Some call it the accordion effect while others refer to it in terms of a bullwhip. Whatever the terminology, the supply chain mess has created a set of perverse incentives leading to a positive feedback loop: the greater the mess, the longer the times for delivery, the more product gets ordered if in only to increase the chance something, anything [...]
There was not much new to report in today’s durable goods estimates, consisting of largely the same we have seen since mid-2012. But that in and of itself is noteworthy, particularly as other indications point to similar patterns and analysis. In the past this has been called “scraping along the bottom”, but if recent history is any guide then it [...]
Slowly the optimism fades as last year’s spurt of activity is recognized for what it was: temporary. It is entirely common for such ebbs and flows to take place in inventory approaching recessions, as businesses themselves experience extremes in expectations in light of both hope and reality. Last year was, I must say, a bit unique in that spread between [...]
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