Print

Please login or register.
1 Hour 1 Day 1 Week 1 Month Forever
Login with username, password and session length

[kernals12]

I think you guys are getting too hung up on the particulars of the analogy and are missing his point, which is that just-in-time supply chains are shit. He posits that they can be made less shit by improving infrastructure, which I feel like is true, but it's also true that infrastructure isn't the current limiting factor.

Just in time supply chains aren't shit, they're wonderful. They save money and reduce risk.

As a 9-year business owner...any business model that might result in me having to let a customer down because of the fuck-up of someone outside of my command structure is shit. I don't sell anything I don't have possession of already. I would much rather carry the risk of product damage or shrink—which I can write off or claim against insurance and then replace—than carry a risk to my business's reputation by promising something I can't deliver, which can't be written off or easily fixed.

That's what I'm saying, with improved infrastructure, you would be able to keep smaller inventories without the risk of disappointing customers.

As it is, we already are trending this direction. If you were running the same business half a century ago, before computerized inventory management and before the deregulation of trucking and railroads, you'd have had to keep a larger inventory for a given number of sales.

[Scott5114]

I think you guys are getting too hung up on the particulars of the analogy and are missing his point, which is that just-in-time supply chains are shit. He posits that they can be made less shit by improving infrastructure, which I feel like is true, but it's also true that infrastructure isn't the current limiting factor.

Just in time supply chains aren't shit, they're wonderful. They save money and reduce risk.

As a 9-year business owner...any business model that might result in me having to let a customer down because of the fuck-up of someone outside of my command structure is shit. I don't sell anything I don't have possession of already. I would much rather carry the risk of product damage or shrink—which I can write off or claim against insurance and then replace—than carry a risk to my business's reputation by promising something I can't deliver, which can't be written off or easily fixed.

That's what I'm saying, with improved infrastructure, you would be able to keep smaller inventories without the risk of disappointing customers.

No, I wouldn't. Upstream fuckups tend to be something like "supplier sent the wrong item" or "supplier did not make product to specifications" or "supplier prioritized someone else's order before ours" more often than they are logistics issues. I can have a 14,252-lane freeway between the supplier and me and it does me no good if I ordered a pallet of plastic and they sent me paper instead.

If I'm running a business with inventory in hand, I can just put the "sold out" marker on the affected item and while it sucks for anyone that wanted to buy that, it doesn't create any expectation or responsibility for me to fulfill an order I can't fulfill. If I'm running just-in-time, then I have to go back to the customer and say "hey, I know you gave me your money two weeks ago for an order you needed fulfilled a week ago, but our supplier is a dipshit and..." Customers don't care about my supply-chain issues, so all they hear is me deflecting blame and it makes them less likely to trust my company in the future.

While I am inclined to agree with this, I think we need to make a distinction here.
Large businesses and small businesses have different models here. For a small business the cost of inventory is a cost, but one that can be more easily justified. For a large corporation that cost gets hard to justify.
Also, a small business not selling a product is the business's problem. A large business not selling a product becomes the customer's problem.
Like the old saying, if you owe the bank 10k dollars, that is your problem. If you owe the bank 10B dollars, that is the bank's problem.
Its understandable why large businesses have gone to this model, because all the risk is tail risk and that is a problem for some other quarter. The issue is more in crafting policies to manage that incentive the other direction.

Yes and no...large businesses do still need to sell products eventually. While Amazon and Walmart aren't going to suffer much long-term harm from a certain item being unavailable, if a customer experiences outages too often, they may stop viewing those companies as a reliable option and start doing business elsewhere. There's a certain value in your company being the first solution the customer thinks of to solve their problem.

Sort of like Whataburger. It's a good fast-food burger and they sell them like crazy here in Norman...but the service is so slow it takes thirty minutes to get one. I used to eat them all the time, and I'd like to do so again, but I finally reached the point at which I realized it's not a good enough burger to wait that long for, so I stopped going there. Now, I'm just one guy, so they can withstand the loss of my business, but if enough people reach that same conclusion, then they have a problem.

You're right that current business culture encourages just saying "that's next quarter's problem" and sweeping it under the rug, but I have never felt like that is a responsible way of running a business. As a country, we need to come up with a way of curbing that way of thinking, because it is the root cause of a lot of ills in our society.

