If we look at the news of the last few months, it can be said without any exaggeration that the most used word was lack. There has been a shortage of fuel, drivers, containers, chips, magnesium, AdBlue and, most recently, paper as well. We are witnessing processes that we never thought could happen in our lives, in the globalized world.
According to experts, most of the shortages were caused by the pandemic, because in many cases the various producers and manufacturers reacted to the shutdown of the world economy by reducing their capacities. People were sent out of the mine, lines of machinery were pulled from the factories, and the world's production stopped almost overnight. However, as many analysts expected, the rebound took place quite quickly everywhere, because the majority of people's incomes did not decrease or did not significantly decrease during the epidemic, but they did not consume.
At the time of the re-opening, therefore, a huge deferred demand also suddenly flooded the world economy.
However, it is not so easy to restart production capacities. The worker may get a better offer from another mine, and the machine line may be sold to someone else, or it may take time to get it back into operation. Therefore, there was not enough capacity to satisfy the suddenly increased, enormous demand. Otherwise, this should not necessarily be a problem, since a system should be able to correct itself in the event of such a disturbance. The problem is that the various elements of the world economy have become intertwined at such a level that practically everything now affects everything. However, the Globe did not become smaller.
And why is this important? Because the spread of the virus is not based on globalization, but on the basis of the laws of nature, so in different parts of the world it had its peak at different times, and at other times it was in an ascending or descending branch. And this resulted in the actors of the various supply chains who were connected with a slight exaggeration every minute, there were sometimes closings and other times opening - and this caused disruptions that we will moan about for years.
One of the best examples of this is the case of containers. Due to its dynamics, the epidemic that started in China subsided there the fastest. Thanks to this, the Far Eastern country's production immediately picked up, exports resumed and tens of thousands of containers left for Europe and the United States. But since the restrictions in the western world were still in full force at the time, there was nothing for them to return to, that is, hundreds of thousands of empty containers were stuck in various ports around the world, disrupting the supply chain in such a way that now even new shipments cannot enter, since whole there is simply nowhere to store them.
And what does this mean for us, as consumers? For example, not to order too many Christmas presents from China or overseas, because they won't arrive.
Another connection that foreshadows the end of globalization can also - in part - originate from China. During the pandemic, capacities were reduced in many coal mines there, and after the economy restarted, there was a shortage of coal, which has not abated since then. The generators that supply the plants have thus been replaced by gasoline generators in many places. The increased Chinese demand for fuel is, among many others, one of the reasons why the price of gasoline has shot up in Europe and Hungary. However, the expensive fuel or the lack of fuel has now also reached China, where recently it was necessary to limit the amount of fuel that can be bought at the gas station at the same time. This puts carriers in a difficult situation, as it takes much more time to transport goods produced in the interior of the country - or indeed coal - to ports on the outskirts of the country.
Thanks to this, of course, there will only be an even greater shortage of goods and gasoline, which will increase prices and thus inflation even more. Moreover, the process is far from over, since almost every day it is revealed that a new basic product or industrial raw material is lacking. Of course, even the companies that have suffered a lot during the pandemic don't want to be worse off, so they prefer to compensate their potential losses with price increases, which will increase inflation, meaning that people's money will be worth less and less.
It is not yet known where it ends and whether there is a cure for the ills of the world economy. What is certain, however, is that a global system built roughly 100 years ago is collapsing right now, right before our eyes. What we can do at the level of our own community or country is to try to become as independent as possible from global supply chains. The government's aspiration for this is clear:
the domestic control or repossession of strategic sectors and infrastructure (for example, the repurchase of Budapest Airport) points in this direction, as does the government's attempt to be self-sufficient in as many things as possible.
And what can we do ourselves? Let's buy domestically, and not just food! Let's support domestic industry and services, trust Hungarian products. If this consumer practice can be established, they will be encouraged to manufacture more and more products or raw materials that are currently only available abroad. There are ten million of us, and thanks to the economic measures of the past 11 years, we are getting stronger and more solvent. We can keep much more domestic products than at present, so let's do it!
The global world is collapsing, and it's up to us to build in its place.
Source: vasarnap.hu
Image: Pixabay
