News

Where to hide?  I mean besides moving to Ecuador, as some of our reader have, that’s the topic this weekend as we roll out our look ahead at 2016 and explore some of the (amazingly-poor) economic choices before us.

To underline how bad things are, let’s take a look at where the stock market is likely to close today:  Looks to me like the S&P 500 will close right around where it is:  2,063.36.

Where was it at this time a year go?  2,058.90.

That means the total return on stocks is 2-10th’s of one lousy percent.  If you want to call that an Economic Recovery, pass the pipe.

Needless to say, the me-too-media (MTM) will not be screaming this from the rooftops because it blows the “narrative.”  (Narrative is another word for fairytale only this one if far more Grimm.)

And let’s not forget the President Doolittle has consumed the same Kool-Aid as Eurabia (formerly the EU):  The Washington (rotten) core somehow believes that immigration is the answer to economic growth.

It’s not.

Although, in terms of providing a short-term economic stimulus, it can work.

We presented some convincing evidence (complete with charts from Eurostat) in  Peoplenomics yesterday that make the case.

But here is the “thinking” that has gone viral among the bleeding hearts in the District of Corruption:

“Since we don’t have organic growth of the economy, if we import 5% more people, that will result in 5% growth.  That’s because everyone will need a place to live, there will be auto sales, new grocery stores, and even more people to pay into the Social Security Ponzi scheme that has been beggared, along with the Highway Trust funds…”

HS&J – hype,. shuck, and jive.

As a result, we looked at the European “import economic expansion model” to see how that’s working out.  Instead of long-lasting economic stimulus, what Eurabia as done is import an occupying army.  But before losing Germany, they will buy a bunch of things.  And that causes “economic growth” – so goes the storyline.

Way to go, Angela Merkel.  Who would have thought the Great American Democracy would follow the megalomaniacs of the Ure-a-pee’in Union down this dead-end (and the bridge is out) road?

2016 (Q3/Q4) should see the implosion of Germany and then the banko E.U. begin in earnest.  We here in America will benefit for a short time (6-months?) but then the contagion will spread here in 2017.

And that’s regardless of what happens in our presidential contest – where we still expect the Obama-wing of the GOP to scuttle real change (Trump) and broker the convention and run with the put-up wet dishrag candidate (Busk the X).

Elaine and I sit around almost daily, shocked in the horror of what’s to come…and wondering why the rest of America slumbers on.

Or, should I say “¿Por qué la gente estúpida de Estados Unidos todavía durmiendo?”

The answer is obvious: “???????, ??

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Before I share an interesting email with you, I’m sure you’ve already seen the emails floating about about the most recent M-class solar flare.

If not, take a gander at this video over here…

In the meantime, just to keep things in perspective, from a radio communications standpoint this is a tiny event.

The idea is that what we have had so far is an expectation of a small regional outage of some High Frequency (3-30 MHz) operations on a small part of the Earth’s surface.  Compared with “real-deal” EMP (think Starfish Prime here, which blew out lights in Hawaii 800-miles away) this is a tiddler to be sure.

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Remember as you read the following report that it is based on October data.  This was before the Housing wholesale pricing started to creep into the Houston market due to the cheap prices of oil – which is holding things down in that area…

So with this as background, off into the Housing report…

New York, December 29, 2015 – S&P Dow Jones Indices today released the latest results for the S&P/CaseShiller Home Price Indices, the leading measure of U.S. home prices. Data released today for October 2015 show that home prices continued their rise across the country over the last 12 months.

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Let’s sort of ease into this  by starting with a record report from the National Weather Service…

At Waco Regional Airport… 2.24 inches of precipitation fell on
Sunday. This breaks the daily maximum precipitation record for
December 27…

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Not a column for the kiddies this morning…

Barring the Syria-Turkey (U.S. – Russia proxy) mess escalating into a “flash dance” – we have some reason to hope on this Christmas Day 2015, that we will have at least one more pleasant holiday ahead of us next year.

If you follow chief word-tracker Grady’s adventures, you’ll appreciate that there are two words that have been giving us fits lately at our www.nostracodeus.com project.

One is the word “flash” so we will be watching to see what evolves with this one.  A “normal” track back into Google and Bing is less than satisfying.  Sure, we have The Flash season II and we have plenty of flash flood cancellations as part and parcel of the weather being exceptionally warm this winter due to El Whats-It.

But I’m thinking the word will meet up with rising prominence in stories like the big explosion  in Nigeria where about than 100 were killed overnight.  Toss in multiple human suiciders and maybe that’s what the language shift is hinting at there.

The other word to watch is Methane.  It may be related to the evolving environmental disaster at Aliso Canyon out in California.  There, an underground gas leak is causing more environmental damage than dozens of volcanoes.  And there seems to be no way to shut if off.

