cheap metals

A couple of months ago, when President Trump first began threatening tariffs to make our international trading more fair to U.S. businesses, I posted about listening to NPR coverage of the hog crisis.

There must have been a crisis; I heard a vignette on every news show on NPR about pork production.  They spent two weeks focused on hog farmers.  We must have heard an interview with every hog farmer in America who was willing to say something critical about the proposed tariffs.  Of course, NPR kept making the point that the farm community had voted overwhelmingly for President Trump, and they repeatedly implied that President Trump was betraying the people who had voted for him.

Over the past three weeks I have heard a similar focus from NPR.  I think I may have heard every small business in America that uses steel in manufactured products.  They speak critically about how tariffs might harm their businesses.  NPR spins this into an anti-Trump campaign.

For the past couple of days the story about steel changed slightly.  Now I keep hearing different Europeans and Europhiles declaiming how the tariffs recently announced by Team Trump are “unjustified” and “illegal.”

At least, on NPR, their long format means that eventually you will learn something useful.  I heard a particular interview with a U.N. spokeslady.  She explained just how it is that the proposed tariffs are considered illegal.  President Trump says that a healthy metals production capability is needed in America for national security reasons.  She says that this is not true, because America can always import all the metals we need from our friends and allies such as Canada or the Europeans.  The fact that American metals production industries are getting killed by unfair foreign subsidies to metals producers should be of no concern.  And, the tariffs are being put forward under a provision of international trade law that invokes national security.  So we should just relax, let our metals production businesses fail, and go forward in reliance on our friends and allies in Europe and Canada.

Thanks to NPR for that clarification.  Now I understand why these tariffs are so desperately needed.

Go, Trump, go.  Do not trust our “friends and allies.”  Make America strong again.

MAGA.


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Faith Restored

Today I talked to a restaurant manager and a construction sub contractor. I was sitting there, sipping coffee from the thermos and a realization dawned on the common thread.

Both were struggling with keeping their places staffed

Both were saying it was hard to find people

Both were saying business was booming

Both looked a bit like deer in the headlights.

These were seasoned guys, not novices, but it came to me that it had been before their time since this pattern had occurred. A hot labor market, raising wages, shortages of skilled people.

We have as a nation forgot how to handle this, coupled with managing a touch of inflation in materials along with spot shortages due to high demand.

Ah well, time to dust off the old experience, long filed away , and describe “the way we did it back then….”

I cannot stop smiling these days. My America is back, at least in part. I do see opportunity shining in the eyes of the young folk, the blessed light of fresh possibilities that fires the soul of Americans.

Political Correctness cannot stand in the way of that force. Division cannot stand. Their forebears told the establishment to stick it and headed west. I have faith that will come again.

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TOTD 2018-05-04: Why Gold?

I often hear of people talking about the joys of returning to a gold standard.  Why is gold the choice people fix on?

Now, currency is based on its ability to be exchanged for something.  Right now, the US dollar is valuable for being able to pay debts to the US Government.  Even if everyone else refused to accept US currency, you could still pay your taxes in US greenbacks.  This is what gives it value – ability to command labor.  (This is why I have been skeptical of BitCoin etc.  There is a significant chance that BitCoin could end up without any possibility of exchange.  There is nothing backing these cryptocurrencies.)

However, gold is not that useful compared to many other metals.   Why choose it, as opposed to numerous other metals and alloys?

For example, aluminum.  Aluminum’s value is directly related to the availability of electric energy to refine it from bauxite.  It is an enormously chemically useful element, and forms a passive aluminum oxide coating on its surface, protecting it from corrosion.  It is reflective, electrically and thermally conductive, and extremely light weight.  If there was an apocalyptic event,  refined aluminum would be worth more than gold.  (This is one of the most accurate elements of the Fallout series of  parody post-apocalyptic video games.)

Titanium is another extremely useful metal that has excellent strength to weight and corrosion resistance.   It has many of the positives of aluminum, only taken to a higher level.  It is very difficult to work or shape, which may reduce counterfeiting.

Now for a real oddball – Uranium.  Uranium of natural or low enrichment is directly useable for energy.  It is incredibly dense in energy.   A Uranium standard could be directly related to energy prices, and a Uranium Note could be exchanged directly for nuclear generated electricity, as well as uranium itself.   This has benefit of being great for the environment, but also ticking off the hippies by being nuclear.

So, anyone up for nuclear nickels? Fission dollars?


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Hog production crisis

There is a crisis, right?

There must be.  Every news report on NPR this week, and I mean every one, morning and evening, has featured a very long feature about the plight of poor pig farmers.  They are in crisis.  Their profits are down, prices are down, their outlook is down.  The poor, poor hog farmers are sorely oppressed.

They are being oppressed by President Trump.  He is mean; he is brutal.  He is waging war against the downtrodden stalwart hog farmers.

This week on NPR was all hog farmer all the time.

Now, I am sympathetic to the hog farmer, but you had to go elsewhere to learn that the U.S. is second to Germany in pork exports to China, and that per capita consumption of pork products has been growing at over six percent per year in China this decade.

