This makes a lot of sense to a non-financial sector person. I think many people are living in denial that everything will "go back to normal" and don't realize that our economy had been built on unsustainable pillars.
Everything in here is on point. The amount of tribal manufacturing knowledge in the Midwest that has been systemically destroyed by MBAs shipping jobs to China is heart breaking. Worked in my families business and machine shop. 2008 so many factory auctions we went to. In our shop we’ve had a few people age out and retire. The younger replacements that we can hire are not the best. Heck getting anyone competent enough to push a button and tighten a vice in a timely reliable manner is staggeringly difficult.
Let me follow up. I'm madder than H_ll. What have the common Mfer's done to my country? My forefathers, to include me, served and bled for this country. To hand it over to some ivory league educated Keynesian economists. This guy Keynes was a stooge, and so is the Fed, the US Treasury and nearly all of the banks on Wall Street.
@@kevinhathaway7240 Totally agree. It is in large part a result of voting in a two party duopolistic system. Made worse by placing capitalism over sociably responsible capitalism. Fuelled by agenda driven media. And unfortunately it spreading throughout the world. Seems the only way through is an event large enough and painful enough to cause a real revolt and reset. Hopefully to something more akin to Austrian economics. But I won't hold my breath for that to happen.
Give me...I'm a retired RN from NY....I would love to do this work at a sustainable $40/ hour. This pays a mortgage, and feeds a family. I'll wait for your call. LOL
The China model is ending and part of it is coming back. The self reliance narrative is vogue these days. My question, what is going to happen to China? Some people believe China will fall apart and disappear. It doesn’t seem like a reasonable conclusion.
@@kevinhathaway7240 Don't blame them- they get away with this because of political corruption. It is remarkably cheap to influence a politician- it is a very high return investment....
This has been one of the most important videos I have watched on RUclips. The analysis that the two of you have provided, the clarity has been eye-opening, and in concert with my observations and future outlook for our nation. I strongly believe in the apprenticeship system and in Worker Owned Co-ops as a means for decreasing the inequality, brought on by the Corporate owners of this country. As you have pointed out, it will take a holistic effort to address the coming challenges, and certainly a more united people that we have today.
you can have a global economic collapse and supply chain shortage AND a monetary expansion due to endless money printing at the same time. the crisis is the breakdown of the rules based international order, and the inflation is a conscious choice to put america on economic opiates to cover up the pain.
This is one of the most enlightening series of education I have witnessed in most likely a decade. The majority of people are just plodding along without any comprehension of the macro complexity of the world they are living in. Knowledge when gained then appropriately used is the avenue of freedom in their lives.
Yes! Heard a quote a year ago..... Went something like this: Companies did not fail because of covid, rather covid exposed the weaker ones. On another note: as a farmer. We have noticed higher commodity prices means very little to a farmer. For example soyabean had reached $20/ bushel vs $11 years prior. Question: what can a farmer purchase with their increased revenues? Answer: not much. Not much is being produced more of. For example tractors, new land to farm, labor, fertilizer etc. So growth in revenue is there, but the productivity of the economy to provide new products for farmers are absent. Farmers are not able to buy more tractors, because the economy hasnt produced more tractors. Hence the price of equipment has gone up. Basically the benefit to farmers isnt felt. The longer curve, prices of food will go up. Why? Because the incentive to produce more food isnt present neither. Food production also maintains or potentially decreases. There are no incentives to produce more. (At least what I see around our farm)
It's not the Toyota way!!! His assumptions about lean manufacturing and its origins are just completely wrong. Wrong in every sense. The idea that lean can only work in Japanese culture is wrong because it is not originally a Japanese idea. Its origins are in statistical process control and the need to maximise armaments production during WW2. It was conceived by Americans working for the US government tackling this very problem. They include W.Edwards Demming, Joseph Juran and Walter A. Shewhart. After WW2 their ideas were ignored by big business in the USA, and so they went to Japan where their ideas were adopted whole-heartedly. The reason that people think it is a Japanese idea, is because the men who invented were ignored in their own country, save for brief period during WW2 when the US ran as a partly planned economy.
True but the subject is not just all about the origins, but the applicability in cultures that work in ways that do not optimize for the strategy. For one, as suggested in the interview, by not being generational thinkers, but people tied to quarterly results at all costs, even the decline of the company's business relationships and long-term viability. There is a difference between helping develop and secure your suppliers and throwing them over on a moment's notice because you might save the odd penny and thus grow the value of your stock options for a single quarter.
You are right that these were American ideas, but isn't it interesting that Toyota had a much bigger inventory of the chips they need than any other auto manufacturer.
Anyone can start a war, but they are unsustainable without, and often won by, logistics. Napoleon himself said, "I will not move my armies without onions!" A lot comes down to the little things done right and in time.
That is exactly the same assessment from almost all East Asian maritime shipping and logistics firms. The US have this supply chain clogging since 2014 and did absolutely nothing to address it. Infrastructure and connectivity takes decades to build. The tiny city state of Singapore took 6 years and $20B to expand a container stacking yard, yet the US allocate only $17B for US ports in the Infrastructure Act...when we critically need $300B and a decade to construct and expand US port capacity. Another problem is that we also do not have the construction capacity and materials now to build too. Double whamy!!
Thank you both for this interesting and thoughtful discussion which also sheds light on the wider hypernormalization thesis which I've heard Simon speak of before and from his early life in the Soviet Union. In the UK, I can say that supply chain disruption has been compounded by Covid but has been building since Brexit with critical labo(u)r shortages in healthcare, hospitality, transport, building and farming and with real shortages on supermarket shelves and rampant inflation eroding the purchasing power of the most vulnerable. Yet the vast majority go about their daily lives grumbling but uninterested and blind to the structural changes and the consequences of their electoral choices.
Every 250 years our world goes from centralized to decentralization. 2030 it's the mark of decentralization. Just like crypto by the way bitcoin's algorithm was designed by "the" NSA. The Federal Reserve not Satoshi yakamoto The Federal Reserve is regulated and controlled by nobody - they have the failing Ponzi scheme Fiat dollar. It doesn't matter to them they're now tatalitarion = total control when will they let go of that hard concept. The Federal Reserve is going with the Central Bank digital currency - CBDC- it will fail like the paper. Crypto decentralized wake up McFly 2 years ago that's what I'm doing for hyperinflation. What about you ?
