Amazing Echoes of the Twenties

I spent a fair number of hours this week going through the 1928 and 1929 newspaper morgue of the Library of Congress online.
I loved it –  a grand non-numerical way to “sense” the rolling end of the Roaring Twenties and look for plays today that rhyme long-past events.

We’ll get to it, just as soon as headlines, charts, and several cups of the bean get us rolling.

More for Subscribers       ||| SUBSCRIBE NOW!       |||   Subscriber Help Center

Crash Odds Down Slightly – Tax Robotics?

On  the Peoplenomics side of the house, we will be taking on a very complicated subject in the ChartPack tomorrow:   How much of our contradictory signals in the economy right now can be traced back to corporate tax reform?

And while THAT debate (and modeling) continue, there’s the matter of the coming jobs collapse thanks to robotics.  One of our astute readers caught the headline “Introduce robot tax, or face massive economic disruption warn lawyers” and was kind enough to pass it along.

The problem with robotics (*and factory automation of any sort) is that it displaces workers.  Remember, when HUMANS work, they generate income taxes, payments into Labor and Industries, they buy (at legal gunpoint) insurance…and the list goes on.  Right down to buying a car and gas, oil, tires etc. to commute.  Robotics?  Nope.  Screws everyone.

(Continues below)


To be sure, there is likely some level of power tool use that could be logically argued against.

Take the construction worker putting a deck on a house;  Should they pay a tax on the power screw-gun, for example?  No, obviously not.

BUT, if half the UAW rank and file in Detroit are displaced by robots on the production line, shouldn’t there be some quid pro quo from the Factory Owners who just removed several thousand primary jobs – not to mention going out to tertiary jobs  (day care workers, quickie-mart people selling coffee and doughnuts in the morning) perhaps 10’s of thousands?

These jobs – the ones being replaced by ROBOTICS are not apparent now – because we are in the OVERLAP BOOM.  This is where the factories still have workers – but only until the machines get dialed in.  Right now, though, workers plus robot builders.  But then what?

They’re toast in the longer-term.

But:  How to tax?

The Internet as a prototype:

This “tax robotics” question actually has one of its roots in how things are taxed on the Internet.

Don’t know if you noticed, but a group of republicans are trying to shove a “net sales tax” through.  And, honestly, it’s not a bad idea.

It’s a terrible idea.

The problem is one we’re familiar with because we actually do pay sales tax on our Internet information product ( for those sales in the state of Texas.

Should our subscribers in Switzerland pay sales tax?  Or, those who live in a state without a sales tax – like Oregon?

Would it bother us to pay sales tax on all states?

Depends how it is structured.

If we were to pay sales taxes based on our tax home (Texas), no big deal.  Press button (*6-3/4%) and write the check.  Increase subscription cost from $40 to $45 to cover it all.  Ebd of story.

Here’s where the (stupid) GOP gets it wrong:  Should I, as an internet-based “product” producer, have to pay “sales tax” to New York?

The (dimwits) will argue yes, if the product is consumed in New York, but remember, Peoplenomics is a news/information product.  Enter the Freedom of Speech issue.

For now, New York lays it out this way in this tax advisory  (Tax Bulletin ST-620 (TB-ST-620)):

“If you sell publications that qualify as newspapers or periodicals for sales tax purposes, you don’t need to charge sales tax because they’re exempt. “

So, let’s see how the dimwits roll with this one:  It’s arguable we shouldn’t even pay sales tax in Texas, but we do, because we don’t begrudge the government its slice.

The problem is when I start up my next company – let’s call it Chester Industrie – and we begin to sell online some incredibly neat products.  If the dimwits get their way, I would end up having to do sales tax filings in 50-states under their plan.

Better:  Sales taxes should be based on the point of manufacture, or if in reselling (Amazon et all) then based on the point of shipping.  Amazon has warehousing in Texas already and charges sales tax here.

One company, one location?  Taxes to one state – not 50.

Would this tend to drive business to lower (sales tax) cost states?  Duh.

Why, hell YES!  And you’d begin to see some long-overdue restructuring of America – the decentralization that has led to lemming and demagogue politics.  The free-lunchers.  Only way to teach ’em a thing, or three, is to cut ’em off at their pocketbooks.

I’ve been through this on the local sales tax side.  Eventually, cities like, Seattle, start to drive out new business with their exorbitant local option sales taxes..,.

And if you really want to see some of the worst taxes in the country, look at the metropolitan utility districts of Texas. Gawd-awful.

Anyway, since I may get Chester Industrie going, it’s laughable to see the dimwits trying to deal their own broke states into another tax and spend scheme.

When government wants to “expand it’s partnership role” with tax grabs like this – instead of taxing the human job-killing machines upstream…it shows you how little these people – many of whom have never worked a day in their sorry lives in the Real World – know about the country they are pretending to govern.  Around the corner and up your tax, types.

