Finally, one more thought in a world where every
economic data point matters. A collection of economic data
offering some hope for our supply chains. The pandemic
disrupted the flow of goods across the globe leading to
shortages of computer chips. Months long waits for furniture
delivery and the mysterious scarcity of essentials like toilet paper
. I would also say that almost all of us
have underestimated the dramatic impact of this outbreak. I
mean, if you would have asked most people eight
or nine months ago, if you would ever see
the kind of impact that we're seeing around the world
right now, few would have gotten it right.
But an S and P global supply chain volatility index
attracts demand conditions, transport costs, inventories and backlogs
. It shows that after more than three years,
supply chains are actually back to some semblance of normality
. In fact, the index suggests suppliers around the
world now have the greatest level of spare capacity since
the height of the COVID pandemic. Other parameters of
supply chain pain including from the New York fed are
showing significant contraction. That's a good thing us,
shipments of empty corrugated boxes down 11% from a year
earlier and data this week from FRA it shows that
the price to move a 40 ft container across the
ocean from China to California is roughly 1/10 of what
it cost just a year ago. China is this
factory. I'll leave the politics and policy to the
experts like Secretary Lincoln. But on the ground business
to business, these two trading partners are inextricably linked
and count on each other for quite a bit.
But the tide, it may have turned a bit
too late for instant pop. The modern spin on
the pressure cooker was all the rage at the onset
of the pandemic. But its popularity ultimately stretched wait
times for customers and drove up the cost of goods
for the company as well. A spiral of disruption
of which the company never managed to break free the
parent company of instant pot. It filed for bankruptcy
protection this month, citing the high costs of keeping
its supply chain running if you manage to get your
hands on one of them over the pandemic. Well
, consider yourself lucky.