Few to none of the required changes that you describe will happen without an economic collapse. There are far too many special interests and disincentives for change standing in the way.
Necessity is the mother of invention, and the Fed & Government will prevent any complete collapse. Even if it means UBI and more free money to keep the machine running they will do it. Change is the only choice here
All of these supply disruptions were made exponentially worse by the amount of money printing and free money handed out, spiking demand to ultra high levels right when supply was at its lowest
Problem is not stimulus checks for the poor and social safety nets, it’s printing money to bail out the corporations, banks and insurance companies to maintain the current power structure. Focus on programs for the poor and lower middle class are the distraction....
@@mrocklop lol totally agreed. The poor received relatively little of the stimulus money. The vast majority of it went to large corporations and the rich. That being said, all that money was used to purchase products that were not being made due to covid lockdowns.
The money went to prop up the crypto, equity and real estate market. Consumer discretionary spending is relatively the same, but asset purchase have increased as seen through their current price.
Yes! The value of money went down. Productivity also went down or stayed the same..... In short, no incentives to produce more. As a farmer, I could have sold x5 times of meat I normal sold in 2019 or earlier. 2020 we sold x2 niot the x5 that we could have sold. Question, why didnt we sell more meat? 1. Labor. We couldnt find labor to help grow, raise, prepare and sell the larger volumes of meat. 2. Despite the labor shortage and an increase in price for the meats we sold. What was left over, wasnt enough of an incenitve to sell more than x2 the volume. Now 2021 demand remains high for meat. Price for meat continues to gi upward. Yet, again the incentive to sell more meat for "today's" dollars remains non existent or not enough. So from a farmer/investor point of view, what on earth is happening!?! Has the price of moeny deteriorated so much, that the supply chains have to fall off a cliff completely to become an incentive to produce more? Or to continue farming?
Australia has exactly the same problem. Tradesmen take year's to train up. For 30 odd year's skilled workers have been increasingly sidelined in favor of cheaper alternatives found overseas. A revaluation of skilled workers is imminent.
He started by saying some people think it's a conspiracy. I really just think it goes to show the most inflated asset... is American management. It was just bad management. You can tell they don't know what we're doing by going to any hospital. No, PPE, but all the luxury cars in the parking lot? They don't know what to invest in, when, and how.
Who owns the ports ? Who controls the port operations ? Why is it that none of the ports improved to be in a position to handle what they could clearly see what was coming ?
1. Corporations. 2. Corporations. 3. Because it costs the corporations money to build extra infrastructure to hedge against rare once in several decades supply chain bottlenecks. This is where government regulations come in handy. Like the ones passed after the 2008 great recession for the financial industry, requiring them to hold more assets insuring against their own potential demise. Any day the government could require and fund expansion of port infrastructure and, forgive the pun, a 'raft' of reforms requiring them to adapt their systems and logistics to these modern times and modern challenges to head off the next potential supply chain bottlenecks.
I work for a global manufacturing company and we are redirecting our suppliers to choose container ships that arrive to east coast ports starting in 2022 and not to use ships headed to US West coast ports... California governor policies are continuing to resist flow of goods at the ports....
We all knew this day was coming and cheap junk from China was an anomaly so I'm eager to get this underway. The US is in deep trouble for all sorts of reasons but it's a necessary step forward to decouple from China and de-globalize in the general sense.
Definitely part of the road, but if that action isn't an effect of a transformational cause, we will repeat the loop. We don't seem to want what we opine.
@@JscottMays We likely will repeat the loop, but that in itself will steady our international relationships and business partnerships, as we come to learn that one shouldn't rely on trade with a single country to drive our own economy, but should promote competition between countries so that we have safety valves should any one of them go rogue on us.
Wow. This conversation started out pretty slow and then got really interesting really fast. Lots to think about here and it makes sense in light of the changes we've been seeing as far as China's crackdown on its tech companies and other aspects of its society.
The US military budget for one year is enough to endow 100 Harvards. Every state could have two world-class public universities, totally self-funded with what we spend pursuing our militaristic failing foreign policy. How much of a sacrifice would it be for the FED to print money for that purpose? . . . Kennedy, you're a bigger dreamer than I am. A more talented workforce would be a risk too large to bear for the oligarchs who own the US.
Hardvard is what Harvard is because of the people who work and study at Harvard. There isn't a sufficiently large base of people with enough grit, intelligence and creativity to create 100 Harvards. In many European countries, all universities are publicly funded, yet almost none of those countries have even a single equivalent to Harvard.
@@Hamsteriller No doubt you are correct regarding the numbers, yet, if the US Public School System had been designed to teach young people to think, instead of to become worker bees, education would have been interesting and challenging. The wealthy sent their offspring to high quality PRIVATE schools! Harvard requires students who can think. And where do such students originate? From PRIVATE SCHOOLS. The Elite have set up society for only their successes, year after year! Please do not be shortsighted.
This interview pulled together and summarized all the "hints" of what is happening from all sorts of news. This makes the most sense and explains everything...even Xi's goals and the impact on us.
These guys are leaving out a huge part of the puzzle wich is Demographics and poor socialization in the U.S. We have a generation of mostly broken people in Gen Z. Lots of cultural conflict aswell.
The little plastic thing a couple of centimetres under your left earbud is supposed to be slid down and used to semi-permanently connect the left and right cables. Give it a try. :)
When we had a small business we didn't order too many of any one item because it would be too expensive and we never took out a loan. These big retailers do take out loans or sell bonds to raise money for their inventory but I assume their main limitation is storage. Small items are easy to find storage space but not bigger items.
I didn't do that either and that was 40 years ago. Now I'm retired at 59. I was a systems administrator for 39 years. No school and not a single certificate.
