Yeah, something of a directionless market in the early futures slog today. With good reason, too.
The Big Picture Sucks
Before we drop this week’s new unemployment claims and the Ex-Im prices, a bit of context is useful here because you need to see how delicate America’s financial future is, at this point.
The biggest problem is we aren’t making much, anymore. Sure, phones get designed in Cuptertino, maybe, and yeah, software updates. But it goes to factories and even server farms overseas. And that’s the point.
The number of people working at non-farm jobs in July was 143,532,000.
A year ago the number of people working was 157,346,000. 13.8-MILLION fewer workers. In just one year. Are you following this? Oh, and the population of the country went UP another million in the period, too.
The M2 Crater
Where’s the money going? Dark Pools of Capital. And the most important Big Picture metric of all – the Velocity of Money at M2 – has NEVER been on the ropes like this – EVER:
Money’s Like Electricity
One of my (few) values in Life is test-fitting “thought templates” between disciplines. And there are some basic forms of thought that will never steer you wrong.
- f = ma Force equals the mass of an object times its acceleration. Example: When a bullet is in flight, no force (besides some air friction) influences means (essentially) no acceleration. However, when that plastic-tipped 98 mm round finds its objective, the speed drop from over 1,000 FPM to zero will force the life out of whatever was in its way.
- p = ie Power (in watts) equals the current flowing in Amps (symbol “i”) times Voltage (symbol “e” as in electromotive force). Example: An un-fused 220 volt line is suddenly shorted. Current (let’s imagine 1200-Amps, shall we?) begins to flow through the now-completed circuit. You don’t want to hold the wire because 264-thousant Watts of power will vaporize small wire. And even large 0000 (four-ought) battery cable – running nearly 4-times rated current – will become an instant heating element causing fires and…well, you get the idea. If not, study thee here.
Money works the same way: Economic Activity equals the Money Supply times the number of times it “turns over” per year. It’s like “inventory turns” – you see?
What the St. Louis Fed chart shows is that money ain’t turning over.
Nor, in our view, is it about to. Why?
Digital Feudalism is Dawning
Or, aren’t you seeing it, yet? Let’s look at some data points, shall we?
- Deconsumption is here in Housing. See micro-homes.
- Shopping malls are dead. See Amazon and Wal-Mart battling for delivery supremacy?
- The Delivery Culture is here. CV-19 shut-in’s guaran-frigging-tee it.
- Robotics are coming for most jobs.
- A.I. will eat the few remaining intellectual properthy gigs that are left. A digital lawyer can “out-fact” a “air eater” any time.
- For the really astute pattern-seeker, you know where the first evidence of this Brave New World was spotted by us years ago? The AUTO-ROUTING feature in printyed-circuit board design software.
- And “Auto-routing” is going mega even as we speak. As in flexible ERP. Why, even my UPS driver tells me they are bringing up a “routing optimizer” so his delivery times may be all over the place, but my (far too many) electronics part could arrive just about any old time, instead of between 4:30 and 4:45 in the afternoon.
Seeing how this works?
As I have said before…and write this on the back of Ure hand so you don’t lose track of the future here: The Madness Won’t Stop because Machines have a Massive Tax Advantage over Humans..”
Example: Firefighter/EMT son G2 may “optimize” his income by going back to work for local government as an infectious disease investigator in the PNW. What was a $35 an hour 20-hour p/t position is now full-time career gig and sports an $80+K income level.
But, that’s only a fraction of the story: He would get 3 or 4 weeks vacation, a government retirement program (plush!) and medical for him and if he can find a Mrs. Right. And Parenting leave…what a deal!
It’s a solid move because there are some careers – high end medicine, fire fighting, and police, where real experience and real hands-on is what saves the day. Yet, even here, Machines are coming.
You want to test an “expert system” when you’ve got chest pains? Well, have fun with that. Not for me…yet. But when the AI and Robots score higher “save rates” gotta go with the numbers, right?
Was ISO 9000 a Global Robotics Scam?
But in food service? Manufacturing? Look at the data.
In our view, thanks to the global ISO-9000 rage, we see the robotics path; how the documentation of ISO 9000 is little more than in many cases telling algorithm designers how to write their code. (Yeah, I designed ’em at one time in the higher ed school management world)
Would ANYONE have “gotten excited by ISO-9000 if they has seen (or been told) that “This, kid, is the path to your obsolescence!”
