30 June 2020

1) The Boeing Aircraft Co. has started it re-certification process for the 737 MAX with the take off of a test aircraft for the first flight. An FAA (Federal Aviation Administration) pilot was on board as test flights begin, to determine if the aircraft is safe for flying with passengers. The first flight test is to fly maneuvers for about three hours, the test craft being fitted with a number of instruments and monitoring equipment to test and record how the aircraft performs. Test include the ‘wind-up turn’ which is a steep turn that essentially approaches a stall, with wings almost at 90 degrees of bank. This maneuver should trigger the Boeing software system that played a role in both crashes, which caused the aircraft design to be grounded. The software caused the aircraft’s nose to be repeatedly pointed downward at the ground until pilots lost control. These certification flights are expected to take approximately three days, and while they are an important milestone, there remains a number of key tasks to be completed.

2) According to the Bureau of Labor Statistics, 47.2% of American adults are now jobless, almost half the adult population. This is a direct result of losing 30 million jobs because of the coronavirus crisis. While there was an unexpected snap back in May, there are now signs of a slowdown in the labor market improvement because of fears of a Convid-19 resurgence increased these last few weeks. The massive loss of jobs is what is now dragging the economy down. Both Texas and Florida have paused plans for further reopening because of a record spike in coronavirus cases.

3) Lending institutions are pulling back sharply on their lending to U.S. consumers during the pandemic, because they can’t tell who is creditworthy anymore. There are millions of Americans out of work and behind on their debts, but many of these missed payments aren’t reflected in credit scores. This is a result of the government’s stimulus package which allows borrowers to defer their debt payments, but credit companies can’t report these late payments to credit reporting companies. For May, there were more than 100 million accounts with deferred debt payments. This is a sign of widespread financial distress.

4) Stock market closings for – 29 JUN 20:

Dow 25,595.80 up 580.25
Nasdaq 9,874.15 up 116.93
S&P 500 3,053.24 up 44.19

10 Year Yield: unchanged at 0.64%

Oil: up at $39.55

29 June 2020

1) Microsoft is permanently closing almost all of its stores across the nation and world. Just like other retail outlets, Microsoft had to shutter all its stores due to the coronavirus pandemic. There are 83 stores worldwide of which 72 are in the U.S., however only four will remain open in the world. The stores allowed people to try out software and hardware offered by Microsoft including laptop computers. No news if there will be any layoffs or how many, the stores are moving to the digital realm, which will absorb many of the store employees. The physical stores generated negligible retail revenue for Microsoft.

2) As oil prices reach the magic $40 a barrel, shale fracking is starting to reawaken to pump oil. The number of fracking crews had bottomed out at 45 last month, but is now back up to 78 this last week. There had been roughly 400 fracking crews before the decline in oil prices started. The drilling of new oil wells remains on hold with a 70% slump, making for the lowest number of active drilling rigs since 2011.

3) Nike is warning its employees of coming layoffs, but these layoffs will not effect store employees. The layoffs are expected to come in two waves, the first this July followed in the fall with a the second wave. These layoffs come amid reports of poor earnings, with sales down 38% giving a net loss of $790 million dollars when the Convid-19 virus forced closing of most of its stores. This compares with nearly a billion dollars in earnings for the same time last year. Nike has 76,700 employees, but it’s not know yet how many will lose their jobs. All wasn’t bad for Nike, with their online sales skyrocketing 75%, with e-sales accounting for 30% of Nike’s total business.

4) Stock market closings for – 26 JUN 20:

Dow 25,015.55 down 730.05
Nasdaq 9,757.22 down 259.78
S&P 500 3,009.05 down 74.71

10 Year Yield: down at 0.64%

Oil: down at $38.16

The Curse of the Krel is Among Us

The ever popular and growing social media, that seems just a harmless recreation, has a growing dark side to it reminiscent of science fiction.

James Lyman BSAE, BSEE, MSSM

The 1956 science fiction movie, ‘Forbidden Planet’ is a classic film of space travel and science fiction, indeed some claim it was the first real space science fiction movie, which pioneered excellent special effects combined with great cinema graphics and story line. Earth men travel to the distant planet Altair-4 finding Dr. Morbius and his daughter, living in a world once inhabited by a very advance people with a technology far beyond the earthlings. These people, the Krel, had gone extinct thousands of years ago, but their advance technology continued to sustain itself on its own. The Krel had developed an advance technology that let any and all of its people create anything they desired just by thinking of it. But the Krel hadn’t considered the secret dark side of an individual’s mind, which went on to create monsters that attacked and killed others. The Krel, with their new technology, unleashed the destruction of their people and civilization. Unable to control the hidden emotions of petty jealousy, envy, resentments and insecurities buried deep within us, those emotions manifest themselves into hunter-killers which attacked the other Krels until none were left.

