Scarcities
From comments on Lance Brofman's missive The Federal Budget outlook and implications from the SP500...
Excerpts from a semantic discourse with Kramer about what we term as "scarcity". I maintain there is no such thing and that we are in a world awash in over capacity. Kramer maintains that "distributional technologies" are at fault. In the end, we come to find that we are on common ground.
The author had commented: "it was just a matter of time before middle-class consumers became unable to absorb the increased production and service the debt that accompanied the overinvestment."
We Nattered: Spot on, as we are awash in global overcapacity.
Enter Kramer: What is there too much of? I really cannot make peace with the idea that "we" can have too much of anything that anyone has too little of. Is there too much food?
To the extent semantics matter, I would urge people to say that we are awash in "capacity," not "overcapacity." Let's put our brains to figuring out how to increase distribution, not reduce the capacity.
We Nattered: How far a horse travels in a day, no longer dictates the size and potential growth of an empire. I'm not talking about transportation either. Roman, Ottoman, Mongol were all dictated by how far a horse traveled in a day. That's how fast you got your news from the front... today, information flows in nanoseconds, click a button and watch live on satellite.
Distributional capacity, informational unlimited, physical: Pipeline, plane, ship, train, truck. Where can I not distribute given these means? If we need to we can drop it in.
Kramer: "China sells things here because it cannot sell them in China. Why not? A scarcity of distributional capacity."
We Nattered: Tautology aside, you mean they can't get it up the road from the factory? But they can get it across the pond to us? No, BY DEFINITION that "scarcity" is money, they lack it and/or lack the gluttonous desire, they don't really need it, nor culturally want it?
Kramer: "a "scarcity" of whatever it is that would enable the stuff the Chinese make to be available to the Chinese people."
We Nattered: Yes, they generally can't afford it, whatever it is or it is not a shiny sparkly "necessity" to them. So the "Scarcity" is not production or distribution, its money or desire.
Kramer: "we have misallocated resources temporarily to the production of things we think we can distribute rather than things that are needed or wanted, resulting in excess capacity in those things. But that's not a global issue."
The Nattering One mused: Yes, misallocation to crap nobody really needs, and we can afford, for the moment, and with the eradication of the middle class, and the poor getting poorer, while the rich get richer, and consume less, the afford part is dwindling.
This is a global issue not only on the income side, China exports their labor at the margin as overcapacity globally, and yes others import it. And it hath laid waste to the world as we knew it. Again, bad choices and misallocation, to which we agree with Kramer. Labor at the margin is exported, eradicating domestic labor, manufacturing, textiles, automobiles, etc.
Resulting in domestic labor rates that are no longer supported, the loss of jobs, the closure of businesses, the eradication of industries and income classes. Worse yet, since it is no longer profitable, the competences or skills to perform such labor are no longer taught.
"SOMETHING is missing." Yes, the scary part of the new paradigm is, we are NOW lacking localized critical competences (i.e. ag, manufacturing) and independence from the globalized supply chain. What if it breaks down? and I refer not just to the supply chain.
More importantly, as a result of this "paradigm" shift, the lack of codependence or independence to machine or repair the (fill in the blank) (camshaft and install it), NO LONGER EXISTS. If it breaks, if its critical, if its the beef or milk or fruit you used to grow locally but now depend upon cheaper imports to supply your needs, and the supply chain hiccups, breaks, fails or is completely shutdown, what will you do and who will you call?
That is the most dangerous part of globalization. If you are not careful, borrowing from Wells, this unchecked dependency could lead to... your life of Reilly can quickly become the life of the Eloi and the Morlocks will be having you for dinner, literally and figuratively.
More to come.
Scarcities 1
Scarcities 2
Scarcities 3
Excerpts from a semantic discourse with Kramer about what we term as "scarcity". I maintain there is no such thing and that we are in a world awash in over capacity. Kramer maintains that "distributional technologies" are at fault. In the end, we come to find that we are on common ground.
The author had commented: "it was just a matter of time before middle-class consumers became unable to absorb the increased production and service the debt that accompanied the overinvestment."
We Nattered: Spot on, as we are awash in global overcapacity.
Enter Kramer: What is there too much of? I really cannot make peace with the idea that "we" can have too much of anything that anyone has too little of. Is there too much food?
To the extent semantics matter, I would urge people to say that we are awash in "capacity," not "overcapacity." Let's put our brains to figuring out how to increase distribution, not reduce the capacity.
We Nattered: How far a horse travels in a day, no longer dictates the size and potential growth of an empire. I'm not talking about transportation either. Roman, Ottoman, Mongol were all dictated by how far a horse traveled in a day. That's how fast you got your news from the front... today, information flows in nanoseconds, click a button and watch live on satellite.
Distributional capacity, informational unlimited, physical: Pipeline, plane, ship, train, truck. Where can I not distribute given these means? If we need to we can drop it in.
Kramer: "China sells things here because it cannot sell them in China. Why not? A scarcity of distributional capacity."
We Nattered: Tautology aside, you mean they can't get it up the road from the factory? But they can get it across the pond to us? No, BY DEFINITION that "scarcity" is money, they lack it and/or lack the gluttonous desire, they don't really need it, nor culturally want it?
Kramer: "a "scarcity" of whatever it is that would enable the stuff the Chinese make to be available to the Chinese people."
We Nattered: Yes, they generally can't afford it, whatever it is or it is not a shiny sparkly "necessity" to them. So the "Scarcity" is not production or distribution, its money or desire.
Kramer: "we have misallocated resources temporarily to the production of things we think we can distribute rather than things that are needed or wanted, resulting in excess capacity in those things. But that's not a global issue."
The Nattering One mused: Yes, misallocation to crap nobody really needs, and we can afford, for the moment, and with the eradication of the middle class, and the poor getting poorer, while the rich get richer, and consume less, the afford part is dwindling.
This is a global issue not only on the income side, China exports their labor at the margin as overcapacity globally, and yes others import it. And it hath laid waste to the world as we knew it. Again, bad choices and misallocation, to which we agree with Kramer. Labor at the margin is exported, eradicating domestic labor, manufacturing, textiles, automobiles, etc.
Resulting in domestic labor rates that are no longer supported, the loss of jobs, the closure of businesses, the eradication of industries and income classes. Worse yet, since it is no longer profitable, the competences or skills to perform such labor are no longer taught.
"SOMETHING is missing." Yes, the scary part of the new paradigm is, we are NOW lacking localized critical competences (i.e. ag, manufacturing) and independence from the globalized supply chain. What if it breaks down? and I refer not just to the supply chain.
More importantly, as a result of this "paradigm" shift, the lack of codependence or independence to machine or repair the (fill in the blank) (camshaft and install it), NO LONGER EXISTS. If it breaks, if its critical, if its the beef or milk or fruit you used to grow locally but now depend upon cheaper imports to supply your needs, and the supply chain hiccups, breaks, fails or is completely shutdown, what will you do and who will you call?
That is the most dangerous part of globalization. If you are not careful, borrowing from Wells, this unchecked dependency could lead to... your life of Reilly can quickly become the life of the Eloi and the Morlocks will be having you for dinner, literally and figuratively.
More to come.
Scarcities 1
Scarcities 2
Scarcities 3
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