marți, 8 decembrie 2015

Seth's Blog : The last minute



The last minute

I'm not good at the last minute. It's really fraught with risk and extra expense. I'm much better doing things the first minute instead.

On that topic: If you're hoping for copies of my latest book, What To Do When It's Your Turn, delivered in time for holiday gift giving, you'll need to order it by the end of day tomorrow. Thanks for sharing it.

       

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Seth's Blog : Full speed, then stop, gracefully



Full speed, then stop, gracefully

Quitting slowly doesn't serve you well.

At work or in anything else you do, people will remember how you ended things. All in, then out is the responsible way to participate and to end that participation. Too often, we seduce ourselves into gradually backing off, in removing ourselves emotionally and organizationally, as if making ourselves unuseful for a while makes it easier for everyone.

Professionals bring their A game to work. Every time. (Rare sports analogy: this is how good hockey players skate. Full speed, then stop.)

Of course you will need to close things down, quit your job, move on someday. The responsible way to do that, though, is not to act things out while you agonize over a decision. Decide, give notice, make the transition work.

Dropbox fell into the gradual trap with the Mailbox app they published for the Mac. They didn't support it well for nearly a year, and the last iteration of it broke many of its features. It's as if they wanted people to quietly disappear so they would have an easier time shutting it down.

If you want people to believe your promises tomorrow, it helps if you kept them yesterday.

       

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luni, 7 decembrie 2015

Mish's Global Economic Trend Analysis

Mish's Global Economic Trend Analysis

Bernanke's "Helicopter Drop" Hits Finland; Prime Minister and 70% of Finnish Support "Free Money"; Dauphin Canada Revisited

Posted: 07 Dec 2015 07:31 PM PST

Bernanke's Helicopter Drop Reality

Contrary to widespread popular belief, with special "thanks" to former Fed chair Ben Bernanke, central banks cannot hand out a "helicopter drop" of "free money".

What central banks do is cheapen the price of money by lowering interest rates to absurd levels, hoping that it will spur bank lending.

Actual results speak for themselves. Central banks have created a series of asset bubbles, one right after the other, with increasing amplitude.

Free Money from Governments

In contrast to central bank methods, governments can and do hand out "free money".

In the US, food stamps (now called SNAP), subsidized housing, earned income credit, disability payouts, and various subsidies such as Medicaid all constitute "free money".

True "Helicopter Drop" Hits Finland

Finland is about to take the "free money" approach to a true "helicopter drop" level.

Please consider Finland Government Officials Propose to Give Tax-Free Payout of $870 to Every Citizen Each Month.
As a way to improve living standards and boosts its economy, the nation of Finland is moving closer towards offering all of its adult citizens a basic permanent income of approximately 800 euros per month.

The monthly allotment would replace other existing social benefits, but is an idea long advocated for by progressive-minded social scientists and economists as a solution—counter-intuitive as it may first appear at first—that actually decreases government expenditures while boosting both productivity, quality of life, and unemployment.

"For me, a basic income means simplifying the social security system," Finland's Prime Minister Juha Sipilä said last week.

Though it would not be implemented until later in 2016, recent polling shows that nearly 70 percent of the Finnish people support the idea.

According to Bloomberg, the basic income proposal, put forth by the Finnish Social Insurance Institution, known as KELA, would see every adult citizen "receive 800 euros ($876) a month, tax free, that would replace existing benefits. Full implementation would be preceded by a pilot stage, during which the basic income payout would be 550 euros and some benefits would remain."
Pilot Stage - Dauphin, Canada

The article cites a ridiculous scheme tried in Dauphin, Canada from 1974 through 1979.

Huffington Post author Zi-Ann Lum proclaims A Canadian City Once Eliminated Poverty And Nearly Everyone Forgot About It.

Read the ridiculous hype and see if you can spot the obvious flaws. Ready?

The problem with superficial analysis by Lum and others is they only focus on half the equation. Yes, citizens of Dauphin benefited, but it was at the direct expense of everyone in all of Manitoba that had to contribute "free money" to residents of Dauphin.

Were the same scheme available to everyone in Manitoba, the money would have had to come from all of Canada.