(Hmmm…anyone I haven’t offended yet?)

Where was we….ah…over here:

Housing Starts

Just out from Census this morning:

If you prefer verbose?  (*Boy, did YOU come to the right place, or what?)

Building Permits Privately-owned housing units authorized by building permits in February were at a seasonally adjusted annual rate of 1,298,000. This is 5.7 percent (±0.7 percent) below the revised January rate of 1,377,000, but is 6.5 percent (±2.4 percent) above the February 2017 rate of 1,219,000. Single-family authorizations in February were at a rate of 872,000; this is 0.6 percent (±0.9 percent)* below the revised January figure of 877,000. Authorizations of units in buildings with five units or more were at a rate of 385,000 in February.

Housing Starts Privately-owned housing starts in February were at a seasonally adjusted annual rate of 1,236,000. This is 7.0 percent (±16.7 percent)* below the revised January estimate of 1,329,000 and is 4.0 percent (±12.2 percent)* below the February 2017 rate of 1,288,000. Single-family housing starts in February were at a rate of 902,000; this is 2.9 percent (±10.8 percent)* above the revised January figure of 877,000. The February rate for units in buildings with five units or more was 317,000.

Housing Completions Privately-owned housing completions in February were at a seasonally adjusted annual rate of 1,319,000. This is 7.8 percent (±14.8 percent)* above the revised January estimate of 1,224,000 and is 13.6 percent (±16.0 percent)* above the February 2017 rate of 1,161,000. Single-family housing completions in February were at a rate of 895,000; this is 3.0 percent (±10.6 percent)* above the revised January rate of 869,000. The February rate for units in buildings with five units or more was 418,000. “

I’d look for things to remain somewhat even-keeled until we see if the market will allow the Fed to raise any more this year.

They’re between a rock and a hard spot next week for the FOMC because it’s great to have a bubbly stock market and repatriation of Apple dough from the Tax Reform sounds good – and sure, let’s clean off the balance sheet at all…

But, how long in all this money flood back to the US before some foreign bank bites the big one and sets off the Global Panic?  We shall see.


While waiting for the industrial production and utilization report things were slightly red.

I look for the market to be somewhat down – toward the close.

Meantime, we see the old Dow record 26,616 and change is STILL 350-points from a new high by our 55-day mark.

As of this morning, though, the odds of another year of upside are about even.  The risk the Crash repeats right here, right now is 52.5% using my incredibly convoluted way of thinking.

What could drive it?


You should keep tabs on the story about how the US is now, for the first time, blaming the Russians for attacks on the US power grid.

We wouldn’t be surprised to see some REAL Russian hacker prowess demonstrated in response.  A kind of “No, if we had, it would feel like this…” from Putski et al.  Telling you, having worked with Ukrainian contract programmers, you’d be hard-pressed to find better in Seattle, for example.

They aren’t “good” – they’re awesome and not to be trifled with.

Sometimes, I think the whole pseudo-battle over Ukraine was less about the warm water port than about software HR…Eastern Europe (Poland east) is hot with grand programmers.

Oh, sure, and Chinese spoofing the ruskies, too.  Plausible de-what-ability?

More at Feds: Russian Hackers Are Attacking U.S. Power Plants.

I checked with our source warhammer – a former oak leafy type  – who’s active in this area:

No surprise here.  It’s been a poorly kept secret that much of America’s critical internet-based infrastructure has been compromised since the get-go.

I was involved in a meeting back in 2000 in which the National Security Agency expressed concern that systems once analog, which had network tech overlaid upon them (e.g. power and water distribution systems), had exploitable flaws which were totally unknown.  The rub was how to identify those security flaws.  Essentially, the answer is to pay hackers to find them.

Russia, China, the Norks and Israel all seem to have done precisely this.  In effect, the Internet boom of the 90s was a modern equivalent of a Trojan Horse.  We’ve since fully embraced an initially non-secure technology, trying to overlay security on top when it should have been baked-in in the first place.  But adding security made networking difficult, less marketable.  So we fully accepted pumping out innovation with exploitable flaws.  Sadly, history shows there is a  price to be paid for such narrow-mindedness.

I fully believe Putin could turn elements of American infrastructure dark with the proverbial flip of a switch.  That is quite dramatic, so instead, the mere threat of doing so provides negotiating power.

This is the anvil hanging over technology’s head.  It is not as secure as we hope and are often led to believe.”

And when comes to “bit-measuring” contests between Trump and Putin, let’s just say those could be a stormy sessions.

Speaking of Which

See the George Nader story in the Sacto Bee.  They headline “Mueller witness is convicted pedophile with shadowy past.”

Reward POOR Performance?

Deutsche Bank boosts bonuses to 2.3 billion euros despite bigger 2017 loss.

Gotta send them my resume – I can piss money away like crazy and I don’t even need a co-CEO to help.

Awrightthen – Moron Monday!

