Tuesday, August 07, 2007

Drywall Maker in Pain as Housing Suffers

USG, based here in Chicago, is in some ways a throwback to earlier times, when far larger swaths of the economy were unprotected against the brutal ups and downs of the business cycle. From banking to warehousing, modern managers have expanded nationally and globally, to minimize the impact of a downturn in any one region, and employed tactics like hedging and outsourcing to reduce risk and lower costs.

The efforts have been remarkably successful, and collectively have helped lead to mostly shorter and shallower economic recessions across the country.

But not all companies can escape the cycle. And a look at USG provides a stark reminder of why businesses are so desperate to immunize themselves against its effects.

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