Doctors, Lawyers, Engineers and Architects have very difficult trades too. Some pay well, but it is the sense of purpose and serving our community which puts us through years of painful exams and no income. Floowed with long hours and high responsibilities.
for some people that's a great option. What I don't like is when those type of people want to evangelize their choices as what everyone should do, as if it were a one size fits all solution to all our labor & economic woes. "People crying about low wages and inequality but don't want to pick up a hammer, hurr durr" Reality is not everyone is well suited to work in trades for a variety of reasons. But for those who are, we should certainly make it easier for them to get started as we have some national shortages of electricians and other trades jobs and they typically pay very well with less class time and ability to earn wages earlier.
Brilliant Job, understanding of what has happened. We have distroyed the country via outsourcing the real economy to low wage countries and benefiting a few. Wall Street and hyper rich
When maximizing shareholder value is the goal, the emergence of this system is inevitable. Every Computer Science major in college knows painfully well that greedy algorithms are rarely optimal.
It starts, with a shake up, of management. They have been more concerned with, their share options, than with the employees. You want loyal, proud, workers, productivity??
No they don't. They want them fearful and easily controlled. Preferably not even in this country, so they can be even more desperate. We are definitely not "all in this together."
This was really great. 40:00 So needed said. My partner and I thought we'd start a very needed technical HVAC mechanical business in January, Wrote us a great business plan and still not a dime of lending comes from our very bailed out banks.. We trying to decide now whether to cut our losses before years end.
@@remrem4 Indeed it is. Most don't understand DeFi (decentralized finance) yet. They're just now hearing for the first time about Ethereum. So much development on L1, soon a gravitation to L2 will be the thing. Blocks will be full. Watch.
Fascinating topic. Watching this 3/10/022. The world is vastly changed since your broadcast. I would like to hear this speaker with an update with today's World happenings.
Like you guys said investment is needed. Companies don’t invest in their own business let alone in shared infrastructure. Our politicians won’t invest. You guys have a nice dream that is to going to happen. We also have climate change which solutions are going nowhere fast to doing anything about it
Great conversation! Exactly all what I have been thinking! Happy I own a few shares of Tesla because Tesla/spacex is bringing back innovation and how to craft labor and do it competitively with rest of world
In my opinion people won't put up with it they'll go back to shopping at the stores two of my deliveries recently I've never received the third one so far has not been shipped
Once I hear '3d printing ' is going to be so important in the future I know this guy knows nothing about the manufacturing business. There's no way he spends any time in a machine shop making any thing. By the way, manufacturing apprenticeships are still around in the US . It's just that most people are only know about sales /marketing and have completely lost touch with making things. Maybe some of their grandfather's actually made things.
Unfortunately, an economic depression could be the catalyst to rebuild our base and get back in the game. So it could turn out to be a fortunate thing if used for an opportunity.
Perhaps, the covid distraction is perfect? Our economy Sept 2019 reached the same size as we left off in 2007. The reverse repo started around the same time. Right at the same time US treasuries were not being bought by the Chinese. We dont hear much about the money printing, nor do we hear much about the US treasuries and we dont hear about how little foreign invstors have stopped supporting US treasuries. Why? Perhaps why is because we are in Depression already? Technically "stuck" since 2009 and have fallen again in 201, failing to go upward or above 2007..... Why? Incentives. Productivity has not gone up.....
A lot of great points in this discussion. I have just come back from a train trip by Amtrak and I saw first hand how much the logistics and supply chain in America are in need of repair. There is a lot going on, to say the least.
Shelves aren’t empty anywhere I shop. Florida, GA, AZ…. I’m in these places a lot. My condo overlooks the shipyards in Miami Beach. There are no backups or ships parked offshore.
Excellent interview! It is the best articulation of what decoupling from China really means. Even a collapse of the CCP, which would be considered deflationary could have an inflationary impact on the rest of world due to the lack of goods and services available. As the globe splits in two, the standard of living declines for almost everybody.
Interesting. Splitting the world into two. Interesting. This seems so. What does it mean? Perhaps, the splitting and two diconomies moving in opposite directions. China, potentially grwoing, and the western world not growing or remaining stagnant.... This essentially sounds like grounds of war???
@@riversedgegoatdairy297 it is my understanding that China is not growing. They are now more focused on a stronger currency in order to manage their global ambitions. By the 2nd quarter, nobody will be growing.
@@michaelhueppeler7005 our sources of information of china are limited. We can witness this by watching countless videos of how China limited their people during the pandemic. But also by not being able to find the data of how much imports and exports this country conducts. Of all the nations in the world, china is perhaps the most "protective" economy. The chinese economy is a domestic driven one. 80% of its total GDP is domestic. The move from rural to urban policy is the driving force and perhaps a recession in their housing market. Unlike here in north America, china has productivity. North america has very little to no productivity. Despite illuding its people to believe we are recovered from the financial recession of 2007-08. As long as the gov't policy sticks. That is continue to move people off of farms into cities? The chinese economy wll continue to grow and prosper. In contrary to the USA. The economy lacks innovation or perhaps a war? To keep its economy going?
@@riversedgegoatdairy297 you may want to check the China Credit Impulse and the demographics development in China. I highly recommend Louis Vincent Gave’s latest interview on MacroVoices right here on RUclips.
@@michaelhueppeler7005 yes, I found the credit pulse an interesting statistic. The fact that if the credit delivered in China "may" out pace the American's or the western world's pulse, is of concern. Foreign investment in the past has always trended towards the higher interest or yeilds. If this happens even to a small degree? A trend towards higher rates will only create devestation mostly in America and Europe.... Less an impact on the Chinese economy. I will look into Louis vincent Gave's...... That name doesnt ring a bell. Thanks
The total leverage in the system both public and private has ballooned in the last couple of years . People forget that the US economy was sputtering after the ninth fed funds bump up to 5.5% in late 2018. The fed had to cut in 2019 long before the pandemic. That was about eight trillion dollars in federal debt ago. It’s going to take much less of an interest rate increase to blow things up now.
Wow I'm glad I stayed and listened to this. I started to think how convenient Covid-19 was to China in helping them break away from the West (specifically the U.S.). Seems the timing lined up to what China is planning. Also if we do really need to alter the way we do things here then the Political Establishment has to start to let the citizens know its has to happen and we have to change and change in the way we see things.
