Sunday, December 4, 2022

Is Tik Tok addictive?

Is Tik Tok addictive?
In the first part of the video, he claims that Baby Boomers have been stealing money from the younger generation.  

So I wrote this:

A liberal professor blames Baby Boomers for bad economics, as if excessive government spending, national debt, and inflation had nothing to do with it. The problem with education is that it is government subsidized which has driven up the cost several times the rate of inflation.

Friday, December 2, 2022

Leverage Buyouts from Private Equity Firms

I don't have an opinion on this.   Why should it be illegal to buy companies?  Should it be illegal to take loans to buy companies?   Should it be illegal to serve on the board of directors of a company that you bought?

Tuesday, November 1, 2022

No, the U.S. isn’t going to run out of diesel fuel in 25 days

Tucker Carlson: The US is about to run out of diesel fuel


This mean that truckers and trains cannot transport food and other commodities.  The economy could collapse.

Mansfield warned that at the U.S. economy level, consumers may feel pain at the pump, but for businesses that rely on diesel for operations, supply will still be available.

"That is not to say there will not occasionally be situations where there is a true physical lack of products," the company said. "Some cities might run dry on diesel for a few days, at least at the terminal level. But the fuel supply chain is dynamic, and suppliers will rally to fill in any gaps in supply."

This is also the time of year that refineries are doing maintenance. They tend to do that in the spring and fall, which is when demand is lower and the weather is decent. So, refinery capacity drops at this time of year.

Third, U.S. refinery capacity has fallen in the past few years as several unprofitable refineries were closed. So, that's a new factor that has appeared in the past couple of years.

But the primary reason is the cutoff of Russian imports. Prior to Russia's invasion of Ukraine, the U.S. was importing nearly 700,000 barrels per day (BPD) of petroleum and petroleum products. Most of those imports were finished products and refinery inputs that boosted distillate supplies in the U.S.

The loss of those Russian imports has caused problems for refineries as they struggle to fill holes in their product slates. Refineries do have a small amount of flexibility in shifting gasoline production to diesel production. But it's a relatively small amount (e.g., ~5% in a refinery I once worked in). That also means that if refiners do shift production, it also potentially creates shortages in the gasoline market.

Some relief is on the way, as some diesel imports are on the way from Europe to the East Coast. But, the distillate market won't likely return to normal before next summer at the earliest.

Saturday, October 1, 2022

The WORST Housing Crash In 40 Years JUST BEGAN

I have always been very skeptical of gloom and doom predictions.  Nobody can predict the future with any accuracy.  However, a housing bust would not surprise me.

Thursday, August 18, 2022

What is modern monetary theory? | John Hancock Investment Mgt

Money is not wealth. It is a placeholder for wealth. If you create more of it, then by definition each unit of money is worth less, unless somehow you created an equivalent amount of wealth.

I am a bit worried about the 40% increase in the money supply that happened over the last two calendar years and what this means for my retirement.

So increasing the money supply can be a form of theft. It is transferring value to those people who receive the new currency at the expense of the people holding the existing currency.

If we count precious metals as a form of wealth, then having a backed currency would make money a form of wealth.

Tuesday, August 9, 2022

China and EV batteries

That's because most EVs run on lithium-ion batteries that are mostly made in China. The nation has a lock on some 76 percent of the battery market today (the US only represents 8 percent). And to get a deal passed in a deadlocked Senate, Democrats agreed to provisions that would require eligible vehicles to use batteries that are made in North America.

The Inflation Reduction Act of 2022, which passed the Senate this weekend in a party-line vote, would require batteries to have at least 40 percent of materials sourced from North America or a US trading partner by 2024 in order to be eligible for a $7,500 tax break. By 2029, battery components would have to be 100 percent made in North America.

Batteries that contain minerals that "were extracted, processed, or recycled by a foreign entity of concern," which is defined as a state sponsoring terrorism or countries blocked by the Treasury Department's Office of Foreign Assets Control, would be ineligible for the credit. China is listed as a "foreign entity of concern" by the federal government.

