Nonlinear Thinking: Robot Run Warehouses

Here’s an interesting video clip that reinforces our view that almost all new innovation and technology is labor saving/destroying and that U.S. unemployment is much more structural than most perceive (click here to view video).   Even the military, with the advent of drones and robots, is moving to a smaller “boots on the ground” force.

There are lags in the Schumpeterian creative destruction process as the labor force has to be retrained for the new high tech economy.   It also illustrates, at least to us,  why corporate profits are at record highs while unemployment is also stuck at historically high levels.

This is the future of what the private sector is looking to employ and, unfortunately, the political economy doesn’t fully comprehend these trends and is trying to pour old wine into the new wineskin.  Trying to reinflate bubbles and the housing and stock market ghosts of Christmas past, which are the root of current macro woes,  are futile quick fix attempts in our ADD political and economic culture.

Labor policy needs more emphasis on math and science training and less quanto easing, in our opinion.  Zero percent interest rates ain’t gonna bring back these warehouse jobs and is destroying the wealth of savers and seniors who are so dependent on interest income.    We’ll have much more on this.

Stay tuned.

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