Wednesday, September 20, 2017

Puerto Rico could be epic

Eye straight into the place.

Enough disaster to send me to sunday-meeting.

The Trump Bump and the 12% swing in the dollar

The downward swing in the dollar was rapid, and 12%.  Import and import prices jumped, about 20% of the economy.  So we are adding a half to full point to inflation, very  soon and very unsustainable.

The ten year rate will want to rise, and the senators, worst case, are looking at eight hundred billion dollar interest charge, up from five hundred a few years ago.  Interest charges are discovered, in real time.  If they are in the trillion dollar range, the senators will be endlessly haggling over their programs, shut down is impossible to avoid.

Interest charges are priced, in real time. 

You have to read the bill to find out what's in it , so to speak.

We do not know the cost of Obamacare completely, we are discovering it.  Nor we do know if the boomers will stampede.  It is uncertain that the millennials actually agreed to pay over 3.5% of income to federal interest charges.  Defense budgets are whacko all around.

The volatility of interest is quite obvious, 100 billion dollar swings over a year or two.  The senators cannot measure the relative risk among the hundred odd discretionary programs they rely on.  Their word is as good as their willingness to continually haggle and prioritize.

Interest as a fraction of RGDP

See those two peaks at .035?   

This economy cannot do that level anymore, that is why we are volatile  on the right, we hit a bound, a hard bound.

The interest charges have bankrupted a bunch of government  programs.  But the structure of government is very contingent on these programs, they keep the small and mid sized states going.  Hence the senators, seemingly undecided but in actuality they are in DC hovering over these programs to the exclusion of any other business.

Those two peaks at .035  caused the upper bound, they caused a quantization effect.  So, to the right on the graph we do not even test .03.    You don;t need economics to see the issue here, if this is a natural process  then we can infer a regime change, a requantiztion, in the process because the two parts of the graph clearly anti-correlated. So, without involving the economists at all, we might expect a new, larger jump in volatility if we requantizated above the ,035.  It is all about a process somewhere packing sphere and it generates this kind of regime change.

Entitlement slave shortage

Finland’s Welfare State Has a Massive Baby Problem

Public sector unions pummell middle class

Before the welcoming committee even arrived at their front door, the Schurtz family’s first property-tax bill arrived in the mail. “We laughed,” Michelle said. “That’s all we could do.”The Schurtzes paid their first full year of property taxes in 2015. The bill totaled $11,000.When it comes to property taxes, sticker shock is typical in Illinois. From small-business owners in Chicago to suburban dwellers in middle-of-the-pack school districts, long-time Illinoisans are often bewildered as to why they pay the second-highest property taxes in the nation, at an average of more than 2 percent of a home’s value.And the nonpartisan Tax Foundation said Chicago’s record-setting property-tax hike will likely vault Illinois to the top of the table, making the Land of Lincoln home to the highest property taxes in the U.S.

Who got defrauded?

Rodriguez announced in November 2014 that he was running for a board seat and raised more than $50,000 during his first campaign reporting period that ended Dec. 31, 2014, according to the District Attorney’s Office. Prosecutors allege that nearly half those contributions were fraudulent because Rodriguez and Melendrez reimbursed those who gave them.In total, 25 donors, most of them family and friends, were allegedly paid back $24,250. The donors’ names were listed on a campaign finance report that was allegedly signed by Rodriguez under the penalty of perjury and submitted to the commission, prosecutors said.
He won the election needing only half the money, so he returned it.  Where is the crime? If he defrauded the voters then why did they elect him?   Did he defraud the state? Maybe, but the state eventually learned the money was returned.  I see this merely as a paper work error, maybe a misdemeanor.

Tuesday, September 19, 2017

My labor market theory and recesions

I extend the idea of tradebook uncertainty to labor markets and note the large tradebook uncertainty for labor  markets.

Hence, any shock that distorts the labor market means hiring managers must way for the market to clear a bit before hiring, generally that means for all the mass layoffs to stop.

Why mass layoffs?

Generally because companies and institution make employment bets when the labor market is calm.  But the intermediaries are gone, most of the staff hired up and the third party staffers gone elsewhere.  

In California we see this effect.  If something shakes he economy a bit, then public sector slows a bit, except the entire sector moves with Sacramento. But, a few lay offs of teachers will go into a teachers employment market that is not geared up, head hunters are not on the job working this market. The short term bulging makes the labor market uncertain and hiring managers lengthen their employment searches, slow things down.  Teachers should be able to move between public schools and industry faster with less matching effort.

More earthquakes, more hurricanes

We have to retally the black swan costs.  

Unexpectedly, nature may have tipped us into recession. I was thinking it more likely we skated by.  All the cycles remained aligned, long term generation cycle, government cycle, trump hump; and now the first and second of the black swans.  If we do a dip in Q3 below 1% growth, then things get very unmeasurable for three quarters because winter is late in recording and Q1 is government slow down quarter anyway.

With no real government in Baghdad

 Iraqi Kurds are set to vote next week on independence from Iraq in what many say is a popular expression of their desire for self-determination after suffering for a century under war and dictatorship.
Government in Baghdad is about factions splitting the oil pot. mostly idiot Shia religious psychos.  Kurds got better things to do. 

Deplorable cave dwellers

“They’re both kind of very similar,” Jerry Brown said at a climate change event in New York. “You should check out the derivation of ‘Trump-ite’ and ‘troglodyte,’ because they both refer to people who dwell in deep, dark caves.”
Some 140 year old ex-Jesuit priest. 

He is no intellectual but he does know how to manage Cal Dems. Wait until Gavin gets the governorship, we will soon be broke and dating teenagers.

Monday, September 18, 2017

The modern version of Yippie

The Insane Clown Posse or Juggalos   Every rebellious generation hashem.  These are the kids who just wanna have fun and sort out the politics later. The anarchist wing of the libertarian left.
In 2011, the FBI classified the Juggalos as a gang, right along with more infamous gangs like the Bloods and Crips and MS-13. That classification has had a real impact on the lives of ICP fans, as they’ve reportedly lost custody battles, had their attempts to enlist in the military rebuffed and even been fired from their jobs by virtue of their association with an official, FBI-recognized gang.

In a year of white working-class grievances, the Juggalos make for an especially curious test case, too. Hailing largely from the Midwest and South, Juggalos have a significant amount of demographic overlap with the less-educated whites who have been scrutinized as a distinct and powerful voting bloc in the wake of Donald Trump’s election. But most of their political statements up until now have been found in ICP’s song lyrics, like the band’s anti-Confederacy anthem “Fuck Your Rebel Flag” and the movement's insistence that everyone, regardless of race, sexuality or age, can be a Juggalo. “We made the name ‘Juggalo’ to represent all of us: men, women, black, white, brown, yellow, fat as fuck, skinny as a broomstick, gay, straight, bi, trans, young, old and folded and loopy, rich, poor,” Kevin Gill, a Juggalo and speaker at the rally, yelled into the mic, as cries of “Whoop whoop” and several expletive-laden choruses rippled through the crowd. They may have made up a motley and underwhelming crowd on Saturday, but their mobilization represents a particularly bizarre iteration of what so many pundits lament is sorely missing on the left: a nexus between white working-class demographics and a stated, passionate commitment to inclusion, diversity and civil liberties.