Democrats, including West Virginia Senator Joe Manchin, who negotiated the deal in secret with Senate Majority Leader Chuck Schumer, are running on a tough-on-China message this year. But the auto industry says that the new requirements would basically disqualify every EV on the market today.

According to the Alliance for Automotive Innovation, the auto industry's main lobbying group, there are currently 72 EV models available for purchase in the United States, including battery, plug-in hybrid, and fuel cell electric vehicles. Of those models, 70 percent are ineligible for the tax credit when the bill passes. And by 2029, when the additional sourcing requirements go into effect, none would qualify for the full credit.

No electric vehicles on the market today qualify for the new EV tax credit - The Verge

Saturday, August 6, 2022

Inflation: Last Week Tonight with John Oliver

People tend to blame everything except the fiat currency.  The technical definition of inflation is an increase in the money supply, not price increases.  From January 2020 to December 2021, the Money Supply went up 40%.  Although the effect is not immediate, we should be looking for a 40% increase in prices as a result, or at least close to it.

Saturday, May 28, 2022

Ending climate change requires the end of capitalism. Have we got the stomach for it?

"Today's children, as they become more politically aware, will be much more radical than their parents, simply because there will be no other choice for them. This emergent radicalism is already taking people by surprise. The Green New Deal (GND), a term presently most associated with 29-year-old US representative Alexandria Ocasio-Cortez, has provoked a wildly unhinged backlash from the "pro free market" wing, who argue that it's a Trojan horse, nothing more than an attempt to piggyback Marxism onto the back of climate legislation.

The criticism feels ridiculous. Partly because the GND is far from truly radical and already represents a compromise solution, but mainly because the radical economics isn't a hidden clause, but a headline feature. Climate change is the result of our current economic and industrial system. GND-style proposals marry sweeping environmental policy changes with broader socialist reforms because the level of disruption required to keep us at a temperature anywhere below "absolutely catastrophic" is fundamentally, on a deep structural level, incompatible with the status quo.

Right now we can, with a massive investment of effort by 2030, just about keep the warming level below 1.5C. This is "bad, but manageable" territory. Failing to put that effort in sees the world crossing more severe temperature barriers that would lead to outcomes like ecosystem collapse, ocean acidification, mass desertification, and coastal cities being flooded into inhabitability.

We will simply have to throw the kitchen sink at this. Policy tweaks such as a carbon tax won't do it. We need to fundamentally re-evaluate our relationship to ownership, work and capital."

1.  They keep moving the goalpost.  I have seen videos from a decade ago stating that we were on track to increase the average atmospheric temperature by 3 degrees Celsius by the year 2100, and that would be bad, but if we can get it down to 2 degrees Celsius then that would be manageable.  However, in recent years, I have seen videos stating that we are on track to increase the temperature by 2 degrees Celsius by the year 2100, and that would be bad, but if we can get it down to 1.5 degrees Celsius then that would be manageable.

In the years prior to all these predictions, I was seeing dire predictions of a temperature change of 5 to 12 degrees Celsus by the year 2100.

The reason for these changes is that some of the very dire predictions of the past haven't come true.  They have made claims that the polar ice caps would have melted by now and that we would have a billion climate refugees.

If you look at the data, it has taken 140 years for the temperature to go up one degree Celsus.  These changes are very slow and don't represent a crisis.  Should we lose some coastlines, people have plenty of time to adapt, or build floodwalls.

2.  There is a difference between what the science is saying about climate change and what the politicians are saying about climate change.  It is a difference between caution with big levels of uncertainty baked into the predictions, versus alarmism.

3.  Climate Alarmism ignores the enormous benefits of carbon fuels and CO2.  Our entire food supply runs on carbon fuels.  Atmospheric CO2 is a valuable resource that is a necessary food for plants.  Over the last 40 million years, the atmospheric levels of CO2 have been in a steep and dangerous decline due to natural processes that sequester carbon, while the recent increase in the level of CO2 has resulted in the greening of the Earth, increased food production, increased rainfall, and a shrinking of deserts, contrary to the opposite predictions.

