Real Economics

Supply and Demand: the basis of all economic activity is the awareness of need, asking for a supply to meet that need, and the reverse process of actually realizing the market has needs that bring rise to manufacturing and assembly. Housing is a universal demand we all have. Know who needs what, where and when is just one aspect of this activity. How much it will cost, who can afford how much at what level of quality and attractiveness, are more complicated aspects of the same activity. Design, engineering, materials, sourcing and transportation of same adds to the complexity. Sourcing materials may be local, regional, national or international. More complexity. Meeting someone’s demand for service or product requires acquisition of knowledge, expertise and materials. All of these processes require careful management. It takes discipline, professionalism and planning to maintain a system of smooth supply and demand.

Supply Chain: this is where buyers and sellers meet up among businesses. Not consumers, commercial enterprises. Think manufacturers needing parts and supplies with specific engineering specifications. Parts engineered by the purchaser like an auto manufacturer, made by another manufacturer, but made only for the designing customer. Just in time suppliers, too, are part of the supply chain algorithm. Logistics defined by timing, mileage covered and interfaced shipping and receiving points, are all part of the same process. Complicated. Eliminating warehousing as much as possible, building in margins for time, weather and that sort of thing. This is a precision business and is delicately managed to provide businesses with just what they need to complete their products and services in order to deliver to the final customer. This process is easily destroyed by policy makers and other variables.

Global Markets: a lot of effort has gone into developing a market among nations throughout the globe. The payback are healthy markets developing around the world, markets that will buy and sell goods and services needed by other countries. A diversified demand for goods and services grows from this and makes the markets even healthier. Upsetting these markets reduces competition and markets. Business demands and supplies constrict. In turn, joblessness increases in the affected markets. International relations are key to building and maintaining healthy relationships that sustain working markets. If those relations destroy relationships to any degree, supply and demand changes and markets often dry up. Investors will deny their funding to those markets creating more economic opportunities. It takes work and critical thinking to build and maintain global markets.

Return on Investments: entrepreneurs invest money in business activities they expect to turn a profit. That profit needs to be a reality within a reasonable timeframe for the individual investor, and that varies person by person. The size of the profit also matters. A lot of these words are variable and depend entirely on the investor. These are expectations. If the probability estimated by the investor is high enough, he or she will put their money at risk to earn that expected profit in the expected timeframe. If the profit is great enough, the investment will remain in place for future profits. If any of these expectations are too shaky, or if they don’t pan out, the investment will either not be made, or if made, withdrawn to invest in another venture. That expectation of a return on investment, ROI, is made by the investor, not a government or any other entity. It is a private matter. Yes, group expectations do exist and often make a difference in investment decisions. Still, a person alone makes the decision to place money at risk for the hope of a return. That is the free market in a nutshell. If the opportunity to invest is there, and the risk of loss is reasonable, the investor will make a decision he alone is comfortable with.

Point: screw up any of the above at any point and the economy of a region, industry or nation will be affected short and long term. The cost of this disruption leads to unemployment, cost to restore and repair the economy, as well as changes in relationships among nations, corporations, economies and populations. It all fits together.

Mr. Trump and MAGA don’t build things. They damage them or destroy them. Tariffs are just one small part of screwing things up. There are so many other policy points in the mix that further destroy our economy. Shameful shenanigans.

July 16, 2025

 

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