[HighwayStar]

I think you guys are getting too hung up on the particulars of the analogy and are missing his point, which is that just-in-time supply chains are shit. He posits that they can be made less shit by improving infrastructure, which I feel like is true, but it's also true that infrastructure isn't the current limiting factor.

Just in time supply chains aren't shit, they're wonderful. They save money and reduce risk.

As a 9-year business owner...any business model that might result in me having to let a customer down because of the fuck-up of someone outside of my command structure is shit. I don't sell anything I don't have possession of already. I would much rather carry the risk of product damage or shrink—which I can write off or claim against insurance and then replace—than carry a risk to my business's reputation by promising something I can't deliver, which can't be written off or easily fixed.

That's what I'm saying, with improved infrastructure, you would be able to keep smaller inventories without the risk of disappointing customers.

No, I wouldn't. Upstream fuckups tend to be something like "supplier sent the wrong item" or "supplier did not make product to specifications" or "supplier prioritized someone else's order before ours" more often than they are logistics issues. I can have a 14,252-lane freeway between the supplier and me and it does me no good if I ordered a pallet of plastic and they sent me paper instead.

If I'm running a business with inventory in hand, I can just put the "sold out" marker on the affected item and while it sucks for anyone that wanted to buy that, it doesn't create any expectation or responsibility for me to fulfill an order I can't fulfill. If I'm running just-in-time, then I have to go back to the customer and say "hey, I know you gave me your money two weeks ago for an order you needed fulfilled a week ago, but our supplier is a dipshit and..." Customers don't care about my supply-chain issues, so all they hear is me deflecting blame and it makes them less likely to trust my company in the future.

While I am inclined to agree with this, I think we need to make a distinction here.
Large businesses and small businesses have different models here. For a small business the cost of inventory is a cost, but one that can be more easily justified. For a large corporation that cost gets hard to justify.
Also, a small business not selling a product is the business's problem. A large business not selling a product becomes the customer's problem.
Like the old saying, if you owe the bank 10k dollars, that is your problem. If you owe the bank 10B dollars, that is the bank's problem.
Its understandable why large businesses have gone to this model, because all the risk is tail risk and that is a problem for some other quarter. The issue is more in crafting policies to manage that incentive the other direction.

Yes and no...large businesses do still need to sell products eventually. While Amazon and Walmart aren't going to suffer much long-term harm from a certain item being unavailable, if a customer experiences outages too often, they may stop viewing those companies as a reliable option and start doing business elsewhere. There's a certain value in your company being the first solution the customer thinks of to solve their problem.

Sort of like Whataburger. It's a good fast-food burger and they sell them like crazy here in Norman...but the service is so slow it takes thirty minutes to get one. I used to eat them all the time, and I'd like to do so again, but I finally reached the point at which I realized it's not a good enough burger to wait that long for, so I stopped going there. Now, I'm just one guy, so they can withstand the loss of my business, but if enough people reach that same conclusion, then they have a problem.

You're right that current business culture encourages just saying "that's next quarter's problem" and sweeping it under the rug, but I have never felt like that is a responsible way of running a business. As a country, we need to come up with a way of curbing that way of thinking, because it is the root cause of a lot of ills in our society.

Retail businesses are not the entire story. If you don't want to buy from TSMC you have few to no options, and the few that you have are likely to be in lockstep with TSMC anyway as far as supplies go.
So to take the example of graphics cards, sure, neither Walmart nor Amazon has them, but you have no alternatives anyway since Best Buy, Micro-Center, and Staples also have none. No one prepared for this kind of event, and none of them are going to suffer any consequences for it either. If they can't buy them wholesale, then the customers just won't get them retail either.

[Scott5114]

Well, yes...but eventually that will become a problem for the graphics card manufacturers, as unmet demand encourages competitors to spring up to fill that demand, meaning reduced market share.

[vdeane]

Just in time shipping does suck.  Highly optimized also means highly susceptible to problems whenever something disruptive happens.  We saw that just last year - and the world is only moving in the trend to more disruption, not less.  If it hadn't been COVID, it would have eventually been something else - and likely still will.  A supply chain with more redundancy would have been far more resilient.

