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60 minutes report on bogged down supply chain

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Posted by BaltACD on Tuesday, November 16, 2021 9:01 AM

I was reading an article the other day about the 'truck driver shortage'.  It was mentioned that there is now a national clearing house of information for those that have transgressed the drug and alcohol laws.  A clearing house whose data is used when it comes to checking out 'new hires' for such transgressions.  The article basically stated that the current shortage of drivers in the industry was because drivers that previously floated between trucking companies while lying about their drug/alcohol backgrounds are now being kept out of the drivers seat by the accurate data of the clearinghouse.

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Posted by SD60MAC9500 on Tuesday, November 16, 2021 9:00 AM
 

charlie hebdo

The report mentioned how the city-state of Singapore is spending 50 billion dollars on a new container port. Ports like Rotterdam an Hamburg are very automated, including transfer to railcars. Maybe single stack has some real advantages in turn around?

 

If your're talking about IM trains. Clearance restrictions in Europe preclude doublestacks. European freight operators wish they could doublestack containers..

 
 
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Posted by BaltACD on Tuesday, November 16, 2021 8:54 AM

Euclid
So now that we have this surge of demand, we know such surges are possible.  The surge may end, but we know there can be another.  So the supply chain weak link has to be strengthened.  The ports may be the week link.

TWO QUESTIONS:

How long will it take to upgrade the ports to meet the demand surges we now know are possible?  

How long will it take for the supply chain to completely collaspse if the current demand spike continues without the ports being upgraded?

In answer to question one - a decade or more - it will take that long in litigation for land acquisition before any improvements are made to the land.

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Posted by CMStPnP on Tuesday, November 16, 2021 8:37 AM

BaltACD
There if virtually NO single handling of containers at any container terminal.  Very rarely, if ever, will a container be off loaded to a truck chassis whose driver, after the box is secured then drives out of the terminal and onto the boxes ultimate destination.  By the same token a Inbound box, loaded or empty, is rarely if ever driven by the over the road driver to shipside for the container crane to loade it on the vessel. Container terminals are ripe with multiple handlings of the boxes, on terminal property between vessel and the terminal gate - both inbound and outbound.  To facilitate the multiple handlngs there has to be accessable GROUND to drop and retrieve the box at least one time and potentially multiple times between Terminal Gate and Vessel.  If you have the land, you can automate to your hearts content - if you have to start stacking boxes just to ground them on terminal property you are in trouble.

Yeah so the point with LB and LA, when they were initially constructed and to this very day they have not been able to acquire the land that they really need to run the operation efficiently.    Land has been at a premium because neither LA or LB wants to use emminent domain.    Nor do they want to use fill to build out.    If you ask me their biggest issue is lack of land.   Rotterdam is 31,000 acres, LA and LB combined is slightly less than 8000 acres.    Rotterdam serves less people than LA and LB as well.    Since Hamburg, Germany is another mega-port.   Hamburg can berth 320 ships at once.   I don't think LA or LB can do even 30% of that.

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Posted by Convicted One on Tuesday, November 16, 2021 8:14 AM

Gramp
Did anyone else watch this? If you did, please comment with your opinion. 

I've watched the video several times now. And I kept getting this strange feeling that I had seen it before, long long ago. Couldn't get around that feeling, just couldn't place "where?"

Then it hit me. 

In the movie "Goodfellas" where after their big heist,  they decide some members are more deserving of a bullet rather than their share of the loot.  "Oh, so-and-so's not right in the head" or "what's-his-name betrayed my trust" etc...but the underlying motives are more along the lines of greed and jealousy, than principle.

 None of the guys interviewed appear to be the type "driving last years model" if you get my drift. Each appear to have made a comfortable living taking jobs away from American workers. But now that somebody else has snatched their fruit, they sit there bawling and finger pointing.

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Posted by Euclid on Tuesday, November 16, 2021 7:06 AM

So now that we have this surge of demand, we know such surges are possible.  The surge may end, but we know there can be another.  So the supply chain weak link has to be strengthened.  The ports may be the week link. 

TWO QUESTIONS:

How long will it take to upgrade the ports to meet the demand surges we now know are possible?  

How long will it take for the supply chain to completely collaspse if the current demand spike continues without the ports being upgraded?

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Posted by BaltACD on Monday, November 15, 2021 9:58 PM

charlie hebdo
The report mentioned how the city-state of Singapore is spending 50 billion dollars on a new container port. Ports like Rotterdam an Hamburg are very automated, including transfer to railcars. Maybe single stack has some real advantages in turn around?

