Mish's Global Economic Trend Analysis

---

• Driverless Cars in 30 US cities; Death of Cars? Convenience vs. Cost; Comfortable Predictions
• Warmongers United: Juncker Requests Creation of EU Army; Peace by War
• 70s Have Returned

Driverless Cars in 30 US cities; Death of Cars? Convenience vs. Cost; Comfortable Predictions Posted: 08 Mar 2015 11:49 PM PDT I remain amused at skepticism towards driverless cars and trucks. Most believe the idea is at least a decade off. Some think it will not happen in a significant way at all. My position has been and remains, driverless vehicles will be widespread before the end of this decade. Please consider Self-Driving Cars Will Be in 30 U.S. Cities by the End of Next Year. Automated vehicle pilot projects will roll out in the U.K. and in six to 10 U.S. cities this year, with the first unveiling projected to be in Tampa, Fla. as soon as late spring. The following year, trial programs will launch in 12 to 20 more U.S. locations, which means driverless cars will be on roads in up to 30 U.S. cities by the end of 2016. The trials will be run by Comet LLC, a consulting firm focused on automated vehicle commercialization. "We're looking at college campuses, theme parks, airports, downtown areas—places like that," Corey Clothier, a strategist for automated transportation systems who runs the firm told, The New York Observer. He explained that they're focusing on semi-controlled areas and that the driverless vehicles will serve a number of different purposes, both public and private. The vehicles themselves, which are all developed by Veeo Systems, will even vary from two-seaters to full-size buses that can transport 70 people. At some locations, the vehicles will drive on their own paths, occasionally crossing vehicle and pedestrian traffic, while at others, the vehicles will be completely integrated with existing cars. Death of Cars? If you think this will stop with college campuses, theme parks, and airports, then you probably believed the need for keypunch operators would not go away, that autofocus cameras would never be reliable, that the internet would not make mincemeat out of many travel agencies, and digital would not replace film. I would not go as far as to say this is the death of cars. Rather, this is the beginning of the end of personal car ownership for millions of city drivers. But, it is also the eventual (and sooner than you think) death of long-haul trucking jobs, taxi drivers, and various chauffeur jobs. Question of Timeframe I have heard countless arguments many times over about lawsuits, about inner-city traffic jams, about ice and snow, about computer malfunctions, about road work and changing rood conditions, and about everything else including motherhood and apple pie. I dismiss all those arguments just as I dismissed arguments that digital would not replace film. The only debate is how fast this happens. Programmed cars can handle adverse road conditions better than all but the most skilled drivers, and certainly far better than those not used to driving in snow and ice. Liability issues will likely be settled by legislation in advance. An internet connected car can certainly pick alternate routes better than non-connected humans. In 2006, had I said we would have driverless cars on the highways in 10 years in thirty cities you might have thought I was crazy. Well here we are. It's just test-mode now, but test mode will not last long. The pace of improvement is guaranteed to happen in one direction only - faster. Will test to approval take more than 10 years? Five? Three? Will trucks and cabs lead, or follow? Comfortable Predictions I believe most long haul truck driving jobs will vanish in ten years. Gone in five or six would not surprise me. The shorter timeframe would require a pretty fast ramp in truck hubs, assuming my truck hub model is the correct one, and it may not be. If the truck hubs I envision as necessary are not needed, then expect the jobs to vanish faster. Taxi drivers? Who need em? They will be gone in 5-6 years, in many places. Cost vs. Convenience I will cling to my car. And so will millions of others, at first. That's why the death of cars will not happen as fast as the death of paid driver positions. Yet, millions of aging boomers with diminishing eyesight, slower reaction times, and poor night vision will welcome driverless taxis on demand. So will millenials and many inner-city drivers who never leave the city. The cost of a car is high. But the convenience of having a car outweighs that cost for now, for most. Ultimately it is convenience of having a car in your garage vs. the cost of having that car that will decide how quickly private car ownership goes away. Convenience is also a two-way street. How many moms would love the convenience of not having to take their kids to and from soccer games or music lessons several times a week? Pent-Up Demand to Dump Cars Cars will be around for quite a long time. It's ownership of the cars, and how many there are, and who will drive them (if anyone), that are in question. Economists see a pent-up demand for millennials to buy cars. I see a pent-up demand for boomers to get rid of them. Demographics, technology, and changing social attitudes suggest I am on the right side of this debate. For more on driverless vehicles, please see .... Never Has Arrived; The Last Mile Robot Truck Convoy Tests in Nevada; Driverless Trucks Before Cars, and Before the End of the Decade Driverless Cars Legally Hit Roads as California Issues Licenses; The Last Mile Self-Driving "Fully Automated" Vehicles on German Autobahn; Supply Chain Math; Uber and Khan Academy Driverless Cars on UK Public Streets Starting January; Transforming Personal Mobility; Taxi and Truck-Drivers Targeted The heyday of car ownership is in its twilight years. The paid driving jobs will vanish much sooner. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com  Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