And yeah, highway capacity has pretty much nothing to do with our current product shortages, as people have mentioned.

[Max Rockatansky]

The latest article I could find regarding the amount of computing power and energy likely necessary for teleportation:

https://www.theguardian.com/technology/2018/jun/12/teleportation-will-it-ever-be-a-possibility

Maybe the UAC was onto something using Argent Energy (AKA human souls) to power their slip gates?

[SEWIGuy]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

[vdeane]

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

Prices wouldn't need to be so low if it were still possible to support a middle-class family on a single income like it was in the 1950s, however.  I'd rather than higher prices but better quality of life than lower prices with shit wages in a shit job.  Evidently I'm not alone, given the current labor shortage.

[J N Winkler]

Well, yes...but eventually that will become a problem for the graphics card manufacturers, as unmet demand encourages competitors to spring up to fill that demand, meaning reduced market share.

While economic theory says that, in general, high prices translate into entry opportunities for new firms in sectors where returns to scale are not so high as to accord incumbents a natural monopoly, what is going on with graphics cards is actually market failure due to bots.  It doesn't matter how many competitors Nvidia and AMD have if bots are going to snap up all graphics cards for bitcoin mining before human customers have a chance to get at them through retail channels.

I think there is a crying need to regulate bots not just for graphics cards, but also for sneakers, concert tickets, and pretty much every other line of business where they are manipulating prices by artificially constraining supply.

[HighwayStar]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

That is just the cool aid you are supposed to be drinking.

It has not caused goods to be made "more efficiently" virtually all efficiency gains were technological, not trade related. Prices for most goods and services are not lower in real terms, that is obvious from the fact that most families have 2 working adults to even attempt a middle class lifestyle, while almost all with one working parent are effectively below the poverty line.

Society as a whole is much worse off, not least of which because our deficit in national accounts right now means that even our current standard of living is not sustainable.

[HighwayStar]

Well, yes...but eventually that will become a problem for the graphics card manufacturers, as unmet demand encourages competitors to spring up to fill that demand, meaning reduced market share.

While economic theory says that, in general, high prices translate into entry opportunities for new firms in sectors where returns to scale are not so high as to accord incumbents a natural monopoly, what is going on with graphics cards is actually market failure due to bots.  It doesn't matter how many competitors Nvidia and AMD have if bots are going to snap up all graphics cards for bitcoin mining before human customers have a chance to get at them through retail channels.

I think there is a crying need to regulate bots not just for graphics cards, but also for sneakers, concert tickets, and pretty much every other line of business where they are manipulating prices by artificially constraining supply.

No, "bots"  have not caused any failure whatsoever. There is no "market failure", it is simply that many sellers continue to sell their goods below market price, resulting in limited stock. If all sellers raised prices to market clearing price then the rationing would take place exclusively via the price mechanism.
And more production is entering as expected, Intel is getting into the business and several companies are building more fabs, but there is of course a time delay in that, so short run supply curves don't shift, meaning that equilibrium price is still high.

[SEWIGuy]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

That is just the cool aid you are supposed to be drinking.

It has not caused goods to be made "more efficiently" virtually all efficiency gains were technological, not trade related. Prices for most goods and services are not lower in real terms, that is obvious from the fact that most families have 2 working adults to even attempt a middle class lifestyle, while almost all with one working parent are effectively below the poverty line.

Society as a whole is much worse off, not least of which because our deficit in national accounts right now means that even our current standard of living is not sustainable.

Cool.   No evidence presented whatsoever, but cool.

Median household income has increased since 1960 - largely in a free trade era where we made the transition from a manufacturing to service based economy.

https://www.advisorperspectives.com/dshort/updates/2015/09/23/median-household-income-growth-deflating-the-american-dream

Income and wealth differentiation in the US is more due to terrible tax and social policy IMO.

[HighwayStar]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

That is just the cool aid you are supposed to be drinking.

It has not caused goods to be made "more efficiently" virtually all efficiency gains were technological, not trade related. Prices for most goods and services are not lower in real terms, that is obvious from the fact that most families have 2 working adults to even attempt a middle class lifestyle, while almost all with one working parent are effectively below the poverty line.

Society as a whole is much worse off, not least of which because our deficit in national accounts right now means that even our current standard of living is not sustainable.