There if virtually NO single handling of containers at any container terminal.  Very rarely, if ever, will a container be off loaded to a truck chassis whose driver, after the box is secured then drives out of the terminal and onto the boxes ultimate destination.  By the same token a Inbound box, loaded or empty, is rarely if ever driven by the over the road driver to shipside for the container crane to loade it on the vessel.

Container terminals are ripe with multiple handlings of the boxes, on terminal property between vessel and the terminal gate - both inbound and outbound.  To facilitate the multiple handlngs there has to be accessable GROUND to drop and retrieve the box at least one time and potentially multiple times between Terminal Gate and Vessel.  If you have the land, you can automate to your hearts content - if you have to start stacking boxes just to ground them on terminal property you are in trouble.

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Posted by charlie hebdo on Monday, November 15, 2021 9:46 PM

The report mentioned how the city-state of Singapore is spending 50 billion dollars on a new container port. Ports like Rotterdam an Hamburg are very automated, including transfer to railcars. Maybe single stack has some real advantages in turn around?

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Posted by BaltACD on Monday, November 15, 2021 9:40 PM

mdw
The matter of local governments not putting money into their terminals.  Do make a generalized statement.  The ports of LA and Long Beach have put billions of dollars into improvements at their ports....maybe where they need to invest more is automation.

The 'lack of investment' statement was directly pointed to the ports of LA and Long Beach.  While they may have put Billion$ into their port terminals, maybe they SHOULD have been investing tens or even hundreds of billion$.

In the video clips shown - the biggest present need, for whatever the multiple reasons, is more land area to ground containers - both inbound and outbound.  Each additional container level can be considered as stuffing an additional pound into the over full bag.  If they are talking container stacks being 9 high - that is, to my mind a safety issue as well as a material handling and logistics issue.

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Posted by mdw on Monday, November 15, 2021 8:04 PM

The matter of local governments not putting money into their terminals.  Do make a generalized statement.  The ports of LA and Long Beach have put billions of dollars into improvements at their ports....maybe where they need to invest more is automation.

 

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Posted by tree68 on Monday, November 15, 2021 7:00 PM

Backshop

People who keep large sums of money in banks are fools.  Your emergency fund of several months to a year or so is really all you need. 

When I hear the interest rates that organizations I'm familiar with are getting on their savings accounts (they can't really invest in the stock market, etc), I'm almost amazed that the banks aren't charging for the privilege of holding the money...

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Posted by Backshop on Monday, November 15, 2021 4:58 PM

People who keep large sums of money in banks are fools.  Your emergency fund of several months to a year or so is really all you need.  

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Posted by CMStPnP on Monday, November 15, 2021 4:48 PM

ClassA
I saw a discussion recently about how the wealthy don't maintain much cash in the bank. They hold on to their investments and borrow against those when they need cash, but keep their actual banked cash low.    Under such a circumstance, inflation would increase their wealth as it's tied up in shares or investments which will rise in value while cash value decreases. In such a scenario, would not the poorer person with less investments suffer more loss?  I'm not rich, so I wouldn't really know first hand. :-P

I feel I am wealthy so I can help you out here.   Inflation has more of an impact on the poor folks because their income is lower and your right most do not invest and live paycheck to paycheck.   

Stating that inflation increases money for the wealthy....I have to see some proof to that.    There has to be something that makes a person believe that inflated money moves in opposite directions based on income class.     So I would like to hear what it is exactly that makes people believe that. 

 Inflated Stock values is a hedge against inflation it is NOT a wealth increase in nominal terms of real money because of inflation.....more like not losing as much as someone that does not invest or holding steady with inflated values.    Any capital appreciation above the inflation rate is more due to the stocks performance not its' behavior due to inflation.

I don't use banks period.   They rip people off six ways from Sunday.    I use credit unions or Financial Investing accounts at wealth management firms.    Your correct that all my savings is invested in stocks except for a small amount of cash on hand.   Investing in stocks long-term is a hedge against inflation.    And in my opinion investing in stocks as a hedge against inflation is a hell of a lot safer than GOLD or SILVER.    Just my two cents.    Your going to run into people that for whatever reason think GOLD and SILVER are the GO-TO commodities for anything that weakens the NYSE.    Which is true if you can time their markets.   I have not met anyone that can though.   With GOLD and SILVER even the dollar cost averging method of investing is difficult at times.    Guess what people do in a recession?    They cash in their GOLD and SILVER.    Just like stocks, what goes up, goes down.

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Posted by ClassA on Monday, November 15, 2021 4:12 PM

I saw a discussion recently about how the wealthy don't maintain much cash in the bank. They hold on to their investments and borrow against those when they need cash, but keep their actual banked cash low. 

 

Under such a circumstance, inflation would increase their wealth as it's tied up in shares or investments which will rise in value while cash value decreases. In such a scenario, would not the poorer person with less investments suffer more loss? 

