A Month-End Decline?

(Somewhere off Cozumel, Mexico)  Market direction changes slowly.

Not a particularly brilliant first thought of the day after scanning half a zillion news sources, but it’s generally true.

Even though futures were down a tad when I looked earlier (-40 on the Dow) and the price of gold was weakening to under the $1,200 mark, none of that is particularly bothersome.  Most of the reason is the Swiss franc is down because there’s light at the end of the Greek debt tunnel – at least that’s the idea over here.

With a tentative Greek bailout plan taking shape, Janet Yellen’s appearance in Washington to answer questions about possible Fed rate increase dates is expected to draw lots of attention. 10 AM (Eastern) so look for all kinds of punditry around that.  Not that ijt will matter, but sometimes I think financial writers get p;aid by the word, not by the idea or interpretation.

There’s really not much of substance until Thursday when we will get the long-awaited (and did I mention late?) consumer price data.  But in keeping with the “paid by the word” notion…

The couple of regional Fed reports out today are unlikely to convince anyone much of anything, but we will be  putting up our usual two-parter tomorrow morning (no telling how long it will be delayed due to wireless at sea issues) when the Case-Shiller Housing data comes in,.  That is a key number to watch.

Wednesday, Fedhead Janet speaks again, but by then we should be swimming in interpretations.  Sometimes, it’s like testimony from a Fed Boss is a kind of Public Relations Dance.  An  idea about raising rates will likely be mentioned (as an in passing remark) tomorrow.  Then, depending on how the financial channel clamor around it, the meaning of what she meant will be massaged around the next day.

Then comes the Big Day, Thursday morning, when we find out what the consumer prices have been.  In keeping with our longer-term views, however, it’s really very simple:  Food prices and rent have not been going down much, if any.  Energy prices are bouncing around what could turn into an intermediate low, and whatever is left is what goes into consumer discretionary.

That leaves a ton of room for interpretation.  Even with energy prices being weak, for example, I can still see how an exceptionally cold winter where some people will use twice as much energy as usual, might not be fully captured.

This is a fine area of distortion in price figures to think about:

If you usually put 500 gallons of oil in your home furnace to cover a winter at $4 a gallon, and this year you need to put in 1,000 gallons at $3.00, how would you report that?

An economist which is “Obama friendly” and singing the latest chorus of “Good Times are Just Ahead, Brother…” will inside that prices have fallen 25%.

Nice try.

As a practical matter, however, I would snap up the 500-gallon bill at $4-bucks a gallon ($2,000 annual heating cost) rather than the $3,000 annual heating cost.

Not to turn this morning into a “misleading statistics 101” class, but depending on who is writing the narrative (which used to be simply a story) really does have the upper hand.

Since Global Warming is (bad pun alert!) such a hot ticket in Washington, here lately, we have to start wondering if the home energy heating bills reflect a “standard winter” or the actual (ankle-grabbing) experience?  Especially if you visit www.globalchange.gov.

I mean, let’s face it:  Depending on how seriously you take Global Warming you could argue that the amount of oil to use in pricing really oughta be down around 490-gallon, just because it’s data and there is not U.S. Department of BS Detection.

It’s clear why:  Sitting out here with the open sea wandering by the window, the mind settles a bit and rejects the creation of such an agency: 

There wouldn’t be enough people in the world to staff it.

Somewhere in my “Barnum and Bailey” of the week’s economics, I should mention that the Gross Domestic Product Estimate will come out on Friday.

This is another one of those cases where it depends on who’s counting the chickens in the Hen House:  The chicken’s union reps, or the Foxes International Union.

With a longshore settlement in the wings, the Dry Ships index should begin climbing out of the basement, but if it doesn’t then look for a major decline to begin around the first week of May.

That’s because of our 55-Day Rule.

If you’ve forgotten, it simply says that stock market crashes seldom happen much before 55 days from a market top.  So even if the markets settle a bit, it would still be late April before a “crash” (as in ‘29) should begin.  I think ‘87’s mini-crash was around 51-days, but I didn’t bring my memory with us on the trip.

Send a copy of this morning’s report to you heirs and tell them not to bug you with idiotic questions like “How you felling Dad?” until at least April 15th.  Even if you’re in the pink of health now, no one feels particularly good then.

Heirs included.

Australia’s Making Sense

Political correctness is a lot of fun to watch.

The country (unlike the arguably dim-witted Obama administration) actually understands that it has these things called “borders.”

And they seem to be preemptively trying to prevent a Muslim onslaught, such as is wrecking Europe, by talking about tougher immigration regs.