People are so hoplessly stupid and ignorant of the larger contexts, it’s simply breath-taking.
Maybe Some Data Now:
Hey, how ’bout them new unemployment claims? How much of the “march of robotic feet” are you feeling from this? None, yet?
“In the week ending August 8, the advance figure for seasonally adjusted initial claims was 963,000, a decrease of 228,000 from the previous week’s revised level. The previous week’s level was revised up by 5,000 from 1,186,000 to 1,191,000. The 4-week moving average was 1,252,750, a decrease of 86,250 from the previous week’s revised average. The previous week’s average was revised up by 1,250 from 1,337,750 to 1,339,000. “
And then we have those export and import prices to consider. And these are screaming “Inflation to Come!!!”
“U.S. import prices increased 0.7 percent in July, the U.S. Bureau of Labor Statistics reported today, following a 1.4-percent advance in June and a 0.7-percent rise in May. The increases for all 3 months were primarily driven by higher fuel prices. The price index for U.S. exports advanced 0.8 percent in July, after rising 1.2 percent the previous month.
U.S. import prices rose for the third consecutive month in July, increasing 0.7 percent for the month and 2.8 percent from April to July, the largest 3-month advance since May 2011. The July advance was led by rising fuel prices; nonfuel prices also contributed to the increase. Despite the advance over the past 3 months, the price index for U.S. imports declined 3.3 percent over the past year.”
All of which says to us, the market is still in 1929 mode. But the very good news is that since March, when the Fed went hooley-gooley with the money supply in March when the world almost ended.
That overdose of liquidity is papering over disaster, and the second part of the crash did not begin in April, but has been pushed back in our work to what would be the equivalent of February 11, 1930.
Which in some ways is really well-done, but in other ways, not so much. Because when the whole of society wakes up one morning and figure sout “Hey! We’ve all been snookered!” the Dow will drop 3-thousand points in a day, Gold will drop to $700, Bitcoins and anything else with no claroic value will become a useless remnant of the Great Modern Delusion. Babel II (the Internet) will fall. Banks will be useless, and the great <Musical Chairs> game will be over.
When the music stops, you will be in situ exactly where you are at the time. And from there, making a future will become the challenge. If you aren’t prepped and ready, you’ll become plant food ahead of the rest of us.
Welcome to Natural Selection on the Planet of the Monkeys.
Aping Real News
Bananas for Breakfast, Dept. We have answers to all problem! Just ask!
Problem: Fortune, in an article over here, many Americans are afraid of touching cash for fear of CV-19. Solution: Mail it to us.
Problem: CNN report that “Chinese officials say chicken wings imported from Brazil tested positive for Covid-19.” Solution: Cook the hell out of it. Add spicy wing sauce, while Ure at it. Now, if the beer starts to test posi, well, then we’re all screwed.
Be stocked on water and goods in California because there is a quake swarm out there that could portend a major earthquake to come. My consigliere is working up some numbers for Peoplenomics readers on just how much of a “hole” there could be under the western side of L.A. *(La Brea tar pits west) from over a hundred years of oil extraction in the area.
Trump may have been bushwhacked again by another socialist insider loyal to the Obama-Bidenistas. This as formerly private communications in the form of 25-letters between Trump and the NorK’s have been unveiled in a new book. We have to wonder how this happened and who could be going to jail.
And the collapse of the Internet (Babel II) marches on. Newsroom grenade-rolls by HR Departments are to be closely scrutinized. Today we’re eyeing stories like the Hollywood Reporter’s version here and the NY Daily News take on it here, have our rapt attention.
If you’re asking “How can they do that and still have enough “news” to fill between the ads? Easy-peasey! Go see https://spinnerchief.com/ and you too can misrepresent America on social media.
And “selling reparations” is picking up steam. Will Joe-Kam be able to giv e a straight answer? We’re starting to think of this as the $12-trillion hustle. Socialists always offer the biggest free lunch.
Say, where are some good candidates on either side going to show up? Or is this really a fall-release horror flick?
And now, into the breach once more, brothers and sisters…
Write when you get rich,