1) This year’s hurricane season was already forecast to be a very active season, but now is going from bad to worst because of La Nina. The hurricane season was already on a record making pace, with the peak of the season coming in just a few more weeks. The possibility of the pacific having a La Nina, a state where the sea surface temperature becomes cooler than usual, is increasing in probability. This change in pacific weather patterns decreases the hurricane killing wind shear across the Atlantic, thus allowing more storms to form and strengthen. The Atlantic has already had 10 storms, which is the earliest number to occur by this date. Predictions are for as many as 25 storms forming, compared with the 2005 record of 28 storms including Hurricane Katrine. Additionally, a La Nina can spell cooler temperatures and storms across the north, with drier weather in the southern U.S., all having significant economic impact on America.
2) Again, the first time jobless claims have dropped, this time it’s the first time below 1 million since last March. Last week, 963,000 people filed for first time unemployment benefits, the first time in five months claims were below 1 million. Although the decline is a positive sign, the economic job situation still remains critical with 15.5 million people still unemployed, but still people are returning back to work. The employment problem still remains worst than for the Great Recession just a decade ago, which had lower jobless claims. It took nearly five years for the peak in 2009 until 2014 to return to what they were before the Great Recession.
3) Oil prices dropped as a result of IEA’s (International Energy Agency) forecasts for global oil demand. This reduction is in part a result of the slowdown in air travel. Price of oil has been creeping up coming to a five month high on Wednesday, but then fell as much as 1.3%, from the forecast of a drop in consumption for every quarter to the end of the year. The forecast also signals a shift in the recovery toward a stalling of economic growth. There remains an inventory overhang that persists, which the oil industry continues to work down.
4) Stock market closings for – 13 AUG 20:
Dow 27,896.72 down 80.12 Nasdaq 11,042.50 up 30.27 S&P 500 3,373.43 down 6.92
1) Another national retail outlet, Stein Mart, is going the way of the brick and mortar retail system announcing they are closing all their stores in bankruptcy amid Covid-19 pandemic. Based in Jacksonville, Florida the company operates 281 stores in 30 states with 9,000 employees. Stein Mart ‘going out of business’ sale is expected to begin in August 14 or 15 with complete liquidation of inventory, with the anticipation of all stores closed by the fourth quarter of 2020. The retailer joins a long list of businesses to file for bankruptcy protection amid the coronavirus crisis.
2) With all the money being pumped into the economy by the government, there were fears of fueling inflation. Those fears were increased with the July consumer price data showing that prices are indeed on the rise. But some are saying these price increases are a result of supply and demand dynamics from the pandemic, and will fall once the supply system becomes stable with production reaching equilibrium again. It’s just a matter of time.
3) Amid suspicion of a rigged election by authoritarian leader Alexander Lukashenko, Germany and Lithuania is calling for renewed sanctions on Belarus. Claiming a landslide victory in his presidential election, Lukashenko has cracked down on protesters and demonstrators. The EU (European Union) has call an extraordinary meeting of foreign ministers to discuss the situation, considering the election was neither free nor fair, and efforts to suppress demonstrations as unacceptable. The EU is considering reinstating sanctions. The protest have been violent with about 1,000 people arrested to add to the 5,000 already being held, and injuries to both protesters and police.
4) Stock market closings for – 12 AUG 20:
Dow 27,976.84 up 289.93 Nasdaq 11,012.24 up 229.42 S&P 500 3,380.35 up 46.66
Former Vice President Joe Biden has chosen California Senator Kamala Harris as his Vice Presidential candidate. Senator Harris was a presidential candidate during the 2020 Democratic primaries but fell short in clinching the nomination, which eventually went to VP Joe Biden.
Senator Harris will be the first woman of color on a major presidential ticket in US history. She will be the third woman on a major presidential ticket in US history. Ms. Harris is of Indian and Jamaican decent. Her mother is Indian and her father is from Jamaica.