4.  Should we need to, we could use a technique called "Iron Fertilization" to remove CO2 from the atmosphere.  However, I think that this would be counterproductive.

5.  During the last 2.5 million years we have technically been in an ice age, dominated by long periods of mass glaciation covering much of the northern hemisphere, with only brief ten thousand year warm periods like the one we are living in now.

6.  Capitalism is really a free market, which is your right to own property and own a business.    My retirement fund is invested in the S&P 500, which technically means that I am invested in hundreds of businesses.

7.  Socialism takes away all these rights in the name of euphemistic terms like fairness and environmental protection.  However, the net result is slavery, or at best tyranny.  The government will tell you what you can own, where to live, where you can work, and what you must do.

8.  Rahm Emanual said, "Never let a serious crisis go to waste."   Nobody voluntarily goes into a prison unless they are more afraid of what is outside the prison.   People don't voluntarily give up their freedom unless they are afraid of a crisis.  For this reason, the political left is always trying to justify infringement on our freedom by telling us there is a crisis.  (This is "The Walking Dead" theory of socialism promoted by Dan Bongino.  In the show, "The Walking Dead", the survivors of a Zombie Apocalypse try to hide inside a prison because it is well fortified.)  

9.  The real goals of the political left are about power. It is about who is in charge and who gets to run things.

10.  True socialism, which means that the state owns the means of production, is unsustainable.  No socialist system has been able to keep itself going without adopting some free-market measures.

11.  When confronted over their ideas, the left tends to change its definitions.  They will assert that they never meant what they said previously and that the rest of us are just too stupid to understand their theories.  They also claim that they want one thing, like a Nordic-style welfare state with a capitalist economy, while out of the other side of their mouth claim that they want to get rid of capitalism.

Sunday, May 1, 2022

Why sheep (lamb, mutton) tastes sheepy

This makes me to not want to eat mutton.

Redefining American Capitalism | Libertarianism

I sometimes get annoyed by this guy for his leftism.  He presents some interesting thoughts here.  I share his skepticism of Ayn Rand.

Capitalism is often used as a pejorative.  I think that the correct term is a "free market", meaning that you are free to make choices.  The opposite of a free market is different degrees of tyranny.  

This notion of deregulation in 2008 is inaccurate. There were far more regulations in 2008 than in 2000. Part of that regulation was the Community Reinvestment Act, which was a real thing, requiring banks to lend to people who were not otherwise creditworthy. Since Government Sponsored Entities (GSEs) were buying up most of the loans, this removed risk from the loan market. Banks aren't normally in the business of making bad loans until the government gets involved.

Thursday, March 24, 2022

Is This The End Of Capitalism? | Answers With Joe - YouTube

In response to...

I wrote...

The word capitalism is used as a pejorative. The correct term should be a free market, which is the freedom to own a business and run it with minimal interference from the government. The opposite of this is different degrees of tyranny. Do you want the government running your business, or taking it away from you?

Corporations are used as a whipping boys, but corporations are a way of democratizing business ownership. My retirement fund invests in the S&P500, meaning that I have some tiny ownership in 500 companies. People resent corporations because they are a concentration of power, and this could possibly be a threat to freedom, but without corporations, very few people could afford to invest in business ownership.

The socialist left keeps looking for excuses to give us a command and control economy. The most recent is a fear of automation, but history shows that automation leads to more prosperity, more jobs not less.

Milton Freidman said that the robber barons were mostly a myth.  People flocked to difficult factory jobs because that was better than the alternative.  Nobody forces you to give a corporation a dime.  Nobody forces you to work for an employer.  In a command and control economy, everything is done by coercion.  They will tell you what to buy, who to work for, what type of energy you can use, what kind of health care you are eligible for, and what you can say.