And for all Canadians, the money would have had to come from Martians.

Nonetheless, in spite of such obvious flaws, economic illiterates have latched on to the free money scheme.

Why Stop at $876?

None of the free money jackasses have bothered to figure out that government programs always cost more and always deliver less than promised. The only reason Dauphin appears to be different is the city was small enough and the program was stopped before a cascade effect kicked in.

In short, such schemes may appear to work for an isolated locality (at the expense of everyone else), but the program cannot feasibly scale to an entire nation.

More, More, More

If this inane proposal gets off the ground, $876 a month ($10,512 a year) will no longer be a living wage (foolishly assuming that it is a living wage in the first places). Every month, the citizens will demand more, and more, and more.

I can hear the cries across the Atlantic ocean already. "It's NOT enough!"

Hyperinflation Events

Government sponsored economic proposals of this kind are precisely what is behind hyperinflation events.

In Finland's case, thanks to being a part of the eurozone, Finland cannot print money. That is the only possible salvation to this preposterous idea. The trial will necessarily implode before it causes damage to the entire eurozone.

Bear in mind that as with Dauphin, Canada, such schemes can appear to work for a while.

However, simple logic and 6th grade math is all one needs to understand the sheer Ponzi-like idiocy of the idea over the long haul.

Mike "Mish" Shedlock
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.

"Various Paths" of UK Subservience to Full EU Integration; Cameron's Brexit Appeasement Bluff

Posted: 07 Dec 2015 03:18 PM PST

Much like a six-year old kid on a playground lot, UK prime minister David Cameron promised to take his marbles away, if he did not get the steelie he wanted.

On December 4, the Telegraph reported the bluff this way: David Cameron May Campaign for Brexit, Allies Say.
David Cameron has privately conceded he will have to campaign to leave the European Union if he continues to be "completely ignored" by Brussels, the Daily Telegraph has learned.

The Prime Minister has made clear to his closest allies that he will lead the "Out" campaign if he considers the result of his renegotiation with Brussels to be unsuccessful.
Definition of "Unsuccessful"

Of course, for Cameron to actually recommend Brexit, all depends on the definition of "unsuccessful". His past actions indicate a high threshold for giving as much as it takes to get a deal done.

On December 3, and as a prelude to what I perceive as a Brexit bluff, the Financial Times reported EU Leaders Balk at New Treaty Demands from Cameron.
One EU diplomat privy to the conversation claims that on Sunday, when Mr Cameron told Mark Rutte, the Dutch prime minister and close ally, of his revised treaty change strategy, Mr Rutte replied: "You cannot be serious, you cannot be serious, you cannot be serious."
It turns out Cameron was indeed "not serious" on his demands.

If Cameron has to give more than British citizens will allow or less than EU leaders expect, then Cameron inevitably plays the "delay card".

And so it was. When EU leaders would have no part of plan to limit British welfare payments to migrant workers, Cameron did the only think he could do: punt.

Cameron Punts on Deal

On the same day, to the relief of the Brussels nannycrats, Cameron Gave Up on 2016 Deal With EU.
At a series of meetings this week the British prime minister told EU leaders he had "changed his mind" and now needed immediate treaty revisions enshrining a four-year benefit ban if he was to campaign to keep Britain in the EU.

But his push for a December deal was abandoned on Thursday during a call with Angela Merkel, the German chancellor. Downing Street said "difficult issues" remained and that it was unrealistic to think they could all be settled before the meeting on December 17-18.

The prime minister is now focused on concluding a deal at a second summit in mid-February, leaving open the possibility of a British referendum in June.

His decision to ease the tempo was greeted with relief in European capitals.
The above set of maneuvering is what led to the above December 4 Telegraph headline "David Cameron May Campaign for Brexit".

Unbelievable Grandstanding

Cameron's Brexit threat reeked so much of unbelievable grandstanding of a purposely manufactured crisis, I did not even comment on it at the time.

Today, the EU is back in action as Tusk Urges Flexibility on Cameron's Welfare Demand.
EU leaders must urgently overcome differences on David Cameron's "difficult" migration demands and set the direction for a compromise deal as quickly as possible, the official brokering Britain's EU reform deal has said.

