Seems to me we do.  Let me explain…this is all about FTM – follow the money because Everything a Business Model.

I sit around, just like you, and read the reports coming out of Iraq.  President Obama is sending in 200 more troops to “secure” Iraq, which I take to mean their borders.  Is 200 a day the new normal?

But, at the same time, the Texas state legislature is having to consider a state border security force because the very same federal government that is willing to secure Iraq’s borders, has demonstrated that they are unable to secure our own borders.

How can  we send troops to Iraq and not the Mexican border?  Help me here….

To be sure, as in any large, bureaucratic monstrosity, there will be delays and butt-covering.  However, when I read how the president is seeking “emergency funding” for the border, he’s not talking about airlifting the kids home (where they belong).  He’s talk about shelters, humanitarianism, refugees, and every other “warm and fuzzy” liberalista feel-good label that comes along.  No Army or National Guard…

What is NORTHCOM for, if not to deal with home land security, I wonder?

One of my liberal friends this week left me a long voicemail which (correctly) pointed out we only have a return policy with Mexico and if the kids aren’t from there, well, sorry, we’re kind of stuck because we have to “follow our own laws.”

I don’t think that the intent or Congress, was that narrow, however. 

The way I see it:  If a kid comes over the Mexican border, they go back to Mexico.  How hard is that, really?

Unfortunately, it seems to be the only way the hard-headed, soft-border regime in that bloody narcostate is going to hear what we’re saying. 

Oh:  Labeling Mexico as a narcostate on my part may be contentious, but the drug war there killed 34,000 people 2006-2010 according to this report.  But while they’re spending $9-billion a year on their drug war, don’tcha think closing their borders at both ends of the country might have something to do with it?

The (relatively new) government of Mexico has been focusing on making the streets of the country safer from the drug gangs.  But, paradoxically, this has made it safer for further-south countries to walk up here…

Meantime, it’s the porous border what makes profit possible for the Cartels.  D’uh.

The publication Foreign Policy (of the CFR) was asking rhetorically about the drug war way back  in 2012 “The world knows how to end it — so why can’t the United States figure it out? “ 

The question is still on the table.  The answer ain’t no mystery, friend:  Somewhere there’s a business model – there always is.

Money always flows – like water – to level things out.  Until the administration begins to identify the business models behind the border problem and attacks those (drug money, cheap labor, profits on money transfers to relatives back home..the list goes on and on) any claims that they are serious about the problem are specious.

For now, it’s a “crisis” and that means more tax money being spent and more government-dependent jobs being created….

If you want to kill any criminal enterprise, take the money out of it.  Didn’t anyone watch The Untouchables besides me?  Legalize weed, and there go the everyday profits.

The death of an 11-year old Guatemalan a mile inside the US is making big headlines, a regrettable thing, but treating the symptom ain’t gonna cure this disease.

Following the money… that’s what would have an impact.  For now, the PowersThatBe have no interest in that, so long as the mainstreammedia lump border security with kicking the family dog and child abuse.

We can defend Iraq’s borders, but not our own.  I’d say we have a serious management problem.

FATCA Hype: The World is Still Here

Speaking of money models.

Several reader asked me about the panic emails sent around by unscrupulous markets which held the US Dollar would collapse as soon as FATCA came in.

That’s the bill that would require tax-cheats to report accounts over a certain size domiciled in other countries.

As Forbes reports this morning, “FATCA is finally here – even in Russia and China.”

And as I’ve been telling you, TEOTWAWKI looks more like 2022, or at least 2017.

Oh, and the world hasn’t fallen apart.

More after this…

   

Climbing the Wall of Worry

Have to say, the rest of the week could be pretty good for markets.  The Dow went through a bit of a decline, but as we explained to Peoplenomics readers, there’s a reason for that.  Today, it wouldn’t surprise me to see a nice upside move, as markets often go into rally mode before major holidays.

The markets are flirting with new highs, and I’ve been predicting a major blow-off (parabolic) advance for a while now. 

