Posted on 12/31/2021 12:05:34 PM PST by SeekAndFind
later
One of the biggest problems is that unstable, capricious, and arbitrary government makes it impossible for businesses and individuals to plan for the future. This is a hallmark of totalitarian regimes and, most unfortunately, our government now has those characteristics. Just look at how Biden undid everything Trump did in his four years just out of evil spite.
This needs to be looked at more seriously as a basic reason why supply doesn’t increase.
An aside...people who write these types of articles display their economic ignorance when they fail to understand the difference between supply and demand curves and the QUANTITY demanded or QUANTITY supplied. My engineering economics prof in engineering school drilled that into our heads.
Go ask Brandon. Better yet; go ask “Heels-up, knees-wide”.
They have all the answers, especially with their mandates and all.
We are being ruled by moronic, tyrant communists that have overthrown our government.
I guess the government wants to pump us some more.
And, of course, apart from our economy, there are world wide political repercussions to this kind of short-term madness.
Why start a restaurant when the CDC will shut it down?
Why start a cell-phone dealership when #BLM and Antifa will loot and burn it to the ground.
Why come up with a new lawn gizmo that California already has plans to make illegal?
There’s a new economics equation making the rounds that involves the number of sub suppliers and their distance from the manufacturer. Prior to Covid you could produce, say, a washing machine that incorporated parts from Malasia, Singapore and China, had it built in Mexico and have a pretty good chance it would arrive at Costco or Walmart on schedule. That’s because the logistics of getting all the parts worked flawlessly. But now medical (political, actually) shutdowns, and the colossal shipping disaster caused by what should have been a minor hiccup if it hadn’t gone on for so long, mean I waited 16 weeks for appliances that were normally in the back room of my supplier. Now, part of this is everyone hired a business school graduate and they were taught that every company needed to minimize inventory and do just-in-time production. That works great if you’re on an island and everything you need is made there. It also works great if you buy from all over the world but nothing, and I mean nothing, gets in the way of a smoothly functioning delivery system. (That equation predicts the probability you’ll have a product waiting in the back room. The more outsourced parts and the farther away they are, the lower the probability.)
One reason supply isn’t matching demand is because the products are so incredibly complex. It’s not just a printer. It’s a node on some huge cloud construct. It sends you an email and a text when it’s time to buy ink. It also tells you when there’s a sale on ink. (It’s enough to make you want to take a .357 magnum to every appliance you own.)
Another reason is, a lot of people in the government really want things (f word) so they don’t work. Any California governing body at any level, for example. Apparently, a lot of trouble at the ports has to do with new California environmental laws. (Apparently, burning California to the ground is not the answer, as they’ve tried that by outlawing trimming under power lines.)
The first place to look at cleaning up the economy is where government is stepping on it with possibly well-intentioned policies.
Excellent examples and there are millions more.
Why invest in any land leases from the government for oil exploration? Why start a pipeline or refinery project? Why buy any new oil tankers? Why lease oil rigs? Etc, etc, etc.
The business climate uncertainty is off the charts and we are paying dearly for that. The USA used to have stable government that changed course a bit from administration to administration, but no longer. Unless this stops, we will continue our rapid descent to Venezuela status.
That increased demands increases supply is true in unregulated capitalism only.
Since gov. regulations restrain supply (as in socialism) the increased demand leads just to shortages.
We must have had the same professor, or at least one from the same school of reasoning.
Biden. That’s why.
On the other side of the coin we can’t get chips or raw material to manufacture with. Our GDP is going to shrink big time. Stocks will follow.
>>That increased demands increases supply is true in unregulated capitalism only.
Since gov. regulations restrain supply (as in socialism) the increased demand leads just to shortages.<<
On that subject, nobody wants to risk putting in the investment to increase production, only to have government stick its fingers in with price controls or whatever, and make your investment unprofitable.
The supply of many things has been outsourced to other countries.
That’s good to hear! Few people know that difference. My Econ prof in my MBA program didn’t even know it! I explained it to him and he got it…as well as being impressed with my understanding!
Increased money supply leads to increased aggregate demand, which leads to increased aggregate sales revenues. Then, if aggregate net consumption by business owners is increased too much and is taken out of sales revenues, then aggregate savings by business does not rise as much, which means that aggregate production expenditures does not rise as much, which means that aggregate production does not rise as much, which means that aggregate supply is not increased enough, so that increased demand is not able to bring in correspondingly more supply.
Gosh, I dunno - have the shelves in Venezuela filled yet? Didn't think so.
Demand certainly creates a motivation for supply to be created but increased costs of production serve to limit it at the same time. The Venezuelan state petroleum concern could sell many times what it currently does based on demand, it's just that there are other fatal constraints on supply. Same with food, clothing, and everything else that is simply no longer attainable despite intense demand. 100% of that problem is of government inception despite persistent attempts to blame outside influences.
I can’t figure out the ammo shortage, especially for 22LR.
Thes store people tell me, ‘Oh, there are only so many manufacturers and they can’t keep up with demand.”
Funny how the donut makers always manage to keep up..
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