Donald Tusk, president of the European Council, is teeing up December's summit of EU leaders as a pivotal debate on Britain's "most delicate" request: a four-year ban on benefits for new migrant workers that has divided the union.

In a letter to EU leaders, Mr Tusk described "good progress" made in most areas of the UK package of demands. When it came to British demands on sovereignty, competitiveness and safeguarding the rights of non-eurozone countries in the single market, he said a deal looked within reach in time for a second summit next February.

[Mish Comment: Progress was made because Cameron accepted a bunch of unwritten promises and wishy-washy statements instead of iron-clad treaty changes.]

"I will act as an honest broker but all member states and the [EU] institutions must show readiness for compromise for this process to succeed," Mr Tusk wrote.

Downing Street welcomed Mr Tusk's "ambition to table concrete proposals in February" and said his letter marked "another step forward in the negotiation".

EU diplomats involved in the process say Mr Cameron's position has hardened in recent weeks, with the prime minister pressing for fast-tracked treaty change on benefits rather than accepting a Brussels-brokered compromise that would require substantial reforms to the British welfare system.

This is setting the stage for a clash with eastern European leaders, who have warned they will oppose anything that is discriminatory against EU citizens doing the same job as a British worker. Countries such as Poland, Lithuania and the Czech Republic have urged Mr Cameron to reform the generous UK tax credits system, rather than change EU treaty rules and thus condone discrimination.

Mr Tusk is more positive — albeit in general terms — about the other areas of the UK reform agenda. He notes the final deal will aim to lay down principles to avoid discrimination against non-euro countries, mentioning work on a brake mechanism that would allow countries "to raise concerns, and have them heard, if they feel that these principles are not being followed, without this turning into a veto right".

[Mish Comment: That is precisely what I was talking about above. Cameron accepted a mechanism to allow the UK to "raise concerns". And of course those concerns will be promptly ignored if not laughed at. The UK needs treaty changes not a mechanism to "voice concerns". ]

Addressing Mr Cameron's separate demand that Britain be excluded from the EU's mantra of "ever-closer union", Mr Tusk diplomatically noted that the treaties already allowed for "various paths of integration".

This indicates EU leaders are willing to give Mr Cameron support on this issue, but may squabble over the final wording when the precise texts and legal documents are circulated next year. 
"Various Paths" of UK Subservience to Full EU Integration

It should be perfectly clear precisely what's going on here. Cameron purposely started a fistfight by threatening to take away his marbles. But that was all for show. When push comes to shove, he will accept nothing less than full EU integration.

Matthew Elliott, chief executive of Vote Leave, sees things exactly the same way.

"David Cameron is only asking for trivial things, not the 'fundamental change' he used to say we need. That is why he is now having a manufactured row with the EU to try and make his renegotiation sound more significant than it really is," Elliott correctly commented.

Various Paths Defined

There is a roughly zero percent chance Cameron gets what he says he campaigned for. It will be interesting to see what kind of meaningless phraseology he finally settles for.

Here are the two paths to full subservience.

  1. Fast
  2. Slow

Something will have to blow up really big for Cameron to actually campaign for Brexit. That's possible, just unlikely.

Mike "Mish" Shedlock
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.

Energy Price Deflation: Crude Dips 6% to 7-Year Low; Gasoline Below $1.50; Central Banks to Blame for What's About to Happen

Posted: 07 Dec 2015 11:31 AM PST

Perverse Central Bank Battle

In the perverse central bank battle to defeat price deflation, the central banks are having a rough go of things.

The price of West Texas Intermediate (WTI) light sweet crude is down 6 percent today to lows last seen late 2008 and January 2009.

West Texas Crude Monthly



There has not been a WTI monthly close lower than $38.69 since May of 2004 when it closed at $37.04. A chart of Brent crude looks similar.

Brent Crude Monthly



Saudi Arabia Throws Down Challenge

Last week, oil producers met. Some member states sought production cuts. Saudi Arabia responded with an Output Cut Challenge. 

Saudi Arabia agreed to output cuts if rivals inside and outside the OPEC cartel agreed to cuts. This was a change in tone from Saudi Arabia, but no agreement was reached.