We too have developed a technology which can do the same thing to us as with the Krel . . . well almost. It’s our social media! This relatively new technology also allows our deep hidden dark side to emerge into the open of the internet. To also attack, hurt, humiliate, degrade, vilify and destroy others, both friend and foe. Not having to face others, we feel free, with no restraints, to say whatever is on our mind without any consideration. When new to the social media such as Tweeter or Facebook, we are cautious and reflective of what we say, but as time goes on, we become relaxed and slowly lower our guard. We become impulsive, beginning to say (write) what is really on our minds without consideration of the consequences on our relationships with others. While we are careful not to say how we really feel when face to face with others, with social media we just ‘let it all hang out’. No forethought or consideration of how our writings will be received by others. We lose all our in-habitations, and so . . .

The Krel are among us . . . and they are US!

My neighbor related a recent experience with social media that inspired this article, a comment on a cousin’s page which caused a pointless dustup of emotions, which fortunately the two were able to back away from and stop damage to their relationship . . . this time. But how about the next time? Now in the habit of no ‘inhibitions’, of impulsive thoughts unleashed without any time taken for reflection, without the facial expressions and body language feedback to warn and guide our thought process as we speak, what can happen? And that’s when we hurt or insult others. That’s the Krel among us, the social media which easily brings our darker side out without us really realizing it, until its too late. The Krel’s ‘monsters of the id’ set loose to began the process of eating away and destroying our interpersonal relationships.

Social Mitosis

Social mitosis is the process of a people, a uniform social group, slowly pulling against each other trying to go in different directions, much as two cats leashed together inevitably pulling in opposite directions. External forces start to polarize the people, often causing subgroups to form, wanting to go in different directions. This tends to be a slow drifting apart process, which is often imperceptible to the people while it is happening, but they are still one people acting largely as one. There is still a high degree of identification and empathy between individuals. But as the people are pulling apart, they become more identifiable as subgroups. More and more, the subgroups pull in different directions, with more strain building between the subgroups, so incidents of friction between the two subgroups become more frequent, but at first isn’t usually severe. However, the friction incidents serve to continue dividing the people until the subgroups become very distinct, each with their own culture. Two new cultures and peoples develop, becoming more distinct and separate, identifying less with each other.

Left unattended, the two people continue to pull apart, continue to become more distinct and different. At some time, there is a rupture and those people become two separate and distinct cultures and societies, and that rupture is usually of a violent nature. ‘Revolution’. ‘Insurrection’. People fighting to be free and out from under the other, to do and think whatever they wish. Very romantic sounding, but the reality is usually very different and far from romantic. The social mitosis of America started when I was a boy in the sixties with the emergence of the counter culture (the hippies), and has continued ever since. While the split has wax and waned over the years, the problem of obsolete people in the last few decades and their displacement from the social-economic system has caused significant strain between people, the rife between them growing deeper as they evolve into separate societies. We see this growing riff every night watching the national news and the political infighting in Washington.

The Krel of our social media is now deepening the split in social mitosis, causing further strain and conflict and at an accelerated rate. Like the Krel in the movie, we are unleashing our inner darker side onto others, to attack and eat away at our relationships, unaware what is happening. The Krel social media is a hidden evil that we have no real control over. We can only rely on the self control of individuals . . . millions of individuals acting independently. The vast majority completely unaware of the Krel syndrom of social media, what they are unconsciously doing as they tap out another posting. The destructive power they hold literally in their hands . . . the power to drive people apart with unforseen consequences. To attack. All without any thinking. So we would do well to consider . . .

A Corollary of War:
Never attack without having a specific objective-
Never attack without a reasonable expectation of achieving that objective.

To ask the questions about a posting- Why are you attacking? What do you expect to gain for the cost of attacking? (cost-benefit) What exactly do you expect to achieve from you’re attack? And most important, do you really think you can gain what you’re expecting to get?

But then, if you don’t realize you’re attacking, it’s rather hard to ask and answer these questions, isn’t it!

26 June 2020

1) General Motors is eliminating 700 factory jobs in Tennessee as a result of low sales, which they are blaming on the Convid-19 crisis. This is the third shift at their Spring Hill assembly plant, leaving 3,000 workers still employed. This plant makes Cadillac XT5 and XT6 SUVs plus the GMC Acadia. This is another sign of the weakness in auto demand, a result of record job loss coupled with people working at home and therefore putting less wear on their old cars. The GM plant for building truck engines remains unchanged, since they were working just two shifts to start with.

