29. 3-D Printing: Revolutionizing Manufacturing and Globalization Away from China

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Hugh Sifu: [00:00:00] All right everybody. Welcome back to Thoughts of a Random Citizen. I'm your host as always Hugh Sifu. Today, we're talking about 3D printing and how it will revolutionize globalization and probably more rapidly than you'd expect. Pretty excited about this episode. It's not going to be terribly long, but I did do a bit more research for you guys so it's not just a random [beep] thought. To dive into the episode, I'm just going to kind of talk a background on what 3D printing is, more specifically the materials used, and then you'll figure it out. Without further ado, I'll go ahead and kick it off.

What is specifically 3D printing, how do you get the materials and all of that and how are they used? Pretty much, One of the most common used materials for 3D printing is something called PLA, which is a polylactic acid. It is considered biodegradable in eco-friendly, however, it is still a plastic. Side note, the Food and Agriculture Organization of the United Nations estimates that one [beep] third of all food produced for human consumption is wasted each year. One third. That's lot [beep] in waste.

Anyways, how polylactic acid is created is essentially with a few other things, recycled foods. It literally takes old foods, adds this carbon mixture and some other scientific liquids and crap, and puts it in, but essentially it takes that one-third of all wasted food and puts it into something that creates a plastic. Kind of cool. [00:02:00] A lot of the materials used are actually recycled materials in 3D printing materials. That's good stuff.

Anyways, another material used is ABS. I don't know how to pronounce exactly what it is, but I'm not even going to try. Just look it up because it's three crazy weird words. It's another more sturdy plastic used in 3D printing, and it's essentially what Legos are made of. They also have other capabilities like nylon, stainless steel, copper, wood, and yes, glass. Literally, if you take a look around anywhere you're listening to this podcast right now, pretty much all of it can be 3D printed.

This technology is new, so every year more and more capabilities are coming out with ways to use 3D printing. I'm assuming you've all heard that food will eventually be 3D printed, but yes, that's how crazy this technology is.

While I predict in the future, we will have a 3D printer in most every house like we do printers now, I think there will be vending machines that have 3D printers where the newest design can be sent to the vending machines virtually. When you come up to the screen and click on the vending machine, you click and buy what it takes a few moments to print and then for you.

Think of those little stupid fidget spinners, I think you know what I'm talking about, there were all the rage a few years back. Yes. That can just be thrown to a vending machine so somebody can walk up and buy it and it'll be 3D printed in customize for you. The key here is the customization. That will make all the difference especially in the new age where you have to embrace yourself and be your own you and blah-di-[beep]-blah. Either way, it's the future.

Speaking of the future, what does this mean for our future? [00:04:00] Well, let me tell you something that I've noticed about Italy so far. Everything in Italy is made from China, literally everything. Luckily the few things that are still handmade are beautiful. I'm currently at Ostuni, I think I've mentioned that and Ostuni is known for making shoes or sandals or one of the many things they're known for, but the sandals are beautiful. It's great. For the rest, I'll just say they're made in China.

Why is everything made in China? Why don't Italians, Australians, Americans, and everyone else in a small town to a big city just make everything on their own? The answer is only slightly complex. A big discussion at the moment is where are we going to replace manufacturing once China stops, well, slave laboring its citizens? Actually, it has to pay for its manufacturing industry like the rest of the developed world.

China has been steadily decreasing the percentage of their GDP in regards to manufacturing over the last 10 years. It's currently at 26% of the GDP in 2020, and back in 2019, it was 30%, manufacturing that is. It's going to try to hold onto that as long as possible. Then as long as they do the rest of the world can't do much to dictate what China can and can't do.

Think about this. One of the main reasons Europe is struggling to present a United front against China regarding sanctions even though the US isn't doing much sanctioning itself, is specifically because of the mass cheap production coming from China. Germany and France are two of the major outspoken pro-China countries in Europe. Why? Because they can buy cheaply made goods and get access to 1.3 billion Chinese citizens in regards to what they manufacture. AKA those corporations and fancy folk [00:06:00] don't really care much about the authoritarian style government, that is the CCP, they just want that money.

While it might surprise you to hear that China's manufacturing is actually decreasing, by no means at all, are they still not producing massive numbers. In 2019, China accounted for 28.7% of global manufacturing output. That's a lot. That's like a third of the world's manufactured goods are coming from China.

Now the reason these countries are having a tough time moving on from China is quite simple. All of the worthless crap we want and need and buy daily has to come from somewhere and China is fully aware of this. Because we are now demanding minimum wage increases to what like $25 an hour or some astronomical number, well that toy car isn't just going to cost $3, it's going to cost $15.

Keep asking for wage increases and we'll keep farming out our money to countries who make that toy for 15 cents. While some of you might be upset about the things I just said, facts and logic rule the day. Nothing I said was an opinion. That's simply the way the economy works. It's economy 101. You pay someone $25 an hour, those batteries you used to buy now costs $30 instead of $5. Move to Australia and you'll see what I'm talking about.

While you could buy the cheaper batteries from a country that doesn't have the same minimum wage that we do, the government will create a tariff on those batteries to make them more expensive. Then people will say, stop the tariffs. Well, those people making the batteries in the country then go out of business because no one will buy the $30 batteries when you can get pretty much the same thing for $5. At $25 wedge, you're not getting will actually be zero because you won't have a job.

[00:08:00] Then people say, well damn capitalism. We need a government that provides for us. This is where an opinion does come in, I think you're confusing providing with dictating. Again, see Australia where Sydney residents had the military sent into the streets to keep people inside. No, anyways, sorry for getting political, but I digress.