At an informal meeting ahead of last Friday's official meeting, Russia and Iran Rejected the Saudi Proposal.
Saudi Arabia has long insisted it would cut production only if fellow OPEC members and non-OPEC countries joined in. The report quoted a senior OPEC delegate as saying the Saudis would agree to cuts if Iraq freezes production rises and Iran and non-members such as Russia, Mexico, Oman and Kazakhstan contribute.

But Russia and OPEC members Iran and Iraq quickly rejected the idea. OPEC and non-OPEC producers have not cooperated to tackle low oil prices since they joined forces 15 years ago to help the market recover from the 1998 financial crisis.

"We do not accept any discussion about increases of Iran production after the lifting of sanctions. It is our right and anyone cannot limit us to do it. We will not accept anything in this regard," Iranian oil minister Bijan Zangeneh told reporters in Vienna before the informal meeting.
Oil Price Deflation Factors

  • Increased supply, especially in the US
  • Falling global demand, especially in China

Gas Prices Below $1.50

Gas prices are a function of oil prices, state gasoline taxes, and proximity to refineries. As of November 30, Gas Prices Fell Below $1.50 at some stations.
The price of a gallon of regular now stands at $2.04 nationally, down 14¢ compared to one month ago and 74¢ lower than this time last year. In early 2015, the national average dropped near the $2 mark but never crossed it. But AAA and others anticipate that we'll dip below the $2 threshold within a matter of days.

Many gas stations are already well below that watermark. "Nearly two-thirds of the nation's 130,000 gas stations now are selling that gasoline for under $2/gallon, a remarkable change from a year ago, when 0% of stations were under $2," GasBuddy reported this week.

In some extraordinary cases, the price of a gallon of regular is much lower than that—like under $1.50. Several gas stations in parts of Texas are posting prices of $1.40 to $1.45 per gallon, according to GasBuddy. CNN reported on Monday that the nation's cheapest gas is being pumped out of a Sam's Club gas station in Lafayette, Indiana, where a gallon of regular costs an astonishingly cheap $1.39.
US Rigs Down 60%, Production Down 3%

In the US, despite the fact that oil cannot be economically produced at prices under $50 per barrel, production has dropped off only a small amount.

For details please see Oil Patch Problems: Rigs Down 60%, Production Down 3%, $40-$50 Price Doesn't Work.

Central Banks to Blame

Central bankers brought this mess upon themselves. By cheapening interest rates, financing of rigs became too easy. With expectations oil prices would stay high, rig counts soared. Now the energy sector is in a mess.

And it's not just the energy sector that's a mess. Central bank actions lifted asset prices globally. Home prices there were affordable in 2009 no longer are affordable. Millennials cannot afford houses so they hold off on family formation.

Population Deflation

As a direct result of central bank actions, we see self-reinforcing population deflation coupled with asset price inflation. It's especially pronounced in Europe and Japan.

For additional discussion, please see Population Deflation: Spain Joins Germany with Negative Net Birth Rate; Italy on Threshold; Who's to Blame?

Price Deflation a Good Thing

Falling oil prices are a good thing. In fact, routine deflation is a good thing. Even the BIS agrees.

On Sunday, the BIS blamed central banks for "unthinkable" interest rates: BIS Points Finger at Yellen, Draghi: Warns About "Unthinkably" Low Interest Rates, Bond Market "Dislocations"

Finally, please consider Historical Perspective on CPI Deflations: How Damaging are They?

Price deflation is not damaging at all to banks or anyone else. Asset bubble deflation is.

Yet, here we are on the verge of another asset bubble bust, and the Fed not only doesn't see it coming, the Fed will not admit they caused the bubble when it does burst.

Mike "Mish" Shedlock
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.
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Damn Cool Pics

Damn Cool Pics

Fun Film Trivia About Hollywood's Most Iconic Movies

Posted: 07 Dec 2015 01:28 PM PST

Today you're going to learn some fun facts about some of the most popular movies in history.

The Shining (1980) - Director Stanley Kubrick was intentionally rude and unhelpful to Shelley Duvall on set and also directed the cast and crew to do the same. The feeling of frustration and loneliness of Duvall's character really shows throughout the film and results in an amazing performance.



