Import Prices Jumping – Inflation Ahead?

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In keeping with our “nominal” economics (and prepping!) bent, we begin today with a look at some well-aged import price data from BLS.

Prices for U.S. imports advanced 0.6 percent in February, the U.S. Bureau of Labor Statistics reported today, after ticking up 0.1 percent in January and falling 1.4 percent in December. The February increase was led by higher fuel prices. U.S. export prices rose 0.6 percent in February following decreases of 0.5 percent and 0.7 percent the previous 2 months.

Imports

U.S. import prices increased 0.6 percent in February, the largest monthly rise since a 0.9-percent advance in May. Despite the February increase, import prices declined 1.3 percent from February 2018 to February 2019. Both fuel and nonfuel prices contributed to the 12-month decrease.

Exports

U.S. export prices rose 0.6 percent in February following a 0.5-percent decline in January and a 0.7-percent drop in December. Higher prices for both agricultural and nonagricultural commodities contributed to the February increase. The price index for U.S. exports advanced 0.3 percent over the past 12 months driven by higher nonagricultural prices.

Meantime, it’s looking to us like the China trade deal may be in trouble as Donald Trump says he’s in no hurry to get ‘er done…

The problem with all economic data nowadays is that government hasn’t yet fully-recovered from GovDown and yet (magically!) markets haven’t done much.  With a few exceptions, like Boeing where the lawyers are circling the grounding of the 727 Max series pending definitive results.

After the data, futures pulled back to even to just a bit positive.  Empire State Manufacturing from the NY Fed tomorrow along with the Federal Reserve’s capacity and utilization report 45-minutes into tomorrow’s session.

Max Grounding – In Depth

Forget the stories about travel disruptions.  The reason question about the Max jets being grounded is why?

Talking to several of flying buddies this week, in addition to being a pilot myself, there’s a pretty obvious answer as to what may have happened. An event that’s not uncommon and it IS part of every US pilot’s recurrent training:  A condition called “runaway autopilot.”

Since I’m a pilot and former airline VP, I think I can walk you through the obvious line of inquiry.  Begin by imagining yourself having taken-off and your aircraft is in a 10-degrees nose-up pitch (or greater, depending on fuel and passenger load, temp outside and so forth).

As you’re taking off, the aircraft is at full-power.  Then, at a certain altitude, typically a few thousand feet, the autopilot/flight director pitches the nose-forward (down) into what’s called “cruise climb” mode.  The airspeed picks up.

In modern autopilots, linked in to an aircraft’s data bus (not something we had to worry about on our old Beechcraft), there is usually a “stall-prevent” sensor.  It looks at the airspeed and – if it is dropping too fast (or in this case maybe airspeed was not coming up as it should at transition) – it will continue to push the nose-over (down attitude) so the weight of the plane and its momentum (now pointing down) begins to build.

As you probably figured, if the plane did NOT have such a “safety circuit” in the configuration of the flight computer/autopilot, it would be possible for the aircraft to “fly itself into a stall.”

When a stall occurs, the aircraft doesn’t have enough air flowing over the wing (smoothly) and the upper surface of the wing – where airflow is normally nice and laminar – begins to tumble.  This tumbling begins at the trailing edge of the wing and then quickly moves forward, dumping lift along the way.  The first sign of a stall is some light buffeting of the wings that increases as the stall develops and tumbling air (no longer flow) moves forward.

Another way to think of laminar flow is air flows smoothly over the wing just above a “boundary layer.”  Once the airflow becomes “unstuck” from the boundary layer, there goes your lift.  There are lots of tricks to keep the flow attached at lower speeds and it’s one of the reasons I LOVED our vortex generators on the old Beechcraft.  By controlling laminar flow at specific points, the flow breakdown at the trailing edge can be delayed, and on some wings it’s on the order of a 5-7% improvement in low-speed (anti-stall) performance.  But no free lunch: there’s a small cost to cruising efficiency where flows are much faster and those vortex generators can be a nuisance when de-icing….

