Parabolic January?

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The stock futures when I looked were up again this morning.  Several reasons for that, but the main one seems to be the U.S. is beginning to abandon the “strong dollar policy” around the edges.

This has massive implications, but let’s start with the basics.

The “strong dollar” idea is that the U.S. dollar should reign supreme in many aspects of the modern world:  Most international trades and debts are settled basis the USD (US Dollar).  And, that’s a good bit of financial clout, but when you have the pre-eminent military – not to mention some of the world’s best financial engineers, what the hell, right?

(Continues below)

 

EXCEPT that a strong dollar distorts the world economy and literally drives up-and-coming countries to make financial decisions that may not be in our best interests.

For example, there’s talk of a BRICs currency.  (*Brazil, Russia, India, China)  Then we see countries in trouble (Venezuela) looking at a move into a full crypto-based economy.  Which continues to get cheaper, by the way:  The Bitcoins were down in the $10,500 area earlier – just as I’ve been predicting, we’re ‘stuck in the trend channel’ which is going down.

In order to make clear what a decline in the US dollar will mean, it’s easiest if we first look at an extreme case.  Let’s assume what will happen if the U.S. Dollar’s purchasing power (now strong) is cut in HALF.

Not going to be that extreme, but it is likely to come down.

First, a look at the import side:  If the US buck is halved, the price of goods from other countries will double.

This means a car built in Germany, for example, will go up in price.  An interesting best I’ve made in the past when this kind of move became apparent, was to buy a Porsche and drive it while the currency move was going on.  At the end of the two times I’ve ridden that pony, I ended up essentially driving a Porsche free!

That’s because when the move of the currency faded, the prices of Porsches within the US had gone up so much that I made money (slightly better than breaking even) and had a lot of fun in the process.

But now, let’s look at what rising IMPORTS will do to America, right?

You will be almost compelled to BUY AMERICAN because all that stuff coming in from elsewhere would double in price.  America cars.  American everything.

With the corporate tax rate down to 21 percent, what’s the point for Apple to sink more money into China when the landed cost of their phones and such stand to go skyward?  Tim’s no fool – he sees it clearly.  The US is back.

At the same time that import prices would be doubling, the value in onshoring would become dramatic.  Maybe those call centers in the Philippines and Guyana seem like sweet deals now (sweet financially, not user-comprehensible, mind you) but if the US Dollar is whacked in half, suddenly ALL those jobs will be coming back to the USA.

Except, of course, when they get here, they will be automated and therein lies one of the more interesting stories from my personal history.

You see, back in 1983 (and in 1985 when I returned) there was this little company called Micropheripheral Corp in Redmond, Washington.  Just up the street, Ron Judy and colleagues had this other new company going – Nintendo – and Bill Gates was still compiling code in the 520 building.  Forget the Halt & Catch Fire days my buddy Gaye and I have been through.

Point is that Microperipheral was the bleeding edge of outbound telemarketing systems and I was the first person on earth to “run an outbound mission” where my voice said “Please hold, I have an important call for this number…”

Well, one thing led to another. Micropheripheral became Digital Systems International, and that was rolled up by a company that (last I checked) was Avaya and they own the telephone automation world.

Here’s the point most people will miss:  When the US dollar comes down internationally, the economics will shift toward the AI/telephony folks (like Avaya) and we will begin to reap many of the promised benefits of AI, not the least of which is getting the low-end jobs done…just not with people.

In other words, in the long-running time domain of technological change, we will have exported labor jobs while the tech steams ahead for a couple of decades, but when the time is right, we will import back TECH jobs, not stunningly boring machine-operator jobs.

This is one of those areas that the uber-owners of the world don’t talk much about.  But, believe me when I tell you there is a schism between the major ownership classes in the world:  Some want more and more people – with more and more concentration of power.  Such folks are promoting their (heavily socialist) way of thinking – which I’d categorize George Soros, et al in.