Before becoming a VP prospect, she is currently one of the two senators representing California in the US Senate; prior to that Ms. Harris was California’s AG, and early on in the beginnings of her political career; she was San Francisco California’s AG. Senator Harris is currently married with two step children. -SB
1) Both Japan and China are building up their military forces for possible future contest over Pacific islands. This is another sign of China’s increasing contentious relations with neighbors, in particular Japan over disputes of several islands in the East China Sea. This is necessitating the buildup of military forces to approach, capture and defend islands. So this means a build up of Marine forces, which both countries are in the process of doing. This includes amphibious armored vehicles and self propelled artillery. U.S. intelligence consider the Chinese Marines to be fully amphibious and able to use combined arms tactics and multiple avenues of approach. This includes building a blue water navy with well over 300 vessels. In response, Japan is starting up its first Marine unit since World War II, modeled after the U.S. Marine Corps, to defend its southern islands. This buildup means massive expansions which neither country’s economies are able to tolerate with the worsening world economy.
2) Boeing aircraft manufacture’s troubles continue to get worst with the loss 737 MAX orders now over 400 and stymied shipments of its 787 Dreamliner because of the world pandemic. Last month, Boeing delivered just four jetliners while also booking zero new orders. Their total stockpile of orders was 4,496 aircraft at the end of July, which is down 1.2% from June. There is the risk that Boeing will have to halt 787 production to preserve cash. Most airline companies have grounded a significant portion of their fleets and are operating only a fraction of their pre-pandemic schedules.
3) Instacart, the young food delivery service, is partnering with Walmart, Amazon’s biggest competitor, to bring Walmart one day delivery service. This will make thousands of items, from groceries to home decor and improvement, personal care and electronics go from Walmart stores to customers’ doors as fast as an hour. This is another ratchetting up of the retail business, when many big name retailers are floundering and some going under. A fundamental change in the way Americans are buying things for their everyday lives is occurring.
4) Stock market closings for – 11 AUG 20:
Dow 27,686.91 down 104.53 Nasdaq 10,782.82 down 185.53 S&P 500 3,333.69 down 26.78
1) Online retailer giant Amazon is considering taking over closed department stores in some malls to use as warehouses in their distribution system. Amazon is in talks with Simon Property Group, America’s largest mall owner, to convert J.C. Penny and Sears stores into distribution hubs for package delivery. Simon malls have 63 J.C. Penny and 11 Sears stores available. With many traditional brick-and-mortar stores in collapse, such a deal would make sense for both Amazon and Simon. Amazon is looking for more space closer to where customers live to help with its one day delivery strategy, while Simon needs cash rich tenants to bolster their business.
2) A report that outlines the three potential future movies in the Star Trek franchise has been released. The movies for Star Trek follow-on’s have been in limbo since the 2016’s Star Trek Beyond. There are three potential projects being considered for possible production, including a Tarantino’s Star Trek movie. The first movie by Noah Hawley (Fargo and Legion creator) is centered on a pandemic story line using a brand new cast, but is now on pause. The second is a movie by Tarantino, of Pulp Fiction fame, as writer, but not necessary directing it. Something of a take on of a prior Star Trek episode, it would be largely an earthbound 1930’s gangster setting. The third is a far more traditional Star Trek with the recent stars Chris Pine and Zachary Quinto. The next few weeks is expected to yield the fate of the Star Trek franchise.
3) Latest job numbers show 1.8 million new jobs created last month to give a 10.2% unemployment rate. This is another coming down of the rate, a good sign for the economy. This leaves 43% unemployed of the 22 million people who lost their jobs from the pandemic, so the economy is still a long way from a full recovery. Fears are that it will be a long time before full recovery, what with the large number of small businesses that have succumb to the Covid-19 crisis with subsequent loss of jobs. The continual struggling price of oil indicates a still weak international economy.
4) Stock market closings for – 10 AUG 20:
Dow 27,791.44 up 357.96 Nasdaq 10,968.36 down 42.63 S&P 500 3,360.47 up 9.19
1) With the expiration of the stimulus bill, there are now 40 million Americans who are at risk of eviction unless the new stimulus bill is passed. This means the threat of eviction by the end of this year. Forty-three percent of renter households are facing eviction. This will result in homelessness and negative health outcomes, greater unemployment, educational decline and long term harm for renters, property owners and communities. Renters in the southern part of the country face the highest risk of eviction, with Mississippi the highest at 58% followed by Louisiana at 56%.