Don’t mean to get “all technical” on you, but the point is the computer will try to get the airspeed up in order to prevent a stall, loss of lift, and if the pilot isn’t sharp, loss of control.

Now, to make this whole Max-Grounding story more complicated is that there are times when the pilot will get into that condition where an “way safe” software program will call for “nose down” and the well-trained pilot will know to disengage the autopilot and “hand fly the aircraft.”

But now suppose you stick a pilot in the left seat who has not been through the “runaway autopilot” portion of recurrent training very recently.  What can happen?

My guess – and this is wild speculation – is that the flight crew did not tap one of several controls (on sticks and screens) to drop off the flight computer and go back to hand flying.  What MAY have happened is that the crew MIGHT have begun to attempt to trouble-shoot the autopilot while it was still connected.  Or, worse, got so much arm and leg power into controls trying to fight the autopilot that something broke.  In either case, if that is what occurred, then the problem would not be Boeing’s, but but instead might be a training and experience issue.

There has been a fair amount of speculation that Boeing’s instruction manuals were not precisely clear on autopilot use, but there’s a reason why pilots work their way up “through the chairs.”  (Understudy in the right chair, please…) They ALL know – and it’s part of recurrent training on complex aircraft – that “In event of trouble, fly manually.”  It’s a ton of work, especially in instrument conditions.

That’s why there are backup instruments, too:  If a pilot cannot properly disengage an autopilot/flight director/computer and then fly under instrument conditions on the back-up instruments, they have business in the left (or right) seat.  Runaway autopilots can and do happen but it’s part of the training how to deal with the fault and fly (by hand) out of it.

While some stories (like this one) give the idea that the Boeing woes may give a leg up to China’s internal airplane company which is coming along quickly to challenger Boeing and Airbus, to a seasoned pilot it’s a clear example of how the uneducated public and reporters who’ve never been through annual flight reviews in complex aircraft may be missing the “real depth of the story.”

Our best guess is the crew may have panicked and been trying to fix (worse restart/reboot) a runaway condition that could have been over-ridden with a single switch…But maybe not.  If the crew executed the disengage switches and they failed, and in this case it might all come back on Boeing and or component/sub-assembly vendors. Our nightmare?  The software was hacked.  Then the state and non-state actor question would be rolling…

But we shall see.

Another Hat In

Young and liberal: “Beto O’Rourke starts presidential run with video tweeted an hour late and won’t officially launch campaign for two weeks – but says in 2020 announcement that immigration is ‘the best possible problem’ for the U.S.”

Not to be excessively snide  (who us???), but if Beto can’t get his own video out on time and if his announcement is bungled, how do you suppose he’d do with a whole freaking country?  Sounds like time for ViseGrips and a shotta something, to me.

Here’s another richly ironic/moronic story “Ocasio-Cortez, Trump, Pelosi — Politics is our entertainment now. It shouldn’t be this way.”

Meantime, the GOP hopes for a return to the WH keep growing with the story out on Bloomberg that “The U.S. Now Has More Millionaires Than Sweden Has People.”

Statistically, a lot of liberals have to be hating Trump…all the way to the bank.

Speaking of liberal, how is it Time can be viewed as anything but a democrat publication when they run stories with headlines like “Don’t Impeach Trump. Vote Against Him…”   As they become the global center of cognitive dissonance in headlines toss in their “Impeachment Shouldn’t Be Political.”  Sorry, non-political impeachment?  AYSM?  (The media may be under estimating the public’s IQ by a huge amount…”)

It’s a Hit!

As “A top leader of Gambino crime family is slain in New York.”

Facing IT

“Facebook struggles into day two of global outage.”

On that note, time to chase down from beans...moron the ‘morrow..

20 thoughts on “Import Prices Jumping – Inflation Ahead?”

  4. Boeing 737 Max Maneuvering Characteristics Augmentation System

    Note MCAS is automatically activated when:
    – autopilot is turned off
    – angle of attack is high
    – gear and flaps are up
    – making steep turns

    To turn it off, pilots must deactivate the electric trim. This is in a different location than the thumb electric trim control on the yoke.

