Supply Chain SITREP: I have seen stuff floating around about a “supply chain collapse” and wanted to weigh in on it. A few data points - fact: 90% of the worlds goods ARE transported by cargo ships. fact: china’s cargo ship exports dropped by 60% in Fed/Mar 2020.. but....

We have to remember there were a sea of containers sitting off the ports in “quarantine”; and there is the ability to move goods via air cargo right now as flights are empty. This method would expedite and offset a lagging sea freight issue - albeit costly to the consumer.

This picture is a real-time shot of current tanker (red) and cargo (green) activity.. so things are still moving! Now back to the “collapse”. The shortage wouldn’t come from the movement of goods as much as from the stopping of production. THAT would cause a lull in port activity

So goods from China WILL have a lull due to production as will everything else in the world. Including US produced products. That’s good from a “job” perspective as it will take people to increase the production back to normal levels. The issue then becomes consumption.

Consumption is down because people are not working. Take the service industry for example, it is estimated that 35% of restaurants will not reopen after thr lockdown. That number increases to 50% if they stay closed past May 15.

So the supply chain hasn’t completely “crashed”, ports will see traffic pick back up.. but it WILL take DECADES for the world to recover from this - not months as this is far worse than 9/11 - and it is global. 9/11 took over 12+ years to exit the recession and it double dipped.

Right now, there are 200 Countries around the world in this mess that are ALL heavily in debt. The REAL problem is the massive crop failures from locusts, droughts, fires and flooding. THAT will be what causes food shortages. Not the supply chain and productivity issues.