One Week to Market Crash?

I will make it really, really simple for you in case you haven’t paid attention:  I’ve been mentioning the possibility of a stock market crash on (or around) March 22 for about a month, now.

It’s not all that had to figure.

It was 55- calendar days from the market highs in early September 1929 until the brown stuff that smells bad hit the rotator back when.  We may be set to replay that pattern – in spades.

(continues below)


If you are skeptical, let me line up some of the data for you.  Take it nice & easy, though, because when you see it, you might become afraid.  Very, very afraid.  Cocktail napkin and some colored pencils, please?

In economic research, based on historical change work of people like Marchetti and Odlyzko, I’ve come to the simple but dangerously non-Keynesian view that periodic booms and busts are the result of progress.

When an old technology is bubbling along – and and a new technology comes along – there is the period of time when things overlap.  A great boom ensues.  We’re there now, but it will end.

This isn’t the first time.  It happened before in 1929 when mechanization of agriculture and mass media caused high demand for workers in the midst of the Roaring Twenties.  When the process unwound, Herbert Hoover was stuck “holding the bag” and what we called the Great Depression followed.

The ONLY issue in my research is whether our present-day “echo” of the stock market collapse of 1929 is presently replaying the “left shoulder” area of the following chart.  If we’re on the left shoulder, there’s a case for one more year of Roaring Twenties analog for Trump plays Hoover.  OR, we’re at the cusp of the “right shoulder” collapse now, in which case, it will become apparent in a month, or so.  Perhaps starting next Thursday.

Here’s one of the most telling charts from the Peoplenomics side of the house – updated with the closing data from Wednesday trading:

Of course there’s a third outcome possible; that we are not going to gracefully replay either case but will do some kluge of past events.  Which would be fine.  Keeps the game interesting.

Meantime, however, we need to talk about “investor confidence.”

Trump’s Poor Kudlow Pick

Markets are still pondering the departure of Gary Cohn from the White House on the economics side.  His replacement is Larry Kudlow – and frankly, it’s perhaps the worst hire Trump has made so far.  Looking at Kudlow’s resume from Wikipedia?

“Kudlow graduated from University of Rochester in Rochester, New York with a degree in history in 1969.[4] Known as “Kuddles” to friends, he was a star on the tennis team and a member of the left-wing Students for a Democratic Society at Rochester.

In 1971, Kudlow attended Princeton University‘s Woodrow Wilson School of Public and International Affairs, where he studied politics and economics. He left before completing his master’s degree.”

So a Clinton protégé and a lefty in school?  Other than media presence, I’m not seeing a ham sandwich here.

Gad zooks! You can’t be a freakin’ moderate/left dilatant and “get it.”  For openers, go read Andrew Odlyzko’s ENTIRE financial bubble page here – and all the papers.  Then, maybe, you’ll WTFU and see it.  Ure is not alone – at least entirely.

Now let’s talk consumption.  Nothing happens until people buy things.

The Federal Reserve’s latest on Consumer Debt (G.19 data) rolled this way:

“In January, consumer credit increased at a seasonally adjusted annual rate of 4-1/4 percent. Revolving credit increased at an annual rate of 3/4 percent, while nonrevolving credit increased at an annual rate of 5-1/2 percent. “

(Revolving debt is credit cards.  Nonrevolving is basically mobile homes and school loans.)

But that was only the bleeding edge of the bad news:  Retail Sales out Wednesday flat-out sucked wind:

And then, if this wasn’t big enough disaster waiting to happen (a consequence of under-spending on R&D resulting in no new “gotta-have-it” products), we have the “darling of the Digital Tulip Sellers” (Bitcoin) in mid-collapse:

IF one were to take Bitcoin as a coincident indicator of consumer sentiment, it may be time to find a high window or bridge to push this economy out (or off)  of.

A couple of Fed Reports:  NY Fed Empire State survey and the Philly Fed Business Outlook.  NY Fed report was upbeat:

“Business activity grew robustly in New York State, according to firms responding to the March 2018 Empire State Manufacturing Survey. The headline general business conditions index climbed nine points to 22.5. The new orders index rose to 16.8 and the shipments index advanced to 27.0—readings that pointed to strong growth in orders and shipments. Unfilled orders increased, delivery times lengthened, and inventories edged higher.”

And as for the Philly Fed?

“The diffusion index for current general activity remained positive but declined, from 25.8 in February to 22.3 this month (see Chart 1). Nearly 37 percent of the manufacturers reported increases in overall activity this month, while 14 percent reported decreases. The indexes for current new orders and shipments recorded notable improvements this month. The current new orders index increased 11 points, with 52 percent of the firms reporting an increase in new orders. The shipments index increased 17 points. The indexes for unfilled orders and delivery times were positive and increased 6 points and 10 points, respectively. Inventories were higher this month: The current inventories index increased from -0.9 to 16.5.”

