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It might do well in these crises, but if it can't survive the times where everything works well, then it doesn't help.

• mlac 5y ago
  That’s fair, but I think we will see a swing to vertically integrated supply chains to address some of this risk.
  • OneTimePetes 5y ago
    We already have, its just not visible. Those who had stockpiles of chips (Toyota, many other japanese companies affected by the 2011 tsunami) were able to supply and provide products, thus taking market share - or sell chips at a larger price as demand sored. This strategy of holding strategic reserves on premium goods already paid for itself. Similar to that, the scalpers - horders of rare/in demand products fullfill that job in capitalism - at the risk of sitting on a pile of lowprice good.
    • mlac 5y ago
      We are going to see a bullwhip effect [1], it's just where and when it happens. I heard two things this morning about more car shortages (due to chips), Manheim auto auction has had extremely low volume this year, cars going at auction for more than they sold at retail 3 years ago. Some of this I think is sticky (I don't see new car dealers lowering their prices or being willing to negotiate quickly), others though I think will have a drop as inventory picks up. Sell high buy low. I just don't know what to sell at the moment. [1] https://en.wikipedia.org/wiki/Bullwhip_effect https://en.wikipedia.org/wiki/Bullwhip_effect
• tablespoon 5y ago
  >> Any supplier who could actually sell right now would be able to take advantage of this market and build serious market share. So it’s a company with these reserves that will do well in a similar situation. > It might do well in these crises, but if it can't survive the times where everything works well, then it doesn't help. See also: all the new US N95 respirator manufacturers that popped up during the pandemic. Now they're laying off most of their staff and most will likely go bankrupt, because their customers went back to buying cheaper Chinese masks as soon as they could.