While Porters Ranch residents “lawyer up” the imagery of this slow-motion disaster is impressive, indeed.

Still, our main focus is captured at the macro level by three defining events which continue to unfold.

One is the election.  As mentioned yesterday, when the Obama administration announces a “sweep” to pick up illegals – and they do so a month in advance (which gives everyone time to hide) we can’t help but sense it is all a set-up.  That’s being echoes by others this morning including the Western Journalism site.

The second and real story to track over there is how Paul Ryan (who we’ve name the head of the Obama wing of the GOP) is defending the horrible budget just passed by the Fools on  the Hill.

While Ryan, et al, talk about how we “need” H2B visas, the reality is that we’re bringing in a new underclass from overseas.

What’s more, while Ryan and the Republicrats screw-the-pooch on the budget, they make senseless yammerings about a future balanced budget is in the works.

What Ryan assumes is that you and I are idiots.  He may be right about me, but you’re maybe aware enough to figure that NO CURRENT CONGRESS CAN BIND A FUTURE CONGRESS. 

Anyone with a nickel’s worth of brains sees proof of this in the how the Social Security and Highway “trust” funds have been broken like piggybanks and how we should have had a balanced budget many times over.  And let’s throw in the piecemeal destruction of Dodd-Frank, too, while we’re at it.

The paymasters (many of which are big District of Corruption law firms) and the Legions of Lobbyists pretend there is not a moral and ethical ideological meltdown underway in America.

But to my third point, let me run this one by you as two obviously contradicting headlines:

The first (and remember who got a piece of your tax money in the budget) is this gem:

“Hiding HIV From Partners Is A ‘Human Right’, says Planned Parenthood.”

Oh?  So being a broken condom away from a slow death, shouldn’t be a choice? 

Meantime, the NY Times reports “Man With H.I.V. Gets Prison Time, Again, for Unprotected Sex.”

What we have here looks suspiciously like America is “making up industries” by holding to conflicting, nonsensical policies that serve to create more problem than they solve, except they do result in additional economic activity.

I mean seriously, think about it:

On the one hand if HIV positive is a secret, then we expect more headlines like the fellow going to prison.  That one case alone employed three lawyers (the two sides and a judge) not to mention the custody costs for however long.

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Time to “shoot the reindeer” down on Wall Street.

Metaphorically speaking of course; don’t want our peace and quiet in the Outback ruined by a pack of animal rights activists.  Otherwise, I’ll send them up to talk to the coral snake family.

Point is (local flora and fauna aside) that our long-awaited Santa Claus rally this year has done a marvelous job of cheering up traders by tacking on an additional 185-points Wednesday.

Today?  Well, the market looks softer than a geezer who’s lost his Viagra prescription.  We might get a rise of out things, but will it lead to much?  Likely not.

For one thing, the markets will close at 1 PM eastern, while the bonds will close at 2 PM.  No doubt to avoid a logjam on the Long Island Expressway.

For us mere mortals, we notice the 10-year bonds are right about where they were prior to the “rate hike” – which as we’ve explained is really just an ease to please.

U.S. Department of Window Dressing

We can help but be a bit suspicious when the democrats start working the border invasion issue, just in time for what’s her name to claim spurious data in the wo9ol-pulling contest (which some call a presidential election).

This story in the WaPo makes it sound like it’s going to be a big deal. A planned Federal “sweep” of illegals is coming.

While there will no doubt be some arrests (the window-dressing) we are collectively appalled that while this is going on, thousands of Syrians are jumping ahead of lawful immigration applications because of the cynical Obamanistas and their Bolshevikian plans to bring in as many people who hate us (or will become good little democrats) before the election.

Then, expect another flood.

Syria, Amnesty, and Calling Out St.

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Ah, the Christmas spirit.

Elaine and I finally got around to putting the railings up on front deck #1 Wednesday.  It’s a feat made possible by the amazingly nice weather this winter (so far).

No, that is not global warming:  It is El Nino which is at an extreme this year.  Which is fine, and since there seems to be some correlation to the Sun’s 11-year cycle (and don’t get me started on the economic cycle that runs with that) because it means in a few more years, the pattern will flip. 

By then, the sycophants of global warming will use the natural cycle behind their  cause célèbre to proclaim victory. 

You’ll know that time has arrived because you will have been hoodwinked into paying another layer of taxation…but again, not today’s story du jour.

No, instead I thought this morning we could do a little thought exercise about the future as shown by activity verbs.

I’ll show you what I mean:

Let’s go back a hundred years, or for that matter, to the lead-in to World War II.

A glorious time in American history it was; for we were a country which built things.  We constructed marvels of engineering.  Grand Coulee Dam had been built.  Haven’t done anything that big since.  (The Chinese have with Three Gorges which may be a sign of ascendancy in global activity rankings.)