Also just out:   Import and Export prices:

“U.S. import prices increased 0.4 percent in February, the U.S. Bureau of Labor Statistics reported today,
after rising 0.8 percent in January. In February, higher nonfuel prices more than offset declining prices for
imported fuel. Prices for U.S. exports rose 0.2 percent in February following a 0.8-percent advance the
previous month.


All Imports: The price index for U.S. imports rose 0.4 percent in February, the seventh consecutive
monthly increase, after advancing 0.8 percent in January. The last time the index declined on a monthly basis was a 0.2-percent drop in July 2017. Import prices advanced 3.5 percent for the 12-month period ended in February, matching the 12-month rise in November. Those were the largest annual increases since the index rose 3.6 percent for the 12-month period ended April 2017.

On the Export side:

“All Exports: U.S. export prices increased 0.2 percent in February after rising 0.8 percent in January. The last time the index declined on a monthly basis was a 0.1-percent decrease in June 2017. In February, higher prices for both nonagricultural and agricultural exports contributed to the increase in overall export prices. The price index for U.S. exports increased 3.3 percent over the past 12 months.  “

So, let me see:  Import prices up twice as much as the export prices?  Terrible – and not a recipe for “making great” as we read it.

Market’s aren’t impressed either – with almost no change in futures pricing.

Cigars and brandy on the Poop Deck today and tomorrow as we await the High Jump finals next week.

In the meantime, though, keep a close eye on interest rates, especially the 10-year.  Because the Bonds will drive.

Right now, they are in the 2.817% range.  But while there have been rumors that the Fed will raise rates four times this year, the collapse in consumer spending (with no new goodies on the must-have list) will cause the four-hike nonsense to, well, take a hike.

When that happens, bonds will begin to gain in price and drop in rates.  And suddenly, the stock market will be wildly over-priced.

The only question is what day next week will all of this come to pass?

My best present guess is still Thursday.  No, that’s not a doctoral project math outcome.  It’s just being able to count to 55.

Maybe no one in Washington can manage even that.

Sheesh.  What’s the point?

Department of Useful

Toys ‘R’ Us goes out of business, 30,000 jobs at stake.

Health Officials Issue Measles Warning After 2 Cases Identified in Travelers to the U.S.

CoreLogic Reports Homeowner Equity Increased by $908 Billion in 2017.  It only matters if you sold, though.

Citigroup CEO earns 369 times average employee.

Another Nor’Easter next week?  Look for the Climate Charlatans –  now arguing both sides of warming.

Department of Useless

Not sure what this means: North Carolina veteran inaccurately declared dead.  Name wasn’t Lazarus, by chance, was it?

Cat owner spends $19G on surgery for 17-year-old pet.

And A Missing Nobel Prize Winner Has Been Found Wandering a Rural Road in a Daze.  Alien abduction’s our guess..  No?

Moron ‘the ‘morrow, then.  TTFN.

Coping: With Ideal Working Weather

Tell you what:  Last bit of winter up until Memorial Day is about as good as it gets for getting outside projects done.  Ides of Match party it is.  A work party.

History of the Ides in a nutshell?  Wiki it:

“It was marked by several religious observances and was notable for the Romans as a deadline for settling debts[2]. In 44 BC, it became notorious as the date of the assassination of Julius Caesar. The death of Caesar made the Ides of March a turning point in Roman history, as one of the events that marked the transition from the historical period known as the Roman Republic to the Roman Empire.

(Continues below…)


Around the Ides is when some of the best working weather of the year shows up.  Why people take vacations in the summer – where many places it’s just too damn hot to get anything done on your personal agenda – has always been a mystery to me.  Spring is best, if you ask me.  Housing building weather.

But, then again, I don’t know what your “outside working weather preferences” are.  Mine come from growing up in a big city – with frequent long bike rides (50-mile a day types) and believe me, as “Young and Strong like Hop-a-Long” as we may have been both me (and my retired bud “the major” always preferred to do the hard part of a long ride early.  Before noon and before the heat of the day sets in.

I’ve mentioned this many times, but if you draw the lines around the world – using scatter-plotting software to map out where inventions come from, you’ll find there is a “sweet spot” that runs from maybe 25-30 north of the equator to about 50 north.

Pet theory has always been that it’s the ideal living but it requires planning.  So in this zone, you get a winter, but summers can be hot.  But, in the right kind of river valleys with enough rain (we get 50-60 inches a year here in East Texas, right?) you’ve got a part of the problem licked.

Still, I prefer some exertion to cause my sweat, not just stepping outdoors.

While that’s a kind of agricultural outlook, it also folds over well into manufacturing.

In the old days, factories were not that comfortable to work in.  HVAC wasn’t widely used.  But, with a high  ceiling in a tin building and a bunch of air turbines set it, you could get something of a cooling chimney effect.  It’s a good use of the “stack effect” if you don’t know of it.