Just like before you work out, you do a little warm-up action, so too, the markets may be just backing and filling before taking the S&P over 2000 and the Dow over 17,000… but we shall see.

Gold and silver are moving up again, too.  Same with copper prices…but I thought the PTB were still setting the groundwork for plastic pennies?  A token of their appreciation for all your hard work when they come….which will all depend on inflation, hyperinflation, and melt values…

Urban Living — Spendy

We get into it more in the Coping section this morning, but in playes like Ft. Wayne, the cost of urban living is high…which is a good read over here.  Who would have though of Indiana? YGTBSM

Singapore prices have dropped again(if you were planning to relo).  But Madhattan?  Fugggitaboutit.

Gas Prices Up

If you’re going over the river and through the woods to grandma and grandpa’s lake place, might want to tank up on gas this morning on the way into the treadmill.

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Our “renting your life” discussion sure touched a lot of people’s nerves.

Reader Victoria found a ‘lil gem over on YouTube:  I didn’t know there was a musical titled :”Rent” but then I live in the outback…

When they act tough you call their bluff
We’re not gonna pay
We’re not gonna pay
We’re not gonna pay last year’s rent!
This year’s rent! Next year’s rent! Rent rent rent rent rent!
We’re not gonna pay rent! ‘Cause everything is rent!

A sample of the music here… 

I can’t hope but notice that the talk about rent cuts for NYC homeless has managed to fall apart.

And as housing prices recover, so are hefty rent increases in the East Bay area (Oakland).

And as if we need to be reminded, a reader in Hawaii sent us this backgrounder…

George,

Honolulu is the most expensive city in the country to live… and the hardest to make a ‘living wage’ (according to Yahoo).  I’ve done fair, with a decent career.  In past years I’ve been renting from long-term owners of paid-off apartments who knew me personally and were not terribly aggressive with their rents.  I’ve been a good tenant who takes care of the places and does my own maintenance and painting.  Most recently renting one of a 4-plex cinder block building from an old Chinese man where I refurbished the apartment myself before moving in.  He was most grateful to be saved the work.

Well, the old man sold out.  Put the 50-year old building on the market and sold it for $1.2mil.  I have a lease until Dec. for $925mo, but now a reality sandwich is about to hit.  The new owner is a Taiwanese-American woman fashion-designer who grosses $3mil/year and has her own real-estate and construction contracting company (more chinese workers) and wants to completely refurbish the building internally… including some structural deficiencies.  The real-estate turnover in Honolulu in recent years means that these new owners with ever larger mortgages need to collect ever larger rent payments, and it is forcing out increasing numbers of wage-earners who can no longer afford a place to live.  I’ve been skating under the market value of rents for years, but no longer.

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There are always multiple ways to view history – even as it is occurring before our very eyes.

When the US was in its last economic depression, we had the roll-out the new government in Germany back in the 1930’s.

To follow up on my Sunday post about the new [global] Caliphate, I’ve been eyeing a timeline of Germany in the 30’s (try here) to see if the ISIS/ISIL people are somehow (perhaps unwittingly) falling into an historical rhyme with Hitler’s rise to power?

As long-time readers know, I’ve been debating for some months now, whether the economy peaked (for good) in 2000 (the Internet Bubble) and whether the present illusion of recovery is simply due to massively dislocated economic resources.

In 2000, the high Dow was around 11,723.  And, when we put that into the Minneapolis Fed Inflation calculator, we infer that the Dow would only need to be at 16,080 in order to have held onto parity on a purchasing power basis.

Since the Dow closed Friday at 16,851, an initial argument could be made that investing in the Dow would have netted a person a 4.8% return since 2000.

Frankly, holding on to the Dow stocks for 14.5 years for a real return of 4.8% doesn’t exactly get me excited, but maybe you have a lower threshold than I do.

But just “buying the Dow” was an incredibly risky thing:  The Dow gets jiggered because of the changing economy and when companies run into bad sledding:

AT&T Corporation, Eastman Kodak Company, and International Paper Company were replaced by American International Group Inc., Pfizer Incorporated, and Verizon Communications Inc..

