Conversation

Preliminary thinking, speculation, and hypotheses. Earnestly intended and honestly attempted, but almost always needing further consideration, clarification, correction, or not-yet-found confirmation. These are research notes and homework still underway. Conversation is derived from the Latin meaning to turn together.

  • Strong August Retail
    US retail sales increased in August, even more than expected. See chart below. Bloomberg initially characterized the outcomes with, “consumers are still spending even as tariffs boost the cost of some goods, sentiment remains subdued and the labor market shows signs of faltering. Though wage growth has cooled, many workers’ pay gains continue to outpace inflation, […]
  • Flows Fluctuate
    First half 2025 US import volumes were choppy but higher overall (see green line on the chart below through end of July). Since a record-setting March, inbound flows have slowed but remain at historically high levels. According to the global shipping analyst Descartes, “In August 2025, U.S. container imports reached 2,519,722 twenty-foot equivalent units (TEUs)—the […]
  • Tariffs: Three Microeconomic Analogies
    Several recent tariff-related conversations have ended-up mostly focused on presumptive motivations for radical shifts in US tariff policy. Supply chain executives want to discern the why behind the what to better frame their own tariff-related decisions. If they can better understand where these tariffs are trying to take us, these executives hope they can develop […]
  • Steady Demand
    This morning the Bureau of Economic Analysis reported that real (inflation adjusted) Personal Consumption Expenditures increased 0.3 percent in July. Please see chart below. According to the BEA, “Personal income increased $112.3 billion (0.4 percent at a monthly rate) in July, according to estimates released today by the U.S. Bureau of Economic Analysis. Disposable personal […]
  • Systemic Continuity
    In September 2015 I published an online primer for Supply Chain Resilience. In August 2025 I reviewed and — very slightly — updated this decade-old content. No corrections were needed. No oversights required gap-filling. For my purposes, the principles and patterns set out then still apply today. My revisions consisted entirely of more recent data […]
  • Robust but softening demand
    According to the Bureau of Economic Analysis, “Personal income decreased $109.6 billion (0.4 percent at a monthly rate) in May… Disposable personal income (DPI)—personal income less personal current taxes—decreased $125.0 billion (0.6 percent) and personal consumption expenditures (PCE) decreased $29.3 billion (0.1 percent). Personal outlays—the sum of PCE, personal interest payments, and personal current transfer […]
  • Consistent Spending Habits?
    Compared to March 2025, during the month of April US consumers earned a bit more, spent a bit more, saved more than in recent months, and spent less on a wide array of durable goods. Despite still robust demand (see first chart below) — and uncertainties related to supply — the year-over-year PCE price index […]
  • Deep Pockets
    According to the US Census Bureau (Department of Commerce), “Advance estimates of U.S. retail and food services sales for April 2025, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $724.1 billion, up 0.1 percent from the previous month, and up 5.2 percent from April 2024.” Bloomberg reported on […]
  • Demand Shock or Supply Shock?
    Wednesday morning on Bloomberg Surveillance (see video link below), Frances Donald, chief economist with the Royal Bank of Canada, highlighted the potential risk of “… dysfunctions in the supply chains that leads to more problematic developments this year.” She emphasized, “… when you start to mess with supply and demand dynamics within supply chains, when […]
  • US Demand Persists in March
    According to the Bureau of Economic Analysis, “Personal income increased $116.8 billion (0.5 percent at a monthly rate) in March… Disposable personal income (DPI)—personal income less personal current taxes—increased $102.0 billion (0.5 percent) and personal consumption expenditures (PCE) increased $134.5 billion (0.7 percent). Personal outlays—the sum of PCE, personal interest payments, and personal current transfer […]
  • Obvious but underestimated?
    I have been surprised by how others have been surprised by how supply chains are responding to tariff turmoil. In mid-December I included this almost throw-away-line in a note to selected clients: The most heavily tariffed imports will likely become rare, consumer prices on rarities will spike, and US exports will shrivel from retaliation. If […]
  • March retail trajectory
    Yesterday the US Census Bureau reported: Advance estimates of U.S. retail and food services sales for March 2025, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $734.9 billion, up 1.4 percent (±0.5 percent) from the previous month, and up 4.6 percent (±0.5 percent) from March 2024. Total sales […]