Honestly, I didn’t get enough time outside on projects Wednesday.

Still, going through the project “hit list” for the day was great.  Got some paperwork done with Elaine (a relative passed away not long ago and there’s paperwork for the executor).

Then, it was time to get the high-speed super modem fired up to get the 254 MB bandwidth I’ve suffered 9-years of withdrawal from.  Got to 9 MB up and 5 down…which will have to do until the software update cycle…but it’s a great start.

Next up was converting our cell phone over to a new Samsung $200-class phone. A little bigger – better for aging eyes and hands.

We’ve been Tracfone customers for a long time because mostly, we can’t get cellular out here enough to make a “plan” worthwhile.  Coverage ends about 1.5 miles from the house at “hog holler.”   New phone is persnickety about using the wifi networks at the house…so a good rainy-day tweaker project to fill in.  (What happened to retirement?)

A trip to town to pick up a prescription in early afternoon was beautiful.  Fresh grass is up and it’s green enough to be the envy of the Irish (two days from now is St. Bushmill’s Day).   At the pharmacy, I try to be a few extra Pill Bottles.

If you have a hobby with lots of small pieces – like jewelry-making, beading, or in my case working on electronics, it doesn’t take much time at all to come up with a grand collection of small parts that’s organized.  (Gimme a Hallelujah!! brothers and sisters!)

Besides the weather being grand (50 at night, 75 in the afternoon – which is so close to perfect I can’t stand it) there’s also this Spring Ritual of organizing and cleaning.

Pill bottles are something I’d seen done in my youth.  Pappy used to tie flies for trout fishing.  He was the inventor of one he christened the Lake Jameson Shrimp.  We must have caught hundreds of good -sized (16-18″ trout) with ’em.  Can count the times I heard another fireman say “Hey Cap!  Going to Jameson  on my next five dayer…got any of those shrimp tied up?”

Jameson Lake, which is over in Eastern Washington, sits down in a coulee which was once, we were told, a tributary of the Columbia River when the ice sheets were melting.  The lake was deep and cold – so into June, and even early July, the trout never tasted muddy like they did in the shallower lakes around the Sun Lakes State Park campground.

North end of Lake Jameson was best…and with the boat launching ramp at the south end, as the afternoon wind came up (*generally from the north), you could troll all the way back to the launch ramp without oars or outboard.  Almost planned on half a dozen trout along the way.

I digress:  Pappy teased and trimmed all kinds of feathers and furs and stuffed them into pill bottles just so.

What people didn’t have then were things like the earlier version of the Brother P-Touch QL-500 Manual-Cut PC Label Printing System that spits out electronic component labels.  Best $65 bucks spent at my desk that year.,

One caution:  If you do put labels on the pill bottles, they won’t stick for more than a few days to weeks.  Parting compound. You need to finish the wrap around the whole container with an inch or two of Scotch tape to cinch it up or they will unwind. Look like a herd of baby chicks with their labels spread.  Or not.

Spring Organizer II

Another little gem I ran into (while trying to find a way to get all the small stuff off my desk corralled), was this great little artist toolbox. a Vencer 5 Drawer Wood Art Storage Box for Pencil, Pen, Pastel, Marker Set VAO-003 which is about $38-bucks.

The plan on this one is simple:  Place it under the high-speed scanner.  That’s where I will let all the “junk” and “tabletop clutter” go.

At any one moment I have 2-3 pairs of glasses,  mailing labels,  pens, markers, a tube of Neosporin for knicks and cuts in the shop, BandAids, (no shop project is really complete without some bloodshed!), and lemme see: stamps, eye drops, paper clicks, a couple of small remotes for the A/C and the sound system, letter openers (one’s electric, don’t tell Al Gore).

Then toss in the Post-Its, the extra staples…..super glue.  Scissors…”scanned” stamp…oh there’s all that small crap.

At what looks like 17-inches wide, I may be able to get both the scanner and the phone on top of it…there’s an antique Western Electric alligator-skin collectable to deal with.  Back in mahogany foxhole days, right?

While box should make a dent in the mess though I feel a lot like the Charles Schulz  character PigPen when I’m project-mode or writer’s frenzy.

The last piece of the puzzle will be a new 10 port USB hub.  And some very, very short charging cables.  ZiBay Micro USB Short Sync Cable for Select Models/Device, 7-Inch – Pack of 5 s a $7 add-on project.  Thing is, I have two keyboards to charge, Logitec wireless headphones, the Kindle 10, and occasional other goodies.

7-port hub’s been great, but the peripherals are getting too damn profuse.  Two printers, scanner, two cameras, biometrics access whizzy, need more charger ports and on it goes…

Part of what makes Friday special around here:  I dream up all these cockamamie project ideas Sunday through Tuesday and click like a madman online.   “The goods” drop in Thursday and Friday.  Really works out great.