Cool.   No evidence presented whatsoever, but cool.

Median household income has increased since 1960 - largely in a free trade era where we made the transition from a manufacturing to service based economy.

https://www.advisorperspectives.com/dshort/updates/2015/09/23/median-household-income-growth-deflating-the-american-dream

Income and wealth differentiation in the US is more due to terrible tax and social policy IMO.

Those "median" household income numbers don't mean that much. The dollar has had nothing remotely close to constant value over time, so both wages and purchasing power have to be adjusted. That is not an easy task, and the methods used clearly don't capture what is going on.
Citing misleading evidence when you don't understand the issue is worse that just giving good analysis.

And the point still stands. At that time one earner households were more comfortably middle class than most two earner households today. I don't care how you try and cook the damn numbers, you can't get past the fact that real wages have clearly fallen for the vast majority of the country.

As to the impact of distribution, sure, there is some of that in there as well. But most of that came from trade policy as well. Tax policy did not do that, taxes are much lower today than they were then and we are still worse off. Social policy was bad too, but again it would never have produced these results without trade, de-industrialization, and the death of the middle class.

[kalvado]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

That is just the cool aid you are supposed to be drinking.

It has not caused goods to be made "more efficiently" virtually all efficiency gains were technological, not trade related. Prices for most goods and services are not lower in real terms, that is obvious from the fact that most families have 2 working adults to even attempt a middle class lifestyle, while almost all with one working parent are effectively below the poverty line.

Society as a whole is much worse off, not least of which because our deficit in national accounts right now means that even our current standard of living is not sustainable.

Cool.   No evidence presented whatsoever, but cool.

Median household income has increased since 1960 - largely in a free trade era where we made the transition from a manufacturing to service based economy.

https://www.advisorperspectives.com/dshort/updates/2015/09/23/median-household-income-growth-deflating-the-american-dream

Income and wealth differentiation in the US is more due to terrible tax and social policy IMO.

Those "median" household income numbers don't mean that much. The dollar has had nothing remotely close to constant value over time, so both wages and purchasing power have to be adjusted. That is not an easy task, and the methods used clearly don't capture what is going on.
Citing misleading evidence when you don't understand the issue is worse that just giving good analysis.

And the point still stands. At that time one earner households were more comfortably middle class than most two earner households today. I don't care how you try and cook the damn numbers, you can't get past the fact that real wages have clearly fallen for the vast majority of the country.

As to the impact of distribution, sure, there is some of that in there as well. But most of that came from trade policy as well. Tax policy did not do that, taxes are much lower today than they were then and we are still worse off. Social policy was bad too, but again it would never have produced these results without trade, de-industrialization, and the death of the middle class.

It is not about just real wages, it is about real productivity. US GDP per-capita was $65k in 2019, and I suspect real numbers were closer to 50-50. After taking into account government spending for non-tangible government spending like schools, roads and military; and considering 62% workforce participation, $55k ($27/hour) should be an above-average number. Sounds like a lot of cities warrant way higher.
And even then, US trade deficit (aka consumption not supported by productivity) was $2K/year per capita, and on the way to go over $3k in 2021. 

[HighwayStar]

Second, the current crisis in shipping is really not about either infrastructure or labor issues, so much as trade issues. In short, we buy far too much from Asia, to the point where we can't get it off the boats fast enough, that is a sign of trouble. If those goods were being produced in the US we would not be seeing anything like this kind of problem.

But we have been buying a lot of stuff from Asia for a long time now, and this was never a problem.

Building it here isn't a solution either.  It would make everything more expensive, and global free trade has been largely good for the United States.

It was always a problem, because it creates a sensitive failure point.
Its like eating nothing but red meat and ice cream and then telling your cardiologist "this was never a problem before now", sure you never had a heart attack up to this point, but you were creating conditions for one to occur.

Building it here is a solution, and this "it makes everything more expensive" line is such utter BS. Global free trade has not been "largely good" for the US, it has been largely good for a very small elite at the top and bad for everyone else. And that is without considering it from a strategic standpoint.

It's been great for more than just "the elites."  It has caused goods to be made more efficiently and lowered prices for everyone.  Which is a good thing!

