Our first conversation tidbit today is really a lot more interesting than the run-of-the-mill, daily installment of political chicanery and spin by the co-opted corporate media. We prefer to study real data which suggests that yes, there really is reason for concern about the near-term future of the economy.
Besides market futures being not-far from flat at click time.
Let’s line ’em up on a log out back on our pistol range and take some pot-shots at ’em, shall we? Then tell me what you think in the Comments section. Here we go:
Here’s our morning “stage-setter” China’s economic growth drops to lowest level since 1992.
First data point is the Fed. Options expire today, and we would normally expect prices to sag a bit. The Big Guys who can afford S&P 500 options, don’t like prices for the underlying to go up too much on options day. In case they need to “buy to cover” they can do so at less than the exercise price of index options Thursday. Yeah, sure, call it a crackpot theory, but there it is.
Second target at the Fed. Is how they have been pouring financial gasoline on markets this week to the tune of more than $100-billion in order to establish plausible deniability with both the president (who keelhauls them regularly) and the long wave economic wonks (like me) who see the Fed’s manipulation attempts as a desperation ploy that will only make things worse downstream with the house of card comes down. But hey! Who cares about history when everything is different thing time, right?
The latest H.6 money stocks, reported Thursday through the end of August (e.g. to September) in Table 1 was running 7.6% basis the 90-day print run rate annualized. While the more recent data (Table 2.) shows the equivalent for the period ending October 7 as only 7.0 percent. When next week’s data comes out, we anticipate the current run-rate will jump up based on the incendiary printing.
But the only way any of this is useful is to subscribe to the NY Fed trading data and frankly, that verges on real work. Disclosure: At age 70, easy work (like writing and editing) is prefferable. Deep statistical analytics of rolling NY Fed “backdoor quantitative easing” via their trading desk is a different kettle of fish.
A “free lunch bubble” may be seen bursting, however, in Bitcoin. It’s barely holding on to $7,900 today. Which means despite all the hype about how people in Hong Kong will move to BTC to keep the ChiComs off their financial backs, people know that the State always wins against the Individual. Anyone who can’t grok that has their head in a personal carry-around “no daylight” region that smells bad and is a pal of Charmin.
With little more than the Leading Economic Indicators – and we all know what LEI is an anagram for, right? – today promises to be boring as hell…
Except for the Real Data
My consigliere, who, disguised as a mild-mannered tax attorney, fighting a never-ending battle for truth, justice, and tax relief (while still able to leap huge data-swamps in a single bound), called this week to advise that an airline passenger index (Gloomberg) had taken a schnoz-dive.
“This kind of thing is something to watch closely because when consumers plan far-ahead, you can see their real sympathies about the economic outlook…” Bad.
Maybe yes, maybe no. Airline travel will vary based on the overall health of Globalism, methinks. More to our way of thinking is: “New York Fed Factory Index Shows Manufacturing Remains Subdued.” Where’s the growth candy?
That’s still only another coincident indicator, you see. We like big-sample, robust data sets like West Coast Port Traffic. I mentioned the drop in Los Angeles Port Traffic to our Peoplenomics.com subscribers Wednesday. Now that they have had a “head-start” in their thinking (which is the point of subscribing for a measly $40-bucks a year, huh?) here’s what Los Angeles reported this month:
As you see, the result of the trade war, raging on the financial pages, has resulted in a real drop in exports. “Strong dollar” sounds good until we price ourselves out of exports.
Although there is monthly back-and-forthing between L.A. and the Port of Long Beach, just west, look at their fiscal year to date over there:
Eyeballing it, we’d have to call the Exim business, at least in SoCal, down somewhere around 3-percent.
In fairness, however, just as there’s some rivalry between PoLA and PoLB, there is also some “destination flex” in shipping out of Asia. We can get some small inference of this in a review of the Northwest Seaport Alliance data.
That’s what the former Port of Seattle and Port of Tacoma up in the are calling themselves these days. In August, they were hyping a traffic increase:
“The Northwest Seaport Alliance’s total container volumes from January through August 2019 reached 2,562,328 twenty-foot equivalent units (TEUs), a 5.8% increase from the same period last year. Import and export volumes grew 3.4% and 8.5%, respectively..”