    If MCAS malfunctions and the indicated airspeed is way over the stall speed, I can see where the pilots would be very confused. Manually fighting the electric trim motors could put the nose in a rollercoaster oscillation eventually resulting in an actual stall.

    The only way to deactivate the MCAS control is to use the stabilizer trim cutout switch and that assumes you know where it is and what it does. The pilots have very little time to figure this out before it’s too late.

    If it’s the MCAS control, how did it malfunction? Interesting that Ethiopia sent the black boxes to France not the US.

    https://www.allkpop.com/forum/threads/do-not-fly-in-boeing-737-max-aircraft-or-any-mcas-software-controlled-planes.285900/

    • At least for the Lion Air crash, the angle of attack sensor was defective, and kept engaging MCAS even tho the plane was not stalling. And for some stupid reason, MCAS only looks at one AoA sensor at a time. So–Zero redundancy, even tho there are 2 sensors

      • Be interesting to see if the AoA sensor was a cost decision, especially if it had to be certified for FIKI (flight into known icing) and the wiring and the additional code overhead…. hmmm…

  5. I never did quite understand the fear that’s is portrayed about some of the college kids developing some of the things that today is considered to be scary..
    And yes i understand the human ethics arguments.. The thing is..it isn’t the kids doing the research but the people behind the curtain planning to use the things that’s been discovered for evil gain and control that’s scary rather than for the good they were originally designed for.
    The kids are given a hypothetical question or goal and the work to find the solution to the question.
    Like a bio suit to mobilize someone with mobilizing back injuries so they can become mobile again..
    Or a life saving robot that can run up stairs at 37 miles an hour to save people in high rise fires or other natural catastrophic events.or a center that tracks all electronic data to stop enemies of the state.
    Many of these kids don’t really even see the other side of the use coin until its to late.. Social media and the internet are two of those..tracking chips in credit cards is another.
    Which always surprised me.. A lot of the brainiacs are like most a little odd.. Focused on end results seeking a solution..inspiration comes from them studying the problem at hand to a potential event or action.
    Take D.C… There is every form of depravity there that is constantly ignored so they misdirect to someplace else to avoid criticism.
    Trump backing away from China negotiations. Well about time.. Pull back at this point the puppeteers are in total control. Anything he attempts at this point is dead in the water. Let them open the borders for illegal entrance and do what they wish.
    Like years ago.. My wife moved out of an apartment in 80..the people moving in basically called the utility companies up and said they were her and she decided to stay. 15 years go by and she gets a notice to go to court..what for unpaid utility bill..she tells them she moved out and turned off the utilities..do you have proof yup..another court date..go back in show the proof..judge these are obviously not your bills ..out the door..a couple months later..a garnish ment shows up at work..what is that for..down to the courthouse.. Oh you didn’t show up for your court date..what court date.. So they show us a certified letter that was sent to a city and address that no one had ever lived at.. That address isn’t real.. Well it was the only address they had..so the letter sent back by the post office was the same as not accepting the document.. On the document they listed the people responsible for the bills but at the bottom they penciled in her name..back to court.. This time the judge is irritated and says haven’t I seen this before.. To the plaintiff.. Does anyone have anything to say..dumb me raise my hand.. Its not her bill isn’t someone assuming your identity fraud or just wrong.. One more word from you and ill hold you in contempt.
    You have to pay it..
    We went to the utility company..they had thousands all lined up by the wall..same issue. We paid the bill.. It became my mission to get that law changed. So someone having the utilities restarted or set up would have to prove identity..
    What I was told is this.(the same thing DJT realizes now). If you have millions of dollars to share.. You can get that law to say anything you want. Otherwise just suck it up buttercup things are staying the way they are..
    DJT’s best move at this point. Accept that things in D.C. are totally broken and being controlled and his best bet is accept it.
    Sit back relax and enjoy his billions..live the remainder of his life in luxury. Figure out which currency will be the best bet for the time when the dollar tanks and secure his family and empire.
    Just my honest opinion