It’s not so much that China wants to break away from the west but it is that China was forced to do so. US weaponized its currency, targeted competition with tariffs and sanctions. From the very beginning China said they wanted win win cooperation but the US targeted them with sanctions and tariffs. They responded by protecting themselves from US aggression and attacks by looking for trade elsewhere (both with internal consumption of their own population and also with expanding trade with other countries).
I have not been putting all my eggs in one basket,and today I heard that all my baskets are in one basket. So,I guess I need the buy some physical gold or some fertilizer stocks.
Wouldn't a disrupted reliance on cheap labour just shift things more towards it being replaced by technology? Not sure i buy the narrative of generational change reverting back to localised labour. Very insightful interview though.
"Wouldn't a disrupted reliance on cheap labour just shift things more towards it being replaced by technology?" I think this is the exact kind of thinking USA has gotten used to over decades that it needs to get rid of. One thing this wonderful interview missed was that a very high percentage of high end tech work is being done by immigrants (first or second generation). With the end of globalization, that inflow will go down as well. During and post the world wars, the world was destroyed(except USA) and all the brilliant minds were kind of forced into USA for atleast 2-3 generations. That lead to a domino effect and brilliant minds have been coming to USA since (because the last generation of brilliant minds were in US). If that cycle breaks, US is in real trouble..
Blame this on shipping all the jobs overseas Blame the Reagan /Greenspan financial rigging In favor of Wall Street and big banks Blame getting rid of Glass Steagall act depression era law
Clinton signed nafta and sent our jobs to other countries. Bush had it in the works. Those two are to blame. With that said, America has sweat shops just like China. We need unions.
@@anniealexander9616 Tesla doesn't have unions and they are employing in record. Umbers quality jobs that pay more than other car companies that are represented by unions.... So no, unions can be useful but it's not an absolute need. I work in a District where the unions doesn't have the best interest of the employees servicing the community. They're corrupt, do I'd be careful with absolutes.
I agree that the decoupling is happening but disagree with the cause of it. It was initiated by US, not China, during the trump era because US finally realized that without decoupling China will surpass US even faster and the only way to slow down China’s growth is decoupling, Which hurts both countries.
AMERICA will SOON be destroyed in "one hour"; THEN, ALL of Asia, Australia, and Europe will face an onslaught of the Communist Hordes from China (Genghis Han!) and Russia (the Great Bear arises and devours). So it is written, so shall it be done...11 “And the merchants of the earth weep and mourn over her, because no one buys their cargoes any more... 19 And they threw dust on their heads and were crying out, weeping and mourning, saying, ‘Woe, woe, the great city, in which all who had ships at sea became rich by her wealth, for in one hour she has been laid waste!’ (Revelation, Chapter 18 New American Standard Bible 1995)
Best information i have gotten in a long, long time. I not being a pessimist, just a realist when i observe that socially and politically the U S is incapable of promulgating his recommendations. Its going to be an unfolding debacle.
Why should a co-party perform when they can make more from the next FED handout? Moral hazard has reached depths comparable only to the soaring heights of the bubble markets.
This makes a lot of sense to a non-financial sector person. I think many people are living in denial that everything will "go back to normal" and don't realize that our economy had been built on unsustainable pillars.
man this guy gets it. Bring him more often
💯
Facts.. let's stop buying taas and bots
Everything in here is on point. The amount of tribal manufacturing knowledge in the Midwest that has been systemically destroyed by MBAs shipping jobs to China is heart breaking. Worked in my families business and machine shop. 2008 so many factory auctions we went to. In our shop we’ve had a few people age out and retire. The younger replacements that we can hire are not the best. Heck getting anyone competent enough to push a button and tighten a vice in a timely reliable manner is staggeringly difficult.
Let me follow up. I'm madder than H_ll. What have the common Mfer's done to my country? My forefathers, to include me, served and bled for this country. To hand it over to some ivory league educated Keynesian economists. This guy Keynes was a stooge, and so is the Fed, the US Treasury and nearly all of the banks on Wall Street.
@@kevinhathaway7240 Totally agree. It is in large part a result of voting in a two party duopolistic system. Made worse by placing capitalism over sociably responsible capitalism. Fuelled by agenda driven media. And unfortunately it spreading throughout the world. Seems the only way through is an event large enough and painful enough to cause a real revolt and reset. Hopefully to something more akin to Austrian economics. But I won't hold my breath for that to happen.
Give me...I'm a retired RN from NY....I would love to do this work at a sustainable $40/ hour. This pays a mortgage, and feeds a family. I'll wait for your call. LOL
The China model is ending and part of it is coming back. The self reliance narrative is vogue these days.
My question, what is going to happen to China?
Some people believe China will fall apart and disappear. It doesn’t seem like a reasonable conclusion.
@@kevinhathaway7240 Don't blame them- they get away with this because of political corruption. It is remarkably cheap to influence a politician- it is a very high return investment....
I like how Ross gives a short direct answer and then gives a coherent long form explanation.
This discussion is a fantastic example of why Real Vision is Essential to understanding where we are.
This has been one of the most important videos I have watched on RUclips. The analysis that the two of you have provided, the clarity has been eye-opening, and in concert with my observations and future outlook for our nation. I strongly believe in the apprenticeship system and in Worker Owned Co-ops as a means for decreasing the inequality, brought on by the Corporate owners of this country. As you have pointed out, it will take a holistic effort to address the coming challenges, and certainly a more united people that we have today.
Right, Mikhailovich. This is not inflation. The FED is using that term to obscure the fact that the incumbent system is collapsing.
you can have a global economic collapse and supply chain shortage AND a monetary expansion due to endless money printing at the same time. the crisis is the breakdown of the rules based international order, and the inflation is a conscious choice to put america on economic opiates to cover up the pain.
Living this nightmare in my company and industry now. Going on 2 years with no end in sight.
This is one of the most enlightening series of education I have witnessed in most likely a decade. The majority of people are just plodding along without any comprehension of the macro complexity of the world they are living in. Knowledge when gained then appropriately used is the avenue of freedom in their lives.