I’d like to be able to report their September data, but true to tradition from when Seattle was my local beat, the PNW runs on an even slower version of government time than even California. Quite remarkable, really. We’ll pass the September data along to PN subscribers when the PNW-NSA PR folks get back from lunch. Any day now.
Our last data point to update is the RailTime Indicators from the American Association of Railroads.
I like the railroad data; perhaps a personality fault dating back to my 0.27 gauge model railroading childhood. Which was wrecked because my pal ( the Major), who I grew up with, had an O-gauge set-up and the scaling just wasn’t right for sharing rolling-stock. Not only that, but his O-gauge engine would blow smoke while my O.27 gauge engine wouldn’t. That lack of blowing smoke led to me being a reporter (and him an Army officer), I figure. But, I digress….
The data shocker in the AAR data out (and largely ignored) was this heart-stopper:
For this week, total U.S. weekly rail traffic was 510,820 carloads and intermodal units, down 7 percent compared with the same week last year.
Which leads to a sucking-in of the breath (with resulting light-headedness, let’s do that again…) as the adrenaline kicks-in and your eyes begin to strobe as a rising sense of panic approaches…
“WTF? Why did the markets go up, then, Ure???”
Magic wand of excess liquidity , mon frer. Read on:
“Total carloads for the week ending October 12 were 243,807 carloads, down 7.5 percent compared with the same week in 2018, while U.S. weekly intermodal volume was 267,013 containers and trailers, down 6.6 percent compared to 2018.
Two of the 10 carload commodity groups posted an increase compared with the same week in 2018. They were petroleum and petroleum products, up 912 carloads, to 12,717; and chemicals, up 439 carloads, to 30,855. Commodity groups that posted decreases compared with the same week in 2018 included coal, down 12,263 carloads, to 73,902; metallic ores and metals, down 3,402 carloads, to 19,720; and motor vehicles and parts, down 2,305 carloads, to 15,295.
For the first 41 weeks of 2019, U.S. railroads reported cumulative volume of 10,355,081 carloads, down 4 percent from the same point last year; and 10,924,972 intermodal units, down 4.2 percent from last year. Total combined U.S. traffic for the first 41 weeks of 2019 was 21,280,053 carloads and intermodal units, a decrease of 4.1 percent compared to last year.”
The Bigger Picture
Is simply that we’re screwed.
The Fed can make up money all day long. But, where the steel meets the rails, and down around the docks, there’s an appreciation that all is not as it seems.
A combination of the impeachment/witch hunt as a distraction from reality, while the trade war rages, and odd Youtube videos like this one predict a terrorist attack on Seattle on November 3rd, all give us a growing sense of dis-ease.
Our rational bottom line to all this? Be skeptical of the Trump “economic expansion claims because the Trade Warfare and the GM Strike put holes below the nation’s waterline. And while this plays out, the Fed’s gone mad with one stealth “easing” after another, while the circus-like atmosphere of a witch hunt backed up by digital mob rule and the soft coup by the Deep State continues to keep the inept, over-built news media hip-deep in click bait.
If you get the sense that I’ve been waiting all week for Friday, whatever gave you the clue?
We now return you to the short version of “Mad World.” (Click for theme music after you skip the ad…)
In the Shorts
Reality is still out there: World Stocks Drop, Futures Tread Water After China Reports Worst GDP Growth In 30 Years.
Witch-hunters have their BIC’s out and they’re flipping them with delight as Trump under more scrutiny with announcement of his Doral resort hosting G7. Could the Doral have been the legit low bidder, maybe? Wouldn’t matter in the PFW (Post-
Fact World).
Meanwhile, Trump’s Acting chief of staff backtracks on apparent confirmation of Ukraine quid pro quo. Not sure he wasn’t taken out of context in the first place. Again, conviction in the media is all it takes to wreck things. Who needs Courts and a Justice System when you have CorpNews and Social Media mobs?
