Thursday, February 20, 2020

The newest virus rumor.

If true - this has been in the wild in Iran for three weeks.

I think the whole market is being delusional. We all just hit the biggest effing ice berg imaginable. And not one single person I've talked to this week has listed the virus as a concern. I think people are really going to be caught short footed. Especially right after the holidays when they ran their credit cards  up. And all that Fed printing made the party seem awesome. The Fed really beat people into submission I have to say.

I think we get inflation and deflation all at the same time. That is a headwind that most of us have never experienced. And recessions never act the same. The market wasn't that strong before this hit. Despite stock market prices.


  1. THAT is fascinating. Thanks for sharing.

  2. This is going to be a test for companies that have prepared for distributed and non-centralized operations versus those who have everyone under one roof.

    I'd really like to have embraced "maker culture" to build the stuff we need, but the problem is that most of these cats send their stuff out for PCB production and assembly like we have, so there's not much to be gained there.

    So the best we could manage was to PANIC EARLY AND AVOID THE RUSH ...

    The people who have been using the market to drive costs down are going to get hit face first by this iceberg you've described, whereas those who have been using it to come up with affordable globally distributed production and assembly arrangements are going to make it through this.

    And, of course, a few essentially paranoid "preppers" with stacks of cash who don't believe in just-in-time production and delivery will probably not be caught out too badly. :-)

    Also, the bigger problem for us has been that the people who have been driving some of the production improvements in materials are also in China, especially with stuff like SnAgCuCe solder and other formulations that are meant to get past this continued annoyance with tin whisker formation on PCBs.

    China's more closely aligned with research in this stuff there because it applies directly to the production business they've had.

    But there are other options that don't require these tech fixes.

    Switzerland is attractive for electronics manufacturers because you can get your boards made elsewhere with Pb67/Sn33 solder and avoid the problems with tin hot dip and conformal coatings not really being up to the job. This also lets us use gold plating (for now), although we usually have everything solder plated with more of the PbSn stuff.

    The only down side is that sales in the EU of this stuff can only be to registered companies who can comply with the EU's WEEE crap on their own.

    We can live with that because we don't send out demo systems to individuals, and that we prefer to do the demos on the customer's turf so they can see how we can deal with their stuff and react to it when we've never seen its quirks before.

    As much as it might be interesting to produce some of these components in the US, given that PbSn solder isn't a production issue, it's not really an option because the other supply chains aren't available or big enough for us.

    American small makers are living in that Gil Scott-Heron "B Movie" where they're inflexible consumers who are now having to dance ...

    Travel's going to be a bitch for a while.

    I've been suggesting to some new vendors that they send over at least one designated "emissary" to us and to some of their other still-in-America businesses so they have people on the ground for interface stuff.

    Get each of them a nice rental car so they can stay off public transit.

    Of course, that's been going the other way as well, as much as we can without exposing anyone to this mess in countries where it's already starting to be a bigger thing.

    Interesting ... that news piece from RFI hasn't shown up in the French Swiss press so far from what I can tell.

    This containment clusterfuck in Japan just keeps getting worse though.




  3. RFI and Radio-Television Suisse do not have your Iran stuff ...

    Russia Today says these are 'realfakes' and there are at least 20 of them.

    I knew you'd never let your phone get that low on battery. :-)

  4. Maybe. But what is "deep" about it? It could just be a fake. It's like people calling things a "hot mess" when they are just a mess.

    It is in Iran now. That part is true. The idea they were arresting people still seems plausible. it's already their thing.

  5. Capital of Texas RefugeeFriday, February 21, 2020 6:15:00 PM

    I called it a 'realfake' ...

    This might be some real news being put in a fake media wrapper.

    It's just not on RFI and I can't find it anywhere else.

    One hint: notice how the text is arranged as if it were written in Arabic or Farsi?

    The entire text is right-adjusted and the periods are on the left.

    Pull up RFI in English on a mobile device and look at how they actually do it.