2) The nation wide retailer Macy’s is cutting nearly 4,000 corporate jobs, about 3% of its overall workforce. The pandemic has taken a toll on the department store chain, just like so many other traditional chain retailers. This move will save the company about $630 million dollars per year, amid a quarterly net loss of $652 million dollars. Macy’s was struggling long before the pandemic because of competition from lower priced retailers such as Walmart, T.J. Maxx and Target.

3) The U.S. GDP (Gross Domestic Product) shrank by 5% for the first quarter, compared to an increase in the previous quarter of 2.1%, prior to the coronavirus pandemic onset. This drop is attributed to a decrease in personal consumption expenditures (PCE) because people are spending less. The real gross domestic income decreased 4.4% as compared to a 3.1% increase in the fourth quarter of last year.

4) Stock market closings for – 25 JUN 20:

Dow 25,745.60 up 299.66
Nasdaq 10,017.00 up 107.84
S&P 500 3,083.76 up 33.43

10 Year Yield: down at 0.67%

Oil: up at $39.18

25 June 2020

1) There are ten companies that may not make it through the summer. These are high brand names of Hertz, J.C. Penney, Pier 1 Imports, Tuesday Morning, J. Crew, Neiman Marcus, Gold’s Gym, Tailored Brands (Men’s Warehouse and Jos. A. Banks) and Diamond Offshore Drilling, which are all in bankruptcy now. The high number of retailers shows the ongoing retail apocalypse with the retail sector, which had already hit before the pandemic by falling sales, lower costumer traffic and too many stores. Retail was near the edge of collapsed with last years Christmas holiday shopping doing little to boost business, especially those located in malls. Last year, 9,500 retail stores closed, with estimates of 15,000 stores closing for good in 2020. This may indicated a fundamental shift in America’s economy, a shift away from hyper-consumerism to something else besides a service based economy. Shopper visits to stores are about half of last year’s numbers, and that’s with businesses reopening after more than two months on lockdown.

2) Fears continue to grow that we are not finished with the Convid-19 crisis yet, as the number of new cases continues to increase. This is happening with states and cities easing their shutdown measures to reopen the economy to start a recovery. The seven day average of new virus cases has swung up 30% from a week ago. It was hoped the warm weather would suppress the virus spread as it does with the flu, but if the virus is resurrecting, then the shutdown may need to returned with the resulting economic impact.

3) The Ford Motor Co., who is in the process of its global restructuring plan and paying off debt related to the coronavirus pandemic, is betting its future on its new line of pickups. Ford is offering its popular F-150 model in traditional internal combustion engines, new hybrids and all electric versions. The Ford F-150 has been the country’s top selling truck for more than 40 years, the best selling for the last consecutive 38 years. Their F-150 is a key part in Ford’s plans to profitably grow their business, to help in the $11 billion restructuring cost and pay off the $20 billion dollars in new debt.

4) Stock market closings for – 24 JUN 20:

Dow 25,445.94 down 710.16
Nasdaq 9,909.17 down 222.20
S&P 500 3,050.33 down 0.96

10 Year Yield: down at 0.68%

Oil: down at $38.07

24 June 2020

1) Economists are concerned about four major factors bearing down on a recovery of the economy. These are 1) the household fiscal cliff, 2) a great business die-off, 3) state and local budget shortfalls, and 4) the lingering health crisis. The pandemic shutdown cost the jobs of 40 million Americans, 40% of them low wage workers. This has left many households short of money, having little to no savings to meet their fiscal obligations such as rent and utilities. Add to this, there has been a steep decline in consumer spending leaving large numbers of businesses to face bankruptcy, thereby making a contraction of the economy. But businesses are not the only one facing revenue shortfalls, for governments are also facing shortages of money needed for their operations and paying employees, as in more layoffs. Finally, the cost of controlling the Convid-19 virus, especially if a major second wave does emerge, for both preventive treatment and caring for the sick. All four of these factors may very well be pushing America’s economy towards another Great Recession, which could last for many years.

2) The New York eviction moratorium ended this weekend, raising fears that tens of thousands of residents will soon face evictions which will flood the courts. This problem is a reflection of a problem across all of America as those 40 million laid-off workers have been unable to pay rent or mortgage payments and now face losing their residence. But it isn’t one sided, for landlords and lenders are also facing money shortages to meet their obligations too, which can lead to their fiscal demise. Most of the tenants and home owners have limited monies beyond their income, so paying back rent and mortgage is going to be near impossible.

