Wednesday, October 01, 2014

No wonder people can't figure out what's going on.

Look at how two different news sources cover the same topic.

U.S. auto sales decline from fastest pace in 8-plus years .

"WASHINGTON (MarketWatch) -- The annualized sales pace of light vehicles declined to a seasonally adjusted 16.43 million last month, pulling back from August's 17.53 million, which was the fastest rate since January 2006, Autodata reported Wednesday. Economists polled by MarketWatch had forecast a pace of 16.5 million for September. Last month's drop was driven by an 8% decrease for cars, and a 5% decline for trucks."

When I read this I let out an audible yeep.

Yet if I go over to BusinessInsider, it's really not all that bad. Look!

US Auto Sales Slow In September.

"September US auto sales came in just below expectations.

According to Autodata, auto sales in September came in at an annual rate of 16.43 million units, below expectations for 16.5 million. "


See... that's barely bad at all!

Now... maybe it's just a typo - but BusinessInsider (wait, let me gather my thoughts so I don't get sued). Forget it. Anything I say about them will probably get me sued. I mean, 16.5 million is close to 17.53%. Kinda.

Get ready for financial winter.

Even the hottest housing markets are starting to cool.

Well - lets start with the elephant in the room. For around the last week - interest rates have ticked up to around 4.12%. Not a big increase, but honestly - enough for the refi segment to start feeling anxious. I think I'm the only one I know who thinks rates are not going to rise. So there might be a bit of panic as rates bounce around a little. It might make people try to rush through that door because they think it's going to close. Sales just are not strong enough to warrant rate increases. I mean, that doesn't mean they wont raise them, but grab your popcorn if they do.

Judging from the amount of people talking about deflation lately - I think I'm still right and rates will only temporarily rise if they do at all. It's even starting to freak me out, and I've been calling for deflation to end the year for months now. Here, here and here.

I didn't talk about housing last week because of those strong new home sales. I suspected they were providing heavy incentives, but I just haven't had time to look back through the data. Obviously someone is juicing something because the whole world looks like shit right now.

This month will be the first that existing home sales with price reductions have not cleared from the previous month in my city. I wouldn't call it alarming, but notable. Real Estate agents still think they are in the zone because reductions are mostly in the 10 grand range.

I'm not all that surprised at all that prices in San Francisco actually fell. It was only a matter of time.  I've lived through enough cycles now that whenever everyone starts screaming about gentrification - the top is near. Give or take a year.

Also notable was how much construction spending fell. Mr S. and I commuted yesterday and as we were driving through Milpitas and Mountain View - it was hard not to notice just how many new buildings had popped up. I think San Jose has three cranes hovering over the city right now. It's been a long time since I remember so many high rises going up there.

I know this is the time of year when construction shuts down a bit because of the weather, but still.

The weather is still fine in California. Sadly.
When the news Ebola had finally landed in the US I told Mr S. - that should make CES interesting this year. It's in three months. It has to be the largest trade shows in America, right? Which made us start searching through Google to see if it was. And it's up there. I'm not sure if it's the largest, but it's got to be in the top 5. There are some other shows that are pretty big like gun shows, but I'm not sure if people fly in from all over the world like CES.

Possibly a few defense shows have that kind of cross traffic from the outside. As it is - almost everyone who attends CES comes back with some kind of cold. It's like clockwork. I managed to escape it one year, but Mr S. got it, and I got the CES ick a couple months after we got back.

The whole time Mr S. and I have been dating, whenever we get one of those horrible colds, we always joked that it's probably Ebola. It was our way to say we felt like death but we are probably fine because there was no possibility on earth you had that.

I guess that isn't funny anymore.

Monday, September 29, 2014



I'm phoning it in today because I have a bunch of douche conferences this week and I don't want to have to delete anything that people might not want to be associated with if they wind up having anything at all I want to talk about. Plus, we are suppose to get back to our normal summer temps. Even though the drought still rages - it felt better for a couple of days with overcast skies. Normally I'm walking this show in over 100 degree temps.