The interesting thing about the story is how the BBC managed NOT to use the Muslim label and only uses the “Islamist terror” moniker.

While it’s true that Muslims aren’t all lining up to set off whatevers at the Mall of America, there seem to be enough that it’s been making headlines most of the weekend.

Australia seems smart trying to get ahead of the curve, but in  fairness to the Obamanist’s illegal usurpation of border laws, it would be a lot more clear to people if there were  hundreds of miles of ocean around the US.

Bring Back “Corruption”

The Time magazine story about a former president of Maldives being arrested on charges of terrorism puts a little finer edge on the scimitar of language.

Notice, if you will, how the term being used is “terrorism.”

The Chinese, who have been around. oh, 5-thousand years as a civilization longer than we have, are much  more precise:  They simply use the term “corruption” and march people out to the wall for the last ciggie.

We have a problem in America with the precise use of language.  Not saying the detained fellow was a good guy – no, not by any stretch.

But, if media were generally less anxious to spout “terrorism” instead of corruption, gangs, thuggery, and insurrection or murders, then we’d perhaps be able to be more clear on our national positions on issues.

Passings:  The Age of Branding

This is something that might not quite register with you at the conscious level, but it’s important when comes down to how much “noise” there is going on inside your head.

Procter & Gamble announces deeper cuts in brands portfolio” is the headline from Google’s news engine this morning, but it could be an important indicator of the “post advertising world.”

P&G executives have apparently figured out that there are only so many “head-spaces” available for product preference.  And, if you own the ‘category killer” why spend a bunch of money on advertising, particularly if something is well “commoditized.”

Pick a category…any category…of consumer product.  I’ll use soup.

Other than Lipton (Cup-of Noodles), Top Ramen/Nissan which are indistinguishable brand-wise, Campbells (cream of mushroom) and Progresso, how many more soup choices do we really need?

I doubt that sounds will be entirely genericized,  but you can see the point. 

Branding, which reached it’s peak of absurdity when came to sunglasses with a billion different idiot-level designer names attached to them, really could have been much more efficiently segmented as to capability:  Polarized, green, gray, and yellow.

But, instead, designers (who added bupkis in the way of functionality) attached their names to things for reasons that are still unclear.

What P&G is doing is plain smart.  When the money to brand becomes more than (“x”) fraction of product revenues, pull out of the branding business and then use the money saved to buy up category competition.

Makes tremendous sense.  It’s like when I compared a PorscheDesign radio to a Tecsun.  Care to guess which one I brought?  I don’t need to pay extra for a name…and in the age of Obamacare and rising taxes, we’re all on the long road to Soylent. 

Maybe P&G will be the first of a growing trend.  Minimalism is here.  Not that we want it, but who can afford brands anymore?

And when P&G steps up, that speak volumes to how future will unroll before us.  Smaller ad agency spending?  Maybe…but that’s OK because they are starting to roll into Social Media…and there’s a human time sink we’ve kicked before…

I have to close, for now.  Elaine will be up any minute, and will be anxious to shop for “designer” froo-froos at the Dujty-Free.

So branding is dead.  Long Live Branding!

3 thoughts on “A Month-End Decline?”

  1. You’re getting wonderfully thoughtful (and punfull) away from the farm! On “branding”, a form of marketing, from personal experience in corp level meetings, I strongly suggest that all forms of marketing will live onward. Two reasons (at least): 1) is that marketers are very good at selling their marketing to upper-level management; and 2) it’s easier for management to try to “buy” more customers with marketing dollars than it is to improve product quality (which sells itself).

  2. Let me know when Australia actually does something about their border rather than just talk about it. In the US, there’s plenty of talk about border control but the southern folks just seem to show up unannounced and we throw out the red carpet. If you look hard enough at it, you’ll see a consorted effort to displace the existing residents (US/Europe/Australia) with the new folks. Ross Kemp is doing his part with a great expose’ on the down-trodden folks of color. Move over…….

    Create chaos (wars, violence, hunger games) – people move to new land and replace – why do so few see this?

    It’s not a new game – it’s just knocking on my door….. Prepare your kids for a bad future reality. When you start dreaming about your kids displacement then you’ve got the future nailed down. Let us know when your dreams scare the bejesus out of you – then you’ll be on the right track!

  3. Departure from Branding reminds me of the late 70’s when they came out with the ‘generic’ idea in most of the grocery stores — they had sections of the store that had all white cans and boxes of various foods with a big black ‘GENERIC” stencil font across the container — the idea being that the food inside was good basic nutritious quality, but absolutely the cheapest no frills version that could be bought. Eventually faded away into the sea of ‘store brands’ that were a little more colorfully presented.

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