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.

  • Pull persists
    October real Personal Consumption Expenditures increased $41.2 billion (0.2 percent). Food expenditures were more subdued (see first chart below). September food-at-home expenditures — adjusted for inflation — were $1154.3 billion. October FAH spending was $1154.8 for a 0.09995 percent increase. Most media commentary and stock market investors have focused on the implications for inflation, future […]
  • White House Supply Chain Resilience Council
    From the White House website: Today, President Biden will convene the inaugural meeting of the White House Council on Supply Chain Resilience, which will advance his long-term, government-wide strategy to build enduring supply chain resilience. The Council will be co-chaired by the National Security Advisor and National Economic Advisor, and include the Secretaries of Agriculture, […]
  • EU Natural Gas
    In March 2022 I started giving much more attention than ever before to EU natural gas sources, inventories, distribution networks, and consumption. In May 2022 I was invited to listen-in and ask occasional questions while European energy experts tried to decide what could be done regarding their dependence on Russia’s natural gas. Looking ahead six […]
  • Fifth National Climate Assessment
    Last week the Fifth National Climate Assessment was released (more and more and more). There is focused attention to supply chains. The chapters on complex systems and economics are especially relevant to Supply Chain Resilience. For example, the concept map below is excerpted from the complex systems chapter. I need more time with the report. […]
  • Supply Chain Fitness
    Supply Chain Resilience is especially attentive to wide-area, cross-sector, high volume, high velocity flows. Is there enough flow in the right channels to deliver what is needed when and where it is needed? This is analogous to the human body’s blood pressure being sufficient to feed oxygen and nutrients to our vital organs, but not […]
  • US retail sales slow (?)
    According to the US Census Bureau, after strong September retail sales, “Advance estimates of U.S. retail and food services sales for October 2023, adjusted for seasonal variation and holiday and trading-day differences, but not for price changes, were $705.0 billion, down 0.1 percent (±0.5 percent)* from the previous month, and up 2.5 percent (±0.7 percent) […]
  • Cyberattack on Australia’s ports
    On Friday, November 10, DP World Australia container port operations in Melbourne, Sydney, Brisbane, and Fremantle were seriously disrupted by a cyberattack (more and more). DP World handles roughly 40 percent of Australia’s maritime throughput (in and out). This morning the BBC reported: “DP World Australia, a unit of the Dubai state-owned DP World, said […]
  • Restrained inland waterways
    Sunday night the PBS NewsHour ran a helpful overview of how upstream drought has squeezed midstream flows to seriously reduce downstream discharge on the Mississippi River (more). The story offers an especially helpful comparison of capacity differences between barge, rail, and trucking alternatives (full story is eight minutes). Per the river gauge at Memphis, a […]
  • More winter worries
    Yesterday the North American Electric Reliability Corporation (NERC) released its 2023-2024 Winter Reliability Assessment for the North American grid. Here’s how NERC summarizes its findings: …much of North America is again at an elevated risk of having insufficient energy supplies to meet demand in extreme operating conditions. The areas identified as being at elevated risk […]
  • Low pressure (not no pressure)
    One prominent measure of global supply chain flow finds the least friction in a quarter-century. Please see the chart below. Average viscosity is represented by zero. In October the measure was 1.74 standard deviations below average. According to the authors of the Global Supply Chain Pressure Index at the Federal Reserve Bank of New York: […]
  • Threat resilience or vulnerability resilience
    Last week I was asked to recommend a well-established private sector, business continuity process that focuses on all-hazards instead of specific threats. I was surprised — chagrined — that nothing immediately came to mind. If you have suggestions, please let me know… In response I did send along two recent studies: PwC has published a […]
  • Realistic expectations for China flows
    Recently there have been signs of economic recovery in China. For example, here and here and here. It is a huge economy that has demonstrated considerable resilience despite several very hard knocks (some self-administered). It would be a mistake to under-value current conditions or future potential. But I don’t yet see evidence for much sustained, […]
  • Winter Preparations
    In an October update Emily Becker with the US National Oceanic and Atmospheric Administration (NOAA) forecasts, “El Niño will continue through the spring, with a 75-85% chance it will become a strong event. A stronger El Niño… means it is more likely that we will see El Niño’s expected thumbprint on winter temperature and rain/snow […]
  • Pulling push persists
    To the extent that demand pulls, sizes, and organizes supply — and in most advanced economies, this is mostly the case — then consumption can be said to fuel supply. According to the Bureau of Economic Analysis: Personal income increased $77.8 billion (0.3 percent at a monthly rate) in September. Disposable personal income (DPI)—personal income […]
  • Hearing does not always mean listening
    Yesterday I watched/listened to most of a hearing conducted by the Budget Committee of the United States Senate entitled: Bottlenecks and Backlogs: How Climate Change Threatens Supply Chains. The link provides access to a video of the hearing and separate links to the prepared testimony of five expert witnesses. The testimony of Kathy Fulton and […]
  • Bad but getting better?