SBC Communications Inc. was renamed AT&T Inc. after it acquired the original AT&T.

Altria Group Incorporated and Honeywell International Inc. were replaced by Bank of America Corporation and Chevron Corporation.

American International Group Inc. was replaced by Kraft Foods Inc.

Citigroup Inc. and General Motors Corporation were replaced by Cisco Systems, Inc. and The Travelers Companies, Inc.

Kraft Foods Inc.

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I’m heavily into templates.  You know  – everything from some simple task like drawing, painting “by numbers” or any of the million and one things that go into making hypercomplexity work.

Short form there’s no question that templates work.  Take Obamacare, for example.  The idea is simple:  spread around costs more equitably and everyone should be better off.  But the real outcome of Obamacare (which missed the mark [single-payer]) is nothing more than a conglomeration of bad ideas, but ideas which profit the insurance industry.

Not a day goes by that headlines don’t cross the wires that back-up my assertion

• Headlines the L.A. Times:  “Confusion over doctor lists is costly or Obamacare enrollees in state..”
• And elsewhere, the shortage of primary care docs is about to get worse.

And the problem just gets worse from there.

In the past week, I’ve been going around with my local doc’s billing office:  When I moved from a high-end (car payment sized medical payment monthly) to Medicare, I duly informed my doc’s office.  Yet, somehow, the latest “lube, oil, and filter” bill went to the old insurance outfit and so far it looks to be resolved with a $65-dollar copay for services that in fact should cost only about $250 (max, being generous here) but that get billed to an insurance company at just under $500.

One of the biggest scams in America – that somehow the Federal Trade Commission doesn’t touch – is this horse-pucky of billing different people different rates.

It’s like when I had my (burst) appendectomy back in 2006, or so:  There “rack rate” was $17,000 and change.  But the Big Insurance Company rate was only $7,900.

The FTC (and other pseudo-consumer groups) make specious arguments that the reason this is all “OK” is that the Big Insurance Companies have was amount to “bulk purchase agreements” where statistically they will buy so many surgeries per year and that’s why the insurance company gets a lower rate.

But, in fact, the delivery is the issue here:  The Big Insurance Companies were buying healthcare wholesale – marking it up dramatically – and then retailing it at a higher price than their costs so in practice, they made money both on the mark-up as well as an intricate system of co-pays.  Toss in the annual deductible, that varies by plan, and excluding certain procedures and costs, and pretty soon you’ve got a hugely profitable business.

The real money is medicine is not in making people well.  It’s in the continuous bloodletting of their wallets.

And that’s where we are with Obamacare.

The reason that the insurance industry gives millions to the political campaigns of senatoids, congressoids and state legislators is not so they will come give vision and motivation speeches to their executives cadres.  That’s what they’d ask you to believe, but any fool can see the ugly reality here is simple:  They’re just looking to keep “buying” that amazing profit margin that comes from a multi-tiered business model based on entirely fictional costs.

Thinking back to my appendectomy, I say a $6-single tablet of Tylenol on my bill.  Arguing the point it was explained to me that yes, the pill was almost free, but I was paying for the record-keeping.  Eventually we negotiated our way through that, the Big Insurance Company that had screwed up on my coverage finally paid the bill (the $7,900 one) but not before the “direct payment good squad” didn’t first try to extort $17,900 out of me for the same service.

But this is a fine example of how “law” – nominally supposed to protect people – fails but it readily twisted into a profiteer’s delight.  If law were rational (no worries, it’s not) it would note that the hospital end customer is the patient who receives services is being unequally billed.

The reason, obviously, that the FTC (or whoever) isn’t all over this like white on rice is because it creates jobs, and for the past 40-years, increasingly more campaign money.  Hence, the twist in contract law:  The services are sold to an insurance outfit, which then is doling out the healthcare, so under contract law the two services (deliver to potentially the same person) are treated as different sorts of transactions.