2) The sheltering in place, because of the pandemic, has brought a boom to the home remodeling market. Now unable to go out people are looking to make improvements to their homes, both inside and out, to make them more comfortable. Home improvements have shot up 58% since the stay at home orders started, with the outdoors improvement the most. New swimming pools and spas are now three times as many as they were last year. With most people now cooking at home, demand for decks, patios and barbeques are also in high demand.
3) Restaurant Brands International, the holding company for Burger King, Tim Hortons and Popeyes restaurants is planning to close hundreds of locations this year. These are restaurants deemed to be underperforming, and closing outlets is a measure usually taken to curb cash outflow. No words on which restaurants might be close or even what country they are in. The closings will balance out the new openings for this year, for a net zero count of closures. RBI is still the process of researching which restaurants are unprofitable and need to be closed with the aim of making the company stronger financially, but closures are expected to start in the second half of 2020.
4) Stock market closings for – 7 AUG 20:
Dow 27,433.48 up 46.50 Nasdaq 11,010.98 down 97.09 S&P 500 3,351.28 up
The recent civil unrest for the last two months in several cities, vividly shows the process of social mitosis at work.
James Lyman BSAE, BSEE, MSSM
The murder of George Floyd on the 25th of May, sparked protests against police brutality, police racism, and lack of police accountability across the nation. Now, more than sixty days later, not only do those protest continue, but they are gaining in momentum and intensity, spreading to other cities. Why? Young people continue to come out and protest, then near riot, to show their disapproval. WHY? Because many young people are dissatisfied with the government and with society, so the murder has triggered a release of frustration and anger, which is focused on the government and its institutions.
We are seeing a process called social mitosis, a process where social groups begin pulling apart, as people strive to go in different directions, resulting in a pulling force against each other. This is illustrated by the figure on the left, with ‘a’ the first stage where we have the α (alpha) people, who are a fairly homogeneous uniform society living in harmony. But the people begin wanting different things in life, wanting to go in different directions to pursue their wants, as seen in ‘b’. This ‘going’ in different directions causes tension as the α people pull against themselves, so sub-societies begin to form, becoming the αΓ (alpha-gamma) and the αΩ (alpha-omega) people. This pulling apart puts more stress between them which in turn further aggravates and polarizes the people.
Left unattended, this pulling away or polarizing continues with the sub-cultures becoming more pronounced resulting in further separation until the subcultures become very distinct entities. In ‘c’ we now see the Γα (gamma-alpha) and the Ωα (omega-alpha) people, the alpha ‘α’ subscript indicating there is still much commonality between the people, but still they are now becoming very distinct cultures with different believes, wants and desires in life. There are increasing stresses between the two cultures over what the shared environment will look like, what it will be like. As this pulling apart continues, the commonality decreases to the point where there is now two separate distinct cultures as represented by ‘d’, there now being the Γ (gamma) and the Ω (omega) people with distinct cultures each wanting to shed the other people and be on their own, charting their own course in the world without having to consider the other people.
Then finally, there is a point . . . an event, which causes an actual breaking apart of these two people at ‘e’, and that breaking often results in revolution or insurrection and the violence of war. A war to determine who will dominate and who will be submissive. A war that is the worst kind . . . one usually of savagery and brutality. War that the participants stumble blindly into unaware just what they are getting into, drawn by the illusion of independence, romantic images coupled with a nonsensical understanding of revolution. The present social mitosis started in the sixties when I was a boy, with the emergence of the counter culture. The hippies and flower children who were disenfranchised with the society they lived in and yearning for a world of their own.
They had become alienated in their home land.
Slowly, but surely the splitting process progressed, in perceivably divisions which widened into separate cultures. While over the decades, this mitosis process has waxed and waned, with the division between people becoming deeper and deeper, and people often migrating to different areas of the country to be with their own. Technology also drives this division, with people failing to advance and therefore be a part of an advance technological society. People become aliens . . . people who fail to advance technologically, so they become aliens in their own homeland. Technology also caused further stress as people became obsolete, they being replaced by technology and machines. People began the long slide downwards from one lesser paying job to even lesser paying jobs, thus leaving people even more alienated and dissatisfied. Add to this is the constant pushing out of the‘social – economic’ system by technology, the same exact thing that happened to the Native Americans over a century ago. A corollary of war-
A technologically advance people will displace a lesser people.
