I’m in banking. There’s an almost endless supply of money. What it costs to pay to rent it is going up sharply in the last 2 months. And again soon I’m next few months. People that took 30 year loans in the 2’s are looking like geniuses. In the 3’s are very smart and people calling today that I’m quoting mid 4’s are pissed because it’s going to cost them a lot more than just 2 months ago. We don’t do much FNMA and I’m hearing from clients that other banks are in the 5’s This should be interesting.

Steel we can get on demand. Some aluminum extrusions and sheet goods we with work with have been problematic. We can still get them but it takes 3 to 4 months sometimes.

quote:

Originally posted by stoic-one:
Variable frequency AC drives.

You can't shop them by brand if you need it in less than 2 weeks, and haven't really been able to for more than 9 months. Choose the horsepower, find anyone that has something in stock, buy it immediately.

Thankfully we stock a lot of them, but we've been burning through them recently. Thanks for the heads up, I'll make sure the guy that orders has a good stock on hand.

We are seeing huge delay's with paper, ink, even supplies for desktop printers. It's getting so bad we are purchasing toner from anyone that is selling and have it in stock because normal businesses that sell the stuff can't get it to fulfill our orders. We have even researched buying newer printers because supplies for these seem to be more readily available at this time.

Aluminum for making litho printing plates is getting so hard to get ahold of that our vendor told us yesterday that they are no longer taking on new customers until 2023 at the earliest, they are raising our surcharge on materials and that all plates are now being manufactured in Germany. They've closed their facilities in China and New Jersey.

Everyone said that technology would kill print but I swear it will be supply chain issues.

I just can't figure out why aluminum?

quote:

Originally posted by ElToro:
People that took 30 year loans in the 2’s are looking like geniuses.

[smiles in 2.25%]

quote:

Originally posted by PASig:

quote:

Originally posted by old dino:
I was surprised to see the cost of electrical wiring. Couple days ago I was chatting with my neighbor who owns an electrical company and he said the increased cost is not because of the copper but rather the insulation outside coating ... that wire making companys can not get supplies of.

It's the copper too that is skyrocketing.

I paid $152 for a 250 foot roll of 12/2 Romex at Lowes in late February.

It's now $165

I'm told that MAY have cost $50 2-3 years ago

It's going to get to the point where it will be too expensive to wire or rewire a house with copper, you watch there will be a push to go back to aluminum wiring for residential.

I agree with you that there is an increase in copper that is raising the wire pricing. The neighbor is a good guy but never admits he is ever wrong.

July 2020 I bought Southwire 10/3 100 ft online from Walmart (best price I could find at that time) for $62. Today I looked up the same wire online from Walmart and now is $162.

Speaking only for myself, I will always stay with copper for wiring ... guess the old days of aluminum in homes having problems still lingers in my mind.

quote:

Originally posted by drill sgt:
To those of you want to move all of this overseas manufactory issues back to the United States where are you going to get the equipment and supplies to get this accomplished ???? .. If they are having supply issues then how do you expect it not be a problem if we tried to drop them and do it ourselves. .... We did it to ourselves starting many years ago by chosing to get out of the manufactoring of products because the "bean counters" saw that it was cheaper supplies and labor cost and have greater profit margins to move all of these operations to other countries... Now we are caught in the middle of this situation and it ain"t going to be resolved any time soon. ...... drill sgt.

I believe that I did mention it would take several years to get manufacturing set back up over here, and when we did it would require being willing to pay higher prices for the security of a shorter supply chain. As for how you do it, well the same way we convince businesses to do anything: money. Adding tariffs to make foreign materials and goods cost as much or more than local ones is a common strategy. Tax incentives and cheap loans are always options as well. PR campaigns to convince people that you can have a good life without a 4-year degree would help. For resources we need or want to import, keeping deeper supplies stateside and cultivating multiple sources rather than always taking the lowest bidder would be useful. If all else fails we could try bribing our politicians with more money than the foreign interests do!

