A great evil lurks in the world – unseen by all but the few who manage to hold an open mind against a sea of group-think zombies.
It’s the massive spread of disposability.
Got started slowly: Once upon a time, mid dieselpunk era, there was a certain substance to life in these United States. One wage-earner could keep a family fed and under a roof with perhaps a second-hand car to get around in. One “company job” and retirement with a nice union pension…
Then the Great Implosion began.
While Pappy urged us when young to “Pick a career you like and get really good at it…” technology was already nibbling away at the foundation. Jobs have gone from the “one-for-life” to a long-running sequence of one (to 3) primary jobs plus a collection of side-hustles.
Even then, it’s not enough. Workaholism and Urban Survival have merged.
We have – as a nation – become the gerbils on the running-wheel. Average duration of a job these days? About 4- years, but as the Bureau of Labor Statistics advised in their “Job Tenure” report this year, that depends on which demographic you’re looking at:
“In January 2018, median employee tenure (the point at which half of all workers had more tenure and half had less tenure) for men was 4.3 years, unchanged from January 2016. Median tenure for women, at 4.0 years in January 2018, also was unchanged from January 2016. Among men, 30 percent of wage and salary workers had 10 years or more of tenure with their current employer in January 2018, slightly higher than the figure of 28 percent for women.”
We can gaze gentle off into the distance and ponder this first “data marker” as we try to envision where disposability is driving. Craftsmen are a shrinking breed and machine-feeders are the rage. Drives things like “open borders.” Unit Labor Costs matter.
The second-up data point, closely-allied with disposability – is the commoditization of people and that’s been done with lots of technology. As one commenter on this site noticed overnight:
“Is anybody else noticing that our cell phones with these voice recorder, camera and video features is turning people into snitches trying to capture the next viral video or time in the spotlight. It seems to coincide with the 15 minutes of fame phenomenon that social media is producing. People either want to be stars for a few million hits or be the person who captures an event that gets them a few million hits…its also coinciding with this incessant need to be liked, adored, pity’d or enflamed.
The 3 worst, most recent technological creations, are the 24-7 news cycle, smart phones and social media. Theyre changing how we view and react to each other and not in a favorable way. The future is getting creepier by the day….”
There’s a concept taught in business schools called SDLC which, according to Wikipedia, means this:
“The systems development life cycle (SDLC), also referred to as the application development life-cycle, is a term used in systems engineering, information systems and software engineering to describe a process for planning, creating, testing, and deploying an information system. The systems development lifecycle concept applies to a range of hardware and software configurations, as a system can be composed of hardware only, software only, or a combination of both. There are usually six stages in this cycle: analysis, design, development and testing, implementation, documentation, and evaluation. “
If the coffee is slamming your neurons about, there’s obviously something missing that software wonks and academics don’t address. We call it:
System Degradation Obsolescence Cycle. SDOC,
You almost never hear software engineers talk about how their technology will be superseded. That’s because to SQL / XML jocks, you simple add and subtract tables, or toss in new functionality and recompile.
But, as the Open Source movement has demonstrated, non-commercial software tends to be less bloated.
What leaders at all levels fail to plan for adequately is that following an SDLC there logically follows a SDOC.
You see the process now and then, but since the grand social cycles are so slow, we don’t appreciate their importance.
Still, new products, made by new employees, come out at “top tier pricing.” Almost immediately, the products value begins to collapse as competing products offering the same *(and sometimes better) functionality come along.
Over time, technology becomes totally disposable. As do people involved.
One of the more interest SDLC to SDOC’s to consider is the ultra-high resolution CRT displays of the 1980’s. I remember when they first came out, a 17″ color monitor was the cat’s meow. And the price point? About $600-bucks.
Today, they are often given away; showing up in the FREE section of Craigslist.
How’s this relate to Money?
Just getting to that.
We see disposability coming to the stock markets worldwide. Because just as it was once upon a time smart to be a Buy and Hold investor, positions are changing more and more frequently.
We keep track of the markets both globally and domestically using Aggregate Indices. They tell us a ton about the reality of 2018.
Consider the U.S. Aggregate Data as follows:
- Dec. 29, 2017: 22,362
- Sep. 28, 2018 24,888
- Nov. 39, 2018 23,356
- Dec. 31, 2018 21,254 *Based on early futures trading
By our reckoning, using aggregates as we do – to make the Big Data bigger – the present bear market began October 3rd of this year – the date of our Aggregate high (25,006). How long it will last is anyone’s guess.
But regardless of specific duration, we’re pretty sure that it’s likely – at least in part – to fall victim to the disposability concept.
Millennials are changing, gone shape-shifter on us. De-consumption and minimalism is not useful to corporations because their lifeblood is growth. Other than demagogues monetizing sexual preference, weather, and trying to keep borders open to artificially “grow” the economy, we look at the world today much differently than the past.
“What is the least I need?” That’s a sure-fire killer for companies that exist only to show a profit and reward the Owners.
American-style Capitalism only functions well when challenged. A massive natural disaster? Terrible wars? Yes, we need those sinkholes in order to create “growth.”
Socialist governments eventually all blow up because they make the mistake believing stimulus can come from government spending and thus, is adjustable. Worker’s Paradises – like the Soviet Union and Venezuela, however, clearly demonstrate that is not in fact possible.
What’s missing? (And our quest around here…) is the Adaptive Economy. Such an economy would be able to work well when growth is required. Or, as population growth globally slows, such an economy should operate in balance even with negative growth.
So far, we haven’t done it.
But, when we look at global population change – and the outlook (blue) for what’s ahead, we don’t see much potential for a return to rapid growth.
The highlighted area is where we’ve been since the 2009 market washout that followed the Housing Bubble blowing-up.
No doubt in our minds – something else will blow up shortly. Corporations and banks have a marvelous way of “Never letting a good crisis go to waste.” They monetize such events by shaking out the taxpayer’s wallets. The thing to watch, though, is the larger global trend. The change-rate of people is going down and as growth slows, it won’t stop the biggies (like oil depletion) and it won’t prevent possible famine. Just too many people for that.
If you squint just so, you can see how this fits with stories like “China factory activity shrinks for first time in over two years, 2019 looks tougher.”
As the year ends, we hope you’ve had a grand year investing. For 2019 we wish you agility and profits. We think those will be had by looking to the Big Picture and how it tends to historically rhyme.
Quips and Tips
Speaking of slowing trends: U.S. companies repatriate over half a trillion dollars in 2018, but pace slows.
Depletion never sleeps, but it’s sometimes hard to remember that when stories like “Brent crude rises over $1, but set for first yearly drop since 2015” come along.
I don’t normally point you to press releases, but this one from Tractica offers 10 A.I. predictions for 2019: Artificial Intelligence Capabilities and Commercial Applications Will Continue to Progress Rapidly in 2019, But Growth Will Also Bring Growing Pains, ….
I’ve referred a couple of times recently to “news shortages” but who would have suspected this? “Suspected Malware Attack Disrupts Some Major Newspapers Nationwide. The FBI Has Been Alerted.”
We continue to wonder how long the bureaucratic nightmare masquerading as government of the EU can hold together. Most recent fuel for t hat fire? “Romania slams EU for treating it as ‘second-rate’ country.” What’s the saying? Under-promise and over deliver. Not the other way around as Brussels seems to manage.
Planning for tomorrow: Here Are All the Stores Open and Closed on New Year’s 2019.
Well, that about wraps it up – final column of 2018 and the first one of 2019 is on the way. Markets will end the year on an up note, but not likely enough to pull out a win for the year, quarter, or month. So, on that note, let’s do Moron the ‘morrow.