But then, there’s this other class of “future owners” – and these would include the Trump-like thinkers who see the future quite differently:  If we are going to be the world’s preeminent tech country, we don’t need dispersion of focus.  We need one language, one concept, and not as many people.  We need clean environment, reliable energy, more time off, but more brains.  We need to move toward stability by modulating the changes of tech to something we can all live with – and prosper from.

Naturally, the political parties are too busy fighting with one another to even think – let alone articulate – this big picture stuff.  But as we have been explaining around the edges in our Peoplenomics.com reports, we have a serious problem of a world that will “our f*ck” itself, resulting in famine and massive die-offs, if we don’t re-model our thinking.

Problem is that many of the financial Genghis Khan class (where I’d lump Soros) go out and buy political parties and social actions in order to win with a tide of lower class bodies rather than understanding and levering technology.

But getting back to point:

When you see the US Dollar begin to weaken a bit, and when you hearing rumbles that the Trump administration is evolving a new concept of the future (it’s why Amazon hasn’t been broken up on anti-trust grounds, for example), this is likely the level where people don’t see it coming.

Halving the dollar’s purchasing power will do lots of other things, too:

Stocks would double.  Price of gold and silver would double, U.S. exports would double.  That would turn around the National Debt rather quickly.  Income taxes would double.  Costs of food would double.  Wage-driven  inflation would appear.  There would be more jobs created – we could have a low-level job shortage.

Concurrently, a revolution in the left-wing education sector would come.  Those who don’t comprehend the new model of makers and doers, who have been busy spawning ineffective me too social media useless texters would have to be removed.  An empowering class of thinking skill promoters instead of ultraliberal social engineering shills would  emerge.

You see, this is why the democrats are on the losing end of history right now:  They are trying to represent the workers…but that’s what’s going away.  The UAW isn’t going to benefit from the onshoring of autos so much as the companies that make robotic assembly lines.  Democrats are still promoting massive immigration, rather than massive AI, you understand.  They are on the wrong side of a massive historical wave.  Even many RINOs don’t get it.

But that IS where the future’s going – with ’em or without.  It’s why Hillary lost.  It’s why the would-be election manipulators in the FBI are going down.  Because at its core, there’s still enough American Knowhow to see a Future and go for it – with gusto!

The picture comes into focus, though, only if you take the time to consider trends at their extremes.  Like this halving of the dollar idea.  Most people don’t have the ability to do that; to see it at the grand strategy level.

Most people are, frankly,  not as bright or as Truth-seeking as we are around here.

But, you’ve now been shown – not much more we can do but keep pushing out Peoplenomics reports for subscribers as we see this big wave coming.  It will wash over some of us with more money than ever…yet there will be those, defending the old paradigms who don’t realize that humans are the new buggy whips.  We’re going to drive technology to a brighter future…

Most people don’t even know this is coming.  You do.

And when you see Apple making a major investment in American tech do not be surprised to see the NE press lash them where they can.  That’s how we’d frame Apple Goes Deeper Into La La Land With Damien Chazelle Project in the NY Times today.

When you read stories like World stocks party like its ’99, dollar wilts again, try not to join the hand-wringing?

It’s all going to be OK…if we remain one nation, indivisible, etc…but there is a lot of bidding against us, no doubt about it.

 

Trump In Davos

Try here – this is how it’s rolling out:

Economic Data du Jour

Durable Goods, GDP, and Trade are all out this morning.  Where to begin?  Here…

Real gross domestic product (GDP) increased at an annual rate of 2.6 percent in the fourth quarter of
2017 (table 1), according to the “advance” estimate released by the Bureau of Economic Analysis. In the
third quarter, real GDP increased 3.2 percent.