Same hospital, same docs, same nursing staff.  The FTC has no balls in this, however, because there’d be a massive unemployment problem (and there for the juicy campaign dollars) as a result.  So now, with few changes, everyone is being herded into the insurance industry at gunpoint.  What’s not to love?

That was sad, though momentarily I had held out the impossible hopes that Obamacare would resolve such crap.  So far, it hasn’t.

In fact, next level play has arrived:  In a follow-up to our meeting last week, Oilman2 has spotted the “new game” – which is where the doctoring business is now busting people – sending them down the road  – because of their credit scores:

Three weeks ago, wife went to our family practice physician. We been using her since she started practicing medicine 20 years ago. She has been in independent medical corporations until 6 months ago. She joined a hospital corporation due to the Obamacare paperwork and malpractice insurance regulations changes (squeezing more out of doctors for less coverage). Now she can do as she normally does, operating under the hospital corporations better malpractice umbrella, and off-loading paperwork. Instead of 3 nurses and 6 admin to handle claims, she has 4 nurses and ONE admin.

Her copay is now $55 instead of $35. She cannot accept cash, checks or debit cars – just MC & VISA – no AMEX.

The wife and I have 3 credit cards that have zero unpaid balance, 1 car financed with draw on specific account where we keep 2 notes worth of balance, a mortgage and a note on the farm which we are never late on.

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Our overnight data run with www.nostrcodeus.com web-sweeping software about puked on the word autopilot which was not how I planned to start this morning’s column.

And what it brings into focus is how mass media is massively manic.

Here’s the deal:  The MH370 flight went missing back on March 8th.

I’m an Excel jock, so everything is a date range to me:  that was 110 days ago.

Fast forward to this morning and Google News pops with 12,300 results for “autopilot” and leading the pack is Australian officials announcing that the planes autopilot was likely on.”

A short class in common sense, if we could?  Being a pilot, If I have an autopilot, I use it.  Duh.  There’s plenty else to do when flying besides hand steer.  (Since I don’t have an autopilot, Elaine flies the plane while I navigate or talk to ATC.  In a jet the autopilot doesn’t go shopping.)

The idea that the “autopilot was on” is about as useful, pertinent, predictive, or significant as “The aircraft’s collision avoidance lights may have been on.”

Useless.  Noise.  Impertinent data based wholly on speculation.  Insanity.

I want to learn more about all those computer scientists onboard.  But to tell the public that the “search zone” is moving is an insult to at least half the public’s intelligence.  Obvious to even us barely above average types:  If you don’t find wreckage one place, you move on. Do we need a media frenzy to remind us?   Oh FMTT this is stupid.  Announce finding the bloody plane or STFU.  Move on.

Useful:  If your IQ is above 100, you might want to blacklist any media outfit that doesn’t label this as pandering and hype which it is, and it’s so labeled here.

If I get time, I’m planning to launch a “How many reporters does it take to change a  light bulb?” page.

More after this…

(I may have to enroll in something…)

Personal Income and Other Humor

I don’t know how many of the gub’munt statisticians go on to become joke-writers for late-night TV, but when you read this morning’s personal savings numbers, it becomes clear that the question is a reasonable one:

“Personal income increased $58.8 billion, or 0.4 percent, and disposable personal income (DPI) increased $55.6 billion, or 0.4 percent, in May, according to the Bureau of Economic Analysis. Personal consumption expenditures (PCE) increased $18.3 billion, or 0.2 percent. In April, personal income increased $49.9 billion, or 0.3 percent, DPI increased $50.8 billion, or 0.4 percent, and PCE increased $2.3 billion, or less than 0.1 percent, based on revised estimates

Personal outlays — PCE, personal interest payments, and personal current transfer payments — increased $18.0 billion in May, compared with an increase of $2.1 billion in April. PCE increased $18.3 billion, compared with an increase of $2.3 billion.

Personal saving — DPI less personal outlays — was $620.3 billion in May, compared with $582.7 billion in April. The personal saving rate — personal saving as a percentage of disposable personal income — was 4.8 percent in May, compared with 4.5 percent in April.

