Markets: How They Churn, Not Earn

Just sitting back in a moment of extreme cynicism this morning, after looking at the futures which are hinting to S&P 500 this week may close out around 2,075, plus or minus 20, I think we need to have us a discussion about “churn.”

Now, everyone knows what churning is in the dairy sense.  You take heavy cream (like whipping cream from the store) beat the snot out of it.  And at first you’ll get whipping cream.

But if you keep going, you will also get butter.  Toss in some food coloring and salt and…

In the financial world, churning is a little different.  A management firm gets a big pile of money to invest, and then then invest long or short in this, or that, and the market does its thing.

Except people don’t realize how easy it is to wrap investment policy people around their fingers, especially when done in a mahogany-line foxhole and immediately followed by a big dinner out or a delicious catered lunch.

When (eventually) the client wakes up to realize that they aren’t making what buying a shoebox full of bonds 5-years ago would have made, they then play something akin to client musical chairs.

The people who make out are the brokerage firms which front-run everyone, but because the SEC is too crooked to call computerized skinning of the client the same (net) as a human broker trading ahead of a client as criminal, everything goes along fine.

Churning is when the client funds go in and out, long or short, when there’s really no need to.  Again, the object is to make commissions for all the money people and for the clients, too bad.

So let’s say the S&P closes around 2,075 today (plus or minus 20).

Last week, we closed at 2,077 and change.

On July 24th, we closed at 2,079.65.

A little further?  How about April 17: 2,081.16

Well, then, how about December 5th of last year? 2,075.37.

Now the shocker.  September 1st, 2000 the S&P 500 was at 1,520.77.

Hold ‘er right there, Ure:  1,520.77 is less than the 2,075 you’ve gone off on.”

Well, no.  Because if you believe that my financially ignorant friend, you’ve been sucked into the fairytale that Wall Street, the Fed, Congress, and the White House all want you to believe.

Because when you use the authoritative Minneapolis Fed inflation calculator  (here, try it sometime).

So there you have it.  (This is the kind of stuff I tell Peoplenomics.com subscribers about all the time, too…)

America – land of the brave, home of the free, which has listed to all the free-trade bullshit and torn down our borders has – on an inflation adjusted basismade a slight negative return on on the S&P over the past OMG FIFTEEN FREAKING YEARS.

Sure, there will be those who claim that “Ure’s wrong.  He doesn’t include dividends.”

Oh?

I’ll include dividends if you include bankruptcies.  And if you include the one other reality the crooks in Washington and Wall Street conceal (CHURN:  Commissions times turnovers times fees), I think you’ll understand what  and how it is that America is now at an economic break-point.

When people are working harder, longer, and not getting anything additional in return, it becomes what the great sociologist Joseph Tainter describes as the “marginal rate of return on additional effort falls below zero.”  Historically, he notes, that’s when countries break-up.

So between now and elections, expect some “hugely useful crisis.”  Because without it, a revolution at the polls is likely and a few like Donald Trump are sensing the shift in the herd and are willing to give ‘em what they haven’t had for at least 15-years.

Socioeconomic honesty. 

And if goes back 55-years if you want to talk poverty rates and 65-years if you want to talk about working households on one job-holder in a family.

The Magician’s Spell

Can be seen in Producer Prices just out:

The Producer Price Index for final demand advanced 0.2 percent in July, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today.

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Coping: With Future Leaks Into Dreams, Again

We need to revisit the Cartesians of dreams topic, again..

You see, I wasn’t thinking deeply this week when a reader pointed something out to me on a discussion posting this morning:  “Didn’t you have a dream you wrote up a while back about an explosion to the northwest?”

You mean  in advance of the Tianjin industrial explosion? 

Yes.

In the interest of dream  science, let me remind you of the posting I put up on May 18th:

Coping: Cartesians within Dreams

Posted on May 15, 2015 by George Ure May 18, 2015

If dreams have predictive content,  we might soon be reading about a shopping center or mall attack in coming weeks/months.

Or – and this is really the more likely – last night’s dream was merely a collection of thought stubs.

First, though, let me tell you about the dream itself.

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EoW or Irregular High Flat Four?

Wednesday we got into this in some depth for our www.peoplenomics.com readers, with charts and all.  But despite the market gyrations making no-brainer headlines for the doom and gloom crowd, we persist with the silly notion that facts still matter.  Like this morning’s retail numbers which we will get to in a moment.

Look at the China Yuan devaluation.  What does it do?

Simple:  In theory is should make buyers of Chinese product, like Wal-Mart, a little more profitable because the things made in China, sold by Wal-Mart aren’t going up in price.  And what that means – if Wal-Mart doesn’t go nuts with those price rollback stickers, is the company’s financial performance should improve.  Everything from China should get cheaper.

On the other hand, if your company makes its money selling to China, I’d be dusting off the resume’.

There are some competing headlines this morning of a non-economic nature that are being beaten to death is less practical media.

We consider UrbanSurvival a kind of output for PM (practical media) because we don’t look so much at the news items, per se.  We try to look at the effects that headlines will have – good or bad.

And right now, we’re having great fun watching the End of Worlder’s line up.  But bad news for them:  The world won’t end even with a drop of the S&P to 1,740.  And that is a possibility for a major Wave 4 correction, though I like 2,040 better..  But then will come five  – a screaming upwave (if our work is right).