OK, off to this morning’s Market which closed yesterday taking a good-sized step closer to my imminent collapse on the 22nd theory…

Write when you get rich,

Doctoring Your Numbers

I have the good fortune to have an excellent doctor here in Palestine, Texas.  His problem?  He has the very bad fortune to have me as a patient. 

This week, I got the results of my latest medical exam…and a discussion of “the numbers” is of great interest since most of our readers are “grown-ups.”.  And, when figuring estate-handling, life plans, and such, having an idea “how much time is left” is a very useful thing.

First, though, some headlines, including this morning’s fresh market data, and the ChartPack.  Best viewed while playing “Fly Me to the Moon” in background…

More for Subscribers       ||| SUBSCRIBE NOW!       |||   Subscriber Help Center

Did Prices REALLY Go Up?

Before we get into this morning’s Consumer Price Report from the Labor Department, a reality check is suggested because of what I’ve long-held is one of the Big Lies in economics.

I refer to what John Maynard Keynes talked about:  He sold the marginally-sane idea that there is a prevailing level of prices.  It is this, argued the Keynesians, that determine what goods and services cost.  They’re wrong, of course, but we’ll get to that.

Sadly for the U.S. ever since, we have missed the whole source of booms and busts – because it’s a difficult thing to understand.  Impossible in the thinking styles of the 1920’s but becoming rapidly intuitively apparent today. Recently, on the Peoplenomics side of the house, I explained how booms and busts are natural cycles that arise from company (and technology) growth and replacement.

(Continues below)


What was going on in the 1920’s was one style of agriculture, for example – the draft animal type – was being replaced with the mechanized variety.

We can quickly see how farmers continued to produce crops (even though prices were falling) and it’s something that cursed Herbert Clark Hoover before he ascended to the presidency.  Most people don’t appreciate that Hoover was deeply involved in trying to right the instability that resulted from the farm/mechanization overlap.

” Hoover was a leader in the Efficiency Movement, which held that every institution public and private was riddled with unsuspected inefficiencies. They all could be improved by experts who could identify the problems and solve them. He also believed in the importance of volunteerism and of the role of individuals in society and the economy.

The problem Hoover was trying to solve (inefficiency) was not the right problem.   The REAL cause of first the Roaring Twenties and the ensuing Hard Times of the Great Depression were really generated by too much innovation, too quickly.

If there’s an itsy-bitsy splash of hope that our next Depression could be smaller, it’s because barriers to innovation and new enterprise as lower with computers and programming.  It doesn’t take huge capital to form a company these days – a solid computer with a couple of code monkeys are do it all.  And then there’s Go Fund Me…

Still, the Depression was overlap at the macro level. It’s easy enough to express in set theory.  You have one circle (the farmers) and another – overlapping – circle which is the New Industry called farm automation.

At first, there was little overlap – no intersection of sets.  But companies saw opportunity and so equipment makers (like Allis-Chalmers, for example) expanded like mad.

Allis-Chalmers was a U.S. manufacturer of machinery for various industries. Its business lines included agricultural equipment, construction equipment, power generation and power transmission equipment, and machinery for use in industrial settings such as factories, flour mills, sawmills, textile mills, steel mills, refineries, mines, and ore mills. The first Allis-Chalmers Company was formed in 1901 as an amalgamation of the Edward P. Allis Company (steam engines and mill equipment), Fraser & Chalmers (mining and ore milling equipment), the Gates Iron Works (rock and cement milling equipment), and the industrial business line of the Dickson Manufacturing Company (engines and compressors). It was reorganized in 1912 as the Allis-Chalmers Manufacturing Company. During the next 70 years its industrial machinery filled countless mills, mines, and factories around the world, and its brand gained fame among consumers mostly from its farm equipment business’s orange tractors and silver combine harvesters. In the 1980s and 1990s a series of divestitures transformed the firm and eventually dissolved it. Its successors today are Allis-Chalmers Energy and AGCO.

As Allis Chalmers, Ford, and the new internal combustion engine-driven industries grew, so did the overlap area (the intersection grew).  Job shortages attracted rural people to the big cities.

Back to “set theory” – which was relatively unheard of in the 1930’s when John Maynard Keynes was spewing his notions on economics.  Computers, databases, and advances in technology have significantly changed our ways of thinking at very fundamental levels.

Thank you databases like dBase III.

Today, it should be obvious to anyone with modest computer database skills, that the intersection  (* again, what the overlap of sets is called, or vesica piscis if you’re a math-type) changed over time.

As set overlaps grow, you see a boom.  Work for all farm hands and work for all the factory builders, and what about those distinct Allis Chalmers tractors?  More manufacturing and sales than you can shake a stick at. You see, THE BUBBLE happens due to overlap.

The mistake that Keynes made was not thinking of the Depression  as a SET THEORY problem.  Instead, linear-thinking ruled the day, Keynes had held (wrongly I argue) to the idea that there’s a prevailing prices thingy.