I feel like the supply chain crisis haven't been discussed in more depth on macro/financial youtube, so this was educational!
Excellent conversation. The predicament we are experiencing was decades in the making. Covid just rushed the process along.
Yes! Heard a quote a year ago..... Went something like this: Companies did not fail because of covid, rather covid exposed the weaker ones.
On another note: as a farmer. We have noticed higher commodity prices means very little to a farmer. For example soyabean had reached $20/ bushel vs $11 years prior.
Question: what can a farmer purchase with their increased revenues? Answer: not much.
Not much is being produced more of. For example tractors, new land to farm, labor, fertilizer etc. So growth in revenue is there, but the productivity of the economy to provide new products for farmers are absent. Farmers are not able to buy more tractors, because the economy hasnt produced more tractors. Hence the price of equipment has gone up. Basically the benefit to farmers isnt felt.
The longer curve, prices of food will go up. Why? Because the incentive to produce more food isnt present neither. Food production also maintains or potentially decreases. There are no incentives to produce more. (At least what I see around our farm)
It's not the Toyota way!!! His assumptions about lean manufacturing and its origins are just completely wrong. Wrong in every sense. The idea that lean can only work in Japanese culture is wrong because it is not originally a Japanese idea. Its origins are in statistical process control and the need to maximise armaments production during WW2. It was conceived by Americans working for the US government tackling this very problem. They include W.Edwards Demming, Joseph Juran and Walter A. Shewhart. After WW2 their ideas were ignored by big business in the USA, and so they went to Japan where their ideas were adopted whole-heartedly. The reason that people think it is a Japanese idea, is because the men who invented were ignored in their own country, save for brief period during WW2 when the US ran as a partly planned economy.
You should challenge business, and the politicians, with your claim.
True but the subject is not just all about the origins, but the applicability in cultures that work in ways that do not optimize for the strategy. For one, as suggested in the interview, by not being generational thinkers, but people tied to quarterly results at all costs, even the decline of the company's business relationships and long-term viability. There is a difference between helping develop and secure your suppliers and throwing them over on a moment's notice because you might save the odd penny and thus grow the value of your stock options for a single quarter.
You are right that these were American ideas, but isn't it interesting that Toyota had a much bigger inventory of the chips they need than any other auto manufacturer.
In the early nineties Jim Grant said that Just in Case would someday replace Just in time.
How can this guy derive all this insight from supply chains and purchase orders?
Pretty incredible.
Because he has to see things systemically for his job.
It might to hard to visualize. But the answer to your question ironically is that he thinks about stuff.
Anyone can start a war, but they are unsustainable without, and often won by, logistics. Napoleon himself said, "I will not move my armies without onions!" A lot comes down to the little things done right and in time.
That is exactly the same assessment from almost all East Asian maritime shipping and logistics firms. The US have this supply chain clogging since 2014 and did absolutely nothing to address it. Infrastructure and connectivity takes decades to build.
The tiny city state of Singapore took 6 years and $20B to expand a container stacking yard, yet the US allocate only $17B for US ports in the Infrastructure Act...when we critically need $300B and a decade to construct and expand US port capacity. Another problem is that we also do not have the construction capacity and materials now to build too. Double whamy!!
Maybe we should spend that $300 billion on rebuilding our infrastructure so we aren't so dependent on imports.
@@ppumpkin3282 300 billion is a drop in the bucket when China spends 10 trillion on infrastructure. It's game over.
Best crosssection discussion I've seen between supply chain and finance
Thank you both for this interesting and thoughtful discussion which also sheds light on the wider hypernormalization thesis which I've heard Simon speak of before and from his early life in the Soviet Union. In the UK, I can say that supply chain disruption has been compounded by Covid but has been building since Brexit with critical labo(u)r shortages in healthcare, hospitality, transport, building and farming and with real shortages on supermarket shelves and rampant inflation eroding the purchasing power of the most vulnerable. Yet the vast majority go about their daily lives grumbling but uninterested and blind to the structural changes and the consequences of their electoral choices.
Every 250 years our world goes from centralized to decentralization.
2030 it's the mark of decentralization.
Just like crypto by the way bitcoin's algorithm was designed by "the" NSA.
The Federal Reserve not Satoshi yakamoto
The Federal Reserve is regulated and controlled by nobody - they have the failing Ponzi scheme Fiat dollar.
It doesn't matter to them they're now tatalitarion = total control when will they let go of that hard concept.
The Federal Reserve is going with the Central Bank digital currency - CBDC- it will fail like the paper.
Crypto decentralized wake up McFly
2 years ago that's what I'm doing for hyperinflation. What about you ?
"Not slaves, but massively underpriced labor." Real nuance there.
Dude let me tell you here in Canada we have a massive shortage of trades people. I'm a plumber/steamfitter and most of us are crapping cash right now
Sounds like too many going to college
Are electricians cashing out too?
@@bennyroyal2191 anyone with a red seal trade is making nothing but money 💰
Few to none of the required changes that you describe will happen without an economic collapse. There are far too many special interests and disincentives for change standing in the way.
quite probably, the incumbents will not change unless forced
Necessity is the mother of invention, and the Fed & Government will prevent any complete collapse. Even if it means UBI and more free money to keep the machine running they will do it. Change is the only choice here
@@DocDanTheGuitarMan Humans fear change, even from terrible conditions. Change rarely comes about unless forced, IMO.
All of these supply disruptions were made exponentially worse by the amount of money printing and free money handed out, spiking demand to ultra high levels right when supply was at its lowest
Problem is not stimulus checks for the poor and social safety nets, it’s printing money to bail out the corporations, banks and insurance companies to maintain the current power structure. Focus on programs for the poor and lower middle class are the distraction....
@@mrocklop lol totally agreed. The poor received relatively little of the stimulus money. The vast majority of it went to large corporations and the rich.
That being said, all that money was used to purchase products that were not being made due to covid lockdowns.
The money went to prop up the crypto, equity and real estate market. Consumer discretionary spending is relatively the same, but asset purchase have increased as seen through their current price.
Yes! The value of money went down. Productivity also went down or stayed the same.....