The Fed rate drop this fall will force money parked in bonds to get more adventurous.

Yet again, the same people who were touting Bitcoins at $900 on the downside (it’s $264 this morning) keep making predictions that turn out wrong.  (See our Sept. 2014 discussion here).  But we will go out on a limb here:

When the major wave five of 2016 gets underway, those Bitcoin promoters are likely to be right for a change.  Because one thing about paper is it’s easy to add zeros.  Satoshis may start to look interesting in here, but not if the market breaks down severely this fall.

So again, we wait.  It’s about as exciting as sitting in a duck blind for 10 hours, but when we shoot, we can get some pretty good kills, now and then.

So What Does Retail Say?

Hot numbers – fresh off the press release:

“The U.S.

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Coping: With Five Realities of Outback Living

Most of the time, life in the outback is pretty nice.  Although sometimes a large number of projects creep up on us.  And this morning you deserve a look at the other side of life outside the big city.  Mostly it’s idyllic…but then there’s this week.  And I mean besides the 105-temps.

1.  How to Fix a Septic System

As you may recall, we had more than 40-inches of rain in five months this year. Since May, though, we haven’t had more than a lick and promise since.

A careful analysis of the septic issue was pretty simple:  Too much water.

The answer – since water, like a P&L – has two sides to it, can be attacked by either adding capacity or restricting supply.

So we put in one of those new ultra low water toilets yesterday – I was blessed because Panama did 90% of the work.  1.26 gallons per flush.

The old toilet it replaced was the 2.5 gallon kind where the poo goes round and round before eventually – some of the time – going away.  This kind of toilet was designed on the “if the poo gets dizzy, then we drown it” theory of toilet design.

The new toilet is much more ambitious.  It sucks harder than a politician around a potential campaign donor.

We are pretty sure this will fix the problem.  As we can see the semi-grass stripe in the lawn where everything else has more or less dried up for the summer, looks like the drain field is healthy enough.

2.  How to Kill Vermin

The bug man came through yesterday making his rounds.  None of the so-called prepping writing have done an adequate job of insect prevention when the lights go out.

If you are thinking about running off to the woods, remember to budget $500 per year for an annual Orkin or Terminex contract (or whoever local is good).  Cats will get an occasional bug, but only if you put them on a calorie reduced diet.  Otherwise they’re not much use.

I know lots of prepper types that like to say that a good “survival dog” is important, but I have yet to see one do anything that a single .22 long rifle won’t fix.  More to the point, dog crap draws rats.

When comes to snakes, rat shot in a pistol is the only way to fly.  A Glock so loaded will also get small birds.  Prepper types who talk the talk, but can’t walk a mile tend to talk hollow point this and plastic tip that.  Great for wild hogs, don’t get me wrong.

But on the hip when tractoring are alternate rounds, you see?

Bottom line of this lesson is what?  If it is a bug, throw money at it.  Anything bigger throw lead.

3.  How to fix a BBQ:

After rescuing the old BBQ (5-years) with rebar and new heat diverters, the old three burner steel box has been replaced with a four burner steel unit.

More important is Ures truly had determined that when Elaine asks “Did you cover the BBQ” it is not a nag.  It’s an audit item.

Longer term:  With no building department (or code) I may build a kind of lean-to roof for the outdoor cooking area. 

With no overly zealous regulators, and no HOA (although that’s a good analogy for the Texas legisleazors that meet down in Austifornia) I’m thinking about painting the house bright purple and chartreuse just because we can.

Then decided that was enough of that drink.

4.  How to Fix Dry Rot:

That marvelous 20×20 deck I built on the front of the place has come down with cancer.  Or, the wooden equivalent. 

Answer:  This weekend I will be tearing off all the old decking and a couple of beams and treating the survivors with dry-rot treatment, refinishing and rebuilding.  Just wish it could all be done in something warmer than 103 degree weather, though, know what I mean?

Lesson:  When a mat (waterproof) is left on a deck – even though it is “treated” outdoor wood, it will hold water under it and things will dry rot.  When it does, be ready to get every single infected board out ASAP, then one or two beyond in all directions off, then spray and have monkey butts worth of fun when you could otherwise be lounging.

5.  Cats are Loveable but Useless,

Zeus the Cat has been banned from the house by Management.

He won’t keep his collar on, and so he has what all country cats have (a summer eco-system under his fur) which itches, and causes him to roll in the dirt.

So he goes from being a black car to being a dirt-colored cat (it’s how they work their ecosystem).

Seeing him coming – and protective of her pristine interior – Elaine’s been  playing bad cop.  I take him out under the misters and play good cop.  Zeus will do anything for a piece of teriyaki beef jerky.

Now and then while we’re sitting there, ZtC will get wet.  So I’ve been easing him into the idea of a real solid bath.

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The Best – and Worst – Investments in Life

The Dow is about to get its ass kicked at the open this morning – the kind of thing our Trading Model has been telling us for about four out of the last five weeks.

With it, we are focusing on only two stories this morning in a good bit of depth, because getting things write in personal finance over the next six months might make – or break – you and your family’s financial future.

But, in case you’re wondering, the Best and Worst investments in Life are often (and paradoxically) the very same things!

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The TNX Matters–Telegraphing 2017 Collapse?

A nice conversation with my friend Robin Landry Monday centered around a terribly important question:  Is the market doing an “irregular high flat four?”

Turns out it is one of the possibilities.