Smoking, huh?  Now try this:

New Orders New orders for manufactured durable goods in December increased $7.0 billion or 2.9 percent to $249.4 billion, the U.S. Census Bureau announced today. This increase, up four of the last five months, followed a 1.7 percent November increase…

And then:

Advance International Trade in Goods The international trade deficit was $71.6 billion in December, up $1.6 billion from $70.0 billion in November. Exports of goods for December were $137.6 billion, $3.6 billion more than November exports. Imports of goods for December were $209.2 billion, $5.2 billion more than November imports.

So in summary:

Dow futures are up only 47 as we near press time.

Next week, we will have housing data from Case-Shiller/S&P on Tuesday.  Monday features Personal Incomes…

FOMC is meeting starting Tuesday – and they might make a rate move Wednesday, though I think they might wait a month – depends.

ADP job creation data will land next Wednesday, Challenger job cuts Thursday, and the dance card winds up Friday with the “offishul” jobs data.

More on where this all goes, of course, in Peoplenomics tomorrow for subscribers.

Political Correctness Overdone?

KFC Just Announced Its First Female Colonel Sanders.

And did you see where Burger King slams net neutrality repeal in Whopper commercial?

33 thoughts on “Parabolic January?”

  1. As long as we are going to be in Ireland when everything is Dublin, when you go to sell those stocks that have double you might be able to buy a dozen eggs. These clowns will issue even more debt into an inflationary collapse – peachy ain’t it…..

    • get some laying hens, a greenhouse, chest freezer on dedicated solar backup, and party on wayne! great year to start raising tilapia and fresh water shrimp too…local yocal is the focal

    • If the value of the dollar is doubling.. Then I wonder would the cruise lines be willing to accept half of the dollar bills since the will be worth twice as many shortly.. Heck i would be willing to give them two thirds the dollars.. Wouldn’t that kind of be like a tip. Shoot we’ll have so much we won’t know what to do with it all..have so many I’ll be able to use it like toilet paper..

  2. You left one thing out of the future full of AI and hi-tech — the entitlement net.. In the future, both Republicans and Demos will agree that we need welfare but they will disagree on the form. After all, when all but the tech workers will be out of a job (way fewer auto workers, no low tech jobs, etc and NFL players treated as modern day gladiators) they will have to be taken care of before they revolt. You can’t tell them ‘you get benefits unless you actively look for a job’ because there won’t be any there. So the next future question is, how will the Republican and the Democrats solution to the common problem differ? It can’t differ by much — the parties will practically merge on this one.

    • No, you missed it: This could be when we get to socially revalue.
      Art could go up in value. Teaching and sharing could go up in value. Mentoring. Multi-lingual – doing all the “best case” research to feed into AI and expert systems.
      We can all be learning and making machines – wee could PARTNER with AI to do amazing things. Feed AI and use it for the tough ons: Solve antigravity – cost reduce and form optimize it…
      \
      See, people aren’t looking at what MIGHT be done with AI on the upside. We might be on the verge of massive positive change.

      Imagine going from warring over dirt to living star trek in three generations. THAT is the upside of AI that no one is talking about…yet there it is…
      I have a note to do a Peoplenomics piece on this in Feb or march – not sure where it hits on the schedule…

      • I agree with you that there is upside to AI and art but disagree on who all can be employed doing it. There has to be some education level to program or to even understand the factors which go into antigravity for example — one cannot ask AI to solve a problem without some parameters/initial dataset/programming which a laid off auto worker won’t be able to provide. Mentoring requires some experience in the discipline being mentored for example. Socially revaluing (like art) will be great but what kind of jobs will it lead to? I become multilingual but what do it do with it. It is a continuation of the debate on the value of a purely liberal arts education today. The best education today is tech related, programming related not socially valuable liberal arts. Not sure how that is going to change. Use AI to create better literature and put writers out of business? Have AI convert photos to paint by numbers as you posited today but t he people coloring will be emotionally satisfied but no work I think as hi tech takes over even the lawyer jobs as suggested I think the other day.