Although the murder of George Floyd is what triggered this unrest, it’s now a reaction to this displacement, the unleashing of pent-up anger, fear, frustration, aggravation and rejection of the world they don’t understand, yet are trying to live in. The young people of America just don’t see any future for themselves with 20 to 25% of college graduates unemployed or underemployed. They want a world of their own, a world where they can belong, to be comfortable and happy in. They don’t feel they are a part of the advance technology world they reject, so they want out. The actions you see in today’s protest is a manifestation of social mitosis. But right now, there isn’t any real direction or goals to their actions, just expressions of anger and frustration through violence.
For any government, the police is the face of that government, consequently when people are dissatisfied with the performance of a government, the people lash out at the police, often blindly. But so far, the actions and violence have been to gratify feelings of anger, lacking any real direction or goal. For the ‘rupture’ to occur, there is a need for a viable political philosophy, a philosophy that people are willing to risk life, limb, liberty and property to pursue. That sets a goal for the people to work towards to fulfill their dreams and desires. That’s what causes stage ‘e’, the actual breakaway of the two societies . . . nearly always with violence or revolution. And that’s when it all turns into one ungodly nightmarish mess for all.
With a closer look at these actions and attitude, many will consider these ‘protest’ to be unproductive, even foolish, but what you are also seeing is the analytical, intellectual, and problem solving skill levels of the protesters, those skills they have for the twenty-first century, which as we might guess, isn’t particularly strong. This is why businesses are continually seeking technologies which allows them to avoid such people as workers. This further pushes them out of the social-economic system. Other than being a consumer, these people have very little of value to offer for the twenty-first century.
All that is missing . . . to have a conflagration, is that viable political philosophy.
My book, “America’s Slide into Domestic Terrorism” in the series ‘Technology Monograms for Law Enforcement’, (available on Amazon.com) explains the three principle forces now pushing so many people, especially the young people (millennials and generation-Z) out of society. It includes the basic theory of war and therefore how those three forces, through social mitosis, can lead ultimately to wide spread domestic terrorism in America.
In all forms of insurrection, the police are the first and foremost targets for the insurrectionist, we’ve seen that recently in Iraq and Afghanistan, for when the Allies started establishing police forces, the insurrectionist immediately attacked the police trying to foil their establishment. The police is what translates the intangible academic power of the state into real tangible power. Without the police, the rest of the government ceases to effectively exist and therefore becomes impotent. But with a collapsed government, innumerable little groups and individuals come out of the woodwork convinced they should be the one who governs. Quickly, they turn to violence trying to impose themselves on the people, thus bringing civil war as we saw with the Arab Spring recently.
Bottom line- what we are witnessing in cities like Portland cannot to be casually dismissed one way or another. Nor will simply repressing and dispersing the demonstrators solve the problem. Only by addressing the problems of obsolete people and alienation of people can any real progress be made. And that means having a functioning government rather than image makers!
1) Another drop in applications for unemployment benefits is giving hope for the economy. For the week ending 1 August, there were 1.19 million jobless claims, down by 249,000 claims. Total unemployment is now at 16.1 million, the lowest since April. But even with continual drops, the claims are still five times the pre-crisis levels. More than decreasing claims is needed for the economy to improve, for much more hiring is required. There are fears of conditions improving so sluggishly, that the effects of the crisis become increasingly permanent. With the resurgence of the pandemic, there are signs of the economy stalling in what is already a fragile economy.
2) The Covid-19 crisis is fueling the need for high speed internet access, and rural America is responding with their electric and telephone co-ops using loans from the federal government. Subscribers are getting speeds up to 1 gigabit per second, with some planning for speeds up to 10 gigabits per second. Rural areas have the duel problem of low population densities and long distances, so its not economically feasible for private companies to install systems. The only alternative is satellite internet systems.