While we save that discussion of how the future arrives for our Peoplenomics.com subscribers tomorrow, I wanted to point out that Ure’s Theory of Blow-Off Tops may be about to slide into the record books over the next two and a half years.

If it does, I promise to take savage joy in reminding you who the contrarian was who called it nearly a year in advance.

Here’s the deal, if you’re waiting for the coffee to kick:

As you know in the middle of the 1920s when the market was running up, the Fed sat pretty tight on the discount rate.  Steady hand on the helm, so to speak.

However, at their February 21st meeting, in 1928, the Fed began  to raise rates.  The first move was from a 3.5% discount rate to 4%.

Then, at the April 23rd meeting, they raised to 4.5%. 

Even that wasn’t judged enough because at their July 19th meeting (1928 still) they raised to a full 5% discount rate.  The “then Fed” held the rates at 5% until their February 1930 meeting – well after the devastating October crash.

Now let me show you how well our Aggregate Index Model is tracking the Dow Industrials run-up into the 1929 crash.

In the chart to the right the blue data trace is the pre collapse Dow Jones Industrials.

The data set on to of that is our Aggregate Index, normed to market levels of 1921. 

Students of market history will recall there were a series of major market shakeouts between the Panic of 1906 and the final downward break in 1921.

And if you’re thinking “Is that all Ure did?  Line up the 1921 bottom with the 2009 bottom in his Aggregate work?”

Why yes,. now that you mention it, things MAY turn out to be that easy.

But don’t put away your glasses yet. 

Look at the bottom of the small decline (which we should be entering now through a week or two before the September Fed meeting).  See that GREEN arrow?  That’s when (normed to the match up with my data series) the Fed made its first rate hike in Feb ‘28.. 

And what happened?  Well, the market went up a ways, then drew back a bit, until (at the red arrow) the Fed made its final July 1928 discount rate hike to 5%.

You will notice that serious disintermediation from the bonds followed and money went seeking its highest rate of returns…which it always does.

Faced with a percent and a half increase in the bond rates (which meant their cash value was collapsing) money poured, hand over fist, into the stocks.

Which is precisely how and why we can see the stock market scream higher if the expectation set for bonds changes at the end of a Long Wave Interest Rate Decline.  If you look at the MAX timescale of the 10-year, you will see we are likely in the end of the bond rate decline.  At least insofar as before the crash of 2017.

And what, pray tell does the ^TNX move Monday have to do with all this?”

Yield on the 10-years (as you can see from the Yahoo Finance screen scrape was up 2.9% while our Aggregate Index was up (from Friday’s close) 1.27%.

Today, therefore, the 10-year should move lower, the down should give up about half (to a Fibonacci 61.8%) of the screaming Monday gains, and the 10 year should give up some ground as well.  Oil should drop, and between now and the Fed meetings from September into early 2016, we could trade about sideways from where markets were (as an Aggregate) last December.

Yes, if the lights are starting to go on now, that’s a go nowhere market for 8-month and perhaps another month to go.  Is nine months long enough to be an irregular high flat four off the rally from the 2009 lows?

That’s why I keep smart guys like Landry on speed dial.

Oh, and how all this ends?

Well, if you were a Peoplenomics.com subscriber, I’d tell you tomorrow.   But I assure you, the end is not pretty when it comes.

The market is screaming 2016 Presidential Election Disaster in 72 point type.

Productivity

Last month, productivity in the US took a major hit.  This morning we have a report that it has rebounded a bit:

“Nonfarm business sector labor productivity increased at a 1.3 percent annual rate during the second quarter of 2015, the U.S. Bureau of Labor Statistics reported today, as output increased 2.8 percent and hours worked increased 1.5 percent.

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Coping: The Government You Never Elected

To start at the beginning, a wise (and long-time) reader sent me this note in which he mentioned a corporate non-profit that exists to design government programs just so.  You know – that function which is supposed to live in the legislative branches of the state and federal governments?

I was impressed with this long-form article on the most extensive corporate corruption clearing house at work in America.  I never knew, for example, that the corporate sponsors of ALEC have 100% veto power over any language in the model bills they send to state legislatures.  I also didn’t know that they take contributions from the corporations, and give those corporations full tax deductibility and protection of anonymity of the millions they spend entertaining their state legislator puppets.

Notice who was speaking at their “convention” near the end of last month.

http://talkingpointsmemo.com/cafe/meet-alec-s-hoped-for-man-in-washington-scott-walker

ALEC?  Who the hell is ALEC and how have they become a sort of defacto branch of state government, supported by tax-deductible money from Big Corporations, and how is it they get to write “model legislation” and pass it around? 

