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What caused all the supply chain bottlenecks?

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Re: What caused all the supply chain bottlenecks?

#681

Post by coolgeek »

freemint wrote: post #677
rossdavidh wrote: post #605

Earlier quoted context omitted.

The reason just-in-time is to blame, is that JIT assumes you have a reasonably stable flow (yes, I worked in manufacturing where we studied JIT a lot). Yes, it was a shift from services to goods that provided the current shock, but it was JIT that meant the system could not adapt to shocks. If you have no buffers (or very small ones), then you cannot quickly adapt. If you put a vase on top of your car and drive away,…

I disagree deeply. If you have no buffers that means you can change what you produce without waste. JIT allows you to produce a customized car as it comes of the production line. it can adapt much more quickly then any system with a lot of stock. The problem is not "the system reacts to quickly to our controls". It's "humanity when faced with uncertainty about the pandemic choose to optimize the controls over a to sh…

You seem to be missing this part:

> JIT assumes you have a reasonably stable flow

Covid made nearly every flow unstable.

You can't adapt your production process if there aren't alternative options

Re: What caused all the supply chain bottlenecks?

#682

Post by pnutjam »

darawk wrote: post #678
pnutjam wrote: post #607

Earlier quoted context omitted.

I haven't realized any gains on my house, but I pay taxes on it.

Yes, but your property tax rate is a much lower recurring rate than the capital gains tax rate. In fact, a tax like that on unrealized gains would probably be a much better way to structure things. You pay 1% a year on unrealized gains until they are realized, at which point you can deduct what you've already paid. I guess this would be annoying to calculate, though.

Good news the unrealized gains are in a form very similar to what you outlined.

Re: What caused all the supply chain bottlenecks?

#683

Post by freemint »

coolgeek wrote: post #681
freemint wrote: post #677

Earlier quoted context omitted.

I disagree deeply. If you have no buffers that means you can change what you produce without waste. JIT allows you to produce a customized car as it comes of the production line. it can adapt much more quickly then any system with a lot of stock. The problem is not "the system reacts to quickly to our controls". It's "humanity when faced with uncertainty about the pandemic choose to optimize the controls over a to sh…

You seem to be missing this part: > JIT assumes you have a reasonably stable flow Covid made nearly every flow unstable. You can't adapt your production process if there aren't alternative options

> You seem to be missing this part:

No I am not missing that I just think that JIT done right (no true scottsman) doesn't require stable flow. At best it needs predictable flows and in the current economic system where a lot of information is lost at the company border => the only way to ensure predictability in our current system is have steadyness if things pass company borders.

If we are making statements about how our economic system ought to be it we should consider either flexible pricing that actually reflects information at the company border (with all the Pareto front guarantees that can bring us) or cross company optimization of the economy (providing better guarantees).

Re: What caused all the supply chain bottlenecks?

#684

Post by RustyConsul »

rossdavidh wrote: post #605
cbdumas wrote: post #314

All of this talk about supply chain issues are totally missing the point in my opinion. So many articles (and tweet chains I guess) have been written about supply chain issues, yet every one of them seems to ignore the elephant in the room which is demand for goods vs services. Over the course of the pandemic there was a staggering re-balancing of consumer spending [0] from services to goods, to which supply chains h…

The reason just-in-time is to blame, is that JIT assumes you have a reasonably stable flow (yes, I worked in manufacturing where we studied JIT a lot). Yes, it was a shift from services to goods that provided the current shock, but it was JIT that meant the system could not adapt to shocks. If you have no buffers (or very small ones), then you cannot quickly adapt. If you put a vase on top of your car and drive away,…

JIT's epitome is vertical integration so i don't think so. JIT made this all much more resilient because everyone has smaller, lower orders allowing everyone to a greater percentage of the total stock. What happened was people got alittle nervous and jumped off the JIT band wagon and tried to ensure they had large inventories to weather the storm. The big guys with the biggest orders got what they wanted at the expense of us plebs.

Re: What caused all the supply chain bottlenecks?

#685

Post by coolgeek »

freemint wrote: post #683
coolgeek wrote: post #681

Earlier quoted context omitted.

You seem to be missing this part: > JIT assumes you have a reasonably stable flow Covid made nearly every flow unstable. You can't adapt your production process if there aren't alternative options

> You seem to be missing this part: No I am not missing that I just think that JIT done right (no true scottsman) doesn't require stable flow. At best it needs predictable flows and in the current economic system where a lot of information is lost at the company border => the only way to ensure predictability in our current system is have steadyness if things pass company borders. If we are making statements about ho…

This comment is so abstractly general that I can't understand it. But I'd like to.