Obviously it hasn't been good for every single person no doubt.  But society overall?  Definitely.

That is just the cool aid you are supposed to be drinking.

It has not caused goods to be made "more efficiently" virtually all efficiency gains were technological, not trade related. Prices for most goods and services are not lower in real terms, that is obvious from the fact that most families have 2 working adults to even attempt a middle class lifestyle, while almost all with one working parent are effectively below the poverty line.

Society as a whole is much worse off, not least of which because our deficit in national accounts right now means that even our current standard of living is not sustainable.

Cool.   No evidence presented whatsoever, but cool.

Median household income has increased since 1960 - largely in a free trade era where we made the transition from a manufacturing to service based economy.

https://www.advisorperspectives.com/dshort/updates/2015/09/23/median-household-income-growth-deflating-the-american-dream

Income and wealth differentiation in the US is more due to terrible tax and social policy IMO.

Those "median" household income numbers don't mean that much. The dollar has had nothing remotely close to constant value over time, so both wages and purchasing power have to be adjusted. That is not an easy task, and the methods used clearly don't capture what is going on.
Citing misleading evidence when you don't understand the issue is worse that just giving good analysis.

And the point still stands. At that time one earner households were more comfortably middle class than most two earner households today. I don't care how you try and cook the damn numbers, you can't get past the fact that real wages have clearly fallen for the vast majority of the country.

As to the impact of distribution, sure, there is some of that in there as well. But most of that came from trade policy as well. Tax policy did not do that, taxes are much lower today than they were then and we are still worse off. Social policy was bad too, but again it would never have produced these results without trade, de-industrialization, and the death of the middle class.

It is not about just real wages, it is about real productivity. US GDP per-capita was $65k in 2019, and I suspect real numbers were closer to 50-50. After taking into account government spending for non-tangible government spending like schools, roads and military; and considering 62% workforce participation, $55k ($27/hour) should be an above-average number. Sounds like a lot of cities warrant way higher.
And even then, US trade deficit (aka consumption not supported by productivity) was $2K/year per capita, and on the way to go over $3k in 2021.

No, its about real standards of living, not "wages" or "productivity" or any other dollar figure that can be manipulated to be whatever you want.
Any realistic assessment of how the average family lives would conclude that real wages, real productivity, and standards of living are lower on a per capita basis now than in the the 1950's. The only improvements that have occurred are technological, and have nothing to do with trade benefits.

You can try and cook numbers all damn day, but when it comes down to it 2 working adults cannot support the average family today as well as one could 60 years ago.
Much of that "productivity" you are talking about is paper, just financial manipulations of Wall Street that generate enormous "product" but nothing that really impacts standards of living. Remember the $600 Trillion dollar derivatives market in 2008? Yep that was all "productivity" all right. You can see this in the data, the financial sector has accounted for more and more of our GDP over time.

[kalvado]

[ clipped zillion quotes ]

No, its about real standards of living, not "wages" or "productivity" or any other dollar figure that can be manipulated to be whatever you want.
Any realistic assessment of how the average family lives would conclude that real wages, real productivity, and standards of living are lower on a per capita basis now than in the the 1950's. The only improvements that have occurred are technological, and have nothing to do with trade benefits.

You can try and cook numbers all damn day, but when it comes down to it 2 working adults cannot support the average family today as well as one could 60 years ago.
Much of that "productivity" you are talking about is paper, just financial manipulations of Wall Street that generate enormous "product" but nothing that really impacts standards of living. Remember the $600 Trillion dollar derivatives market in 2008? Yep that was all "productivity" all right. You can see this in the data, the financial sector has accounted for more and more of our GDP over time.

That is pretty much what I am talking about. An average family would consume about 60% of goods and services made by that average family, remaining 40% being non-tangable things (such as  schools, roads, military as big ticket items). Trade deficit/surplass is added/subtracted, currently +$3k/year per person in US.
If a single working person cannot satisfy demands of entire family - it is either productivity (in terms of goods and services, not $$) is too low; or standard of living is too high.

FOr example, standard of residential footage per person roughly doubled over past 50 years. You may assume that building footage has to be built and maintained, and that means average person consumes more of goods and services in that area, regardless of pricing. Hence need more work, e.g. by having a second family member to get a job.