Of course, paying off your credit card isn’t really savings, any more than filling your car up with gasoline is savings but I’m not doing the accounting.  Leave the definitions loose enough and I can show you anything you want for a number.

Stock market looks to open about flat this morning (at least that was the earlier reading) and gold was going through its end of month beat down.

Life in the Datamocracy

*(this will be reposted on my www.datamocracy.com site this morning, too)

The courts have really talked out of both sides of their mouth on life here in the information age

For one thing, the Court has turned down Aereo, which was in the nifty business of pulling “off the air” TV signals and piping them down the internet.  No biggie?  Well, the real deal is the Court just got into the “defending dead industries” position with this one.  Cable operators gotta love it, though and the satellite guys too.  I look for industry contributions in 2016. The internet is gonna cream ‘em though…give it time.  It’s coming.

Meantime the other Datamocracy headlines this morning include how a federal judge has ruled that warrantless bulk surveillance is legal. Oh, crap, like that’s a surprise.

Of course a court’s also saying that what’s on your cell phone can not be searched without a warrant, but it’s likely to be only a matter of time till that falls, too. Police will press on this issue as hard as they can…

And then it will go to the Supreme Court and there will go that Constitutional guarantee about privacy of your papers.

Six Country War 

It’s now a REGIONAL WAR IN MIDDLE EAST

Other than the mythical savings rate and searching for search news, the elephant in the room is there are now six countries involved in the fighting with ISIS/ISIL and the Saudis on one side and Syria, Iraq and Iran on the other. 

Six countries, in all, by the account on the Debka site over here.  “As firs US advisers reach Baghdad, Iranians and Saudis airlift weapons to opposing sides in Iraq.”

I promise to take your editorial guidance here, but when six country are throwing in weapons isn’t that up to your definition of regional war?   It is mine…when Syrian planes are bombing runways with Saudi plans on them.

Cashing In on Fads

Fine example about to pop:  GoPro – the portable camera folks.  Can a great product make a great company?  Put’cher money on…new shooter….coming out….

Free Lunching Notes

From our news analyst fellow in Winnipeg:

Dear Mr.

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We’re going to ponder upgrading America to Internet-based democracy this morning.

In a 1979 paper, a very forward-thinking researcher described the problem of “datamocracy” and proposed “Strategies against computer abuses and in information tyranny.”  Unfortunately, that horse if out of the barn now…so it’s time we look at some of the options ahead.

After suggesting innumerable times that Congress adjourn after immediately installing a secure online “Congressional Session” software package, and seeing that nothing is coming for such forward thinking….well, about here we get into some really revolutionary stuff.

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Well, we can’t be right all; the time, can we?

“Hello George:
While I am in no way enamored of the leadership or policies of President Obama, in the interest of fairness, the brief YouTube video where Obama speaks of surrendering rights to an all powerful Sovereign is cleverly edited with certain phrases taken out of context and then strung together to make it appear more sinister.
The full context of the speech is here.
More on how this was done here:

Here’s the actual context of Obama’s comments:

Leaders and dignitaries of the European Union; representatives of our NATO Alliance; distinguished guests: We meet here at a moment of testing for Europe and the United States, and for the international order that we have worked for generations to build.

Throughout human history, societies have grappled with fundamental questions of how to organize themselves, the proper relationship between the individual and the state, the best means to resolve inevitable conflicts between states.  And it was here in Europe, through centuries of struggle — through war and Enlightenment, repression and revolution — that a particular set of ideals began to emerge: The belief that through conscience and free will, each of us has the right to live as we choose. The belief that power is derived from the consent of the governed, and that laws and institutions should be established to protect that understanding.  And those ideas eventually inspired a band of colonialists across an ocean, and they wrote them into the founding documents that still guide America today, including the simple truth that all men — and women — are created equal.

But those ideals have also been tested — here in Europe and around the world.  Those ideals have often been threatened by an older, more traditional view of power. This alternative vision argues that ordinary men and women are too small-minded to govern their own affairs, that order and progress can only come when individuals surrender their rights to an all-powerful sovereign.

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