A check of Wikipedia:

“The American Legislative Exchange Council (ALEC) is a nonprofit organization of conservative state legislators and private sector representatives that drafts and shares model state-level legislation for distribution among state governments in the United States.[4][5][6] According to its website, ALEC “works to advance the fundamental principles of free-market enterprise, limited government, and federalism at the state level through a nonpartisan public-private partnership of America’s state legislators, members of the private sector and the general public”.[7]

ALEC provides a forum for state legislators and private sector members to collaborate on model bills—draft legislation that members may customize and introduce for debate in their own state legislatures.[8][9][10] ALEC has produced model bills on a broad range of issues, such as reducing corporate regulation and taxation, combating illegal immigration, loosening environmental regulations, tightening voter identification rules, weakening labor unions and promoting gun rights.[11][12][13][14] ALEC also serves as a networking tool among state legislators, allowing them to research conservative policies implemented in other states.[13] Some of these bills dominate legislative agendas in states such as Arizona, Wisconsin, Colorado, Michigan, New Hampshire, and Maine.[15] Approximately 200 model bills become law each year.[11][16] Many ALEC legislators say the organization converts campaign rhetoric and nascent policy ideas into legislative language.[8]

ALEC’s activities, while legal,[17] received public scrutiny after being publicized by liberal groups in 2011 and news reports from outlets such as the The New York Times and Bloomberg Businessweek described ALEC as an organization that gave corporate interests outsized influence.[11][12] Resulting public pressure led to a number of legislators and corporations to withdraw from the organization…

Well, I’ll be damned. 

I have long held that corporations have taken over government and here we are with an organization with does the interstate coordination through “Model Laws.”

But that Wikipedia summary sort of leaves us hanging about how this organization has been operating since being “outed” in the major right coast media.  I mean it’s all about money and influence, right?

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The Federal Reserve’s ABS Braking System

With all due respect to “Jammin Janet” the Federal Reserves modus operandi seems to have been to slam on the brakes at the free money window a month or two back, and then sort of pump the brakes, hoping for a smooth stop of deflationary pressures, so rates can be raised slightly this fall.

As you can see in the short-term H.6 Fed Money Stocks data, the rate of M1 increase has come back up to 2.5% while broader M2 is running 4.6.  And Trader Bart’s estimate of M3b (reconstructed) shows, the M3b is running around 2% which is still slightly below Fed prayer levels.

If you look closely, though, you can see how people are trying to arb things up.  That last hour press on gold Friday, for example.  It doesn’t take away from the 10 year being just over 2% and it doesn’t mean we are out of the financial woods yet.

The reason the ABS analogy is useful is this: 

If you slam on the brakes on ice too hard, you lose control.  By the same token, when the Fed slammed on the brakes, they have done so in a measured way.  They don’t want to lose control.

Ideally, rates will bottom out over what’s left of summer, we will see a tiny increase in rates in September.

This will drive people by the thousands to lock-in real estate deals because yes, rates will revert to historical norms and they are far below those levels now.

When the herd starts to move into real estate (big jump in Housing data) then the Fed can pump the brakes just so.  Enough to get the economy going again, but not so much as to send things into hyperinflation.

Gold prices, even with the Friday bump are telling us the Fed is still in control, but the reality of the Long Wave in Economics is the terrible bottom is not in yet.

In order for the meaningful bottom to arrive, we need to see a massive destruction of both debt and savings – none of which has happened yet.  Check with the Greeks and Cypriots on how much fun this is.

But the amazing part is that the doomsters are saying “World Ends this Fall!!!

No.  Go look at the data.  Go look at Trader Bart’s M3b.  Go continue the growth rate of money from the 2009 point where print to save became the regimen.  The Fed as I read it has yet another Trillion of QE they could make up, if they really wanted to.  And, if things get bad, they will.

So for now, we continue with a very skeptical off-planet perspective.  The Fed is pumping the brakes, trying to arb up rates.  When rates go up, people will revert to the “Buy now before prices go up” mentality and the economic recover sees our one more massive upside.

On the other hand, an accident at a major player could spin the world into the financial abyss. 

We’ve been telling you to keep an eye on Deutsche Bank, for example.  New CEO is sounding less than upbeat about legal problems and just Friday key counsel stepped aside.

The reason for concern here is evident when you look at the Comptroller of the Currency’s most recent quarterly report:  Banks are back to increasing their Net Current Credit Exposure (NCCE).

We seem to be building towards another 2007-2008-like spike and you know what happened at that spike high in 2009 – the world was ending as real estate imploded.

Deutsche Bank is huge.  In one story back in June when the co CEO’s were “shown the door” DB’s derivatives book was placed at $54-trillion.  To put that into perspective, the US Gross Domestic Product is less than $18 trillion.  Thankfully, this is all supposed to be hedged.

All of which sets up a fascinating question the markets may be answering as we head into the fall.

“Are the problems in Deutsche Bank big enough that they might need to be helped or (God forbid) bailed out? “  And the follow-on question is “Who’s big enough to do that?”

I’ve got a crazy pet theory about how to bail out a “Too Big to Bail” problem – should ever one come along.  And Deutsche Bank – should things blow up – might be an interesting test case.

Obviously US taxpayers would scream bloody murder if there was a move to bail out a foreign bank.

But there’s another way to have an  international bailout of a super player.  And that’s what I’d describe as the “Distributed Screwing” approach. 

Let’s say an International Monster like Deutsche (though I don’t think they will) ran into trouble.  What would happen if there was a “structured failure.”

Under such a scheme, the Monster Bank would “stiff” US banking counterparties in a proportional kind of way.  Laying off their cost of a bailout on US and other country’s banks who did business (as counterparties) to the Monster Bank.  It’s be like a deliberately inverted Herstatt effect…

The slick thing about this is it spreads the pain around, no one in the US could object to saving the “poor victim” US banks, and should a little “extra” be distributed to the rest of the derivatives poker players at the table, then the Monster player could be saved without the host country having to put up a dime.

It’s all theory, mind you…and a nutty one at that.  But crazier things have happened.