I'm not rich, so I wouldn't really know first hand. :-P

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Posted by Convicted One on Monday, November 15, 2021 1:38 PM

FORCING ME TO WONDER,  what percentage  of returning containers are typically loaded on the boat for the return trip empty, versus how many are  loaded (at the port) with export goods before being sent back out onto the big salty?

Somebody's got to have a good excuse for not sending those empty containers out, and just watching the circle of finger pointing, I'm sure there's gotta be some blame to be handed out there.

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Posted by Convicted One on Monday, November 15, 2021 1:31 PM

Question:  regarding all those chassis stranded under returned empty containers. Since containers on chassis are only "one high", wouldn't they be better off  bringing in a couple reach stackers,  liberate the chassis, and then inventory the waiting empties  "five high"  until their turn to go back to sea?

Seems like it would be a more efficient use of floor space, and at the same time free up available chassis for more productive work.

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Posted by CMStPnP on Monday, November 15, 2021 1:23 PM

BTW, in regards to inflation.....Papa Johns has shrunk their large pizza by 2-3 inch in diameter and increased the price slightly.    I just had one a few days ago Large is slightly larger than what Medium sized used to be.    Very noticeable.   My expectation was if inflation was short-term they would hold the line on prices and pizza sizes but apparently not this time.

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Posted by n012944 on Monday, November 15, 2021 1:05 PM

Convicted One

 

 
CMStPnP
Here is the 60 minutes report: https://www.youtube.com/watch?v=W7jSsyQKIfE

 

 

Interesting how they state that the problem has only been getting worse of late, instead of better.

 

 

Snowballing, going into the busiest time of year.  Short of some historic collapse, I think it will be well into February until we see a dent in it.

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Posted by Convicted One on Monday, November 15, 2021 1:04 PM

At roughly 8 minutes into the segment, the authority states that the majority of available chassis are sitting under empty containers waiting to go back to the ocean. And with those chassis out of the circulation, that's trapping freshly unloaded containers from leaving the ports, causing the logjam.

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Posted by Convicted One on Monday, November 15, 2021 12:33 PM

CMStPnP
Here is the 60 minutes report: https://www.youtube.com/watch?v=W7jSsyQKIfE

 

Interesting how they state that the problem has only been getting worse of late, instead of better.

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Posted by CMStPnP on Monday, November 15, 2021 11:44 AM

Here is the 60 minutes report:

https://www.youtube.com/watch?v=W7jSsyQKIfE

 

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Posted by n012944 on Monday, November 15, 2021 11:41 AM

Convicted One

 

 
Euclid
How do the wealthy gain through inflation as a rule?  I suppose individual circumstances could result in some poeple gaining through inflation, but give me some examples.  And what would give extra advantage to the wealthy? 

 

WAY outside the scope of this forum, and frankly not anything that I'm interested in debating.  But, if I own a $40 million office building while you own a $50,000 house, and everything is inflated by 7%...who gains more?

 

I have a million in the bank, you have $1000.  Because of inflation, my million will only buy $930,000 worth of goods, while your $1K will buy $930 worth of goods.  Who lost more buying power?

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Posted by CMStPnP on Monday, November 15, 2021 11:22 AM

BaltACD

Watched - valid points from every side.  Of course, the ocean carriers didn't present their viewpoint with their own shill.

This is congestion on a classic scale - if and when more 'capacity' is constructed and/or hires by all the players and placed in service, there will then be a paucity of traffic for the newly constructed capacity to handle.

The one salient point brought out - Port Terminals are controlled and financed by local governmental authorities - authorities that have continued to be stingy with cash for upgrades necessary to get the terminals to state of the art.  

I have not watched this yet on 60 min but I know from UP CEO remarks and looking online at LA/LB Port status reports,  Kind of humorous but did you notice how each player is acting in their own silo instead of acting as part of a larger integrated logistics team.    I wonder if the shortages would be as severe or the problem as big if they were all playing like an orchestra instead of each individually with different sheets of music.   Tampa, FL ports spokeperson last night:  "Unlike LB and LA we always have worked a 24 hour shift round the clock so we do not have these excessive wait times"...........ouch!

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Posted by Convicted One on Monday, November 15, 2021 10:02 AM

Euclid
How do the wealthy gain through inflation as a rule?  I suppose individual circumstances could result in some poeple gaining through inflation, but give me some examples.  And what would give extra advantage to the wealthy? 

WAY outside the scope of this forum, and frankly not anything that I'm interested in debating.  But, if I own a $40 million office building while you own a $50,000 house, and everything is inflated by 7%...who gains more? We're still both gonna pay $7 for a cheese burger, an issue of trains magazine is gonna cost us both the same, a coke is a coke regardless of which of us is buying it . So the relative gain available to one versus the other is different.