What’s really going on is competing supplies and demands with gobs of moving parts that don’t simplify as easily as economists would like.  Kind of like heat island – another ugly, complicated, problem best simplified and then marginalized, but I digress…

So convincing was Keynes argument that it took hold with the banker crowd – equally in-the-dark about how economic overlaps works.

So today, visiting the International Monetary Fund website here, you can read of the godlike status afforded Keynes for giving clueless bankers some fresh ideas:

“During the Great Depression of the 1930s, existing economic theory was unable either to explain the causes of the severe worldwide economic collapse or to provide an adequate public policy solution to jump-start production and employment.

British economist John Maynard Keynes spearheaded a revolution in economic thinking that overturned the then-prevailing idea that free markets would automatically provide full employment—that is, that everyone who wanted a job would have one as long as workers were flexible in their wage demands (see box). The main plank of Keynes’s theory, which has come to bear his name, is the assertion that aggregate demand—measured as the sum of spending by households, businesses, and the government—is the most important driving force in an economy. Keynes further asserted that free markets have no self-balancing mechanisms that lead to full employment. Keynesian economists justify government intervention through public policies that aim to achieve full employment and price stability.”

Of course, there was another, more simple explanation: and that’s where the monetarists come along.

They point out that the fundamental policy error made in the Great Depression was in trying to hold prices at their old (and no longer supportable) high levels.

This caused all sorts of economic displacements, job sharing, and job cuts.  Arguably, had prices been allowed to go where they would in a bust (down) the Depression could have been shorter (still painful, though) and we’d have come through faster.

It’s an article of faith among monetarists (which I confess to being) that intervention makes things worse.

This may seem like a YUGE yawner to you, but I’m warming up to the point.

As you read today’s data on PRICE INFLATION, try to remember the monetarist’s view:

Prices don’t go UP.  The purchasing power of “money” goes DOWN.

Oh, and how far is down?

Looking at the Federal Reserve’s most recent H.6 Money Stocks report, M2 (not seasonally adjusted because “seasonal adjustments” are nonsensical in year-on-year comparisons since the “seasons” are identical, but that’s a statistics discussion for another morning) is up 4.2% and if you follow the fine work of John Williams over at, you’ll see that implied M3 – a revealing statistic that wrong-way Greenspan buried to keep knowledge of bankster schemes hidden from the public – is presently running about 5%.

So keep those numbers in mind:  M2 says your money has been watered down 4.2% and Williams’ M3 reconstruction says try 5%.

Detailed foreplay, but THAT is what you really need to know in order to understand the Consumer Price report which was just released:


The Consumer Price Index for All Urban Consumers (CPI-U) increased 0.2 percent in February on a seasonally adjusted basis after rising 0.5 percent in January, the U.S. Bureau of Labor Statistics reported today. Over the last 12 months, the all items index rose 2.2 percent before seasonal adjustment.

The indexes for shelter, apparel, and motor vehicle insurance all rose and contributed to the 1-month seasonally adjusted increase in the all items index. The food index was unchanged in February, as a decline in the index for food at home offset an increase in the food away from home index. The energy index increased slightly, with its component indexes mixed.

The index for all items less food and energy increased 0.2 percent in February following a 0.3-percent increase in January. Along with shelter, apparel, and motor vehicle insurance, the indexes for household furnishings and operations, education, personal care, and airline fares also increased in February. In contrast, the indexes for communication, new vehicles, medical care, and used cars and trucks declined over the month.

The all items index rose 2.2 percent for the 12 months ending February, a slightly larger increase than the 2.1-percent rise for the 12 months ending January. The index for all items less food and energy rose 1.8 percent over the past year, while the energy index increased 7.7 percent and the food index advanced 1.4 percent.”

It’s a sad joke that government policy wonks believe in so-called core inflation.  That’s inflation with food and energy backed out.  Try living life without either and you’ll see what I mean.

Markets were about flat after the announcement.  With quadruple options this week, the next few days ought to be interesting.

The Crooked Media

So the House Intel Committee says No Collusion, democrats hold their breath and turn blue.

But what’s terrible instructive is how the networks are burying the story like it didn’t happen.

And those that mention it seem more obsessed with TRUMP USING ALL CAPS IN HIS TWEET.

Meantime, Mueller’s gone fishing again.

Racial Bombings?

The PC media ain’t saying it yet, but all the victims in Austin area bombings have been minorities.  See All 3 Austin Package Bombs That Killed 2, Injured 3 Are Connected, Police Say for details.

US Dept.. of Useful

CoreLogic Reports Early-Stage Delinquencies Increased Slightly in December But Serious Delinquency and Foreclosure Inventory Rates Declined Year Over …

Now, for Useless

European court backs Spaniards who burned royal photo.

Coco Chanel’s Fascination With Fashion Started Early in Life.

