Spears - Coil's Tortuous Path

I sit on a bunch of boards. I do not sit on these boards because I am a financial wizard. I’m the opposite. I keep the book “Finance for Dummies” at my elbow so I can look up things like EBITDA or Preferred Shares or Cost Accounting.

I was freshening my overview of cost accounting one quarantined day last week when I came across the death spiral phenomenon in cost accounting. This death spiral occurs when a company repeatedly eliminates products or services without reducing fixed costs. The concept refers to situations in which a company falls into a spiral of increased fixed costs and lower production volumes (I borrowed this definition from somewhere, but don’t remember where!).

https://spearsresearch.com/insider/2020/4/10/px2n098orhqsysn3npyet008zz3m7l