Trade troubles “to the MAX” in EU will hit U.S. in time with tariffs over Boeing: Malmstrom evolve. Pardon our labeling ’em Europricks, but jealous megalomaniacs is just so, you know, clinical.
Oxy’s for breakfast department: Judge Summons Drug C.E.O.s for Talks on Sweeping Opioid Settlement.
Them “suspicious blackouts” continue to hold our attention as Fortune rolls out How 3 PG&E Execs Decide When California Businesses Go Dark to Stop Wildfires.
Well, enough of this rolling news crap, let’s get to the useful stuff…
Around the Ranch
Nailing down projects and follow-up time.
Ham Radio: The “mega antenna” works pretty well in first testing done Thursday. The SWR readings indicate I need to add about 6-feet to the open-wire feedline to bring the 40-meter resonance down a bit. But, most satisfactory. Best SWR was about 7.5 MHz so I need things lengthened to get best results/gain down on the bottom-end of the Morse code portion of 40-meters where the computer-modeled gain figure could approach 9 db on the major lobe pointed at the PNW.
Kitchen Sink Project: Here’s another example of how doing the actual work of installing a new faucet takes one-third the time of prepping the worksite. The old faucet was a beast to get out. My review of the WEWE Single Handle High Arc Brushed Nickel Pull out Kitchen Faucet,Single Level Stainless Steel Kitchen Sink Faucets with Pull down Sprayer
($79, the ‘Zon) and my review (pending approval) gives it 5-stars.
Main reason in the old, American-made, faucet has a gdo9b of stuff 6-inches down from the bottom of the stem. You get to install faucet hoses, right? With the WeWe, they build-in 18″ (or so) hoses which is ultra convenient and eliminates two p[otential leak points. Why couldn’t American engineering have gotten this right like, oh, you know….30 years ago?
Speaking of The Major: Congratulations to his son. Truly one of the smartest people I know. AF Academy, MIT Masters, and teaching the fine art of supersonic flying somewhere over Mississippi for Uncle, he’s been upped to O4 (Major) at the tender age of 31. I’m betting Lt Col by 35 – the kid’s that sharp…so congrats and a hearty “Thank you for your service.”
Seeing people like him at the “sharp end of the sword” take the sting our of the 5-figure annual income tax bill.
The most interesting part of the promotion (did I mention this before?) is the saluting protocol problems this sets up in the household. Since the Major‘s doctor-wife left the Army as a Captain, the question becomes whether Mom has to salute Son? And while the Major can shake hands for now, with the (I figure sooner than later) bump to Lt. Col. my pal will be having to salute his son….
Meantime, on the young-un’s of our brood, George II is about the halfway point in his firefightrer I/II academy which is neat. I figure around the first of the year he’ll be shopping for F/T firefighting and then finish his medical studies. The current thinking is fireighter, then finish paramedic. Do a career in the fire service while getting a PA ticket…and then income concerns ought to be mostly gone from his life.
Daughter #1 is about to begin her intereship to finish off a degree and daughter #2 is nailing her training as she moves up the insurance food chain…
It’ll be a busy winter for ’em all…and nice to see ’em rocking life. Now, if we could just pass along better government to ’em…
Write when you get rich, remembering the real riches are between your ears….
george@ure.net
Europricks is a bit harsh. Is it not short sighted for either side to impose trade sanctions when both Airbus and Boeing have been found to be illegally subsidised?
A spritz of yes, but a boatload of no.
the US, far as I know, have never levied a penalty on the worldwide revenue of a foreign entity. But the EU has – ask Google.
Methinks “pricks” is a bit lite.
Crops still in the fields around here, partly the reason for rail traffic being down.
Tariffs on Europe. MAGA by forcing China and Europe to marry. Quantum Chess if I’ve ever seen it.
I’ve been thinking about Syria.
The controlled hand-off to Russia makes me think the U.S. is about to collapse and it’s possible the world knows (but we’re not in on it yet). Syria was handed to what will be a stable power while we tribulate. Just like Afghanistan was handed to the U.S. before Russia collapsed.
Recall the Obama Presidential transition. All the former presidents were up there explaining how it’s good that Obama is taking over. That was a racist scene. My thought now is a white guy, Trump, clawing back entitlements makes it more palatable to the majority.