3) China is warning of the risk of a naval incident with the US. Claiming that the U.S. military is deploying in unprecedented numbers to the Asia-Pacific region, which makes for a rising risk of an incident with China’s navy. The United States freedom of navigation operations in the South China Sea has angered the Chinese, who is trying to establish dominance in the area and hence control of the territory. The Chinese claim that 60% of America’s warships and 375,000 soldiers are deployed in the Indo-Pacific region, including three aircraft carriers. So far, the U.S. Navy has conducted 28 freedom of navigation operations by sailing through the area where China has built islands, and therefore claiming the area as theirs.

4) Stock market closings for – 23 JUN 20:

Dow 26,156.10 up 131.14
Nasdaq 10,131.37 up 74.89
S&P 500 3,131.29 up 13.43

10 Year Yield: unchanged at 0.71%

Oil: up at $40.02

23 June 2020

1) Speculation abounds over what the next stimulus package will have, such as extended income support for the unemployed and underemployed. New temporary subsidies for low wage workers. Cheap loans for small and medium size businesses with additional support for state and local governments. Cost estimates for a second stimulus program range from one to two trillion dollars. But like the first stimulus package, no one is offering ideas how this money will be paid off, especially if economic expansion doesn’t materialize.

2) The worlds fastest super computer is now Japan’s Fugaku supercomputer developed by Riken and Fujitsu with backing from the Japanese government. It has a speed of roughly 415.53 petaflops, which is 2.8 times faster than the US Summit supercomputers at 148.6 petaflops. The Fugaku was under development for six years and will start full time operation by April 2021, although it has been pressed into service in the coronavirus crisis, running simulations on how droplets would spread in office spaces with partitions. Previously, the fastest supercomputers have belong to America and China.

3) The sales of existing homes has dropped in May, a result of the coronavirus impact on the economy. The sales of existing homes in May fell 9.7% compared with April, which makes for an annual decline of 26.6%. This is the largest decline since 1982 when interest rates were 18%. There remains a shortage of housing which is helping to uplift the market, and therefore the economy as soon as the crisis has subsided.

4) Stock market closings for – 22 JUN 20:

Dow 26,024.96 up 153.50
Nasdaq 10,056.48 up 110.35
S&P 500 3,117.86 up 20.12

10 Year Yield: up at 0.70%

Oil: up at $41.13

22 June 2020

1) Oil has passed$40 a barrel, continuing a slow but steady recovery. This could be signaling a reawakening of the U.S. shale oil production. This rally allows the oil industry some breathing room with its high debt burden as the shale oil industry seeks to rebuild after the worst price collapse in a generation. This is far different than earlier this year when oil producers were paying to have their oil taken away. OPEC+ continues efforts to re-balance the global oil market, now abundantly clear that everyone loses in a price war.

2) More encouraging economic news with Ford Motor and Fiat Chrysler returning to pre-coronavirus pandemic production schedules in their American plants. Ford plans to fully return to production levels by July 6 while also ramping up their production facilities in Mexico. Although not given any firm dates, Fiat Chrysler is also returning to former production levels as rapidly as possible.

3) Experts are predicting the restaurant business, as we know it, is coming to an end because of the Convid-19 crisis. The industry generates $900 billion dollars a year, employs 15 million people, which is 15 times more than the airline business, which many are so concerned about now. Estimates vary widely of 20 to 80% of the privately own restaurants succumbing to the pandemic. The big franchise restaurant chains are expected to mostly survive and continue, but the independents are expected to fade out. One factor is change, which is coming too fast for small operations to adapt and keep pace with. The general consensus is that the business was in trouble long before the pandemic, struggling with poor working conditions, very thin profit margins, low wages and increasing competition. But it’s not just the restaurants themselves, for behind them is farming, distribution, suppliers and commercial real estate. It’s apparent that the demise of a significant number of independent restaurants will spell a significant change to the American business environment.

4) Stock market closings for – 19 JUN 20:

Dow 25,871.46 down 208.64
Nasdaq 9,946.12 up 3.07
S&P 500 3,097.74 down 17.60

10 Year Yield: unchanged 0.70%

Oil: up at $39.43

The Major Factor in Black Lives Matter!

As so often the case with social problems, the obsolescence of people is ignored which makes finding any real solutions impossible.