 

[HighwayStar]

[ clipped zillion quotes ]

No, its about real standards of living, not "wages" or "productivity" or any other dollar figure that can be manipulated to be whatever you want.
Any realistic assessment of how the average family lives would conclude that real wages, real productivity, and standards of living are lower on a per capita basis now than in the the 1950's. The only improvements that have occurred are technological, and have nothing to do with trade benefits.

You can try and cook numbers all damn day, but when it comes down to it 2 working adults cannot support the average family today as well as one could 60 years ago.
Much of that "productivity" you are talking about is paper, just financial manipulations of Wall Street that generate enormous "product" but nothing that really impacts standards of living. Remember the $600 Trillion dollar derivatives market in 2008? Yep that was all "productivity" all right. You can see this in the data, the financial sector has accounted for more and more of our GDP over time.

That is pretty much what I am talking about. An average family would consume about 60% of goods and services made by that average family, remaining 40% being non-tangable things (such as  schools, roads, military as big ticket items). Trade deficit/surplass is added/subtracted, currently +$3k/year per person in US.
If a single working person cannot satisfy demands of entire family - it is either productivity (in terms of goods and services, not $$) is too low; or standard of living is too high.

FOr example, standard of residential footage per person roughly doubled over past 50 years. You may assume that building footage has to be built and maintained, and that means average person consumes more of goods and services in that area, regardless of pricing. Hence need more work, e.g. by having a second family member to get a job.

Quality has declined considerably, while houses have gotten larger, they have also gotten cheaper in every imaginable way. And doubling would be the MINIMUM to even keep pace with 2 people now working, but in reality the amount of debt on housing, combined with the fact that people can no longer afford things like retirement or college, shows that the larger houses are an illusion, the people living in them don't own them and have no real hope to do so.

[1]

It's corporate greed. Universities used to be just tuition; now it's tuition plus five times as much in fees. Retail and restaurant jobs often pay minimum wage — even with the union I was in at Stop & Shop (a grocery store), it was still minimum wage ($11/hr when I was hired, $13.50 now), with the union primarily making sure people were given enough hours (but not more than 8 per day) and that people weren't getting in trouble for no reason, plus benefits for full time employees that I wasn't included in. Without a union (e.g. Walmart), managers could easily force you to work extra without appropriate pay. Back when unions were prominent in e.g. Detroit with auto workers, they made more than I did as a raw amount, meaning 5-6× more inflation-adjusted.

[Max Rockatansky]

It's corporate greed. Universities used to be just tuition; now it's tuition plus five times as much in fees. Retail and restaurant jobs often pay minimum wage — even with the union I was in at Stop & Shop (a grocery store), it was still minimum wage ($11/hr when I was hired, $13.50 now), with the union primarily making sure people were given enough hours (but not more than 8 per day) and that people weren't getting in trouble for no reason, plus benefits for full time employees that I wasn't included in. Without a union (e.g. Walmart), managers could easily force you to work extra without appropriate pay. Back when unions were prominent in e.g. Detroit with auto workers, they made more than I did as a raw amount, meaning 5-6× more inflation-adjusted.

But there is a flip side to that.  All those high pay union auto workers (example; my Mom made about the equivalent to 150k in today’s dollars as an accountant for GM due to UAW agreements pertaining to tenure) were a primary reason why manufacturers started going overseas where wages are lower.  Pertaining to retail, the reality is that unless you are in managment the chances are you are in an unskilled entry level job.  When I worked in Los Angeles we typically would have 500-700 people applying for every cashier or sales position we had posted. 

[kernals12]

To revive this thread and bring it back on track:

Smaller inventories have a macroeconomic benefit; during economic expansions, retailers will build up their inventories and then during contractions they are forced to mark it down to get rid of it. When retailers stop ordering, then the companies that produce their merchandise have to lay off workers which makes recessions more severe.

You can see that here by comparing Gross Domestic Product with Gross Final Sales, the latter is equal to GDP minus changes in inventories


It's even clearer on Quarterly Data (this charts ends at 2020 because COVID f*cks up the y-axis)


And for most businesspeople, the risk of supply chains collapsing from a global pandemic is much, much, much lower than the risk of their inventory suddenly plummeting in value.