> flexible pricing that actually reflects information at the company border (with all the Pareto front guarantees that can bring us)

What information is lost at the border? Why? How is pricing not already flexible?

Re: What caused all the supply chain bottlenecks?

#686

Post by markjspivey »

cbdumas wrote: post #314

All of this talk about supply chain issues are totally missing the point in my opinion. So many articles (and tweet chains I guess) have been written about supply chain issues, yet every one of them seems to ignore the elephant in the room which is demand for goods vs services. Over the course of the pandemic there was a staggering re-balancing of consumer spending [0] from services to goods, to which supply chains h…

what you describe is still an actual supply chain issue though, you are merely elaborating on a possible cause for particular supply chain issues .

Re: What caused all the supply chain bottlenecks?

#687

Post by evandijk70 »

jjk166 wrote: post #676
evandijk70 wrote: post #671

Earlier quoted context omitted.

Having inventory on the shelf during a crisis is a far greater risk to the survival of a company than failing to produce cars quickly enough after unexpected high demand. Cancelling chip orders was the safe play, not the risky one.

Having inventory on the shelf is only an issue if it cannot be sold, which would only be possible if car sales never resume, an incredibly improbable outcome to the crisis. Everyone knew people would be back to buying cars soon enough. On the other hand cancelling orders carries great risk as no one is going to wait around for you to get more stock, if you miss your opportunity to make a sale it's gone, hence the mad…

'Everyone' did not people would be back to buying cars soon enough. Stock prices of car manufacturers lost 50% of their value. Factories were closed. They could have been closed for months or even years. That is a recipe for a liquidity crisis for a company, of which there is no coming back if you can not borrow money. Moreover, even if it was possible to produce cars, people were worried about a deep economic crisis caused by long lockdowns. Car sales are the first thing to go in such a crisis.

Re: What caused all the supply chain bottlenecks?

#688

Post by freemint »

coolgeek wrote: post #685
freemint wrote: post #683

Earlier quoted context omitted.

> You seem to be missing this part: No I am not missing that I just think that JIT done right (no true scottsman) doesn't require stable flow. At best it needs predictable flows and in the current economic system where a lot of information is lost at the company border => the only way to ensure predictability in our current system is have steadyness if things pass company borders. If we are making statements about ho…

This comment is so abstractly general that I can't understand it. But I'd like to. > flexible pricing that actually reflects information at the company border (with all the Pareto front guarantees that can bring us) What information is lost at the border? Why? How is pricing not already flexible?

Answering these questions depends on the particular industry and supply chain. Some industries do a better than others other use flexible pricing

Re: What caused all the supply chain bottlenecks?

#689

Post by leppr »

gruez wrote: post #358
leppr wrote: post #312

Earlier quoted context omitted.

Stock market valuations

You mean how S&P 500 was up 35% compared to the start of the pandemic? That's more of a reflection of the stock market getting inflated 35%, than the constituent companies getting 35% better.

Not agreeing to it, but that's what media and politicians mean when they talk about "the economy".

Re: What caused all the supply chain bottlenecks?

#690

Post by quadrangle »

EdwardDiego wrote: post #666
quadrangle wrote: post #479

Earlier quoted context omitted.

Seems to me like people just aren't sharing the wisdom enough about how to do these things both responsibly and efficiently. We used just use cloth diapers, put them in a diaper-only load in our washing machine, dry them in the dryer, and it worked fine. Scraping? We just used a sprayer attached to the toilet, held in a little clip thing that keeps the spray contained. Stuff went in the toilet, mostly-clean diaper go…

Or, different people have different circumstances. Like, say, a low pressure water supply, limited to 900L a day. There's a reason we went with scraping the solids off, then soaking the nappies. It wasn't a lack of wisdom. Wisdom is why we used a washing line instead of a dryer, as the UV in my country is amazing at removing the left over stains. It's also great at giving people with a Northern European heritage skin…

Thanks for sharing your perspective. I could have better emphasized though that I know there would have been no way for us to have managed as well as we did without having learned some wisdom that came from other people.

Yes, circumstances vary. But I stick to my basic point that wisdom is not shared anywhere near enough, and a lot of the blame for that goes on the businesses who profit from people remaining unwise. This factor is at the heart of a huge portion of the world's problems.

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