Still, this is not an immediate problem.  Big problems – like elephant pregnancies – take a while to gestate.  Between 617 and 645 days, depending on if you are talking Asia Elephants or African Elephants.

I’m guessing the gestation period will be about that long for the Teutonic species of elephant, too.  Then we shall see if a crisis is delivered.  But if it is, Ure’s Distributed Screwing Theory might just show up.  That’s how Depressions work…destruction of debt and savings.  A global Elephant’s death could do it all.

Ferguson’s Social Suicide

To mark the one year anniversary of violent death in Ferguson, there’s a quote in a Reuters’ story over here that’s worth reading:

These were criminals, they weren’t protesters,” he said of the shooters. “There is a small group of people out there that are intent on making sure that we don’t have peace that prevails.”

Unfortunately, it is a case of social suicide.  A community that looked like it was beginning to get back together has, once again, been shoved in the direction of social suicide by what I am just speculating are the same people who support anarchy and don’t believe in the rule of law – unless it’s theirs.

It’s Called Payback

The story this morning out of Turkey about deadly violence in Sirnak and Istanbul may not seem like a big deal.

But it begins to fall into place when you remember the US just sent half a dozen F-16s to Turkey in order to launch faster attacks in the region.  And now we are going after Syria directly along with ISIS…and from where?  Why, Turkey, of course.

So look for Turkey to be blown sky-high with some frequency.  The thinking of the opposition (Syria/ISIS) is that even though asking the US to leave Turkey won’t work, if the country is blow up from under moderate leadership, they will have to flip.

Summer Rally Arriving?

Dennis Lockhart of the Atlanta Fed speaks today.  We’ll see if he hints toward a hike in September, or not.

Not much else going on except some bond rates and then productivity which comes out tomorrow.  To my reckoning, celebrating high productivity is dead wrong.  At 100% won’t we all have been replaced with robots?

Dow futures were up about 110 when I looked.  Which might be the start of the run toward the average annual high date:  August 26 plus or minus a couple of weeks.

Do you regret not buying bushel baskets of cheap call strikes for the August option expiration last Friday when they were cheap? You might get better odds on the Strip.  At least there you can get free drinks.

Matter Goes Shapeshifting

A new NOvA experiment gets into morphing neutrinos with interesting results.  Not sure how that turns into a free lunch or steak and lobster, though.

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Coping: With Another Novel Weekend

Or:  “How I wrote a third of a novel and upgraded to Windows 10 in one weekend.”

Once again, I shall be short on words today because most of ‘em were drained out of me this weekend.  About 28,000 words and just over a hundred pages of text as I finished the first draft of my novel DreamOver.

Sadly, the problem with writing a novel – all 87,998 words of it and more than 410-thousand characters – is that it’s only a good start.

My friend Howard (Finance Mon$ter$) Hill warned me that getting something written was only about half the problem.  The second half is the proof-reading and tweaking.  It’s a daunting task, but I’m fortunate that my lifelong friend “the Major” will be taking a pass through it once I get it reasonably error-free.

The plot came out fine.  No animals were injured in the writing of the book.  And so far, only one draft has been printed.

There was a time when writing “The Great American Novel” seemed like quite the thing.  You read about writers like Hemmingway, and the ilk, and you wonder if they were really that good at typing and spelling as they went.

From what I understand today, most of the big publishing houses aren’t after diamonds in the rough – works of art that can be tweaked and cut into exotic gems.  What they’re after *(this is the genius of modern marketing here) is a “plug and play” that is press-ready and all they need to do is approve the “right cover” for it, turn on the publisher’s media blitzer, and presto, everyone makes money.

Were all writers in the past held to the same standards of spelling, syntax, and grammar as the lazy giants of today?  Somehow I doubt it.

That said, if you know anyone in the publishing industry who is looking for a good novel, have them drop me a line.  DreamOver is best described as “An Action-Adventure on the Frontiers of Reality” with a writing style and plot line that’s about in the middle of the literary triangle formed by Clive Cussler, the late Tom Clancy, and scientist Dean  (Entangled Minds) Radin.

I get connected with my literary “muse” nicely.  It’s a hard place to describe, but it goes something like this:

When you’re writing a fast-moving fictional book, you see everything as though you were watching it on a movie screen.  This vastly simplifies the writing process because it removes all the conscious effort at creativity.  Instead, as you watch this IMAX adventure roll out in your head, you simply write as fast as you possibly can, while trying to avoid too many typos.

Curiously, have one half-hour period where I found myself making tons of mistakes.  For the life of me, I couldn’t figure out why.  But, all of a sudden, it dawned on me:  I was watching the movie too fast in my head.  Because it was playing at near normal speed, I was becoming so engrossed in watching the plot unfold, that I’d become oblivious to the words that were going onto the pages.

I got up, walked around for a few minutes, adjusting blood sugar levels with a snack and a cup of cinnamon tea, and got back into the flow.  Only this time, I was conscious of the “pause” button in my head.  And I think the writing flowed much better – and certainly at a lower error rate – when approached this way.

I’ll try to remember to take the same approach here, as well.  The only thing different is that when “news writing” – a kind of typographical version of the old TV show “Beat the Clock” – there’s a real reluctance to hit that pause button because every second counts. 

But not really, as it turns out.

My Upgrade to Windows 10

As if pounding out 28,000 words, plus or minus an apostrophe, this weekend wasn’t enough, I also managed to upgrade to Windows 10 on my main writing machine.