James Lyman BSAE, BSEE, MSSM

The problems for American Blacks, as well as many other minorities, is boiled down to one simple all encompassing word that ignores some very powerful forces at work in society today. That word is ‘Racism’. It’s the systemic centuries old racism, particularly by the privileged white people, which is the curse of Black people that keeps holding them back in society. Lets explore that for a minute, but first a little background so you can understand what I’m saying.

We hear repeatedly that the American Civil War freed the slaves! But in actuality it didn’t. The winning of the war did end titled slavery, where people actually owned other people as property. After the war, the plantations still needed cheap labor to produce tobacco and cotton, so this titled slavery was replaced by a serfdom system of share croppers. These were farm labors, mostly Black, who worked small plots of land for a portion of the crops raised. Forty acres and a mule, the share cropper and his family worked long hard hours to raise the labor intensive crops of cotton and tobacco to earn just enough to subside on. For the year, he lived off credit from the local store, paying it back after harvest, with very little to nothing left. Being left in debt, he couldn’t leave for any better opportunities, facing a systematic program of terrorism designed to keep him on the land working.

But then came World War II, and the massive expansion of American industry and its ability to design and manufacture sophisticated machines. Before the war, there had been much interest in automation for agriculture including cotton and tobacco, and after the war ended, new machines to automate their cultivation were introduced, just as had been done with wheat and corn crops. Suddenly, farmers no longer wanted all those little 40 acre plots, they wanted fields that went for a mile or more, and were half as wide. They didn’t want any obstructions on the land, they wanted smooth continuous fields where a combine could be driven with a minimum of turning.

They no longer wanted those share croppers with their small shacks and out buildings. They no longer had any use for their serfdom slaves, therefore they wanted all the share croppers off the land, but in the process finally set the Blacks free. In turn, this allowed real progress to be made with civil rights, because the monied powerful no longer cared about retaining the serfdom system of sharecroppers. The way was open, so starting in the fifties, civil rights began to make real progress.
The thing that truly freed the slaves wasn’t the Civil War, it was technology that made them obsolete as cheap human labor. The Black people were displaced by machines! They were now free to go out and make their way in the American economic system, to have their part of the American dream.

Trouble was, just as technology made them obsolete and free, technology was also beginning to take away jobs in industry . . . you know, those factory jobs where previous Americans had started their climb up the economic ladder. They were walking right into another round of even bigger displacement by technology. So it was like they were climbing a huge hill trying to reach the top and be with those ‘privileged whites’, except that hill was made up of gravel (our picture upper right). Every time they took a step, they slide backwards some amount. And the gravel they struggled against was technology which was taking away jobs.

No one realized that at the same time, many of those ‘privileged whites’ were starting to slip off the hill, sliding down, scrambling to regain what they had lost, but also taking one step forward and sliding two back as technology forced them down and out. The newly freed Blacks didn’t realize they were NOT in competition with the white people for a place in the economic sun, they were in competition against the machines. This continues today, but at a faster pace. And the machines don’t know or care anything about race, color or creed! It’s evident by the gravel hill analogy just how important technology displacement is to the advancement of Blacks or any other people. If technology is continually eroding away the steps to advancement, by doing away with jobs, then you must consider it if you’re going to make any real progress, yet every political activist working to advance the Blacks ignores this very important, indeed essential fact of life.

That’s why all of them have basically failed to make any progress.

We now have another political movement spawned to try again and lift up the Blacks, and again they are depending solely on political activism to achieve their goals instead of working the problem by analysis, research and understanding what is driving the situation. The same methodology that’s been used since the 1960’s and therefore most certainly will have the same results. The leaders of this political activism, in their drive for equality, don’t realize that Blacks are just as equal to the other Americans . . . because they are just as equally obsolete before they ever get started. And that’s the crux of the problem.

This applies to other minorities besides Black people. The exact same thing happened with the liberation of women. What actually liberated women was technology . . . technology made women obsolete as women, freeing them to go out into the work force and make their way, but they quickly found the way blocked. Like the Blacks, they came out into the workforce just when automation was beginning to make inroads in eliminating jobs, taking away jobs leaving women to also climb the crumbling hill of gravel. You can read another article I wrote titled, “The Fallacy of Women’s Liberation” on my website www.peopleobsolete.com, scrolling down to article number 32 and clicking on the title or the ‘PDF Download’ to read. It will give you a better understanding of the complexity of the problem.

Problems don’t get solved by pretending, they get solved by working them, by using real problem solving skills of understanding that only comes from research, analysis, modeling and intellect instead of by emotion. By THINKING! As long as we depend on political activism to solve our problems no one will ever have any real viable solutions.

We will always have those problems plaguing us.