    Below are the USGS water gage outputs for the Mississippi River at Memphis. Last week an all-time recorded low was reported (blue line), even lower than last year’s (brown line). According to Yale Climate Connections: In Memphis, Tennessee, the river dipped to a new record-low water level of -10.81 feet on Saturday, October 22. The […]
  • Fragile and Unstable Equilibrium
    That’s an accurate distillation. A whole host of flows demonstrate a rough current balance of demand and supply. There are manifold endogenous and exogenous sources of instability. While many flows are huge, there are so many active sources of instability and potential chokepoints it would be foolish to deny innate fragility. This helpful phrase is […]
  • Geopolitics, Energy Transition, and Demographic Change
    Yesterday the team at Bloomberg Surveillance interviewed Alex Brazier from BlackRock. It was an often nerdy, but strategically valuable conversation. The Great Moderation is over. Mega forces point to significant regime changes. We are on the edge of a generational re-set. We will experience a series of “negative supply shocks”. Geopolitics, the energy transition, and […]
  • Running loose (into trouble?)
    The most recent measure of the Global Supply Chain Pressure Index continues at well below the long term average. Despite global inflation, fog and friction of war(s), purposeful production cuts, and increasing complexity of flows, volume is strong. Velocity is much better than two decades ago… or even two years ago. Agricultural Production: The last […]
  • September CPI and supply chain fitness
    Yesterday’s Producer Price Index and this morning’s Consumer Price Index (both for September) each confirm robust US demand (more and more and more). Most American consumers remain active and ready to spend. Pricing trends suggest that demand exceeds current supply in several categories, including shelter, energy, and most energy-related categories such as transportation. This summer […]
  • Whither goest demand
    Supply tracks demand. Push follows pull. Flow seeks fulfillment — unless demand is silenced, unless push is obstructed, unless flow is drained by extreme upstream drought. According to the Wall Street Journal, “U.S. hiring surged last month, the latest sign of accelerating economic momentum… Employers added 336,000 jobs in September, the strongest gain since January and up sharply from […]
  • US personal consumption
    Here’s the BEA up top summary: Personal income increased $87.6 billion (0.4 percent at a monthly rate) in August, according to estimates released today by the Bureau of Economic Analysis… Disposable personal income (DPI), personal income less personal current taxes, increased $46.6 billion (0.2 percent) and personal consumption expenditures (PCE) increased $83.6 billion (0.4 percent). […]
  • EU Natgas flows
    Price is lower than last year, but high enough that EU demand for natural gas continues much lower than two years ago– yet is sufficient to pull LNG flows from far away to replace Russia’s flows that are now mostly gone. Matching supply and demand depends a great deal on winter weather. Temperatures are forecast […]
  • Midstream constraints
    Trucks, pipelines, barges, and ports get most of my attention. Railways and ocean-going vessels are crucial to discharging upstream capacity and long-distance volumes, but not as vital to the flows I most often follow: consumer-facing food and fuel. Air freight — belly cargo and more — is important to some flows (e.g., fresh fruit, flowers, […]

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