  • Full value or fickle tariffs
    The following was contributed by a reader who has asked to remain anonymous. Many thanks — and apologies — to William Shakespeare. Let me not to the supply of demandAdmit impediments; trade is not tradeWhich alters as politics commands,Or bends with the remover to remove.O no, it is a value-fixèd markThat looks on tempests and […]
  • Resilience: Cause or Effect?
    Shallow men believe in luck or in circumstance. Strong men believe in cause and effect. (Ralph Waldo Emerson, The Conduct of Life, 1860) Gravity’s effect is variable, but its influence (as far as I know) is unavoidable. Friction has both beneficial and problematic effects depending on context or purpose. Supply chains constantly manage gravity and […]
  • Most pernicious tariffs
    Below is an interview from this morning’s Bloomberg Surveillance. Henrietta Treyz of Veda Partners says that the sector-specific tariffs (previously discussed here) are the “most pernicious”: causing the most harm in a surprising way. Derived from the Latin per-nicies meaning by- or through-death. She expects the current automotive, steel, and aluminum tariffs to be joined […]
  • Warwick: Hurry up and Wait
    Below is a helpful Bloomberg interview (under 8 minutes). David Warwick outlines fundamental tariff-related issues facing supply chain decision-makers. While the Tech supply chain is front-and-center, very similar issues face most other sectors. Warwick is wonderful at concisely capturing the challenge now complicating supply chains. I am less impressed by his hope that common sense […]
  • Uncertainty versus Perfidy
    Many have complained of uncertain tariff policies (here and here and here). Houthi attacks on Red Sea shipping are uncertain. This October’s water levels on the Mississippi, Rhine, and Yangtze rivers are uncertain. June energy prices are uncertain. Commerce persists and constantly adapts to such uncertainty. Uncertain derived of Latin certus: not fixed, not resolved, […]
  • Trying to pierce the fog of war
    This morning the new ten percent universal — or baseline — tariff will be levied on imports into the United States. Other tariffs are already in place (here and here and here), more tariffs are promised. As headlined in the Financial Times, “US stocks shed $5.4tn in two days as Trump’s tariffs stoke recession fears.” […]
  • “April is the cruelest month”
    During February American consumers expended about the same as they did in January (which was slightly less than a high-spending December, see first inflation-adjusted chart below). Last month Americans made a little more, saved a little more, and may have stayed home more (bad weather? ). On Friday Bloomberg’s PCE report (and others) emphasized: Notably […]
  • Tariffs and TARA
    Below is a conversation from this morning’s Bloomberg Surveillance. Ryan Petersen with Flexport discusses tariffs. He offers most of the same predispositions, assessments, arguments, and preferences as most of my supply chain-focused clients and contacts. Most support “bringing back” manufacturing to the United States. Many are open to carefully crafted reciprocal tariffs (here and here […]
  • Characteristics of pre-tariff demand
    January consumption expenditures ticked-down just a tad (see first chart below). Given unusually cold weather and perhaps some post-holiday restraint, this is not unprecedented nor necessarily the start of a pattern. January 2024 expenditures ($15,812.6 billion 2017 dollars) were lower than December 2023, but by last month US personal consumption expenditures had grown to $16,283.6 […]
  • Tariffs (again)
    From Sunday night to Monday noon (US Eastern Time) my inbox overflowed with questions and venting — probably more venting than questions. By Monday dinner-time the drama had significantly abated (here and here and here). Back on December 2, I wrote in regard to Mr. Trump’s tariff strategies, “What is promised — threatened — often […]
  • Closing status of 2024 US Flows
    According to the Bureau of Economic Analysis, December demand — measured by Personal Consumption Expenditures — increased 0.7 percent compared to November. This was almost twice the rate of increased personal income (0.4 percent) continuing a steady — supply-chain-friendly– ascent in real (inflation-adjusted) consumption that started in mid-2021. See first chart below. In response to […]
  • Resilience realities
    Nicholas Morales at the Richmond Federal Reserve Bank has authored a helpful Economic Brief that concludes: The push for resilient supply chains reflects a trade-off between stability and cost. While resilience investments protect against future disruptions, they may raise input prices and inflation in the short term. Given the likelihood of increased climate events and […]

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