3) The Bank of England is warning of the potential risk of what’s called the ‘shadow banks’ in amplifying the volatility of unstable economies. Funds in investments like pension funds, investment funds like real estate investment trusts and money market funds are increasingly absorbing the cash once kept in banks, but are not as secure in times of crisis as traditional banks. This makes it harder for businesses to access their money when needed most. The non-banks impact in a financial turmoil is being assessed, lead by the Bank of England.
4) Stock market closings for – 6 AUG 20:
Dow 27,386.98 up 185.46 Nasdaq 11,108.07 up 109.67 S&P 500 3,349.16 up 21.39
1) Rocket Companies Inc., the parent company of Rocket Mortgage and Quicken Loans, is trying to raise $2 billion dollars with an IPO (Initial Public Offering) after an initial capital target of $3.3 billion dollars. The reduction in the number of shares offered is believed to be because of push back from investors, who considered the valuation of the company as to high. This is based on the company being more of a consumer based company rather than a technology based company. The downsizing may signal that the IPO market’s rebound is straining as the coronavirus pandemic deepens in America.
2) Entertainment giant Disney has announced that its streaming service Disney+ (pronounced Disney plus) has surpassed 60 million subscribers, which is well ahead of Disney’s target. Disney forecasted having 60 to 90 million subscribers by 2024, fueling speculation that Disney+ has won the first stage of the streaming wars. Netflix presently has 193 million paying subscribers, but with Disney+, which was just launched last November less than a year ago, it’s clear that Disney is very rapidly gaining on Netflix, and liable to be passed by Disney in the near future. More importantly, Disney should reach profitability very soon too, something hard for new streaming services to do.
3) The ‘Services PMI’ index from the Institute for Supply Management, posted its second monthly gain in July. This indicated that despite the rising number of Covid-19 cases, the services economy keeps recovering. There is a continued weakness in the international component of services with worries of how the international economy will eventually effect America’s recovery. Investors remain focused on earnings and hopes of a vaccine to push the economy upwards more. There is still the looming question of how many of the small businesses will survive the pandemic, and therefore how much of the economy will be changed by their demise.
4) Stock market closings for – 5 AUG 20:
Dow 27,201.52 up 373.05 Nasdaq 10,998.40 up 57.23 S&P 500 3,327.77 up 21.26
1) The FAA (Federal Aviation Administration) has issued a 36 page document detailing the fixes and training that Boeing needs to implement so the 737 MAX can return to commercial service. The document was in the works before the planes were grounded in the spring of 2019, a result of two air crashes. There were few requirements that Boeing management wasn’t already aware of, and it’s considered a milestone in the certification process. The document only applies to 737 MAX aircraft flying in the U.S., and it is expected the changes will be adopted by aviation regulators around the world. Once done, all 737 MAX jets will undergo an operational readiness flight prior to returning each airplane to service. The European Union Aviation Safety Agency is waiting on doing its flight test as the FAA moves ahead.
2) The oil company giant Exxon Mobil Corp., is seeking the dismissal of a climate change lawsuit brought on by the Massachusetts attorney general. The lawsuit alleges that Exxon defrauded consumers and investors by the company’s public position on climate change, that Exxon hid its early knowledge of climate change and misled investors about the projected financial impact of global warming on its business. Exxon claims the law suit amounts to improper retaliation against the company over its views on climate change. The bases for Exxon’s challenge is the state’s anti-Slapp law which prohibits the use of litigation to punish a defendant for statements on matters that are under consideration by a legislative or judicial body.
3) The Department of Labor has come down hard on social investing or EAG, proposing rules that strongly limit such activities for private pension plans covered by the Employee Retirement Income Security Act of 1974 (ERISA). They consider that pension fund investing is not the place to solve the ills of the world, that it is unlawful for a fiduciary to sacrifice return or accept additional risk to promote a public policy, political or any other nonpecuniary goal.
4) Stock market closings for – 4 AUG 20:
Dow 26,828.47 up 164.07 Nasdaq 10,941.17 up 38.37 S&P 500 3,306.51 up 11.90