War and the Global Economy

[Art]

I read an article today which claimed that Russian new tank production has been shut down due to a lack of semi conductors. It seems the sanctions have impacted the supply of semi conductors to a critical level.

The Rooskies aren't alone in this. We import lots of critical components used by our military including electronic bits and pieces.

[barretcreek]

We may run out of goodies also. Stinger production may be on hold and our stocks of Javelins are low. May have to fight with rocks and clubs the old fashioned way.

[togor]

A lot of it comes out of Taiwan, and the Taiwanese have an incentive to prioritize things, providing US industry is organized about it.

What happens is that businesses run on lean inventories, JIT technique, because it streamlines their bookkeeping. Until there's a hiccup in the supply chain then everyone overcorrects and wants to pay for stock on the shelf. That inventory building drives up demand.

Same is being seen with oil stocks. Excess demand is going into storage keeping prices high.

Shooters do the same with ammo, except for those who were in it for awhile and bought back in the good days. Ammo keeps better than oil or chips. A 20 year old IC is useless and oil turns over faster than that anyways.

[one shot]

Hey Togor I'm JIT for some primers I know they're working 24/7 any day know .

[jon_norstog]

Silicon doesn't travel by boat. It flies air freight.

jn

[barretcreek]

One reason for JIT supplies is inventory taxes and interest on the money to pay for the stuff. Early '90s ordered taillight assemblies for an old car; parts man said he had no idea how long it would take or how much they'd cost. I offered to pay up front and pick them up when I returned from a four to six month job assignment. Got back and he'd returned them because he said he couldn't justify having them in inventory. Having a 90 to 120 or even 20 to 45 supply on hand was prohibitive even then.