GFC in 2008, the monetary policy back then was too tight (hindsight 20/20 and all that of course), causing the recession to be extended longer than it would've.

This covid disaster would've caused a similar problem, imho, if the Feds did not loosen up like never before. It "solved" that same problem the GFC produced. Had the GFC not occured, the pandemic would cause a double wammy - a medical problem, and also a monetary problem.

Re: What caused all the supply chain bottlenecks?

#482

Post by jollybean »

whatever1 wrote: post #405
roiboosxh wrote: post #380

Earlier quoted context omitted.

You cannot tax an asset that does not move. In what intervals would you do this? Your bank account would go to zero.

If the underlying asset is real (not speculative) and it grows, then it is income. So it should be taxed whether you spend it or not. But nobody wants this because we all know it’s pure speculation. That is why we call it “unrealized gains”. If everyone tomorrow tries to cash out their Apple stock, except from the first few, all the rest will get 1 cent each. There is no value in these tickets, just the power of comb…

No, unrealized gains are not income.

We 'don't want it' to be taxed because it doesn't make sense.

Also, you'd have to provide a tax shield for the losses as well.

There are so many things wrong with taxing on 'mark to market value'.

We can barely get away with it in real estate, but that market acts more rationally, and most of it is about rent extraction.

Re: What caused all the supply chain bottlenecks?

#483

Post by Inhibit »

spiralx wrote: post #446
WJW wrote: post #213

Earlier quoted context omitted.

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.

Can you have a cooperative with limited liability? I'm sure you can emulate it with a limited company and particular arrangements of stock ownership and voting rights, but I doubt that's easy or cheap to set up. The John Lewis Partnership in the UK is a public limited company whose shares are entirely owned by a trust that pays shares of profits to all of its employees, which isn't quite "ownership" but close, and th…

An S-Corp is the structure made for that sort of spread to a limited number of stakeholders. Not to say it's viable in some states with current regulation.

Also, LLP is a limited liability partnership. Wholly state entity, though, so the same caveat again. Member limits, etc.

And that's the USA of course. Your country may vary.

Re: What caused all the supply chain bottlenecks?

#484

Post by dragonwriter »

spiralx wrote: post #446
WJW wrote: post #213

Earlier quoted context omitted.

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.

Can you have a cooperative with limited liability? I'm sure you can emulate it with a limited company and particular arrangements of stock ownership and voting rights, but I doubt that's easy or cheap to set up. The John Lewis Partnership in the UK is a public limited company whose shares are entirely owned by a trust that pays shares of profits to all of its employees, which isn't quite "ownership" but close, and th…

> Can you have a cooperative with limited liability?

Yes, in the US, at least. A coop can be a corporation or LLC (and a coop that is either the former or the latter when taxed as a corporation has special tax status with the IRS, under subchapter T, so occasionally they are referred to as “T corps” analogous to C or S corps.)

Re: What caused all the supply chain bottlenecks?

#485

Post by throwaway984393 »

Of course there's no cash on the balance sheet. If you leave it on, your competitor won't. I don't know why people continue to believe there's an invisible economist in the sky making sure that your economy will always be healthy as long as the market can do whatever it wants.

Or, perhaps we're just looking at it the wrong way. Nature has epidemics, hurricanes, droughts, forest fires. Maybe a recession every 20 years is an economic forest fire clearing away the dead brush, and a collapse of global infrastructure is just a global logistics drought. Sure, companies collapse, people's lives are thrown to the wind. But nature's cruel, right?

Re: What caused all the supply chain bottlenecks?

#486

Post by Spooky23 »

Gigachad wrote: post #430
dpierce9 wrote: post #136

The average lifespan of a company is 10 years.[0] The average lifespan of companies on the S&P is maybe a little more than twice that. Each year you have a 1/100 chance of seeing a hundred year flood. With a short lifespan the odds are decent that your company simply won’t see one. The question is then: how good of an idea is it to spend to be robust to them? Of course it is viciously circular: planning to not be rob…

It should all come down to a cost/risk/reward/importance factor. If you are a bakery that sells very close to 100 loafs a day, you would want to make about 100 per day. Some event happens randomly and you have demand for 400. You could call it a supply chain failure or you could call it a success to turn away 300 customers once a year vs throwing out 300 loafs every other day. At the end of the period, all of this re…

I literally worked this scenario. We procured extra proofer and oven capacity as compared to what we needed daily. The cost was marginal, there was some labor cost savings (less cleaning) and added resilience.

But on those busy days, the store would turnover 4-5x when competitors were out of product.

Re: What caused all the supply chain bottlenecks?

#487

Post by whatever1 »

jollybean wrote: post #482
whatever1 wrote: post #405

Earlier quoted context omitted.