In short, no incentives to produce more.
As a farmer, I could have sold x5 times of meat I normal sold in 2019 or earlier. 2020 we sold x2 niot the x5 that we could have sold.
Question, why didnt we sell more meat?
1. Labor. We couldnt find labor to help grow, raise, prepare and sell the larger volumes of meat.
2. Despite the labor shortage and an increase in price for the meats we sold. What was left over, wasnt enough of an incenitve to sell more than x2 the volume.
Now 2021 demand remains high for meat. Price for meat continues to gi upward. Yet, again the incentive to sell more meat for "today's" dollars remains non existent or not enough.
So from a farmer/investor point of view, what on earth is happening!?! Has the price of moeny deteriorated so much, that the supply chains have to fall off a cliff completely to become an incentive to produce more? Or to continue farming?
@@henrytep8884 Hardly anyone still owns any % of crypto.
Australia has exactly the same problem. Tradesmen take year's to train up. For 30 odd year's skilled workers have been increasingly sidelined in favor of cheaper alternatives found overseas. A revaluation of skilled workers is imminent.
He started by saying some people think it's a conspiracy. I really just think it goes to show the most inflated asset... is American management. It was just bad management. You can tell they don't know what we're doing by going to any hospital. No, PPE, but all the luxury cars in the parking lot? They don't know what to invest in, when, and how.
Who owns the ports ?
Who controls the port operations ?
Why is it that none of the ports improved to be in a position to handle what they could clearly see what was coming ?
1. Corporations. 2. Corporations. 3. Because it costs the corporations money to build extra infrastructure to hedge against rare once in several decades supply chain bottlenecks.
This is where government regulations come in handy. Like the ones passed after the 2008 great recession for the financial industry, requiring them to hold more assets insuring against their own potential demise. Any day the government could require and fund expansion of port infrastructure and, forgive the pun, a 'raft' of reforms requiring them to adapt their systems and logistics to these modern times and modern challenges to head off the next potential supply chain bottlenecks.
🤔
I work for a global manufacturing company and we are redirecting our suppliers to choose container ships that arrive to east coast ports starting in 2022 and not to use ships headed to US West coast ports... California governor policies are continuing to resist flow of goods at the ports....
We all knew this day was coming and cheap junk from China was an anomaly so I'm eager to get this underway. The US is in deep trouble for all sorts of reasons but it's a necessary step forward to decouple from China and de-globalize in the general sense.
Definitely part of the road, but if that action isn't an effect of a transformational cause, we will repeat the loop.
We don't seem to want what we opine.
@@JscottMays We likely will repeat the loop, but that in itself will steady our international relationships and business partnerships, as we come to learn that one shouldn't rely on trade with a single country to drive our own economy, but should promote competition between countries so that we have safety valves should any one of them go rogue on us.
@S. Medina 0
Agreed but..... by de coupling are we then in more of a risk to fight militarily
Can’t wait to pay $400 for a pair of shoes and then never have to buy one again.
This spells out the manufacturing distribution side of things beautifully. The money supply policies would be a great bookend to this.
Wow. This conversation started out pretty slow and then got really interesting really fast. Lots to think about here and it makes sense in light of the changes we've been seeing as far as China's crackdown on its tech companies and other aspects of its society.
I feel like I'm in an MBA Program.
Bring this guy more often. Brilliant!
Eye opener. Problem of US is SHORT TERM THINKING. As stated in this video!!!!!!!!!!
This a concise and substantive talk. Excellent
The US military budget for one year is enough to endow 100 Harvards. Every state could have two world-class public universities, totally self-funded with what we spend pursuing our militaristic failing foreign policy. How much of a sacrifice would it be for the FED to print money for that purpose? . . . Kennedy, you're a bigger dreamer than I am.
A more talented workforce would be a risk too large to bear for the oligarchs who own the US.
Hardvard is what Harvard is because of the people who work and study at Harvard. There isn't a sufficiently large base of people with enough grit, intelligence and creativity to create 100 Harvards. In many European countries, all universities are publicly funded, yet almost none of those countries have even a single equivalent to Harvard.
@@Hamsteriller No doubt you are correct regarding the numbers, yet, if the US Public School System had been designed to teach young people to think, instead of to become worker bees, education would have been interesting and challenging. The wealthy sent their offspring to high quality PRIVATE schools! Harvard requires students who can think. And where do such students originate? From PRIVATE SCHOOLS. The Elite have set up society for only their successes, year after year!
Please do not be shortsighted.
This interview pulled together and summarized all the "hints" of what is happening from all sorts of news. This makes the most sense and explains everything...even Xi's goals and the impact on us.
These guys are leaving out a huge part of the puzzle wich is Demographics and poor socialization in the U.S.
We have a generation of mostly broken people in Gen Z. Lots of cultural conflict aswell.
Also birthrates are dropping like a rock.
Are we gonna go back to 2019😅🤣😂
Soon as we get back to September 10th 2001 at the airports.
The little plastic thing a couple of centimetres under your left earbud is supposed to be slid down and used to semi-permanently connect the left and right cables. Give it a try. :)
Haha boomers are something else but I love it. The focus is aimed at money making, all other is secondary 💪🏼
who cares?
When we had a small business we didn't order too many of any one item because it would be too expensive and we never took out a loan. These big retailers do take out loans or sell bonds to raise money for their inventory but I assume their main limitation is storage. Small items are easy to find storage space but not bigger items.
If you invite a specialist guest on, you should probably give him the lions share of time to speak. Just my thought.
The US should go vertical in its manufacturing and supply chains as much as possible.
Supply chain distribution will go on Ethereum and Layer 2 components along with bridges and smart contracts. Blockchain tech is catching up.
It’ll recover. The beauty of this situation is that it’ll inspire other opportunities for those looking to start a business.
Excellent presentation 👍
New subscriber earned! I appreciate real, informed analysis of our current mess.
Not going to university and getting a trade certificate has treated me so well.
I didn't do that either and that was 40 years ago. Now I'm retired at 59. I was a systems administrator for 39 years. No school and not a single certificate.