It wouldn’t be easy, and there is are serious problems with isolating ourselves and making our economy uncompetitive rather than stimulating internal production, but it isn’t impossible. We chose to give up manufacturing to get cheaper stuff. It took decades to create this problem. No reason to think it wont take decades to fix it. As always, the first step is admitting there is a problem, and I think everyone, republican, democrat, or other, realizes there is a problem right now. Hopefully it leads to a correction rather than just waiting for cheap shit to come back.

- Bret

Yep - definitely seeing supply chain issues. I work in IT & Operations[Production] and have items on backorder in both areas, some since December. When we do find what we need in stock - the cost has exponentially gone up (lets see if my forum buddy comes back for round two of the meaning of that word...)

I was on a call first of this week and recommended we again start to pull forward as much purchasing we can, especially items that already have long lead times critical to production even in the best of times - laying in supply best we can to mitigate outages or worse, forced substitutions (big issue in consumer goods arena) - which we did early on during the pandemic and had started to ease back from doing so.

This time around however, I feel it will be like a tsunami - ripples in the water, which is shortage here and there [which is where I think we are now], then water begins to recede, very far from the shoreline as the shortages really start picking up across the board, then an epic wave rushes onshore as all those goods come crashing in all in one fell swoop

One in five ships I read are tied up right now in China - could actually be even higher than reported as many are retasked to other shipping lanes or sitting idle elsewhere as there is no need to run if you just sit waiting outside port for a dock time. That lull in [just in time] shipping means there will be a gap in shipments, thus the shortages.

As a secondary effect, in the logistics world - truckers have been slammed and in short supply getting goods delivered, things were starting to soften up but wait till there is dramatically less to ship as the gap of little shipping from China(and elsewhere, its not just China with issues) builds. Trucking companies will be crushed - then when goods start to flow again it will be a crushing wave of goods to ship that incur logistics issues on an unprecedented scale. The second order effects and beyond boggle the mind.

Course I could be - and mayhaps hope so - totally, utterly, completely wrong on what's to come...

My point in all that - right now most things we need will likely be more expensive and not as cheap as they are today - if you use them, lay in that supply - basically pulling forward your spend on consumables

And welcome to stagflation-ville - we are heading there now

Congrats, That’s a great rate. I have a friend that scraped the bottom and got 1.9 for 30!

I’d suggest that you Don’t prepay it. Before long, cash in savings will be earning more. And depending on your tax rate and what you believe the real inflation rate to be it’s already a net negative real rate.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by ElToro:
People that took 30 year loans in the 2’s are looking like geniuses.

[smiles in 2.25%]

From my company's standpoint:
- Electrical supplies are crazy expensive right now, and some things are ridiculously hard to get. A particular limit switch we use, for instance, I ordered two weeks ago. They might be here in June... maybe.) Copper is outrageous.
- I have a hard time getting PCs for my team and for the production floor.
- We have a couple of good overseas suppliers; getting materials here from them is a challenge.
- Drives and power supplies are a challenge as well. I got some small DC drives within a week, and that was a surprise.
- Epoxies and adhesives. A) hard to get, and b) expensive. One particular adhesive we use has tripled in price, and we use a LOT of it.

- Drill sgt is correct: bringing manufacturing back to the States is tough, because of materials -- and manpower. Materials are tough to get; reliable manpower is as tough. We currently have about 10 production positions available. We pay pretty well. Our hours are good, and it's indoor (dry, heated, air-conditioned) work. It's not hard labor, by any means. Of roughly 120 interviews, we found about 20 people to whom we could make offers. Of those, a dozen or showed up. About half of them stayed.

In addition, there's a lot of knowledge lost. People who gave up or retired during the plandemic took a ton of knowledge with them. People who helped set up factories overseas years ago aren't still among the workforce. What that means is that we just don't have the knowledge anymore. Sure, we could re-learn and reinvent things, but that comes with great [time] inefficiency. Sadlerbw is right -- it's not impossible -- just slow and expensive.

To Goose5 regarding aluminum: Something I read a couple of months ago (sorry, no link right now) said the bauxite mines were suffering workforce issues, due to the wuflu. Bauxite is a key component in aluminum alloys.