If you’ve forgotten, UrbanSurvival and Peoplenomics live on two computers.  One is named Big Box and it’s the four video card, 12 gB monster with the big SSD and many terabytes of wasteland.

Most mornings though, the writing computer is SamTop.  A Samsung portable with the i7-cores, a terabyte drive, and until this weekend, it had Windows 8.1 on it which was entirely satisfactory.

Still, realizing that Win10 would likely be a bit more secure for travel and the like, I opted to upgrade now – before we go on our Peoplenomics cruise in early September to Jamaica, Grand Cayman, and Cozumel.

I’m not sure the improvements in security are real or illusory.  Sometimes I think Microsoft just rearranges where everything is and calls it an upgrade.  I still haven’t figured out how to set my own home page in their new browser (named Edge, for reasons that must relate back to a hangover someone had in marketing).  Explorer worked and anyone who could confuse a browser with an SUV should be allowed to compute or drive.

There are some real pluses to Win10, not the least of which is the screen is now much better behaved when you scroll in on certain applications to make type larger or smaller by using your roller mouse.

Simply hold down the “Control” key and run your finger on that middle mouse wheel between the right and left clicker buttons.  It’s magic.

The problem I had previously was that although it would work with my web writing tools (mainly LiveWriter), but after a line or two, the spacing would get screwed up on everything except the normal 100 percent scaling.

A little secret here:  That’s probably the source of about 50% of the errors in past columns:  When in the 100% scale mode, things are mighty small and I usually don’t get around to cleaning my glasses (and getting the last of the sleep out of my eyes) until around 7 AM. 

Not that something happens at 7 AM, though.  That just means I have only 54 minutes of writing to get the news and finance portion finished so the quality of typos hasn’t previously improved.

I’m operating on the theory that with a larger display on-screen, some of my gaffs will be evident even to me.  No doubt some readers will miss the former NY Times Crossword aspects of the column, but I’m still far enough from good at writing that shouldn’t matter.

The Actual Install Hints

Here are the three huge secrets that I found when installing Windows 10:

1.  Once you are ready to begin, if you are on a laptop, unplug everything from your USB ports before you begin.  I have two Logitech devices – a wireless keyboard (the fancy one with the backlit letters – another help when writing early in the day) and a wireless mouse.  The Win 10 installation froze at 92 percent on the program and 69% on the drivers until I hit the web and discovered that unplugging all USB devices save a keyboard and mouse, was the only way to fly on laptops. 

As soon as that was done, the installation was back to rolling along until the next problem came up.

2.  Once I had Win 10 installed (on SamTop), the next problem was trying to get the wireless adapter to work correctly.

Turns out that (at least on my machine) all of the previous wireless connections appeared to have been wiped out by the Win 10 install.

The good news was they weren’t – but that didn’t become evident until I decided before rolling back to 8.1 (where everything was working fine) that I would reboot the computer once and see if that helped at all. 

What got me thinking about it was the visual prompt that on the new Win 10 initial screen, there is a Wi-fi indicator.  Being a rocket-sturgeon (sic)_I figured a reboot couldn’t hurt, and in my case it solved everything.

3.  The third problem was reconstructing all things in  my browser which I thought would happen automatically, but it doesn’t. 

You’ll find a tool in the Browser settings area that will allow you to imp[ort your bookmarks from your previous version of Windows.

4.  Last, but not least, it wasn’t clear from the installation prompts that all of my Favorites would be playing Hide-and-Go-Seek.

Turns out that the simple “star” for favorites is now more or less an “Add Favorites” button while all your old bookmarks (and a lot of web searches which is more mysterious) is in the circular button called the “Hub”.

Apparently, the marketing people decided that when we go looking for something on Google or Bing, it’s worth remembering the search.  Judging by the searches it saved for me (most relating to the book which means they were one-time checks of a piece of geography in a scene) it was a waste of time.

Once you get past these few trip-wires, the rest is pretty much the same.  Maybe it’s a computational version of “the annual model” in the auto industry, but it seems to work – mostly.  And if you are planning a low productivity week at work, I can’t think of a better current excuse than to tell the boss:

Hey…lighten up already.  I just upgraded to Windows 10 and I’m still getting used to where things are located.”

With luck, that will keep you employed for another month.

During that time – in fact the next three or four months – Win 10 should provide a good computing experience until the hackers and crackers all figure out where the musical program locations landed with this fine iteration of recurrent marketing.

And by this time, say next year, we will all be back in the same kettle of fish we were in relative to personal computers that drove us to consider 10 on a few laptops now.

Reader’s Writes

Haven’t opened the mailbag much later, and it’s time.

The “Yokes On Us” I’ve often remarked about the so-called Women’s Movement.  You’ll remember that was the drive which got women something near to equal pay, but it also roughly doubled the size of the labor force available to the PowerThatBe, which in turn kept unit labor costs low.  About here, reader James picks it up”

“You are right on…until 1982 one income at two dollars an hour cut the mustard. Electricity was ten dollars or less a month, gas was the highest expense for the car.

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Pretend We Have a King

Today we proudly present an interview with the King of America.

Not that we have a REAL King, of course.  One of the best things about America is what?  That we don’t have a monarchy.  Instead, we have divided power between the Courts, the Congress, and the Executive.

