Michael Steinberg's smart piece at Seeking Alpha makes a persuasive argument that this downturn in the world economy shows the inherent weakness of the global economy--long lead time for orders. He also points out that American factories are running so efficiently they won't be laying off workers in the current recession. But this claim is striking:
The long production cycle, just-in-time manufacturing model exemplified by Toyota (TM) is now dead. China just does not realize this yet. Local highly flexible manufacturing will replace the lethargic dinosaur logistics and sourcing that signifies the Chinese-Wal-Mart (WMT) model of today. How much longer can Macy’s (M) order 9 months in advance for Christmas?
Is this recession that reshapes the economy into a decentralized, more highly efficient industrial base? Will inefficient, cheap labor markets lose their edge to leaner domestic producers? I don't know, but it is a fascinating possibility.
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