Here’s three new cases:

• Shipping – see Sink or Swim on massive over-building [also discussed in my presentation on lessons from the crisis]
• Commercial real-estate – see article on office vacancy.
• Insurance – can’t say more on this at the moment, as there’s a client opportunity, but there is crystal-clear evidence of the big swings in profitability in this industry too.

As I say, the frustrating thing is that we know why it happens, and some strategies for coping with it or even damping it down. Three observations in particular stand out.

1. It is worse if the sector is fragmented – the more small players you have, the higher the chance that some of them will be foolish, so managing competitive entry [legally!] is vital.
2. Cycles last many years, so it is especially important in these sectors that firms tell investors about the realities and do not get pushed into over-investment and over-borrowing.
3. The time-scales are long, so solid experience amongst senior management is vital.

An especially annoying consequence of all this is the appalling environmental damage that can result in some cases, such as the vast tonnage of unwanted ships to be scrapped and the equally vast acreage of unwanted office space, both of which drove consumption of enormous quantities of natural resource and carbon emissions.