But the majority is really in question. We’re being lied to at every corner. Yesterday we were told the U.S. has 22 million illegals and not 11 million illegals. Someone counted very wrong. Everything is a lie.
“All the guards were sleeping. All the cameras were broken that day. Epstein had a fresh roll.”
Rumor is Japan will start protecting its interest in the Strait.
Another tell the U.S. is getting ready to implode.
The BIG LIE of the last 18 years….11 million, repeat, repeat, repeat, Goebbels said it best, didn’t he? And we have heard these kinds of repeatable numbers before, 6 million. But I digress. They are still lying. Do the math, 1994 NAFTA passed, floodgates opened to our borders south. 25 years of reproduction. We have 50 million plus here, as all the illegals have reproduced themselves times a multiple. That’s millions upon millions of dual citizens with loyalties south of the border, lands, too, and continuing to come daily 10,000 plus, and nothing will stop it as other nations are funneling their citizens through the unlocked gates, and more to come. The USA is cooked, just like Europe. Our controlled Media has made sure everyone is fighting over IT and paying for IT, NOT our sovereignty.
Un-Hackable – Un-Confiscatable – Un-Stopable De-Centralization
Suggest viewing actual coin volumes, mining rates and btc dominance charts before making prognostications regards price – but there it is $7900.00
Thats right $7900.00 for nothing that cant be used anywhere for anything..
Bwahahahha
I like to keep an eye on position levels of the big prop desks and there VIX positions.
Seems the markets always go in the direction of most pain for participants – always.
How does investing in a company bleeding cash – with neg earnings – dodgy business model build value? don’t think it does
Shorting the hell out of that company and driving its valuation down (over time) is value add..creation out of destruction – ya know the cycle of life on Earth.
Or as the coot likes to do – Synthetic Shorts.. Same underlying Stock -Short Calls/Long Puts.
Q is baaackk up – all about 17 – POTUS in Dallas last night – 17 again..hmm
Wonder if the “clowns” got the Message?
If you can’t stand in front of it to protect it, you don’t own it!
-Gerald Celente
crash bandicoot, do tell us where you find new Q posts. I know 8kun is working on it, but I as of yet to find new posts
https://www.youtube.com/user/gunnytorres/featured
but I do enjoy this link to serialbrain2, BUT I do not get the gematra coding and Georges 11-3 ties into their coding,,,I need a tutor
Dorsal has seen revenue drop over 40% since Trump took office. That’s the downside of being the type of contentious President he decided to be. So, is it fair to use his Presidency as a way to boost his income and bottom line of the Trump organization? Emoluments Clause says no. Hell, if Obama or anyone else would have had a bake sale in the lawn of the White House for their own personal gain, they would have been impeached. Why does Trump seem to get away with everything?…Especially since he has done nothing as a President.
On Mulvaney…He wasn’t taken out of context. He said they held back the. $400million from Ukraine, then said “ get over it, we do it all the time with foreign policy”. That’s pretty clear…Trump blows his top and the typical Trump like denial statement from the White House is dispersed. Trump must think we are stupid and many of his supporters just may be that. He says various “out there” statements on camera hundreds of times, then makes claims later that he never said it. The other stupid people are the press that don’t challenge him on these lies to his face during these pressers. Weird world we live in.
@ Markx
Obama did not need any bake sale…HE took the whole cake himself and left crumbs to many in his admin…by allowing VP biden and Sec State Hillary to due HIS bidding and paying BILLIONS to various corupt States …that gave all of them ‘kickbacks’…that IS what Durham has found to be the truth and what will come out very soon….as the CORUPT OBAMA ADMIN IS PUT ON TRIAL….and I get my info from the same outlets that you do…interesting we disagree on the ‘spin’….BUT….I do not drink ‘kool ade’….nor do I allow bias to direct my ‘tounge’
It’s not over ’till it’s over-
There may be “Light-at-the-End-of-The-Tunnel” (and it’s not an oncoming train).
“The stark reality is that, once the CrowdStrike crime wave is disclosed to the American people, the Democrats are history—FOR REAL!”