If the underlying asset is real (not speculative) and it grows, then it is income. So it should be taxed whether you spend it or not. But nobody wants this because we all know it’s pure speculation. That is why we call it “unrealized gains”. If everyone tomorrow tries to cash out their Apple stock, except from the first few, all the rest will get 1 cent each. There is no value in these tickets, just the power of comb…

No, unrealized gains are not income. We 'don't want it' to be taxed because it doesn't make sense. Also, you'd have to provide a tax shield for the losses as well. There are so many things wrong with taxing on 'mark to market value'. We can barely get away with it in real estate, but that market acts more rationally, and most of it is about rent extraction.

“ Also, you'd have to provide a tax shield for the losses as well.”

Not really. My car is losing 10% of its value each year but nobody is returning me the sales tax I paid for the full price. Let alone returning me some of lost value.

Why if your stock depreciates do I have to compensate you?

Re: What caused all the supply chain bottlenecks?

#488

Post by ridaj »

This is such a lame-ass take geared towards bashing the proposed tax on unrealized gains...

It's clear enough that the pursuit of ROE incentivizes stripping excess capacity in the short term. But NIFO vs LIFO accounting is a small insignificant detail of this, and the claim that founder-led businesses are fundamentally different doesn't pass the sniff test.

First there are many businesses in logistics that are founder-led or privately controlled by founder families, from Walmart to Maersk. If founder control was really critical to setting up a business to weather a 100-year storm, you'd have expected the logistics industry to fare pretty well.

There are also plenty of industries that had to deal with massive demand spikes and did not end up being long term bottlenecks, in spite of being pretty brutally managed by markets, like grocery supplies or telecom and internet access providers.

The main difference IMO is the growth orientation. In tech there was already a large expectation of strong long-term demand growth, so there was already a structure in place to deal with capacity growth. Industries that did not have this expectation, like maritime transportation and port infrastructure, do not have the ability to start increasing the capacity on a dime.

When the profit growth expectation isn't there, evidence is the private founder businesses don't invest either. I would believe the argument more of I heard a lot more of the likes of Bezos, Gates, Page, Musk etc. investing their private money into the kind of massive infrastructure upgrades needed to solve the world's logistics bottlenecks. Until then I call BS on the argument that we should just wait for them to invest their money to solve it.

Governments might as well take it and upgrade infrastructure if the money's just parked. With the modern "golden share" structures, that shouldn't actually take a lot of control away from founders...

Re: What caused all the supply chain bottlenecks?

#489

Post by rsj_hn »

whatever1 wrote: post #487
jollybean wrote: post #482

Earlier quoted context omitted.

No, unrealized gains are not income. We 'don't want it' to be taxed because it doesn't make sense. Also, you'd have to provide a tax shield for the losses as well. There are so many things wrong with taxing on 'mark to market value'. We can barely get away with it in real estate, but that market acts more rationally, and most of it is about rent extraction.

“ Also, you'd have to provide a tax shield for the losses as well.” Not really. My car is losing 10% of its value each year but nobody is returning me the sales tax I paid for the full price. Let alone returning me some of lost value. Why if your stock depreciates do I have to compensate you?

Say you bought a vintage car -- do you have to pay more sales tax each time the car appreciates? I know some owners of FJ Cruisers that would be pretty upset.

Re: What caused all the supply chain bottlenecks?

#490

Post by leetcrew »

dragontamer wrote: post #236
marginalia_nu wrote: post #228

Earlier quoted context omitted.

Bots still buffer items. Bot based factories produce when those buffers are low, not strictly when items are needed. A true on-demand factory would take ages to produce anything, it would basically not be much faster than handcrafting because the iron plates wouldn't start being created until the pipe is needed, and the pipe wouldn't be needed until the steam engine is needed. But it's much slower to make iron plates…

Just in time doesn't mean "buffer free". It means eliminating unnecessary buffers. When Ford ran out of chips ( https://www.cnbc.com/2021/03/31/ford-slashes-vehicle-product... ) because of its "just-in-time" process, Ford was able to give 2-months of notice before shutting down one of its lines. That means that Ford had a 2-month buffer __in practice__. ---------- When you go bot-based, you have full control over the…

> Just in time doesn't mean "buffer free". It means eliminating unnecessary buffers.

this is sort of tautological, or at least hinges on how you interpret "necessary". certainly no one would implement a buffer knowing at the time that it was unnecessary!

but even in factorio, it can be worth maintaining a buffer deeper than what's needed to keep the factory running at 100% under optimal conditions. you don't want to find out that you're out of stone when your bots stop autoreplacing your walls and the biters flood in, or discover that you've exhausted all your uranium patches when your base goes dark. it's a real pain to reseed your kovarex enrichment in a power crisis. I usually maintain fairly deep buffers of critical defense items and monitor them periodically (or set up alarms). especially with fuel cells, I like to have at least a two hour supply, in case setting up the next mine is nontrivial.

disclaimer: I have played several hundred hours of factorio, but I have never built a base so large that my PC itself became the bottleneck.

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