How do I see a way out of this cycle? Enter 3D printing. A question I've also often asked myself is how can one small town in Italy make everything from Bluetooth speakers to yoga mats, desks to lawn chairs, garden sculptures to cutlery, mattresses to toilets? Well simply put, they could, however, with supply and demand, not to mention minimum wage to date, they really can't. Let's not forget all the rent and energy it takes to do all this. While could open up a factory to create yoga mats, the entire region you're producing for, only 50 people buy them a year. You'd go out of business within that same year, not to mention it's just a massive waste of resources.

At the end of the day, when you're on the hunt for a yoga mat and you don't have the 25 extra dollars to spend for the almost exactly the same yoga mat that was made in your country, can you really blame anyone for buying the cheaper imported option? No. Well, besides maybe the slave labored Chinese, but moving on, moving on.

Without trying to get off my chirp box here, why did I digress from 3D printing to the ins and outs of capitalism and supply and demand? Mostly because with the new era of 3D printing, you're not only able to custom design literally any item you can think of, but you'll be able to do it and have it shipped within a day ideally in every small town across the world. [00:10:00] That means local jobs, local economies, no supply and demand waste, no slave labor, no authoritarian governments dictating how the rest of the world controls their citizens.

More importantly, it means that the only globalization will be the specialized con, AKA you want an iPhone from Apple, you buy US-made iPhones. You want a beautiful German Volkswagen, you buy German-made. You want amazing chocolate. You buy Swiss chocolate, so on and so forth. You want a yoga mat, you customize your own and purchase it from the building down the street that is making them in the new 3D printed facility, not the one 10,000 miles away in some broken down, sweatshop. I'm really just killing a certain demographic here aren't I?

Anyways, I'm assuming, especially if you're a millennial from America, you remember the glory days of Nike, where you could customize your shoes online, and then it went to sunglasses from Oakley and beyond. That was great. Right? I remember that was when my super cool customized shoes that I created myself and was so proud of finally arrived at my doorstep, matched with absolutely nothing because they were a bit too loud I guess. Lesson learned.

However, with one small factory in any small town that is capable of 3D printing or a larger factory in a larger town, it enables anyone in that town to order a Bluetooth speaker or yoga mat, desks to lawn chairs, garden sculptures to cutlery, mattresses, and toilets that are completely customized and designed by you. Cheaply made with a majority of recycled materials like I mentioned, above, and from your neighbor down the street picked up within 2 to 72 hours, depending on the item. That time will only lessen with the developments of the technology.

[00:12:00] Think about Pinterest. I'm assuming that everyone is at least somewhat familiar with the platform where you see amazing things people have created and now we're able to purchase some, if not all of those things. Well take Pinterest and integrate it with a software that allows you to take bits and pieces of the coolest creations you found and then easily create your own items. Click a button to submit it and that neighbor down the street is 3D printing exactly what you've created.

This is going to change the way the world works. No doubt in my mind, and it will definitely change the way we see emerging markets and more importantly, it will change globalization effects on minimum wage hikes and the buying power of the dollar plus a lot of other things. It will revitalize small towns and get away from this city build cheaply abroad mindset that has dominated for the last decade or more.

What I'm most excited about, however, is the innovation on what will be created. Think about how we use computers today. Now compared to the way we use computers in the '80s, better yet think about how a normal person uses computers now to the way we did in the '80s. Most people didn't even know how to use a computer. It wasn't taught to them or even fully understood. Sorry to the older people ahead of time, but picture an elder using a keyboard on a computer. They don't really know how. They aimlessly poke with their index fingers, all the while slightly more frustrated, as it should be.

Well, millennials will be those hopeless index-poking fingers in this new era of software designed 3D printing. Why? [00:14:00] Because in 20 years, maybe sooner, our children will be taught how to type, if you will, on these 3D printing software's, enabling them to easily create whatever their brains can think of. Prototypes for innovative ideas that currently required a team of startup money will cost $5 and it can be in your hand at the end of the day.

What I learned to type in school, that is what kids will be learning for the 3D printing software in the future. Think about this. When the Xerox Star system, the first basic desktop computer or home office set up today was announced in 1981, the cost was about $75,000 or $207,000 in today's money. Today you can spend anywhere from 150 to 750,000 give or take for systems that are capable of doing all of what I explained at the start of this episode. Glass, wood, stainless steel, copper, plastics, et cetera. Where you can buy cheaper ones for a thousand dollars to do basic 3D printing, these aren't necessarily what I'm referring to.

I hope you can see how revolutionary this 3D printing is going to be. Not only is it going to change globalization, it's going to change the way we operate day in and day out how we obtain our materials and that's not even going into the possibility of 3D printed food. This system is going to completely change everything and it's completely being overlooked by most investors today.

Where are the three places I would invest? First, find the companies that make the materials that are required for the 3D printing. Think of the ink for the printer. Second, find companies designing the software that will be used in the future by the everyday user. Think Microsoft Office. [00:16:00] What we were trained on as children and how the future generations' children will be trained. Lastly, most obviously find the companies that are creating the actual printers, thank Apple, HP, Dell, for the computers of today. Start there and I promise you're going to retire a happy person.

That's pretty much it guys. Hopefully, you got a bit more information, hard factual information out of that, apologies for a bit of a political rant in the middle, but it really wasn't that political it was more just logical. Hopefully, you can see that, but anyways, happy innovating and also you guys the next week on Thoughts of a Random Citizen, enjoy guys.

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