Doctors, Lawyers, Engineers and Architects have very difficult trades too. Some pay well, but it is the sense of purpose and serving our community which puts us through years of painful exams and no income. Floowed with long hours and high responsibilities.
for some people that's a great option. What I don't like is when those type of people want to evangelize their choices as what everyone should do, as if it were a one size fits all solution to all our labor & economic woes. "People crying about low wages and inequality but don't want to pick up a hammer, hurr durr"
Reality is not everyone is well suited to work in trades for a variety of reasons. But for those who are, we should certainly make it easier for them to get started as we have some national shortages of electricians and other trades jobs and they typically pay very well with less class time and ability to earn wages earlier.
Low taxes, less regulation, hard money. Problem solved.
Hold our beers: The Rothschilds
This is a great explanation of everything going on in China and a little more nuanced than Jim Rogers bullishness on China. This one was great!
As far as Wall Street and K Street are concerned, Main Street is just overhead.
That was outstanding. Thank you very much.
Thanks for showing your backgrounds, it makes you more relatable.
Trump: We want to decouple. China : OK. Americans now : China is forcing a decoupling.
Brilliant Job, understanding of what has happened. We have distroyed the country via outsourcing the real economy to low wage countries and benefiting a few. Wall Street and hyper rich
When maximizing shareholder value is the goal, the emergence of this system is inevitable. Every Computer Science major in college knows painfully well that greedy algorithms are rarely optimal.
It starts, with a shake up, of management. They have been more concerned with, their share options, than with the employees.
You want loyal, proud, workers, productivity??
That's why there's a Great Resignation
No they don't. They want them fearful and easily controlled. Preferably not even in this country, so they can be even more desperate. We are definitely not "all in this together."
Great insight, thank you
GREAT CHAT GUYS THANKS!
Well done, very informative.
This was really great. 40:00 So needed said. My partner and I thought we'd start a very needed technical HVAC mechanical business in January, Wrote us a great business plan and still not a dime of lending comes from our very bailed out banks.. We trying to decide now whether to cut our losses before years end.
DeFI is going to be the answer to ta lot of these problems central banks can't overcome.
@@remrem4 Indeed it is. Most don't understand DeFi (decentralized finance) yet. They're just now hearing for the first time about Ethereum. So much development on L1, soon a gravitation to L2 will be the thing. Blocks will be full. Watch.
Wonderful interview, both the host and guest made great points. One of the best videos on this channel in terms of substance and delivery.
Fascinating topic. Watching this 3/10/022. The world is vastly changed since your broadcast. I would like to hear this speaker with an update with today's World happenings.
Like you guys said investment is needed. Companies don’t invest in their own business let alone in shared infrastructure. Our politicians won’t invest. You guys have a nice dream that is to going to happen. We also have climate change which solutions are going nowhere fast to doing anything about it
Great conversation! Exactly all what I have been thinking! Happy I own a few shares of Tesla because Tesla/spacex is bringing back innovation and how to craft labor and do it competitively with rest of world
Watch SpaceEx go bankrupt...and that Tesla stock selloff...
@@kathrynj.hernandez8425
Tesla is valued up there with gm and ford? Does anybody look at the amount of cars he selling.
In my opinion people won't put up with it they'll go back to shopping at the stores two of my deliveries recently I've never received the third one so far has not been shipped
Excellent! Thank you 🙏
That was great conversation, thank you!
Once I hear '3d printing ' is going to be so important in the future I know this guy knows nothing about the manufacturing business. There's no way he spends any time in a machine shop making any thing. By the way, manufacturing apprenticeships are still around in the US . It's just that most people are only know about sales /marketing and have completely lost touch with making things. Maybe some of their grandfather's actually made things.
I sear when he said "rubber meets the road", I heard "robber meets the rope".
I suppose that fits as well..
Unfortunately, an economic depression could be the catalyst to rebuild our base and get back in the game. So it could turn out to be a fortunate thing if used for an opportunity.
Perhaps, the covid distraction is perfect? Our economy Sept 2019 reached the same size as we left off in 2007. The reverse repo started around the same time. Right at the same time US treasuries were not being bought by the Chinese. We dont hear much about the money printing, nor do we hear much about the US treasuries and we dont hear about how little foreign invstors have stopped supporting US treasuries. Why? Perhaps why is because we are in Depression already? Technically "stuck" since 2009 and have fallen again in 201, failing to go upward or above 2007.....
Why? Incentives. Productivity has not gone up.....
Enlightening interview!
Great Video!
Great perspective. So well spoken!
A lot of great points in this discussion. I have just come back from a train trip by Amtrak and I saw first hand how much the logistics and supply chain in America are in need of repair. There is a lot going on, to say the least.
Shelves aren’t empty anywhere I shop. Florida, GA, AZ…. I’m in these places a lot. My condo overlooks the shipyards in Miami Beach. There are no backups or ships parked offshore.
Excellent interview! It is the best articulation of what decoupling from China really means. Even a collapse of the CCP, which would be considered deflationary could have an inflationary impact on the rest of world due to the lack of goods and services available. As the globe splits in two, the standard of living declines for almost everybody.
Interesting.
Splitting the world into two.
Interesting. This seems so.
What does it mean? Perhaps, the splitting and two diconomies moving in opposite directions. China, potentially grwoing, and the western world not growing or remaining stagnant.... This essentially sounds like grounds of war???
@@riversedgegoatdairy297 it is my understanding that China is not growing. They are now more focused on a stronger currency in order to manage their global ambitions. By the 2nd quarter, nobody will be growing.
@@michaelhueppeler7005 our sources of information of china are limited.
We can witness this by watching countless videos of how China limited their people during the pandemic. But also by not being able to find the data of how much imports and exports this country conducts.
Of all the nations in the world, china is perhaps the most "protective" economy. The chinese economy is a domestic driven one. 80% of its total GDP is domestic. The move from rural to urban policy is the driving force and perhaps a recession in their housing market.
Unlike here in north America, china has productivity. North america has very little to no productivity. Despite illuding its people to believe we are recovered from the financial recession of 2007-08.