    • @LOOTB

      Did you forget that DJT…took the job because this country allowed him to prosper and He wanted to repay it for that reason, so that he set about to remove the corruption and the SWAMP in DC…one man alone as he is, really needs the ‘old time State Militias’ to give him some clout and enforcement, since ALL Federal Agencies are CORRUPT..Top Down as we can see…and voting does NOTHING to correct the ills in this country…as over 60% in CONgress are millionaires…and DO NOT WORK FOR THE CITIZENS of THIS COUNTRY….DJT ….with the Q Team…WILL get this country back on a honest path….March 20th 2019 will START that event….Semper Fi

      • I hope he can d…

        I personally believe he toyed with the idea he could fix it before he ran.. Even if you read and believe the corrupted and manufacred polls.. Those statistics show the average citizen wants to see changes. If the people had any influence on their representatives. It should have been a walk in the proverbial park.
        Secure the borders (an action I don’t think will work by building a wall. Instead go after the money changers. Tax those coming to America opposed to giving them years of tax free living with access to all the benefits that should be given yo citizens. Charge them on top of it a non resident tax. Once they have become citizens then the twenty quarter rule apply.)
        I don’t think he truly thought he’d get the job..once he did..then he had to put his best shot forward.
        I am willing to bet he was shocked at just how much power that the ones pulling the strings truly have. The same old people with rotten work histories and decades of questionable voting are still being voted back in. Those that do get voted out and new reps move in. The new reps are swarmed by interests throwing money and its to, to get them under their control.
        Any man can be bought..and unfortunately our congress I think are bought and managed by puppet pimps..
        I say get rid of Congress. Let the pimps do the job ..but then I think..they would be the ones being screwed if one of their plans went south..and seriously.. Are any of the US citizens?.heres What happened at work.. The execs controlling the company didn’t see any reason to have a plant manager.
        One day they sent a man to work on a ceiling fan. An idiot turned the fan on. The guy plumaged to the floor and got hurt really bad. All the execs were dragged through court on his cares and future.
        The next thing you see was the guy with absolutely no experience. No knowledge of anything..he was a cart pusher..push this cart to the dumpster.. Pull that cart here.. No education but he was a yes man and to shock everyone..the guy the employees considered the plant idiot..he became plant manager..anything goes wrong he takes the blame.
        They are doing that in medical facilities everywhere as well. Hire the educated one to use their licenses to watch over uneducated barely trained to do the jobs that educated people should be..the company gets the work done the nurse or DON takes the blame for any serious medical mistakes. The facility saves money and face. My doctors nurse and I worked together when they were implementing the changes..every one walked in for a meeting and hundreds walked out jobless.
        Anyway in my opinion that’s why the puppeteers don’t just take the seats. Its better to have someone (aren’t you proud of me..I said someone instead of.. it then I don’t think our congressmen are idiots..their educated. Unfortunately they work in a bubble and only get information given to them. A work schedule so short their virtually isn’t time to concentrate on a bill written in a way that would confuse a team of lawyers) keep representatives in that will forge ahead with their plans without considering what they are really agreeing to. Or willing to read first.
        On the some ones side..I would probably do the same thing they are doing.
        Or Do like some. Get the sketchiest bills of all passed.. Then jump from the boat before it sinks.

  6. It is logical to presume that the MAX fleet likely has a problem with aircraft mission computer software accurately interpreting pitot static system airflow data into airspeed under certain flight conditions. The flight computer then feeds said bad data to control surfaces like the new 737-8 fly-by-wire spoiler system as well as the Maneuvering Characteristics Augmentation System (MCAS), which it just so happens automatically applies nose down stabilizer trim during high angle of attack flight when the flaps are up and the auto pilot is disengaged.

    If the pitot static system provides erroneous data to the flight computer, the flight computer will inevitably send out wonky control surface commands, often during critical phases of flight. If the human(s) flying the bird is/are not actively thinking about when or how their airplane might try to kill them, particularly on takeoff and landing, those humans increase their odds of experiencing the tragic consequences of placing their blind trust in autogenerated code and massive amounts of humand generated code developed by people who may never fly on the airplanes they are doing the coding for.