“This is precisely why Deep State has put the craziest of all the crazies — Schiff, Pelosi, Nadler, Schumer, Newsom, DeBlasio, etc. in charge of their insane asylum at this pivotal point during their historic crash and burn. These bad actors (very bad by the looks of Shifty Schiff in every interview) were specifically chosen because of how profoundly compromised each of them is.
http://stateofthenation2012.com/?p=130160
Good Morning Mark,,
“Do not go gentle into that good night,
Old age should burn and rave at close of day;
Rage, rage against the dying of the light.”
Did President Trump leave a bad taste in your Cheerios?
Quit eating Cheerios, but please keep posting for us, to hear your lament.
Many who read this blog dislike you view, but I say, post on Mark. It lets us know that President Trump is WINNING
” I say, post on Mark. ”
Darrell .. It isn’t Mark’s fault… I truly look forward to the comments.
From my perspective I see things quite different..
From Mark’s point of view he sees things in a completely different perspective point.
Different perspectives as in different truths? Nah, I ain’t buying what he or anyone else on here is selling unless its the TRUTH. Anyone can take a contrary stance at any time and keep that dancing going all the life-long and waste one’s life.
I consider the non-stop propped-up-ganda a big ole waste of time sink and life…so “I Just Keep a Scrolling.”
Ignorance is NOT bliss. IINB
Maybe he’s the Antichrist.
https://www.learnreligions.com/who-is-the-antichrist-700629
I read Mulvaney’s remarks and it appeared to me that Trump withheld funds because of the well-known corruption in Ukraine as a whole. He wants the COUNTRY’S corruption investigated before sending funds that would most likely be diverted from their intended purpose.The Biden shenanigans are possibly part of that corruption and he should ask for them to be investigated because they impact the U.S. as well as the Ukraine.
Also, “according to the Treaty Between the United States of America and Ukraine on Mutual Legal Assistance in Criminal Matters, passed by Joe Biden and signed by President Clinton at Kiev on July 22, 1998, the conversation was actually mandated.” The agreement was to fully cooperate in investigating criminal matters, especially those that involved both the U.S. and the Ukraine.
Although this may be too factual for you, Mark, I suggest you look it up and apply the same sense of outrage to Biden and Clinton for making such an outrageous treaty that you pour onto Trump for complying with it. Trump did EXACTLY what he was obligated to do by that treaty.
Saluting the son from both the parents…enshrines the’rewards’ of a good family upbringing, and the RESPECT due to all….Semper Fi
Yeah, I gotta say, it impresses the shit out of us simple folks.
George,
As you might recall, I have done some research on the number combination 1-1-3. It seems to be a ritual killing day for the group Nostradamus called The Pagan Sect of New Infidels.
https://theageofdesolation.com/nostradamus/index.php/2018/01/15/new-website-is-ready-for-takeoff/
03-11-1985 – MIKHAIL GORBACHEV COMES TO POWER IN THE USSR
03-11-2004 – THE MADRID TRAIN BOMBINGS
03-11-2011 – THE FUKUSHIMA EARTHQUAKE AND NUCLEAR MELTDOWNS
03-13-2013 – CARDINAL JORGE BERGOGLIO BECOMES POPE FRANCIS
10-31-2015 – A RUSSIAN PASSENGER JET IS BLOWN UP OVER THE SINAI
11-13-2015 – ISIS JIHADISTS KILL 130 PEOPLE IN PARIS FRANCE
So, I will watch the video, because this story has potential, especially now. Thanks for bringing it to my attention.
This is related to:
https://theageofdesolation.com/NOSTRADAMUS/index.php/2019/04/17/bloody-april-19th-and-april-20th/
https://theageofdesolation.com/nostradamus/index.php/2019/04/21/the-math-for-a-ritual-killing/
Wow – good stuff as always Stu – thanks!!!
“as a rising sense of panic approaches…”
I just visited with a gentleman that has apartment buildings and his major gripe was the increases that they made per apartment for water..he mentioned that all his plans had to change on spending .. so I’m not the only one in that position.
