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To: edward miller who wrote (2594)	10/21/2021 1:29:17 AM
From: Sun Tzu	Respond to of 10538

From the article: To understand the situation, consider the country's inventory to sales ratio is at a 10-year low, which indicates that we're low on stuff. The Port of Los Angeles reported a 30% uptick in incoming cargo in the first nine months of this year. (Important note, most of nonfood goods sold in the US come from abroad.) The Port of Charleston, South Carolina, has been breaking all-time records since March. Prologis, a major industrial real-estate player, is "effectively sold out" of warehouse space. All of that means that the inventory to sales ratio isn't low because the US is short on stuff. It's low because sales have gone completely nuts. It's kinda hard to argue with the logic, unless you are disputing the numbers. The author then goes on to essentially agree with you. They mention that there are supply chain problems and shortages like semiconductors, but that doesn't explain why the shelves are empty. ---------------------- Now on to your point about the globalization. There is always a balance to be made between optimization and generalization. And this is not just for the global supply chain; it is a battle that is fought everywhere. For example, I personally hate Apple products and despite many attempts by friends (they bought me Apple gifts) and genuine attempts by myself, I just cannot use them. Why you might ask? Because I find the Apple user interface very restrictive and hard to use. How can this be true given Apple's reputation for the ease of use? The answer is that Apple's products are "easy to use" because Apple designs their products with a specific use case in mind. They then optimize the user interface for that specific use case to the Nth degree. The price for such optimization is rigidity. I do not fit the Apple mold and since Apple products cannot be customized to my way or thinking/usage, I end up hating them. I am sure that Apple is aware of this problem. But they have made a business decision that there are enough people who fit their mold that Apple is willing to forego sales to generalists like me. This is a valid business argument and it is in essence the same issue we are facing on the global supply lines, That is the business operations have been optimized for a "normal" use case. The pandemic threw a monkey wrench into those operations and stopped normal way of doing things. As a result we cannot easily cope with the alternative way of doing things (just as Apple's products cannot cope with my way of using them ;). Can we do it differently? Yes, of course. But there is also a price for generalized products. My favorite operating system is Unix. It has a reputation for being guru friendly and novice hard. You can make it work in any way you want, but you have to spend a ton of hours customizing it to your needs. In business that translates to increased costs that are then passed on to the customers. So there you have it. You can have lower prices, faster service, and higher profit margins 98% of the times, but you have to put up with a couple of difficult years once every 100 years or so. Or you could do it as it was done before WWII. Be more or less self sufficient. Have your own local standards and customize everything for your needs, but probably pay 20% - 40% higher costs throughout the years.