Sunday, September 28, 2014

Rusty VW.



Normally I'm not into that rusty patina thing. And I'm still not sure I am. When I first saw this I liked it, but now that I see it in pictures - I'm not sure. Maybe it looks better in person... Or maybe I'm just starved for new stuff. The guys haven't really started any new trends lately.











Friday, September 26, 2014

OMG. A real life screamapillar.



HT Nothing to do with Abroath.

Your pictures are raping the forest.

The U.S. Forest Service Wants to Fine You $1,000 for Taking Pictures in the Forest.

Apparently - the forest service service thinks it is saving the wilderness from being exploited for commercial gain. No foolies.

Land of the free and all.

What? No Hitler perfume?

Scent of Che? Revolutionary perfumes hit the stores.

"Cuban business group Labiofam have immortalised the Latin American revolutionary icons in a new perfume. Now ardent fans can purchase "Ernesto" which is said to have a woodsy, citric scent with hints of talcum powder. There's also an apparently fruity fragrance called "Hugo" that has a touch of mango and papaya."

Look, I live in the Bay Area. This particular nerve is completely dead. It isn't unusual at all to see hipsters wearing Che Shirts around here. I did find it pretty interesting how the author fawns over Hugo Chavez and Che at the end of the article. You just have to read it.

Trees aren't suppose to be that color.



I had a new set of 50 shades of beige, but we got our first rain yesterday. Just enough to wash the dust from everything. The parade of sad trees continues though. I've been watching this one for about a week. I think the rain actually made it more depressed looking. The Cypress are really having a tough time now and this one probably will have to be cut down.

Thursday, September 25, 2014

Lebanon is going to boil over.

Lebanon is hosting 1.1 million Syrian refugees. Do you know how many people live in Lebanon?

4.467 million.

The refugees total almost a quarter of their population. And things are getting a bit bat shit crazy over there. Tonight I start seeing tweets that the refugees have hoisted the Islamic State Flag in front of the border town Arsals municipal building. In recent days the refugees have been getting attacked since the beheadings of the police officers there. It's safe to say things are starting to get a little tense between the locals and the refugees. 

I was at least able to find a news source covering it from LB International.

That's going to require a whole new friends and family plan.

Wednesday, September 24, 2014

It's the first time that's happened.

Today I was trying to find interesting stuff to write about at a trade show. But I really wasn't finding much until I hit on some privacy glass. You know - the glass they send an electrical signal through and it changes from clear to frosted or even some of it will darken like glasses do. I wrote about it in The world of Next Tuesday. The pictures are in the middle of the post.

It was something I was really interested in, because that stuff is really expensive to make. I've been watching it for years. Hoping for a tipping point to bring the price down.

He was half way through his talk and other people walked up. I am not a paying customer, and I never want to take them away from actual possible sales so I told him I would wait. But he really never seemed like he was coming back, so I went to walk the floor. I was interested enough that after a while I went back when the booth was empty.

When he finally came up to me I said - ya know, if you want people to write about your product you have to talk to them about it. Which probably did come as sharp. I mean, normally if you even look at a person at a booth - they are on you. I'm not exaggerating when I say that I spend a lot of time avoiding eye contact, because that is the start button. You might not even be that interested in the item, but if you make polite eye contact, you are going to have to have a conversation with them. It's just the way things are.

This guy though responds "I have a PR department".

Simultaneously I knew this was going downhill, and the whole thing just made me laugh internally and externally. For every guy like that who makes it in Silicon Valley hundreds of others get crushed. Maybe he makes it - odds are against him. I wasn't offended, it just made me laugh. The more people you can get to talk about your product the better off you are. Even if they are a nobody like me.

I say - so....do you not want to show me the product?

He asks me what I want to know. Of course the first question I ask him is price, because I know roughly what this stuff used to cost about 7 years ago. He doesn't want to talk about that at all. Which basically told me the price had not come down. Maybe it's gone up, because other companies I've talked to about it were right up front. It's pricey, but here is the price.