Then I read stories about the woman in town in her late eighties that eight years ago built a fence because her neighbor had a dog that would normally be considered vicious.
The ordinances changed and the neighbor complained that by the ordinance the boards are facing the wrong direction.. so their after her for ordinance violations and want ten grand out of an old disabled that gets eight hundred a month living on a set income.. lol lol lol it gets better to..
I told one of the kids on the board that now that a court date is set.. and the media is involved.. they may win the fight and drag great grandma through the mud.. the evil witch building a fence so she wouldn’t get bit by a vicious dog.. then have the audacity of facing the boards wrong eight years ago..lol but even though they win the fight they will loose the battle..
What I told them is they should have grandfathered it in and told the neighbor ( nope their names aren’t the hatfields or McCoy but that dam fence is the pig that’s started it) I would have grandfathered the fence in and told the neighbor to suck it up..
It gets to court the judge will go for the ordinance but to save his job in the next election will have to do a pontius pilot move and ask them WTF is your problem there.. I asked the board member if they would like me to construct a cross for them to lol..
I am eagerly waiting bbn this outcome..
George,
Like you, I have a MBA with a science undergraduate. I have run my own residential construction business for approaching 50 years. I do a lot of analyzing, and read the WJS every day.
I would offer a possible modification of your rail traffic decrease in relation to the WHOLE economy. For the 41 weeks of the year to date, we had about 21million carloads. Based on only the one statement you included of about 12,200 coals units down for one week, if we extrapolate that for the 41 weeks, we get about 500,000 units down on coal by itself, (this is probably reasonable as coal movements are not all that much variable week to week), which represents about 2.5% of the 4% less rail traffic in the US year to date. That leaves, minus coal, only about a 1.5% drop in combined other traffic, perhaps.
The WSJ had an article on October 13 talking about the bankruptcy filings of 7 large coal companies affecting about 42 individual mines in the USA in the LAST YEAR. Coal used for power generation has fallen from 48% of USA power production to only 28% from 2008 to 2018, and is projected to fall further to 25% for 2019 and 22% for 2020. This is a HUGE drop in coal production. In addition, we have lost additional exports to China recently of coal. Therefore, there has been a very large drop in coal shipments by rail as reflected in your statistics quoted in today’s column. The challenge has been the very low price of natural gas due to fracking which is driving coal out of the power production market in a big way.
Adjusted for the coal shipments drop, which seems to represent about 60% of the rail freight shipments decline year to date, the total economy drop is substantially less. It IS REAL of course, but the drop turns out to be about 1.5% rather than 4% which makes it as a measure of the broader economy quite a bit different.
George, you are good about thinking outside of the box and bringing into your column the rest of the big picture not often thought about by others. I appreciate that additional analysis from you on a regular basis. I believe in this instance, you might not have, in the fast paced world or writing a daily column, not thought about that one commodity which is rapidly changing its importance in the USA and did not do the additional analysis and discover that the large drop in rial traffic had been affected disproportionally by coal, which likely does NOT reflect strongly in total GDP at this time. I submit that the broad economy, as represented by rail traffic, is not nearly as largely going down due the the significant disruption of the coal market in those statistics.
Just incase you would like to mention the increase in petroleum shipments, real but tiny, they would represent only about .2% increase if extrapolated for a year to date idea. Those have been going up do to the lack of pipelines for oil transport recently. Several additional petroleum pipelines are going to come online in the next year that will help that issue somewhat.
George, be alert …
Your qualitatives are on target. What is the quantitative? It is … after all …. a quantitative asset-debt macroeconomic system.
Since you have not mentioned it in your ‘future worries’ yet, I will don the mask of your ‘worry monster’ and remind you again of your words:
“What turns a recession into a depression is famine.”
So when do we find out just how bad the agricultural harvests are this year??
I should think one could find out as early as mid-November, if they did a spreadsheet on the y-y CBT numbers. It won’t show up in the media until the numbers can become politically useful, unless those numbers are so bad that we actually feel it in the “breadbasket…”
Brit exit denied on Saturday, expropriation rolls Mexico banks Monday.