The End of the World is Just the Beginning

The End of the World is Just the Beginning

Peter Zeihan

Steel Box

Container shipping remade global supply chains.

Containerization changed the math by making shipping more reliable, enabling firms to push their inventorying back onto vessels, and enabling smaller orders to be produced at more reasonable costs. Toyota in particular realized that with changed shipping norms, manufacturing could evolve from a big-batch model to more of a steady product stream. This new “just-in-time” inventorying system allows firms to place orders for a few-day supply of widgets as little as a month in advance, with those fresh supplies arriving just as their last orders are running out.
Pacemaker Principle

Constraints in one part dictate the whole.

Oil, with its price inelasticity, does the opposite. Any sudden change in supply or demand rapidly ripples throughout the entire system.