Then I ask him about the glass because his was the kind that darkens like prescription glasses. But I couldn't see it actually darkening. I was trying to figure out if it just slowly darkened or if you could flip a switch like I've seen with some of the glass. He said it darken slowly. And in the small talk I said - well some consumers might be able to just flip a switch.

But, my last comment didn't help. He replied, well - I know my market. Which I'm guessing is douche politicians. This is the kind of green energy, price is no option kind of product. At this point I laughed and wished him luck.

I only write about it because it was the complete opposite of every other conference I've been to in my life. By nature of you being at this conference means you don't have a market yet. That was the funny thing. All I know is - I've seen a few companies with way less bravado not make it. But, maybe he proves me wrong.

Tuesday, September 23, 2014

Australia's come to Jesus moment.

ISIS flag has been brandished by extremists in Australia for at least two years.

When the news came out that Australia had done a terror sweep, in my head I was like - well, yeah! I was not surprised at all. I'd read the above story the day it came out. I read Australian news all the time. They cover our country better than we do.

It was notable because I go through these phases where I check out the protests. Maybe these signs had been flown there and I just never knew what they were at the time. You get all sort of signs from all sorts of places.

I view Australia as a pretty sharp place and strong on terror. They have always been strong partners. And I think it's relatively hard to get into Australia. Unlike here. So, if ISIS is there - you should hold no doubt they are already here as well.

Monday, September 22, 2014

I guess it's on.

You really can't think of much a worse worse scenario than the one playing out right now. I don't even get the objective. He's just going to chase ISIS over the border to Iraq which they already control anyway. He should have started there in the first place. That whole thing is destabilizing for a whole region.

The boarder countries are filled with Syrians in camps. They can't not take the influx of Iraqis too.

Lebanon has about a million refugees. Jordan half a million. Turkey was at a little more than 3/4 of a million people. All the border countries are under great strain due to the refugees. Feeding, housing and keeping them somewhat healthy. That has got to cost a ton of money. Imagine if a million people strolled up to our boarder. Just in this past few days 130,000 Kurds have escaped to turkey probably putting Turkeys refugee numbers close to a million now. You can see these refugee cities from space!

And then, lets talk about Lebanon. There have been an alarming amount of reports recently of violence from the refugee camps. The refugees are getting attacked by locals. There is a lot of resentment in Lebanon right now because two of their policemen were beheaded bu ISIS and the government did nothing. And now it seems there is some vigilante justice going on. I saw some tweets a few days ago where a group had been slashed with a machete, and others where men were being confined. I don't know what happens if these camps spiral out of control.

All I know is that none of the bordering countries can take many more refugees.

Luna Park. Last.





























I thought he was getting an early start.

Sunday, September 21, 2014

Luna Park San Jose 2014.



Luna Park was yesterday. For some reason I thought it was a two day thing because often these chalk art festivals are. Luna Park isn't and I was pretty bummed. So we planned to go out today and see if there was anything left to photo. Everything isn't as bright as it might have been, but I still got some stuff for you.

Last year will probably always be my favorite Luna Park. It started to rain just as I was getting there. And everyone was leaving, but I was running in to get anything I could. And it was pouring buckets. I could hardly keep my lens clean. Somehow I found the chalk running in the rain beautiful. It made the temporary-ness seem even so more temporary. It still makes me happy when I think about it.

When we heard we might get rain a few days ago, I hoped there would be a rainy Luna Park repeat. But it wasn't to be.



















Friday, September 19, 2014

Today all I want to do is talk about international stuff. But it's Friday, and hell - there will be plenty of time to talk about it next week.

Really - for three weeks I've been trying to get a post out about Syria. I have so many things to say about it I might have to break it up into several posts. It is breathtaking how delusional people are when they talk about ISIS. Flat out delusional. I've been watching the twitter feed out of there for three years. Before twitter made everyone scatter to other places at the beginning of this year.