A thorough examination would have to include a comparison of discretionary vs non-discretionary expenses, and that's way more effort than I'm willing to expend here, so either agree, or don't. You won't offend  me either way. Geeked

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Posted by Convicted One on Monday, November 15, 2021 9:53 AM

Eventually when the supply chain gets choked with hinges that nobody in their right minds are gonna pay $30 for a pair and a half for, then heads will come down out of the clouds and a return to sensibility can prevail. Smile, Wink & Grin

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Posted by Euclid on Monday, November 15, 2021 9:53 AM

Convicted One

How do the wealthy gain through inflation as a rule?  I suppose individual circumstances could result in some poeple gaining through inflation, but give me some examples.  And what would give extra advantage to the wealthy?  

I sometimes wonder if many people realize what the full potential of inflation is once it get out of hand.  The popular veiw of inflation seems to be that prices of things they purchase are increasing.  And that is viewed as a moderate annoyance. 

 

 
Euclid
Is this a fake crisis?  Is it being used to deflect the blame for causing inflation?  Is inflation actually a good thing because it proves how successful our roaring economy is? 

 

 

The wealthy actually gain through inflation.  I suspect at least part of your answer is there.

 

How do the wealthy gain through inflation as a rule?  I suppose individual circumstances could result in some poeple gaining through inflation, but give me some examples.  And what would give extra advantage to the wealthy?  

I sometimes wonder if many people realize what the full potential of inflation is once it get out of hand.  The popular veiw of inflation seems to be that prices of things they purchase are increasing.  And that is viewed as a moderate annoyance. 

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Posted by Convicted One on Monday, November 15, 2021 9:32 AM

Perhaps now is not the best time to build new?  Let the swell of the resurgent economy peak, and taper off some first?

People's unwillingness to be flexible is what makes them such sitting ducks.

 

Eventually  once the system equalizes we'll get back to the point where one middleman will have to cut the other middlemen's throats in order to grow market share, and we'll all be happy once again. Mischief

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Posted by Murphy Siding on Monday, November 15, 2021 9:29 AM

charlie hebdo

 

 
Murphy Siding

 

 
Euclid
People have been sheltering at home for survival.  They only go to stores for essentials.  They buy everything possible on line.  This is a sudden and radical change.  The change has overwhelmed the supply chain with a demand spike.  It cannot cope with the spike and cannot be made capable of coping without a massive rebuild that could take years. 
 
The demand spike and supply chain failure is growing worse.  Being that it can’t be fixed, it will collapse.  Nobody is going to pay the cost that it is adding to product delivery.  The supply chain is a component of Chinese product manufacturing, sales, and marketing to the U.S.  They will lose that component as the supply chain collapses.  We will suffer a shortage of merchandise, but China will suffer a severe economic setback due to loss of product sales. 
 
It would have been wise to have built extra capacity into the supply chain to handle possible surges.  But we instead focused on just in time philosophy which implies do only what it needed at the moment.
 

 

 

Are you writing a doomsday science fiction novel? I feel like I've already reviewed a couple chapters.

 

 

 

 

Reality: October sales and industrial production in China both increased.

 

Now I'm confused. Does that play into euclid's narrative, or against it?

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Posted by Murphy Siding on Monday, November 15, 2021 9:23 AM

Convicted One

 

 
Murphy Siding
In a similar vein, we had a manufacturer confidently tell us that they because of their foresight and planning, they weren’t having any supply issues with the natural resources required to make their product. No kidding. The product is cement siding. It’s basically made out of dirt. No caffeine- never had it, never will!

 

 

I'm sorry Murph, I realize that as a middleman you find comfort in thinking that you have consumers square in your sights, and they have no alternatives than to absorb the price increases passed along to them, but I just can't embrace that thinking.

I see  willingness to find acceptable substitutes, to make do with available resources, and  to reuse and recycle what retains sufficient value to not be discarded ..as the necessary kryptonite  required to derail snowballing inflationary ambitions.   So, I believe those who are willing and able to furnish locally sourced alternatives are entitled to whatever gains they might secure.

It's a "build a better moustrap"  opportunity, IMO

 

Oh, those evil middlemen. Devil Where have you been? People have been trying to find alternatives to lower costs for about the last 1000 years. 

Yes, recycling is good. Please point out where one might buy enough recycled goods to build an apartment building.

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Posted by Convicted One on Monday, November 15, 2021 9:11 AM

Euclid
Is this a fake crisis?  Is it being used to deflect the blame for causing inflation?  Is inflation actually a good thing because it proves how successful our roaring economy is? 

 

The wealthy actually gain through inflation.  I suspect at least part of your answer is there.

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