  6. Oh yeah. I see you did. Sorry about that.

  7. *sigh* my company already stockpiles stuff like mad for the spring/summer crazy, to the point where we have to worry about truck drivers accidentally running over things as they try to get in to unload. This spring is going to suck......

  8. I'm not sure if I understand. Is it because they are going to have more stuff to stockpile on top of the stuff they already have?

  9. Ruth and Snarkie: They're on a continuous production cycle for stuff that is seasonal.

    The company can save a lot of money that way while keeping their suppliers from seeking out other companies to fill in the gaps. That works really well in cases where the company has its own private brands.

    Some companies turn it into a situation where they have small stockpiles of nearly-ready-to-sell stuff that are being staged in retail locations for the seasonal sales periods.

    What that means is that they have several supply tiers of this stuff to sell off, but if they're doing that, they believe they have plenty of future sales volume and will price this stuff so they're more than making up the inconvenience of maintaining stock.

    Now the real problem: the suppliers of such things as lawn chairs and other outdoor goods aren't producing as much stuff for late spring to early summer right now because of the factory shutdowns in China.

    Some of the competitiveness between retail locations also means that some shops will be stuck with merchandise that they don't want to shift to another location because that messes up their sales volume.

    One shop I went to had something that I've wanted to stock up on in the past, but I didn't like the retail price, so I didn't. Because a stack of that item had been sitting in a noticeable heavy traffic area for a few weeks and nobody was biting, the price got marked down by roughly 80%.

    I bought the entire stack, and now I have at least a five year supply. :-)

    When I asked the manager what the deal was, it turned out that if they transferred the stack over to another store, they'd lose out on their sales volume targets plus take a hit on the transfer. Selling the stack to me at barely above wholesale price kept their sales volume targets on track and also got rid of the no-sales-volume stack that was in the way of them doing other promotions.

    Some of this no-sales-volume sell-off radical price adjustment stuff has been happening by algorithm. The home office told the shop to clear out the inventory for that item, approved a massively lower price by algorithm, and now that location won't be getting any more of that particular item.

    Meanwhile, twenty miles away at another location, the same item isn't in a noticeable stack and they're being sold at retail price.

    So you might want to be on the lookout for insanely good deals on stuff that's going to sit around for a while because it's being sold out of season or it's just a slow mover right now ...

    There may be less of that as the year goes on because of the bats stuck in the supply chain snake that is China, but there are still going to be a lot of carry-over sales.

    BTW, I've mentioned this mostly for Ruth's benefit because there may be some deals so good with a further employee discount that it'd be worth having some small stacks of cash set aside to take advantage of some of that.

    Provided, of course, that US retail sales aren't about to fly into the crapper and the money's going to be needed for something else ...

  10. Yesterday on BBC:

    "Iran reported its fifth death from the disease. The outbreak is centred on the holy city of Qom but officials warned that the virus may already have spread to 'all cities in Iran'."

  11. Refugee, I understand the economics of it, but that doesn't make me any happier having to deal with that stockpile on the store level.

    Snarkolepsy: I figure one of two things is going to happen, or possibly both, depending.

    1: we're going to end up mad short on the things people want
    2: the company managed to predict things far enough ahead to get their orders in far enough in advance that they have mad stockpiles of shit to now ship out to the stores so we can have stock on hand.

    They already stockpile the hell out of the stores in March/April, I'm serious about there being issues with the delivery trucks being at risk for running things over, due to lack of enough space. I figure that if they actually managed to get their bulk orders in soon enough they're going to stockpile us even worse, AND likely end up short on other stuff. I'm not looking forward to it.

  12. Ooooh. I see what you are saying. That's what I thought. It ~will~ be interesting to see how that works out. Once supplies are depleted, it might be a while before they are restocked. And other stuff people won't feel like using.

  13. "The outbreak is centred on the holy city of Qom but officials warned that the virus may already have spread to 'all cities in Iran'.""

    Yeah... it pretty crazy today.