Half the time it was so extreme I didn't even want to Google translate it. You mostly didn't need words anyway. There are no words. Only a far away stare.

Wednesday, September 17, 2014

More 50 shades of beige.



There is a small possibility we might get some rain tonight, so I had to post my tree shots. You have never seen a group of people so tired of a season as we are. I can't remember the last time it rained. Everything is covered in a layer of dirt. I would die to be able to wash the windows at my house. The whole thing just grates on you. I've lost all sense of what a normal tree looks like. The Willows have all almost turned brown now. Sometimes you can find them in this weird olive/brown.. Normally the hills are a dead grass color, but most of that has blown away and they are the color of dirt. Which is a pretty unremarkable color here.





I got these because I think the wind will probably strip most of the leaves. This is already about half the leaves this kind of tree would have.



People just giving up.






This is a cedar grove. They are on well water and even one of them is still trying to go belly up.







The next two pictures are of the creek bed. There hasn't been any water there in months. It will be interesting to see what happens when the real rain comes.





They shut off flow to all the creeks from the dam, so I was surprised to find water anywhere. It's pretty choked out though. I regretted finding it because of the mosquito's.





Storm clouds of "disinflation" everywhere.



Last month I wrote an article titled "Deflation nation coming to a city near you". At the time food inflation was still going hot and heavy. This has now normalized. I've been saying since the very beginning of the year that without food inflation - things would have looked much different. The thing about food inflation is - it's the easiest type of inflation to sort out and has nothing to do with money printing. It's takes just a few months to get a crop from seed to your table. And farmers in other areas will pick up the slack if they feel they can make money. This often produces bumper crops, like for example corn.

Sure you still have people like Zero Hedge screaming about milk prices being at an all time high. But it takes several years to recoup livestock that was killed off due to drought conditions. Money printing has nothing to do with this. I guess he just ignores the fact that commodities have now fallen to a five year low. Or he ignores the savage drop in oil prices. I read gas may hit 3 bucks a gallon by the end of summer. On the face of things this seems great. But if higher gas prices produce inflation, what do you think lower gas prices produce?

When the second quarter GDP number came out, I kind of fell off my axis. I don't think it's ever good to become too entrenched into your beliefs. One day things will change and you are going to get blindsided. I mean, maybe we were producing more oil. I suspected that the real answer was the demand just wasn't there. And now that seems to be more true than our economy all of a sudden started growing gangbusters.

It was unusual enough that when all the analysts saw the jobs number they started screaming "don't believe it! It's an anomaly." Self I said - the only anomaly is that GDP number. Awfully convenient I think just a couple of months out of an election that all of a sudden we were growing at 4.7% (after the final revision). Especially when none of the earnings numbers backed that number up. Retail sales numbers are shit. A ton of companies revised their Q3 down.

First it was a massive order of planes that bumped GDP up. Then cars. Then health care spending. Then we sold more distillates. Literally every day it seems like they came up with a new reason we were growing so fast all of a sudden. Just throw everything at the kitchen sink they said.



And then there is housing. If we printed all that money to save housing - I don't really know where we go from here. When the recession first started 46% of homeowners were underwater and trapped. Now that number is 17%.

I don't see any relief coming for those 17% any time soon. The 29% of people who escaped will almost assuredly stay in those houses for the duration of the loan because the interest rates are just so low. That market is locked up, and the FED is trapped like a stuck pig.

Let's talk Europe. They are in negative interest rates. And they just embarked on their own money printing scheme. That means demand is going to be weak. Not to mention the sanction wars.

I see nothing but deflation for miles.

Monday, September 15, 2014

Mortgage rates are well up today. I'd say the aggregate is in the 4.20% range.

Slightly more than 47% of the properties in my city are now in markdown now. That is almost a 25% increase since September 2. Things are slowing fairly sharply.

With how many there are - this might be the first month mark downs from the previous month didn't clear before a new month started.
 
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