Warmongers United: Juncker Requests Creation of EU Army; Peace by War Posted: 08 Mar 2015 04:54 PM PDT Warmongers United European discussion of Russia has gone from dumb to dumber. Of course, the highly regarded "Warmongers United Think Tank" (WUTT) would dispute that. "Warmongers United" believes more armies, more missiles and more fighting are precisely the right thing to do. What? Haven't heard of WUTT? The think tank consists of a various collection of folks itching for a war with Russia, Iran, and Syria, preferably all at once. True believers want to include China in that group. In general, WUTT wants to set the world right (just as they insisted a war with Iraq, Vietnam and other places would set the world right). John McCain is the official spokesman for Warmongers United in the US. Jean-Claude Juncker assumed that role today for Europe. Hillary Clinton and Jeb Bush both hope to assume global leadership in 2016. Juncker Requests Creation of EU Army Please consider Jean-Claude Juncker Calls for Creation of EU Army. The president of the European Commission has called for the creation of an EU army in order to show Russia "that we are serious about defending European values". In an interview with German newspaper Die Welt, Jean-Claude Juncker, who leads the EU's executive arm, said an EU army would let the continent "react credibly to threats to peace in a member state or a neighbour of the EU". In an interview with German radio on Sunday, Ursula von der Leyen, Germany's defence minister, also spoke in favour of a European army, pointing out that a brigade of Dutch soldiers was already under German command. "I think that in the Bundeswehr we would also be prepared, in certain circumstances, to put units under the control of another nation," she told Deutschlandfunk. "This interweaving of armies, with the perspective of one day having a European Army, is, in my opinion, the future." Mr Juncker, a former prime minister of Luxembourg, whose army consists of 900 professional soldiers, has long argued for the establishment of an EU force, making it part of his foreign policy plan during the selection process for the presidency of the commission in 2014. British prime minister David Cameron argued against his appointment, claiming that Mr Juncker was too much of a federalist for the position. Mr Cameron has repeatedly reassured eurosceptic MPs in his own party that Britain would "never support" any form of EU army. Responding to Mr Juncker's comments on Sunday, a government spokeswoman said: "Our position is crystal clear that defence is a national, not an EU responsibility and that there is no prospect of that position changing and no prospect of a European army." Some MEPs defended the idea, arguing that such an army should be controlled by the European Parliament. "I support Juncker in building an EU army if it means the termination of all EU member states' armies and is controlled by the European Parliament," tweeted Jan Philipp Albrecht, a German Green MEP. But eurosceptic parties criticised the suggestion. Mike Hookem, a defence spokesman for the anti-EU UK Independence party, said: "A European army would be a tragedy for the UK. We have all seen the utter mess the EU has made of the eurozone economy, so how can we even think of trusting them with this island's defence." Nato was not a sufficient protection for the EU as not all EU members are part of the alliance, according to Mr Juncker. Defend Values by Warmongering There is nothing better than warmongering to defend "European values". After all, war is the European way! NATO Insufficient If NATO is insufficient, how about a call to disband it? The answer is less warmongering is never acceptable. We need US forces, coupled with NATO forces, coupled with regional forces, coupled with European national forces, and coupled with other national forces in Asia, primarily Japan, Australia, and New Zealand. There can never be  too many military alliances. Thus, when it comes to Japan, Australia, and New Zealand, the world needs a JANZ alliance, an NZA alliance, a JA alliance, and a JNZ alliance. The more the better. Of course, each alliance group needs its own set of tanks, missiles, guns and troops. Need for Enemies If there are no hostile countries in an alliance area, then its axiomatic to invent some or create some. Let's not forget the need to hold parades right on the borders of hostile countries, even peaceful countries. History suggests that making new enemies is quite easy. Still struggling? Note that Japan is a fantastic addition to any alliance because of its long-standing feud with China. Forge an alliance with Japan and you have the built-in (and very welcome) enemy of China. War Pays for Itself The only possible concern right now is how to pay for this. Such concerns are ridiculous. Printing money is the easy answer. We need to take advantage of this fine opportunity for more war while we can! Of course every sensible person on the planet realizes that war pays for itself.  Iraq, Vietnam, Ukraine, and Afghanistan are perfect examples. Growth Prospects War is the one global growth industry that remains. A simultaneous war with Iran, Iraq, China, and Russia is just what the world needs for growth. Want jobs? Then join Warmongers United today! Demand more wars. Insist on the real thing, not simulations. Peace by War Previous US foreign policy "successes" in Iraq, Iran, Afghanistan, Vietnam and other places without a doubt shows that more warmongering is the only way to peace. "Slight failures" in some places only proves one thing: We did not wage enough war!  Should Russia retaliate with nuclear weapons, fear not. We can blow them up 10 times over while they can only blow us up 3 times over. Besides, it's self-evident that either nuclear war or perpetual war is a "small price to pay" to achieve global peace. Curiously, the only way to achieve permanent peace is to have permanent war. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