I remember in the 80s it was all about "vertical integration" -- buy up your suppliers, so as to be able to secure and manage the supply chain. At least one company I know of is forced to do the opposite right now -- farming work out -- because its labor shortage won't allow it to keep up with demand.

In our case, demand is strong. We've got customers we can't feed fast enough, and we've got new projects in the pipe that we can't even start on yet, largely due to materials costs and availabilities.

RogueJSK: I'm grinning right along with you at 2.25.

Supply chain issues? Yes.

We can't get any supplies. Work doesn't get done. Freeway doesn't get built. Traffic stays fun.


Even better was back in the '90s a good rate was just below 9%.

At least I didn't have to finance anything in the early '80s. Yikes!

When talking about the high prices of American made goods you can't just blame labor cost. You have to factor in the cost of complying with the cost of all the EPA regulations. China, Mexico, and other countries don't have those cost. For many products that is more costly then labor.

True. And it's my belief that that's the very reason we outsource so much stuff.

quote:

Originally posted by ElToro:
I’d suggest that you Don’t prepay it. Before long, cash in savings will be earning more.

I've still been prepaying it, purely because I plan to retire in 12 years and want to be mortgage-free at that point.

But if it does get to the point where savings earns more, I'll reconsider my plan.

For those of you who think you have it bad, I was talking with a friend who is a partner in a decent sized commercial construction company. A majority of their contracts are with local governments. Right now they apparently have a whole yard full of broken equipment they can't fix and are causing them to fall behind on their contracts. But if you thought that was their major issue, it only one of them. Apparently a couple large local governments are threatening lawsuits given these contracts, signed some two years ago, have performance standards and deadlines that are obviously not being met due to current conditions. So along with all the issues he's facing trying to find equipment and parts, as well as laborers to work these jobs, now the local nitwits are having tantrums their projects are way behind and lobbing legal threats his way. Welcome to a more retarded version of the Twilight Zone.

quote:

Originally posted by goose5:
I just can't figure out why aluminum?

We questioned that as well when he said it and he just said they are having a hard time sourcing it. I don't know why aluminum used to make litho plates would be different than any other aluminum used to make can's or anything else.

quote:

Originally posted by RogueJSK:
I plan to retire in 12 years and want to be mortgage-free at that point.

Darn right! Who wants to be paying on a mortgage in retirement?

I'm surprised it's taken this many months for the issue to show up on your end.

My profession is in supply chain and I'm glad I quit working in April 2020. Because like your vendors, I would have been under pressure by my boss to look like I'm doing something even though they know and I know there's nothing that can be done. It would have been at least weekly or daily reports on what is missing, when is it expected to come in, why did it miss the last deadline, and what's being done about it.

It would have been what they call Chinese fire drill.

quote:

Originally posted by RogueJSK:

quote:

Originally posted by ElToro:
I’d suggest that you Don’t prepay it. Before long, cash in savings will be earning more.

I've still been prepaying it, purely because I plan to retire in 12 years and want to be mortgage-free at that point.

But if it does get to the point where savings earns more, I'll reconsider my plan.

My wife and I never bought into prepaying for most things using installment/payments like paying ### over loan payment - we typically always hold the overpay cash in reserve and when we get the cash to cover, pay it off. Its a very conservative approach, but there are too many unknown variables and we look at it as a what if we cannot come up with that kind of cash later for some unknown reason - we likely could cover the payment going forward - but may not ever or for some unknown length of time have a chance to save that much cash [health or job troubles or just a job change or economy issues etc]. So we hold the cash (some in various near term and long term savings and some as investments) - then if we need the cash for something else we have it and still make the payments. We have done this over the years for many large purchases - a couple times it really came in handy to have cash at ready for something that paid off better over the longer term

ETA - on a house I understand the savings - paying bi weekly for example which we did with our old house plus a bit of extra before renovating this one - going into the economic headwinds I think we are heading for - I rather even with inflation hold more cash in reserve than ever would have before for emergencies/what ifs