French government announces security plan for Mayotte island.  (Damn, there goes my plan for revolution there!)

OK, tomorrow we look at health numbers and life span projections on the Peoplenomics side.  And more fun and excitement here Thursday.

Coping: With the Signs of Spring

As we are still catching up with (the damn) time change, a collection of observations about people is about you’ll get out of me.  Until we get into the market data shortly which this morning is scheduled to include the Consumer Price Index.

Consumer Prices are an odd thing.  If you are a monetarist, all things are driven by the amount of money sloshing around the system.  The goods in our highly commoditized world don’t change that much in supply or demand.  Hence, when prices change, we look to the central bankers as prime suspects.

When prices go up in the Spring, it usually means that the banksters figure enough people have paid down enough debt that it’s time to run it up again.  Consumer spending on credit cards give a pretty good view of how the country is doing psychologically.

(continues below)


If people are spending more on cards (called revolving credit) than they are on non-revolving debts (things like mobile homes, college loans and the like) then it’s a fair bet things are really humming.

In the last Federal Reserve note on point, credit card type use was up 6.8 percent against education and mobile home type loans which were up 5.6%.

It’s not a perfect short-hand, but it’s worth remembering.

Spring is when people go nutty, as if we didn’t notice.

Not only is there a grand conspiracy theory – yet to be written – about how Daily Time is to cover up Spring Fever – which we used to get in the old days, but there’s also an element of breaking down American values in there.

I’ll leave it to the conspiracy theorists to figure the details.

Testosterone runs high in Dallas.

Elaine happened to notice a trailer hitch while we were driving south on I-35E Sunday about noonish.

There, hung from the trailer hitch was what looked an…er…animal sack.  It had what she swears were a couple of hardball-size baseballs in it.

But, you see, hung from a sack they looked like…well, it was a Ram truck…what can I say.

Who’d have though such a thing would catch a woman’s eye?

I’m planning to cobble up something like that for the tractor now.  Light tan ultra-suede, maybe 8-inches deep with a couple of baseballs…

I’m sure in some states (California comes to mind) the mere display of such a fine sense of humor would land one in their political reeducation centers (California calls ’em “schools” and the real hardcore needing re-education end up in Berkeley, near as we can judge…).

I’m working on a product development project that is going along well.

So if I seem a bit distracted, there’s a damn fine reason for it.  This new product is one of those “million sellers” but first I have to get the PPA (*provisional patent application) written up and filed.

When that’s done, and we’re ready to sell first units, I’ll let you know.

On the other hand, the idea is so damn good I’m thinking about proposing to Amazon or maybe one of the shopping networks.

We’re talking REAL mass appeal product.  The kind that might even get me into the lap of luxury long dreamed-of…sleeping until I damn-well feel like getting up.

Not that I begrudge our morning’s together.  But unless you tell all of China to start reading Urban, there may be more money in actually patenting and producing something of value.

A sharp wit doesn’t fill the bank fast enough.

With Peoplenomics tomorrow morning already mostly written, there are two other projects on the agenda here today.

Last frost is past (in theory) so it’s time to get the seedlings started in the greenhouse.

That means the real work on the garden will follow shortly, although I can’t say enough about the $20-buck weed burner from Harbor Fright. (sic)

Toss a 20-pound propane bottle on the hand truck, securing with a bunch of rope, and aim me at anything green.  It’s like the fireman’s boy is a pyro when it comes to burning out the crap from last season and keeping the fence lines cleaned up a bit.

The other project here will be installing a replacement data hub for the solar power system.

Outback Power (great support, too) suggested I make one ginormous battery bank instead of two independent ones.  So that (with some 2/0 cables) will happen after breakfast.

With any luck, set-up will go smoothly and we can start selling back some of the power we consumed this winter.

With the existing malfunction, we’re only able to sell 6-10ths of a kilowatt.  Should be closer to 2 to 2.5 kw going out – and that’s with the office fired up.

Picked up a USB keyboard and the Office for Word app from the Kindle Store for the Fire 10 HD.

Amazon keeps moving in the direction of voice controlled computing and that has generated yet-another patentable idea I need to toss in the hopper.

Not sure why I feel like writing on the Kindle, but seems worth experimenting with.  Belt and suspenders people can’t have too many backups.

Last, but I suppose first, will be a run down to Crocket Texas to pick up the new higher speed satellite modem.

Our local reseller (an electric company) sells a 25 MB download unlimited data deal now for $100 per months and that’s not a bad deal at all.

We will keep the DSL lines, though, since satellites and thunderstorm weather don’t place nicely.  Rains send speeds down the tube.  Something to remember if you ever decided to “go rural.”

Before you make an offer on property, make sure to check for Wi-Fi providers because that’s a deal point into the future.

On to the business part of the column and then Ure’s off to nail many items on the to-do list…

And, of course, Thursday is our Ides of March party…

Write when you get rich,