As long as the gov't policy sticks. That is continue to move people off of farms into cities? The chinese economy wll continue to grow and prosper.
In contrary to the USA. The economy lacks innovation or perhaps a war? To keep its economy going?
@@riversedgegoatdairy297 you may want to check the China Credit Impulse and the demographics development in China. I highly recommend Louis Vincent Gave’s latest interview on MacroVoices right here on RUclips.
@@michaelhueppeler7005 yes, I found the credit pulse an interesting statistic.
The fact that if the credit delivered in China "may" out pace the American's or the western world's pulse, is of concern. Foreign investment in the past has always trended towards the higher interest or yeilds.
If this happens even to a small degree? A trend towards higher rates will only create devestation mostly in America and Europe.... Less an impact on the Chinese economy.
I will look into Louis vincent Gave's...... That name doesnt ring a bell. Thanks
The US corporations wanted cheap labor to support their bottom line at any cost!
To me it’s all about bad fiscal policies and the manipulation of fiat currencies .
The total leverage in the system both public and private has ballooned in the last couple of years . People forget that the US economy was sputtering after the ninth fed funds bump up to 5.5% in late 2018. The fed had to cut in 2019 long before the pandemic. That was about eight trillion dollars in federal debt ago. It’s going to take much less of an interest rate increase to blow things up now.
To get rid of the incumbent structure, first get rid of the incumbent parasite class who depend on it. How are you going to do that?
How do you know "everything is going to be fine"? By definition, a revolution is when thing revolve. Those on top end up on the bottom.
Great show. cheers
Thank you guys. Great discussion.
Great conversation. Thank you!
This was great. Thanks.
Wow I'm glad I stayed and listened to this. I started to think how convenient Covid-19 was to China in helping them break away from the West (specifically the U.S.). Seems the timing lined up to what China is planning.
Also if we do really need to alter the way we do things here then the Political Establishment has to start to let the citizens know its has to happen and we have to change and change in the way we see things.
It’s not so much that China wants to break away from the west but it is that China was forced to do so. US weaponized its currency, targeted competition with tariffs and sanctions. From the very beginning China said they wanted win win cooperation but the US targeted them with sanctions and tariffs. They responded by protecting themselves from US aggression and attacks by looking for trade elsewhere (both with internal consumption of their own population and also with expanding trade with other countries).
I have not been putting all my eggs in one basket,and today I heard that all my baskets are in one basket.
So,I guess I need the buy some physical gold or some fertilizer stocks.
never say never, as the old adage says .....
Awesome thanks
He said adult toys😂
Wouldn't a disrupted reliance on cheap labour just shift things more towards it being replaced by technology? Not sure i buy the narrative of generational change reverting back to localised labour. Very insightful interview though.
"Wouldn't a disrupted reliance on cheap labour just shift things more towards it being replaced by technology?"
I think this is the exact kind of thinking USA has gotten used to over decades that it needs to get rid of. One thing this wonderful interview missed was that a very high percentage of high end tech work is being done by immigrants (first or second generation). With the end of globalization, that inflow will go down as well. During and post the world wars, the world was destroyed(except USA) and all the brilliant minds were kind of forced into USA for atleast 2-3 generations. That lead to a domino effect and brilliant minds have been coming to USA since (because the last generation of brilliant minds were in US). If that cycle breaks, US is in real trouble..
That intro reminds me The End of Chimerica the last chapter of The Ascent of Money on 2008 crisis
How hard will it be for the non-aligned nations to decouple from the US when the US produces nothing but military equipment and financial products?
777billion on milatery contractors building obsolete weapons are the American people aware
Blame this on shipping all the jobs overseas
Blame the Reagan /Greenspan financial rigging
In favor of Wall Street and big banks
Blame getting rid of Glass Steagall act depression era law
amen... wouldn't be such an issue if the supply chains had mfg nearby-like at home(US)....try that for a change....
Clinton signed nafta and sent our jobs to other countries. Bush had it in the works. Those two are to blame. With that said, America has sweat shops just like China. We need unions.
@@anniealexander9616 Tesla doesn't have unions and they are employing in record. Umbers quality jobs that pay more than other car companies that are represented by unions....
So no, unions can be useful but it's not an absolute need. I work in a District where the unions doesn't have the best interest of the employees servicing the community. They're corrupt, do I'd be careful with absolutes.
@@anniealexander9616 yes you are right it’s all of them I have the picture of Clinton signing it into law etched in my brain
@@anniealexander9616 Unions are like the CEO’s at big corporations just looking out for their own members and not care about consequences of society.
The Empire is kaput!
Wow! Thank you so much.
Ross has confirmed what Lance Roberts said about why the supply chain bottle-neck happens.
Excellent podcast
Thank you very much!!
I agree that the decoupling is happening but disagree with the cause of it. It was initiated by US, not China, during the trump era because US finally realized that without decoupling China will surpass US even faster and the only way to slow down China’s growth is decoupling, Which hurts both countries.
AMERICA will SOON be destroyed in "one hour"; THEN, ALL of Asia, Australia, and Europe will face an onslaught of the Communist Hordes from China (Genghis Han!) and Russia (the Great Bear arises and devours). So it is written, so shall it be done...11 “And the merchants of the earth weep and mourn over her, because no one buys their cargoes any more... 19 And they threw dust on their heads and were crying out, weeping and mourning, saying, ‘Woe, woe, the great city, in which all who had ships at sea became rich by her wealth, for in one hour she has been laid waste!’ (Revelation, Chapter 18 New American Standard Bible 1995)
nothing is permanent
So then impermanence is permanent.
@@m.vonhollen6673 impermanence is nothingness
Where can I read the RBI Bank in Austria articles on the "storms ahead" articles mentioned at at time frame 34:00 to 35:00.
Excellent interview!
Love this discussion. My thoughts too.
Best information i have gotten in a long, long time. I not being a pessimist, just a realist when i observe that socially and politically the U S is incapable of promulgating his recommendations. Its going to be an unfolding debacle.
Excellent interview! Intelligent minds.
Why should a co-party perform when they can make more from the next FED handout? Moral hazard has reached depths comparable only to the soaring heights of the bubble markets.