      • I am sympathetic with Robert regarding the worry over AI affected masses, which the progressive left almost totally depends upon to achieve and maintain power. The political left will likely move to capitalize on the early worries and adverse AI employment impacts encountered while introducing AI to perform routine tasks. Put another way, convincing millions of unionized Teamsters, Steamfitters, teachers, factory workers, construction workers, transportation employees, warehousing workers, teachers (aka baby sitters), fire fighters and police professionals that their lives will ‘eventually’ get better if they just learn to cope with and accept AI taking over many ‘human’ jobs is not a plausible scenario. Left wing fueled angry masses protesting said AI ascension and their loss of human jobs is seemingly inevitable. Nowhere in our recent past has the politician nor the wealthy elite ever combined to earn or deserve the trust of the humble masses. That’s why the Founders were forced to add the Bill of Rights to the Constitution. Nice dream, and I so like to dream, but the path forward towards this economic AI enabled nirvana is paved with great peril. Queueing the cautionary quote: “Actual happiness always looks pretty squalid in comparison with the overcompensations for misery. And, of course, stability isn’t nearly so spectacular as instability. And being contented has none of the glamour of a good fight against misfortune, none of the picturesqueness of a struggle with temptation, or a fatal overthrow by passion or doubt. Happiness is never grand.” Such is human nature. Take away the struggles and we lose what makes us successful as a species.
        ? Aldous Huxley, Brave New World

      • But wouldn’t the simpler solution be to just take a whack at the excess population via a plague? If it was less likely to kill with a well fed and round of moderately priced chemicals – the sorting selection pressure of ‘how useful are you’ would get applied via the cash in your pocket as the proxy.

      • Don’t think that people will be emotionally satisfied doing nothing.

        Think the tax code needs rewritten as you have eluded to. Give a monthly tax credit to be passed on to an employee for working (human labor is more sustainable than technology – if we do not populate like rabbits) and have a consumption tax so there is a premium on quality and stuff does not break in a week.

        A robotic milking machine does not do a better job than a human, just essentially allows the haves to consolidate more wealth. Though the energy to run a system driven by AI is far greater and more harmful to GAIA than humans.

        Your speaking of Alan Savory’s work, which I employ, is far more labor intensive than a tractor… so not really cost effective, when you consider Work Comp, Payroll taxes and the other headaches of being an employer (given the higher costs). My help visited a robotic milk operation and they cut 90% of their staff going to an automated system and yet that system uses lots of energy and inputs to run. F, the Chinese found that having their slave labor do the job of the conveyors was more cost effective and put humans to work (at slave wages).

        Anyway, employers of Humans need rewarded, as opposed to the current paradigm or the proposed base wage for all utopia proposed by the whackadoodle left and MMT to pay for it.

      • Previous comment-

        They already use machines for milking – doubt that the cows would allow anything more ‘intensive’. . . sounds like you anticipate robots picking up ‘free range humans’ someday!

      • AI will be great up to a point but we are going to have a war with a I eventually hopefully we will win

      • Yep they already have essentially human free milk parlors. The point is that it is completely unsustainable, environmentally unsound – the energy needed for all facets of it and goes with the need for a consumption tax versus a tax on labor to fund government.

        Dont believe in Global warming, but “modern” agriculture is going to leave us with no topsoil, greatly depleted already, which is leading to more severe droughts and flooding, as the organic matter is no longer there to capture rainfall and store it for later use.

        But then, you are some ignorant git who probably has no idea on any aspect of regenerative agriculture.

