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Forum topic by Bob #2 posted 05-27-2009 04:06 PM 964 views 0 times favorited 6 replies Add to Favorites Watch
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Bob #2

3809 posts in 3488 days


05-27-2009 04:06 PM

Topic tags/keywords: question

With all the doom and gloom surrounding the state of many industries in Canada and the U.S. in particular it may just have a silver lining.
Should the price of fuel increase, and that’s pretty much a given, it will make goods finished in local markets considerbly cheaper than those lugged from country to country to be refined, built, packaged and then shipped into the North American markets.

I am hoping it will make local markets for food, clothing ,furnishings etc. more competitive than has been the case where artifically subsidized oil has given off shore companies an undeserved competitive edge.

What are your thoughts?

-- A mind, like a home, is furnished by its owner


6 replies so far

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RedShirt013

219 posts in 3128 days


#1 posted 05-27-2009 05:48 PM

True although for the most part I think local food and produce would benefit more than manufactured goods.

For goods, even food to a certain degree, the price gap may decrease but i think local good would not be cheaper than import. Especially like you said when some countries subsidize their fuel, such as China, who took much of the rising fuel cost to their coffer instead of passing it on to manufacturers/consumers. Plus most products shipped via cargo ships have very low per unit shipping cost anyway, and their economy of scale vs small local operations probably makes up for the disadvantage of a slight increase of per unit shipping cost.

Even for local goods, the materials used a lot of times will be impossible to source locally, so they cannot be shield completely from rising trtansporttation cost anyway. The gap in labor cost between developing countries and developed countries is still much too big to overcome in my opinion, even with an increase in cost of transportation.

Maybe less of a disadvantage but not enough to turn the situation around. I’d rather bet on the Chinese one-child policy take effect and their labor force significantly reduces and their goverment less rich when a small ratio of youth workforce support a large ratio of seniors. But then some other developing country will take up the slack, so it’s best to comete in an arena other than price.

-- Ed

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Bob #2

3809 posts in 3488 days


#2 posted 05-27-2009 06:52 PM

Interesting thoughts Ed.
I kind of envision the $100.00 garden gnome perhaps being a thing of the past if the freight costs keep escalating.

-- A mind, like a home, is furnished by its owner

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a1Jim

115202 posts in 3043 days


#3 posted 05-27-2009 09:50 PM

I say it’s good to spread any good economic news you can

-- http://artisticwoodstudio.com Custom furniture

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Bob #2

3809 posts in 3488 days


#4 posted 05-27-2009 09:58 PM

I am conivinced that there are thousands of products out here in reality where the labour component is nominal compared with the freight and distribution costs.

It’s going to be a challenge to find them and get them back in the communities. It may require a re thinking by civic officials etc as to what constitutes a reasonable safety standard.

We can’t expect a small businessman to “lab test” all his products prior to sale but our goverments could provide such operations with co-op facilities instead of mind numbing regulations.

-- A mind, like a home, is furnished by its owner

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Julian

880 posts in 2991 days


#5 posted 05-28-2009 12:05 AM

I have to say that I was just in England a few weeks ago and I see that the English as a whole have it right. The small towns are pretty self sufficient, and there was NO fast food or big box stores of any kind. You go to the local hardware store for your household needs, the bakery for bread, and the local co-op grociery store for everything else. It’s the people who take pride in their communities that make it possible for the small businesses to thrive for generations. We as a nation have it all wrong! We need to get back to supporting our own communities, and help the mom and pop shops to survive. Walmart is really just the devil in disguise.

-- Julian, Park Forest, IL

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Bob #2

3809 posts in 3488 days


#6 posted 05-28-2009 01:07 AM

I think what we don’t get here in North America is that “big” is only ”better” for corporations and governments.

It does nothing for the people.

When we start dealing with each other again things will gradually shift back into place.

Government is there to do our bidding , right now they have a different opinion.

-- A mind, like a home, is furnished by its owner

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