Spend Matters welcomes a post from lead analyst Thomas Kase.

Last week, I asked a northern European friend of mine (he works in the financial field with securities and derivative strategies) what he thinks of the current Euro zone brouhaha. Here's what he came back with:

This is a multifaceted problem -- it is easy to understand the German protests (around bailing out the Mediterranean EU members) but they really should be happy to have Greek and Latin currency involvement since this has provided much needed Euro devaluation for many years now. Had the Germans still been on the Deutschmark, their fighting power in export markets would have been considerably worse. In other words, if you decouple the Latin countries from the Euro, the currency would quickly rise in value, and German exports would fall, domestic German unemployment would rise etc.

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Wage inflation is hitting the Chinese automotive manufacturing market, doubling in a recent seven-year period (and are expected to double again by 2015 based on 2010 levels) according to a recent WSJ analysis that considers the evolution of Hyundai's consideration of the Chinese market. Moreover, the wage and labor climate for foreign producers in China appears to underpin a double standard between domestic and state-owned enterprises and those owned or operated by outside interests.

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Last week, as the weather turned cold and wet in Chicago, five members of the Spend Matters crew made a lunchtime pilgrimage to "Argyle Street," or as it's better known in our confines, Vietnamese-town. Unfortunately, the quality of pho in Chicago is nowhere near what you can get in Seattle (or Tram's in Pittsburgh for that matter, at least on a good day). Still, it does the trick to ward off the Chicago autumn cold chills. In the broader domestic equation outside of comforting soup, Vietnam is following in steps of its large "Red" neighbor to the North, becoming as known in the US as a low-cost country producer as it is for its cuisine and restaurant proliferation. Yet the transition, at least from a Vietnamese logistics and operations perspective, is not as simple as it sounds.

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Last week Goldman Sachs came out with what feels like a rather conservative forecast suggesting only a slight decline in the euro relative to the dollar over the next 12 months (if the forecast proves accurate, recent volatility will mostly amount to temporary noise). According to the WSK's take on the forecast, "Goldman says it reduced the forecast because of increased risk premium being built into the euro surrounding the ongoing debt crisis in Greece and the threat of contagion throughout the currency zone." Yet, "the forecast calls for a strengthening euro because of ongoing broad depreciation pressure on the dollar, but starts at a lower base to factor in the euro's higher risk premium."

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Late last week, we got a note from a client that some funds due to us were wired. Our client wrote: "Your money has been transferred -- see below. Our forex traders warned us the pound will fall more as they (UK Gov) are printing more money this week and next." Oh, boy. There go the printing presses. But this time they have a distinctly British twang to them (I'd love to hear the confused intonation in the sounds of the Eurozone ones, mind you). It seems that the world's largest Western economies are nearly in a collective race to see who can have the loosest monetary policy of all, what with the need to keep sputtering economies and the Franco-Prussian dream of a common currency alive. For many of us in procurement and supply chain, the natural inclination might be to sit back and watch all this from the lens of a spectator. Wrong decision.

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Here at Spend Matters, we've been long aware of the onerous rules governing manufacturing sales in China by the US and European companies. In order to access the local market, you essentially need to form a joint venture with a local Chinese company with either direct or indirect government interests that will then steal your IP and ultimately compete against you in the coming decade. Why we allow this behavior given our consumption of Chinese-made products in the US without fairer trade rules that go both ways, I'll never fully understand. But China is not alone in protecting its domestic market. We can -- and should -- add India to the list as well, albeit from a different angle given the greater protections afforded IP in the world's largest democracy.

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Rather than a little light summer reading this August, I thought I'd share some of the summary highlights from a more somber report Tragedies of Globalization: The Truth Behind Electronics Sweatshops No Contracts, Excessive Overtime and Discrimination: A Report on Abuses in Ten Multinational Electronics Factories. Published by China Labor Watch, the analysis, which comes off as slightly less professional than it should given the gravity of the subject, is nonetheless a critical piece of primary research into the violations of countless factories in China. Reading the report, you can't help but feel like there is an organized effort -- despite rhetoric to the contrary to appease labor leaders and end-customers -- in China to maintain a status quo where labor rule violation is the norm and not the exception.

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Here at Spend Matters, we're about as American as it comes. We hail from different backgrounds, cultures, political persuasions, states and countries. We like to talk straight (and some of us know how to shoot straight, too). About all we have in common as a collective group is a passion for procurement, supply chain and new media. And of course, the love of charred meat (well some of us), apple pie, cold beer and just about all the accouterments of a good July 4th barbecue.

Besides celebrating the birth of America and our independence from that other debtor nation with austerity programs across the pond today, we thought it would be a great time to avoid digging into the usual subjects on Spend Matters and share a few examples of re-shoring. In our view, this is about as patriotic an act as procurement is capable of (which is made even better when it's in the interests of shareholders). So without further ado, here's a list of the top re-shoring stories and background articles that have crossed our desks (and Google News alerts):

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Spend Matters is pleased to present a guest post from Verian Technologies.

The other day, the Wall Street Journal ran the headline "U.S. Balks at Pakistani Bills." As I read the article I thought of you, supply chain professionals, and how I wish one of you could have been there when the U.S. struck its deal with Pakistan for "services" it required for the war on terror.

In 2004, Osama bin Laden claimed responsibility for the 9/11 attacks and the United Stated wanted to find him immediately. I am sure many of you faced a similar situation. When there is a crisis, people want action. The desire for a clear course of action is intense, and people want to see immediate results.

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