Daily Archives: December 24, 2010

Proud To Be Fox News Free!

Especially since a recent “study confirms that fox news makes you stupid”! (Fark.com)

Check out this recent article on AlterNet that describes a survey conducted at the University of Maryland that found that Fox News viewers are significantly more misinformed than consumers of news from other sources and that greater exposure to Fox News increases misinformation. Wow!

This is scary considering that 85.7 Million Americans watch Fox News every month (source: TV by the Numbers). That’s 27.5% of the population being misinformed every day!

And before you go dismissing the study, read the article in full as it also mentions a previous study by the University of Maryland and a Wall Street Journal poll that found the same results. As a result, the
conclusion is inescapable. Fox News is deliberately misinforming its viewers and it is doing so for a reason. Every
[reported] issue above is one in which the Republican Party had a vested interest.

That’s why Sourcing Innovation is, and will continue to be (as our gift to you), Fox News Free! Happy holidays and happy new year!

Capital Costs are Going Up. Can Your Supply Chain Handle It?

The McKinsey Quarterly just published a great article on “how the growth of emerging markets will strain global finance” (registration required) that should be read by every CPO who doesn’t work for a mega-corporation with a large cash balance. The article will help them understand what’s keeping the CFO up at night and why the CFO, who already has to deal with Basel III, might be afraid to invest in long-term capital projects (or, at the very least, have difficulty committing the capital).

The article points out that when you combine low savings rates in developed economies, decreasing savings rates in the more mature emerging economies, the increasing expenditures required to support the aging population in developed countries (that will further reduce savings), and the growing need for capital-intensive investments in infrastructure in the new emerging economies, in less than 20 years there will be a significantly greater need for investment in the global marketplace than there will be investment dollars available. When you combine this increasing demand for capital with the looming threat of increased inflation, and factor in the increased risks associated with short-term funding, it quickly becomes clear that interest rates have no where to go but up, especially since these rates are now at their 30-year lows. At the very least they will return to their 40-year average (which is about 150 basis points above current rates), but they could rise even higher.

As a result, capital for supply chain infrastructure investments could soon be in short supply. This means that if your supply chain is aging and needs significant infrastructure upgrades in terms of facilities or vehicles, the last thing you want to do right now is extend end-of-life (planning) too far into the future if a costly upgrade is inevitable. At the very least you want to start planning and analyzing different upgrade cost scenarios that factor in different (potential) costs of capital so that you’ll know how much capital the supply chain upgrades are going to require and at what point it becomes too expensive. Then you will be in a good position to work on securing the capital before it’s too late.

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