Taxi Driver (1976) - Robert de Niro drove cabs in New York City for a month, mostly working fourteen hour days in order to get ready for the film. He also studied mental illness.



The Shawshank Redemption (1994) - Clint Eastwood, Harrison Ford, Paul Newman and Rober Redford were all in the running to play Red in the film. Red in the novella is a big burly Irishman, however director Frank Darabont wanted Morgan Freeman for his deep voice and a strong presence of screen.



Shaun of the Dead (2004) - When Shaun tells Liz he's going to take her to eat at "the place that does all the fish", you can see when he opens the phonebook that the restaurant is actually called "The Place That Does All the Fish".



Raiders of the Lost Ark (1981) - Steven Speilberg and Melissa Mathison wrote a script while on the set of Raiders. While Mathison was there to visit her husband, Harrison Ford, Speilberg went over an idea he had for a new script, dictating it to Mathison. The script was E.T. the Extra Terrestrial (1982).



Pulp Fiction (1994) - The famous heart stabbing with a syringe scene looks so intense because it was filmed with John Travolta pulling the needle out of Uma Thurman's chest, then the film was run backwards.



Lawrence of Arabia (1962) - Almost all of the movement in the film is shot from left to right, including walking and horse riding scenes. Director David Lean said he shot it this way so the film would look like a journey.



Jaws (1975) - The film was shot at about 25% from water level, so the audience would have the eerie feeling of treading water.



Goodfellas (1990) - The "you think I"m funny, how am I funny?" scene was based on a story Joe Pesci told director Martin Scorsese. As a young man Pesci was working as a waiter and told a mobster at one of his tables that he was "funny", and the mobster became furious. Scorsese let Pesci and Liotta improv the scene and didn't tell the other actors, hence the geniune reactions.



The Godfather (1972) - In 1974, The Godfather premiered on NBC, running from 9p.m. - 11p.m. At 11p.m. the New York Municipal Water Authorities received an urgent overflow report from all toilets flushing at the same time. Talk about being sucked into a movie.



Fight Club (1999) - In the scene in Fight Club where Edward Norton punches Brad Pitt behind the gas station, Norton actually punches Pitt. It was supposed to have been faked however right before the swing scene director David Fincher pulled Norton aside and told him to go for it. You can see Norton smile after the hit.



Ferris Bueller's Day Off (1986) - In order to appear completely drugged out for the film, actor Charline Sheen stayed up for over 48 hours before shooting.



The Exorcist (1973) - Linda Blair who played the possessed teen received so many death threats from extreme religious groups that Warner Bros. Films hired bodyguards to follow her for 6 months after the films release.



The Life Aquatic with Stever Zissou (2004) - The song that plays when Steve is giving the tour of the boat is actually the theme from The Royal Tenenbaums (2001) being played in reverse.



A Clockwork Orange (1971) - When Malcolm McDowell met Gene Kelly at a party years after the film was released, Gene Kelly walked away from McDowell in disgust. He was not happy with the way the song 'Singing in the Rain' was used during the rape scene in A Clockwork Orange. The song was ad-libbed by McDowell.



Citizen Kane (1941) - In the film Orson Welle's character states, "Don't believe everything you hear on the radio!" The statement is a tip of the hat to his radio broadcast of "War of the Worlds" which scared the entire nation and ended up in multiple law-suits.



Blazing Saddles (1974) - Mel Brooks and his writer's were sitting across the table from John Wayne one day at lunch on the production lot. The Duke said he had heard about their new western, the one where they say things like, "blow it out your ass". Mel Brooks replied, "Yes and we'd like you to be in it." John Wayne replied, "Naw, I can't do a picture like that, but I'll be first in line to see it!"



Blade Runner (1982) - The snake-scale scene under the electron microscope was actually a bud of marijuana.



A Christmas Story (1983) - The film was shot in Cleveland and the house that was used in the film was bought in 2005, renovated to the way it looked in the film and is now a fully functional Christmas Story museum.



Edward Scissorhands (1990) - The cookie-cutter houses and neighbors in the film are all based on Burbank, California, hometown of director Tim Burton.
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