And perhaps it informs any conversation on the topic of the economics of pork to recall that the price of corn (a common foodstuff for pig farmers) is inflated by government subsidies of ethanol.   And NPR has a reputation for diving into the details of complexities, and so they have, if you listened very carefully.  They did advise that pork exports to China amount to nearly 11 % of pork exports, but they did not report that this is a recent high mark.

The casual listener would be excused for coming away from this series with only one lesson.  “President Trump has been callous to his agricultural base and is being mean to American farmers with his stupid tariffs on aluminum and steel, which cause American producers of swine products to suffer.”

 


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Much Ado About Nothing We Didn’t Know

As a successful investor in FB, I’m annoyed with the careless people who opened accounts thereby exposing their personal life to a world of G-d knows whom.

Yeah, Mark Z ran with this one and who wouldn’t? His stockholders made a lot of money and were smart enough to avoid using the product. (Myself included.)

I took my profits and ran and will cautiously re-enter when the Z fixes the privacy issue.

He’s smart and savvy and very politically connected, so I’d advise investors to watch this comeback very carefully. I have my buy orders analyzed, staggered, and placed and am merely waiting to push that button.

I still believe in his incredible ability. Steve Jobs made far more serious mistakes and died one of the richest men in the world.


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My Letter to the CEO of United Airlines

Dear Mr. Munoz,

A longtime customer of United Airlines, I write to tell you that I will no longer avail myself of your services. You see, I was under the impression that we had a business relationship, not a political one; that you were serious about the business of running an airline. Your action of severing mutually-beneficial arrangements with NRA members is an act obviously intended to disparage us and the organization to which we belong. That organization’s secular sin, according to the wisdom of United Airlines, is to dare stand steadfastly for preservation of the Constitution and the entire Bill of Rights. Your action represents the basest form of moral preening aimed at assuaging a leftist, statist mob ginned up by a dishonest media whose agenda is nothing less than undoing the Bill of Rights. It is beyond ironic that you have chosen to dissociate yourself from what is likely the most law-abiding, organized group of individuals in the entire country and that you purport to be doing that to protest the criminal acts of one disturbed individual who is not an NRA member and who – in this instance – used a gun to kill and maim. Had he instead employed a Chevy Volt to run down his victims, would you have distanced yourself from the American Automobile Association (AAA)? Make no mistake – that is precisely the jejune and incoherent moral principle you have espoused.
One would think this kind of virtue signaling, this striking of a contorted political pose, would be beneath a successful, visible, international corporation interested above all in satisfying its customers. As one who practices a demanding profession on which others’ lives depend, it is beyond doubt that I cannot perform at my best if I am distracted by ancillary or frivolous political matters unrelated to my mission. I can’t imagine it is any different when it comes to running an airline, complex as it is. I suggest you stick to your core business and not waste your limited resources on politics. Until you see fit to follow this sound bit of business advice, I will make do without your services, and, I suspect, so will lots of other NRA members which you deplore with such facile animus.
Your sudden interest in politics ought to inform a similar interest in history. It teaches that, in feeding mobs, the purveyors of hors d’oeuvres often become the next entrée.
With utter disdain,
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On Main street, that great street, I just want to say, They do things they don’t do on Broadway

Another report from the deplorable economy.

I saw an excavator dig out of Chapter 11 with a half million dollar contract…

Two small firms were hiring last year at 14.00 an hour for entry trainees are now upping the wage to 19.00 just to get applicants.

Paydays are the day of smiles as checks get handed out and the amount that surprised earlier in the month is still there.

One business had me license them to work in the neighboring state. The Department of labor there was telling me they used to have one applicant a week from the neighboring state, it is now four or five a day.

A metals fab shop is putting a third shift on their laser lathe. All for work that is coming back from China.

All the halfway house felons are working two jobs and most are staying sober.

If it is not yet Morning in America, I can sure smell the coffee brewing.

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Needed: An Alternative Economic and Financial Universe – Choice

Virtue signaling and censorship by large business and financial enterprises have become difficult to ignore. Companies like Dick’s – announced the it will no longer sell “assault rifles” by which it apparently means all semi-automatic long guns – go out their way to take flaccid political stances with which I strongly disagree. By virtue of being their continued customers, they would have us add to not just their bottom line, which is fine, but they would also force us to accede to their having injected politics into our relationship; they do so in an “in your face” manner, to boot.

Censorship by outfits like Google (I use it as little as possible) and Twitter (never have, never will) is especially disturbing. I was an early adopter of Amazon, but have developed reservations in that I do not like financially supporting the power of Bezos in furthering his well-financed progressive agenda. Similarly with Apple and numerous financial institutions like Bank of America, who do their progressive thing in many ways, at every opportunity. Also, “in your face.”