    • Okay I’m sure you saw my video on YouTube about living on an island with 32 300 other people there’s no money there you see they existed without money so what we have s some people way out there they’re called bankers and they’re trying to control everything through the money but if you watch my video I tell you hate these people are happy without money and they don’t have to work except once a week maybe it’s really easy to survive on an island when Nature gives you everything you need don’t have to pay taxes on income you don’t have to pay property taxes you don’t have to pay state taxes or federal taxes and you don’t have to pay anything like that because there’s no such thing so what we’re saying is you are a slave someone who’s making the money and give it to you it interest do you want to get rid of them do you want to do away with that all you have to do is think that if your thoughts get rid of those who want to put you into slavery then it will happen but you have to do it in Mass you have to start somewhere one person double double double double and then before you know it you’re not enslaved by those evil evil Rothschild banking systems you in control anybody that’s a banker you don’t want to have anything to do with you want to put them out of commission completely because they are not in your best interest the only interest they are interested in is their control over your everyday lives

      • to make America great again it will involve I think you get the general idea it’s about taking those who are controlling you out

      • And that my friends and Neighbors is what Trump’s goal is to make America great again without the bankers who are controlling our up-and-downs and buying everything when you are out of a job they buy your vehicles houses they buy your businesses they buy your Farms because you don’t have any way to pay for it but they do because they make the money out of thin air so that’s why we’re on this thing about putting the Rothschild in the ground and bury it very very deep put them in morial on their says hey we don’t want you we don’t need you you are dead

    • By the way, the more intensive, is utilizing low tech hotwire fences to move the cows, in order to mimic how ruminants used to interact with the grasslands.

    • yeah – I think it’s the Big Picture than the NIM (ninnies in media)_ completely miss having focused to much on periods and apostrophes in life…and pancake! Can we get some pancake over here? (for the media unwashed “pancake” is to keep the shiny noses of the media stars from shining or looking Pinocchio like

  5. George, a super weak dollar with inflation? Sure. Great for debt holders. Plus wages rise last, so a plum to Wall Street too. But aren’t all countries in a currency race to the bottom? Won’t China just out devalue us? Or is that what you’re saying. In the modern age, loss leaders must be so big that only planned, centralized governments (like China) can run their competition out of business? But won’t lenders catch on pretty soon, and raise interest rates? Mike

  6. Yep and I remember when the first computerized machines came on line “why everyone would make more money more time off more vacations more this and more that” all to benefit the wink wink workers of course,and of course the FREE Atm’s were another case well until the people were conned into using them that is.
    As far as making America great again forget it for its never going to happen, for I can’t think of one Empire in history that was ever “great again” after it went down to join all the rest of the great empires,no we will in the end in the pecking order of the world be in the number two or three slot seeing that much of our export data includes the military items planes ships and other weapons…

  7. The question I have is who will be buying the products produced by robots/AI after corporations have fired most of their customers? To me it seems business will end up chasing an ever smaller pool of potential customers. When is the tipping point reached when it all falls apart?
    James Johnson, Ex-nuke

  8. The feds idea of math sort of reminds me of the old story of the three fishermen.
    They landed their fishing boat at the dock went in to see how much since everyone was gone and the only one around was a dock worker he politely told them that he wasn’t sure but give him thirty and if he was wrong he would let them know.so each of the three fishermen dug deep and handed the worker ten dollars.
    The manager came bback later and told him.. Well the actual cost is twenty five dollars here’s five one dollar bills go give the fishermen back the money.
    Well the dock worker isn’t quite sure how to split five dollars between three men.. So he sticks two one dollar bills in his pocket. Gives each of the three fishermen one dollar so each man paid a total of nine dollars.. The question is. Three times nine is twenty seven add the two dollars the dock worker had put in his pocket.. Which makes twenty nine..where did the other dollar go

  10. It maybe off topic — but it might be interesting to George, because it ties into anti gravity matters ;-).

    P.S. Need not be posed.

  13. George, I don’t understand, just 2 years ago you were warning about the secret plots of the one world government elitists to depopulate the planet through the Club of Rome and Agenda 21 initiatives but now you’re saying that these one world elitists (ie Soros) actually want more numbers and now you propose that the world would be more efficient with less people. What happened, what changed??? Oh, never mind.

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