Except, as a result, all the functions of the Monarchy are still fulfilled and those in charge are abled to exact the same tribute as a King or despot.  Funny how history works out.

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Jobs Mortem

Just out from the Labor Department:

Total nonfarm payroll employment increased by 215,000 in July, and the unemployment rate was unchanged at 5.3 percent, the U.S. Bureau of Labor Statistics reported today.

Job gains occurred in retail trade, health care, professional and technical services, and financial activities.

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Coping: With the Only “Warming” That Matters

Sunspots have fascinated man since their discovery in the Middle Ages.

And somewhere back there, an 11-year (roughly) solar cycle was also observed.

And then later, economists began to observe an 11-year economic cycle.  It was not a perfect relationship, however as it varied a great deal:

The Juglar cycle is a fixed investment cycle of 7 to 11 years identified in 1862 by Clément Juglar.[1] Within the Juglar cycle one can observe oscillations of investments into fixed capital and not just changes in the level of employment of the fixed capital (and respective changes in inventories), as is observed with respect to Kitchin cycles. 2010 research employing spectral analysis confirmed the presence of Juglar cycles in world GDP dynamics.

As one zooms out to even grander time-scales, there appears a relationship whereby every five (or six of these business cycles, there is a Kondratiev (Kondratieff) wave with a duration of anywhere from 46-years on the short side and 64-65 years on the long end.

Even further out, we see cycles that define the lifespan of a fiat (paper) money as upper bounded near 90-years, but whose length is largely determined by how quickly the value of money is “watered down” (debased) by simply printing up more money than is justified by economic activity; the results of which are mis-named “inflation”.

Economists like Keynes liked inflation as the fairytale became it was simple enough to explain to average people a “general rising of prices” rather than admit to something much more surreptitious: A deliberate government plan to print too much money in order to spend money from the future that had not yet come into existence.

It was this ignorance that led to the current crop of “Free Lunchers” in Washington, and although both corporate-owned parties have espoused a “balanced budget” (which would allow for stabilization of purchasing power) it hasn’t happened, nor do we expect it ever will.

The reason is simple:  It is too tempting – and easy – to step over the the printing presses of money and attempt to adjust the print rate in order to counter the normal flow of the business cycle, the shorter term and longer term cycles, including the Presidential Cycle, as one in called.

But our focus this morning is not on this big picture of how the economic cycle is adjusted – we will get to that in a moment.

Instead, we will begin this morning’s discussed with the 55 dead people in Japan, victims of the “longest heat wave on record” there.

A lot of climate change adherents are pointing to this as clear evidence that Global Warming is real, here, and a matter of urgent public concern.

But the more skeptical look at data like the sunspot data, historical weather data, and begin to see a relationship (with a bit of lag to it) between sunspot peaks and weather changes on Earth.

Moreover, there is another phenomena that garners little attention from the easily manipulated public, and that’s the matter of compression heating.

When air is compressed, it releases trapped heat.  When compressed gases expand, the lowering of pressure absorbs heat, which is why the air compressor air lines in the shop get so cold on a warm day when I’m blowing off a power tool or cleaning off the bench.

So we have to mention that concurrent with the heat wave in Japan, we see the forthcoming arrival of a typhoon in the region, as well.  Well off from Japan, though, this typhoon will be around Taiwan.

From “Elementary Meteorology Online” please see “Chapter 6 – Humidity, saturation, and stability” and then review the dynamics under “Adiabatic Compression/Expansion Simulation.”

.Here in East Texas we are about to have our own heat wave.  It hit just under 100 yesterday – which is average for this time of year.  And the next week, or three will be much the same with afternoon temps right at the top end of seasonal averages.

In order to cope, Zeus the Cat has been hanging out in my office where the solar panels assure a pretty even 74-degrees year round, except cold cloudy winter days when we rent a few BTUs from the local power company.  Since our solar is grid-tied, I can make some of that back when the sun returns.

When we’re not in the office (*where Zeus carefully watches the back of his eyeballs, if you know what I mean), I turn on the misters between the house and the shop.  These drop the temps several degrees.  Since cat body temps run 101.5, or so, we’re pretty careful to have the misters on, or the cat in the house for several hours during the day’s peak heat.

As to the misters, we started with a Orbit 30060 Arizona Outdoor Misting System Basic 3/8-Inch Cooling Set which was about $25 bucks worth and then tacked on a Orbit 30068 Arizona Outdoor Misting System Basic 3/8-Inch Cooling Extension Set for another $11-bucks and change.

Elaine likes to think of herself as a “desert rat” so even when it was 96 outside on the screen porch, she was out tossing around free weights and working out on her Tony What’s-his-name walker thing.

She comes in the house (air conditioning set at 77), does whatever for a while, then complains about how cold it is and goes back to working out to “warm  up.”

Those of us with Danish and Scottish genes (plus onboard R386 insulation) were never meant to be above 75, and frankly, my preferred operating temp is about 68F.  Cool temperature, steaming hot mug of coffee and I can  rock the paperwork for hours on end.  Flip side, I suppose, is Elaine’s risk of deep vein thrombosis (clots from sitting around too much) is about zero.

Meantime, I’ve been using the hot spell to collect water from my window-mounted air conditioner.  Last year, Elaine noted that it was putting out drops of water which were splashing onto the exterior wall of the office and she had concerns that would cause rot if not addressed.  It went on the ToDo list in 2014 and actually came up a couple of months ago.