70s Have Returned Posted: 08 Mar 2015 03:17 PM PDT Contrary to popular belief the 1970s have returned. I can prove that statement in pictures. First, let's take a look at a few ways the 70s have not returned. 10-Year Treasury Rate In the mid-70s the 10-year treasury rate was 8.4% on the way to 15.32% in September of 1981. Today, we see a very un-70s-like rate of 2.24%. CPI All Urban Consumers - Change from Year Ago CPI All Urban Consumers -  Percent Change from Year Ago We did not see much CPI action that looked like this in the 1970s. Please note both of the above CPI measures are negative compared to a year ago. Manufacturing Employment Manufacturing employment was close to 19 million in late 1973 and early 1974. It peaked near 20 million in 1979. Manufacturing employment is now about 12.3 million. Nothing Like the 70s Closer scrutiny shows none of the following is anything like the 70s. Price trends Employment Interest rates Union membership Number of pension plans in trouble Number of city bankruptcies Robots Phone usage Internet Demographics 70s Return I did find one set of images however, taken yesterday, that are very 70s-like. Liz and Mish Heidi Heidi is a karaoke host at two local places we frequent: The T-Bar on Roberts Road in Island Lake on Saturdays and the Riverside Pub on IL-176 in Burtons Bridge on Friday. Heidi sponsored a 70s only songfest last Friday. Thought I would share some 70s flashback silliness taken with someone's cell phone. Mike "Mish" Shedlock http://globaleconomicanalysis.blogspot.com Mike "Mish" Shedlock is a registered investment advisor representative for SitkaPacific Capital Management. Sitka Pacific is an asset management firm whose goal is strong performance and low volatility, regardless of market direction. Visit http://www.sitkapacific.com/account_management.html to learn more about wealth management and capital preservation strategies of Sitka Pacific.

You are subscribed to email updates from Mish's Global Economic Trend Analysis To stop receiving these emails, you may unsubscribe now.	Email delivery powered by Google
Google Inc., 1600 Amphitheatre Parkway, Mountain View, CA 94043, United States