Today, though, we don’t seem to be “constructing” or “building” as much.

In its place has come “coding.”  We also see a lot of “developing.” A few offer “work product” while others create  “intellectual property.”  All as vapor-ware replaces real stuff.

Google Trends is a marvelous tool for spotting trends like these.  For example, when we look at a term like “build,” what we see is that we are just now rolling over at the top of a cycle and we may be heading down over the coming few years:

BUILD:

As you can see in this chart, the past cycle high was around 2004, but the peak in the housing market didn’t come until 2007 – so three years between language/use and  the evolving physical reality appearing. 

Not to harp on our outlook for a grim  mega-depression in 2017, and thereafter until 2021, but if you look with “soft-focus” you can almost see it.

On the other hand, all those computer science grads may have something to do…because there is a long-term recovery in search activity for…

CODING:

Here is another trend – not that the sample is large enough – but it sure as heck is interesting: 

WALKING:

And here is another trend of something “verbly” – this whole “prepping” movement.

Now, to my (admittedly cynical) eyes, this one, like construction, seems to be just past “peaking.”

PREPPING:

Don’t get me wrong: People are still very interested in DOING something, it’s just not as clear WHAT exactly they are interested in doing…at least from among the small number of action words (verbs) we have been sampling this morning.

DOING:

Things may not be all bad.  Lots of Americans doing…which didn’t seem to happen on the GOP’s watch in Washington.

In fact, the good news is that the act of “giving” seems, according to our Search Engine Oracle (www.trends.google.com not to be confused with the other kind of SEO) seems to be telling us that there is a very regular heartbeat in the behavior of humans.

Not only does Christmas (and the period leading into it) show an annual  heartbeat but the difference between the peak and bottom of trend may represent something about what we might describe as a prevail level of generosity… which is what the giving chart showed ….More people DOING good irrespective of season:

GIVING:

It is possible that the crass materialism of the “me generation” has also peaked?

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Mrs. Claus may wish to get hold of Bob the Enzyte guy and have a little confab about Santa’s Low-T.

Except, it’s not the T as in testosterone.  It’s the T as in Treasuries.

You see, my friend the Bond Dude who suggested that the Fed raise was accompanied by a loosening on the back-end to essentially give an illusion of an interest rate hike while in reality they were just doing an easing, may be exactly right.

Here’s why I am leaning this way:

Went you look at interest rates a year ago, do you remember where they were?  (10-year) Around 2.257.  On Monday of this year (yesterday if you’re in the egg-nog recovery ward) the 10-year closed at 2.20.

So let me ask you this: Since the 10-year was up at 2.47% in June of this year, tell me again about how the Fed supposedly “raised?”

The truth of the matter is that steering an economy with interest rates may not be instantaneous.  But when I looked at the latest money supply figures, my Bond Dude’s hypothesis actually looked like it might have some substance in fact.

Here’s a quick scribble on the inflation rate of the monetary supply, so you can see what I’m looking at:  Left Column is M1 seasonally adjusted and the right is M2 seasonally:

If the bean hasn’t kicked-in yet, the story goes like this:  Bottom data first.

Last year the M1 increase 0.554% or an annualized rate of 6.86% Ocober to November period.

Now for the top data:

What it reveals is that M1 (on a seasonally adjusted basis) went up 1.884% in one months and annualized this works out to a bump of 25.197%.  You can see M2 was going up 8.9%

This would certainly explain why the Fed rate increase is not being reflected in 10-year rates yet…and why my friend the Bond Dude is likely right that while the Public Face was raising, the Policy Reality face is still passing out money like crazy.

I have to admit:  It’s a graceful way to try and arb up the economy and it should work.  I am continuing to expect a major rally in Q1 –Q3 of 2016, it’s just that the Fed may not be driving bond money back into the markets.

It may simply be because there has been another defacto easing which is what looks like what happened here.

We will revisit this in a month (when we get the first December data) because last year, the seasonal Christmas bump in M1 annualized to something like 15%. 

And if this hare-brained theory of ours works out, the M1 annualized for December should be in the 30-35% range.  And 30-90 days later, the market will be screaming ahead. New highs, skies parting, and green shoots II will be going strong.

Except it’s a paper game, and few people understand the interplay between money creation, rates, and markets, and maybe you’re not ready for that discussion so we will save it for the grown ups over on the www.peoplenomics.com side of things.

Just remember:  When money printing increases, a month to three later there’s a tendency for markets to rise…more money means it’s easier to go bidding up of prices.

Hot Economic Data

Well, would you believe lukewarm?

Real gross domestic product — the value of the goods and services produced by the nation’s economy less the value of the goods and services used up in production, adjusted for price changes — increased at an annual rate of 2.0 percent in the third quarter of 2015, according to the “third” estimate released by the Bureau of Economic Analysis.

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