I just added “How long would that take to fill up a 33,000 gallon swimming pool considering evaporation and loan mean temps?” to my 2016 ToDo list.

The answer to the initial problem (air conditioner drips splashing the office wall) was to drill a couple of 1/4” holes in the bottom of the A/C unit (being careful not to nick a line, motor, or anything stupid, eh?) and then placing a blue 5-gallon plastic bucket under it.

On  a good warm day, the condenser from the A/C will drop in about 5-quarts of water to the bucket.

I’m  not sure if that one is in the prepping books, but seeing as our friends over at Backdoor Survival are doing “Water Month”  (See: “16-ways to Conserve Water In Your Home”) I thought I’d make an unusual contribution.

I should mention my other biggie for summertime water conservation:  Don’t put ice in your drinks.

Not that I have actually practiced such a Plebian thing, but I’ve worked out a number of calculations that suggest water in the amount of about one ounce per cube MIGHT be used as an ice replacement, but not in my afternoon Martin, thank you.

I’ll have to check with Gaye on ice use in Mohitos.  This is the fun part of prepping, you understand. 

So far, this morning’s column has been little more than a recitation of facts and figures, along with a few heat-coping and water-conserving ideas.

It still hasn’t answered the BIG Question about whether Global Warming is real.  Sitting under the misters, cat under the chair I was in so he could be cool yet keep his fur dry, and sipping the afternoon Martin, I really didn’t much care, at least yesterday afternoon.

But this morning, Ures truly the Intrepid Journalitist (or Insightful  Urinalist or something like that) wanted to mention a little oddity that popped up in one of our www.nostracodeus.com data runs as a link.  *(Hat tip to Grady for finding this):

http://fire.pppl.gov/ 

This website has everything to do with the US fusion research program.

Take a look at the top of the page at the progress chart there.  See anything odd?

Well, to my conspiratorially curious mind, it sure seems interesting that in the 2005 (and earlier) timeframe, when a bunch of big corps and scientists were drumming up money for the Fusion project, that it seems (going from memory here) about coincident to the time that Global Warming was starting to pop as a great big deal.

And then – reading along the timeline, we see that like all big bureaucratic projects, the time to “first plasma” has slipped.  It has gone from a target date of 2020 back to 2024 and the US is pulling back/out of the fusion program.

Fits my notion “If we pay long enough we can get nothing to happen” approach to government projects.  Worked that way for the Great Society programs, if you’ll recall.  We still have the same poverty levels as…well, that’s off point.

But we do notice the fusion thingy is being built in France, by the way, not here.

All of which got me to looking at the relationship between the timing of Global Warming (replete with data jiggering) and the dreams of a fusion powered world.   I’m still in the camp that believes fusion has been done before, perhaps deep in the pyramids as a pulse steam generator source which might have driven low power steam…but that’s an aside.

While there are still many good pieces of science coming down the pike, it seems the presidential declaration of war on coal-fire generation which Obama just doubled-down on in the past week, means there may be something more going on under the headlines about fusion and a potential breakthrough.

The Boston Globe, in fact, says “Obama leaves coal nowhere to go.”

As part of the Obama administration sales plan for clean energy, the presidential blog this week went into a long discussion of the myths and facts about clean power, including a re-assertion of the primacy of climate change as a driver.

Yet, upon closer inspection, one can’t help but wonder what’s really going on:  Both the fusion industry and the nuclear industry (and in same cases overlapping players) have high stakes in promoting climate change.  The more they can do that, the easier funding will be and the more pressure will be on coal, which is a much cheaper (albeit in the short-term only) competitor.

Yet around here, we’re still not totally convinced.  Compression heating does happen, and in new and novel places when the water waters of the Pacific are seriously out of position, and I’m guessing because of the high solar cycle readings in the 2000-2003 period and the one we are now in.

Authoritatively, the National Oceanic and Atmospheric Administration explains:

El Niño and La Niña are extreme phases of a naturally occurring climate cycle referred to as El Niño/Southern Oscillation. Both terms refer to large-scale changes in sea-surface temperature across the eastern tropical Pacific.

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News is Mostly Marketing

It never frigging stops.

Elaine came home with a bag of prewashed salad fixings (a salad and omelet is a good breakfast,, at least to my taste buds.  You oughta try it sometime).

But come to find out, it wasn’t really salad fixings at all.  Nossir:  It’s now an Antioxidant Kit.  Honest-to-God, I can’t make this stuff up.

But it does remind me that everything is marketing, a truth kinda co-equal to our Everything’s a Business Model.

Let me show you how it works.

Take the lead in the NY Post this morning:  Hillary’s FBI probe is indeed a criminal inquiry reports the Post.

The Post then quotes a source:

“I’m not sure why they’re not calling it a criminal probe…”

What’s the word we are studying this morning?  Marketing.  And who is the leading democorp? 

You see, this marketing stuff isn’t so hard to figure out, is it?

Job Cuts Suck

Writ large in this morning’s Challenger, Gray and Christmas job cuts report:

Monthly job cuts rocketed to the highest level in nearly four years, as U.S. employers announced plans to shed 105,696 workers from their payrolls in July, according to the report Thursday from global outplacement consultancy Challenger, Gray & Christmas, Inc.

The July total is 136 percent greater than the 44,842 job cuts recorded in June.

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