Several years ago, in its wisdom and to cuddle up to the Obama Administration’s “Operation Choke Point,” BofA fired the McMillan Group – an honest and reputable manufacturer of firearms and accessories – simply because it did not like their products. I immediately sent a letter to BofA saying that, since they had chosen to inject politics into our business relationship, that flows in both directions and I would reciprocate. I withdrew a sum of money which was noticeable to them and closed my account permanently. In their face. It felt pretty good and cost me nothing.

There must be a market opportunity here, at the very least for apps which would steer non-progressives like me to businesses which exist merely to please their customers and not to further various political agendas. The fact that all this takes place with breathless cheerleading of the MSM makes it even more obnoxious. This morning, the readers on NPR could barely contain their near-orgasmic glee at announcing Dick’s aim. I am struggling to restrain myself from applying the suffix  “-less” to the store’s logo.

In all seriousness, creative non-progressive entrepreneurs have an opportunity to strike some real blows against the “new-and-improved” brand of fascism which has taken hold of corporate America. These big business leaders must be put on notice that they cannot take us for granted and that will be best shown them on their bottom lines. Myself, I am sufficiently incensed by the actions of most mega-businesses that I would gladly pay incrementally more for goods and services in return for the knowledge that I am not supporting the further piecemeal destruction of most every value I deem essential for a peaceful and decent society.

What were once efforts at national improvement have been overtaken by deconstruction of its essential values and outright destruction of its common bonds. To the extent possible, I do not wish to be a supporter of the private-enterprise perpetrators of that destruction. This really is a new and highly-effective form of fascism, and it has insinuated itself into most every aspect of our modern, digital, economic lives.

The businesses involved in the new fascism are literally feeding off of us. This must be recognized for what it is and it must be resisted by liberty-minded counterparts of the left’s “community organizers,” only it must be done at the level of business enterprise, not “pay the dead to get out and vote,” as is practiced by the Obam-ite community organizers. Are there really no entrepreneurs willing to organize and distribute, at minimum, the information which would allow us to direct our economic decisions toward those business and financial enterprises with which we agree (or at least those not rubbing our noses in their virtuous leavings)?

I’m afraid we have reached a point where continued agnosticism in our economic lives only serves to further undermine the society in which we are living. The corporate/government political alliance as it  presently exists is inexorable, like death and taxes. Buying stuff from corporations, however, is optional, as is the sense of utter helplessness which results from sending them our money. I would sure appreciate some options created by liberty-minded entrepreneurs. They must be out there, somewhere. It would be neither as difficult or as costly as sending humans to Mars and it might just elicit a similar level of enthusiasm.


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Mnuchin holds steady under fire

Secretary of the Treasury Steve Mnuchin gave a guest lecture to a forum at UCLA, following which he was interviewed before the crowd by Kai Ryssdal of NPR.   The whole thing is worth listening to, but here is a part that I thought was a good showing by Mnuchin:

Ryssdal: OK. The catch of course is, and as you know, you did have two quarters of 3 percent economic growth this past year, but year-over-year growth in the American economy was 2.3 percent. So you’re still far away from the target, right?

Mnuchin: Absolutely. That’s why we’re doing all of these things. So these things have some impact. And all of our economic plans are about creating sustained economic growth.

Ryssdal: Help me understand then with some specificity how you’re going to do that. Because the numbers that were engineered by the White House and the Council of Economic Advisers that went into the tax plan were, “We’re going to get 3 percent. Here’s how,” as opposed to, “These are our policies, which is going to get us to 3 percent.”

Mnuchin: Well, you must seem to have a bias because you’re using the words engineered, so you obviously think that it was the policy the policies were created. Again, what I would say is we fundamentally believe that we will have economic growth and again, 35 basis points is the break even. And we’re already seeing this. By the way, we’re seeing companies give millions and millions of workers bonuses all as a result of this. And for people who are getting these thousand-dollar bonuses, these are not crumbs.

Ryssdal: Absolutely not, and I’m not going to imply that at all. You said 4 million workers in this economy?

Mnuchin: Four and a half million.

Ryssdal: Four and a half million have gotten one-time bonuses.

Mnuchin: Yes.

Ryssdal: So this is a labor pool of 155 million people, sir.

Mnuchin: So are you, tell me, are you, for those four and a half million workers —

Ryssdal: So my question is —

Mnuchin: in one month. That’s a big deal. That’s a big deal. Four and a half million workers have already seen this impact.

Ryssdal: By some estimates —

Mnuchin: I understand you’re doing the math.

Ryssdal: No. So the Americans for Tax Reform say plus or minus, 86 companies have given wage increases, 250 companies have given one-time bonuses, and I guess the question is, what would you rather have? Would you rather have a one-time bonus or a consistent wage increase over the next couple of years?

Mnuchin: We fundamentally believe that there will be wage increases going through to the workers.

Ryssdal: Why do you believe that?

Mnuchin: Again, I just went through why we believe it. It’s a function of economic policy, it’s a function of making a more competitive system that companies can invest. And again, there is research that 70 percent of the tax burden is borne by the workers. So this is all about making a more competitive U.S. system for jobs. [Applause] Thank you.


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