    • Update: 737-8 engineering problem: http://www.spiegel.de/international/europe/what-s-wrong-with-the-boeing-737-max-8-a-1257608.html

      The improvisation (which will send chills down any air traveler’s spine): https://www.seattletimes.com/business/boeing-aerospace/black-box-data-reveals-lion-air-pilots-struggle-against-boeings-737-max-flight-control-system/

      So engineers add a control system that offsets the original control system because the new (bigger) engines alter the base aircraft’s flight profile. The new augmented control systems function with a single AOA sensor (lacking a back-up) that we now know often produces demonstrated unreliable data. The added sensor comes with a quick fix software patch to “increase aircraft control system reliability.”

      Real fix (as suspected): turn off the flight control system when the auto stall program noses the aircraft down too far and fly the bird manually, since the MCAS is way too sensitive (fly by wire inputs direct to the flight computer) to safely damper out the wrongly interpreted stall correction.

      It sure sounds like Boeing cut corners on fully flutter testing the modified aircraft with new engines, mounts, sensors and software. Now a ‘new’ software fix is about to be released.

    • It used to be that when a welder laid a bead on the pressure hull of a submarine during construction then he was in the sub during submerged sea trials – a good method of quality control!
      Perhaps all of the decision makers for this aircraft along with the H1-B’s and diversity workers should be given some ‘flight experience’ on the craft that they designed and built, especially if done in chancy weather.

  7. I have several thoughts here:

    The left seat pilot was approximately 8000 hours, I don’t know how many in type. The right seat “pilot” was 200 hours! Again – no idea how many in type. At 200 hours in a small aircraft, you are just getting dry behind the ears and not even qualified for a commercial license in the USA, much less an ATP. Apparently, in much of the world, notably Asia and mideast, hand flying is considered far less important than in the USA. Pilots are taught to do what the aircraft manual(book) says to do, and any hands on flying is strongly discouraged. There’s a lot of probable cause history to back this up. Both George and I have experience with Lake aircraft and both have a displaced thrust line vs the pitch axis. In this case it has an opposite effect of pitching down with power, yet it’s easily anticipated with only a few hours of time in type. Competent hand flying is very important to safety when anything goes wrong(and it will). In the USA, a pilot would have to have a minimum of 1500 hours to even get an ATP and become minimally qualified to fly such an aircraft with paying passengers. A first officer with 200 hours! GMAFB.

    One other thing bothers me: Reports of smoke and debris dropping from the cargo bay prior to the crash. This would indicate something broke in a big way. It could be an explosion of something – anything. Sabotage needs to be ruled out, at least. The pitch control problem may well be secondary to something else.

    I don’t like the idea that France got the black boxes. Why? Is there a verifyable chain of custody? At the minimum, NTSB and Boeing should be present and participate when they are examined.

    • Great point on the Lake LA4-200 I flew (great memory Mike!) There is NOTHING like coming off a high mountain lake, over the face of a dam and hitting the updraft — yee freaking haw!
      The main thing? When you pulled back power on the Lake (it had the big Pusher-engine and prop up and behind the pilot on a pylon over the fuselage) the nose would come right up (like 20-degrees) and if that was done at low altitude by an inexperienced pilot (not current in type) it was a heart-pounder. After a few dozen times – slowing for pattern power and such – T’ain’t no big thing. But the brotherhood of Lake amphib pilots knows the reactions…no question about it.

      • Time in a Baby Great lakes but that was as close to a Anfib, G
        ot my Float plane endorsement in a Citabara with floats long ago in another world N5754F

  8. Confirms my preference to NOT be a Beta-tester… of software or aircraft. Sounds like Boeing got a deal on autopilot software from Tesla!

  9. George, it has repeated.

    Pittsburg synagogue 138 days ago, now this in New Zealand.

    The cycle continues unfortunately.

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