Set your phone’s passcode … right now!

August 5, 2022

Tips from my “hacked” experience
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In a prior post, I recounted how I got hacked …

A perp hijacked my cell phone numbe,  used it to breach my BofA bank account and withdrew a statistically significant amount of money.

For details of the sophisticated hack, see:
I was HACKED … and my story is worth reading!

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The first lesson that I learned (again) is that cell phones are the weakest link in online security.

Step #1 is to secure your phone with — at a minimum – a passcode.

Yeah, it’s an annoying inconvenience, but…

It’s not just to keep kids from grabbing your phone to play games … or keep peering friends & family from sneaking a peek at your texts and emails.

If you lose your phone (or have it stolen), it buys you some time to call your carrier and de-activate your number.

An amateur may get stymied trying to guess which of the 10,000 possible 4-digit numeric codes you use on your phone … a hack-pro can eventually crack the code, but it takes time & effort, so it buys some time … and the perp may just toss the phone and hunt for a non-passcode phone.

Of course, if your phone is equipped with fingerprint or facial recognition, consider using it.

It adds to the inconvenience, but it ups your phone security by orders of magnitude.

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Why is this important?

If perps can open your phone, they can see where you have accounts.

For example, they can scan text message alerts that you’ve received from your banks and credit card companies.

Bingo, they know where you keep your money.

Then, they can go to the banks’ web sites and simply click “Forgot user ID & password “.

The bank will likely recognize the device (remember, the perps have your phone) … and, if you’ve activated 2-factor authorization, the bank may unwittingly send the 2FA code to your phone … which the perp is holding in his hand.

BINGO … account breached … and the perp is off to the races.

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P.S. My phone wasn’t lost or stolen.  It and my number) were hijacked when my carrier “sold” a perp a new iPhone, charging my account and over-riding my activation with the fraud purchased phone.

My bet: A likely “inside job”.

You (and I, now) are way more likely to lose our phones (or get them stolen) than getting them hijacked … which is why passcode protecting them is important.

Again, doing so may cut off some easy paths to your accounts … and may at least buy you some time to contain possible financial damage.

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P.P.S. If you have any anti-hacking ideas, please post a comment or email me.

I was HACKED … and my story is worth reading!

August 3, 2022

Strong passwords and two-factor-authorization gave me a false sense of security … lessons learned!
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Cutting to the chase: a perp breached my B of A account and withdrew a statistically significant amount of money.

Here’s the story as I’ve been able to piece it together…

Somebody (in Ft Worth TX) “bought” a new phone on my Verizon account and activated it to “highjack” my cell phone number.

It’s not clear to me how he did it.

It appears that he bought the phone in a Verizon store (though some Verizon reps say it was an online purchase).

My questions…

If a store purchase, why didn’t somebody check his photo ID and notice that the account has a Maryland address … not a Texas address?

If an online purchase, he might have illicitly got his hands on my ID and password, but how did he get by the “challenge question”?

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My theory of the case:

The perp downloaded the Bank of America app to the highjacked phone, signed on to B of A and clicked the “forgot ID & password” button.  B of A sent my 2FA code to the hijacked phone … which allowed the perp to access my B of A account … changing the password and processing transactions

My B of A “connection log” does show transactions via the B of A app … which I have never even downloaded,.

B of A did send me email alerts about “User ID lookup” and “Password changed” … but I didn’t notice them until about an hour after-the-fact … and, it took me another hour to finally get through to B of A’s fraud department.

In the 2 “open season” hours, the perp made 2 withdrawals from my B of A account. — an online funds transfer and a branch bank cash withdrawal

Again, all of this is happening in Fort Worth TX … it’s not clear to me why the branch didn’t check a photo ID and take notice of the account’s Maryland address

Once I connected with the fraud department, they froze my account and started the process of reversing the fraudulent transactions.

I’m confident that B of A will make me whole.  I’ll keep you posted on that.

Since my account is now frozen (for 6 months, deposits ok but no outflows), I had to open a new account.

That sounds simple enough, but …

Opening a new account means:

  • Changing the delivery instructions for all of my direct deposits (e.g. Social Security and retirement “checks”)
  • Restoring my list of “Bill Pay” accounts
  • Changing instructions for a couple of recurring direct debit charges (e,g, medical insurance)

That all sounds easy enough, but trust me, it’s a frustrating and time-consuming process …. and I’m sure some things will fall through the cracks.

The bad news: Getting to the “right” customer service reps is a challenge.

Many are “above my pay grade” or “not my department” people … some speak with practically unintelligible accents … some sound like they’re using fast-food drive-thru speaker technology to communicate

The good news: While it took many calls to get to them, several of the Customer Service reps were fantastic.

They obviously knew what they were doing …they spoke clearly … they were patient with “dumb” questions … they knew how to “work” their company’s systems … and they “got it done”

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My biggest takeaway

Our IT director at Georgetown frequently reminded me that cell phones are the weakest security link … and strongly advised not using them for online transactions.

I don’t use my phone for online transactions … and I never dreamt of my phone number being hijacked … and, I didn’t even consider the implications (e.g. 2FA codes going to the hijacked phone number).

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Some action items

Some things that I’m doing:

  1. Tightening security on my cell phone account
  2. Changing (and strengthening) all financial account passwords.
  3. Activating 2FA for all accounts (after being sure that #1 is done)
  4. Updating accounts’ contact information (especially fraud dept. phone numbers) for all financial accounts.

Trust me, #4 is easier to do before, not during, a hack when nerves are frayed.

If the earth is warming, why isn’t Baltimore?

August 1, 2022

I hate to ruin a popular narrative with actual data, but…
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Like much of the U.S., the Baltimore area (where I live) was enduring a heatwave in July.

It was hot enough that, even I, momentarily thought: “Maybe the earth really is warming.”

Then, I got my monthly electricity bill from BGE (Baltimore Gas & Electric).

Besides usage info, BGE reports the average monthly temperature, for the current and prior years (the red boxes)

image

As Gomer Pyle would say, “surprise, Surprise, SURPRISE”.

The average July temperature this year (including the heat wave) was 78 degrees … down 2 degrees from last year’s 80 degrees.

A fluke?

I looked back at my July 2021 bill…

It confirmed the 80 degree average in July 2021 … and reported that the average temperature in July 2020 was 83 degrees … 5 degrees HOTTER than this year’s July average.

Hmm.

So, I pulled some more data from my BGE file…

Below are the average monthly temperatures in Baltimore for January to July in years 2020, 2021 and 2022 (as reported by BGE).

image

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What does the data show?

  • Again, this year (July 2022) was 2 degrees colder that July 2021 and 5 degrees colder than July 2020
  • More broadly, comparing year-to-year temperature by month, all 2022 monthly temperatures were equal to or colder than 2020 temperatures … and,  only one month —  February 2022 — was hotter than the prior year’s temperature (40 degrees to 36 degrees) … all other months in 2022 were colder than their comparable months in 2021.
  • The 2022 7-month average (Jan to July) was 1.7 degrees colder in July 2022 than it was in July 2021 …. and 2.9 degrees colder than it was in July 2020

image

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My take

  • It’s conceivable that BGE’s data collection is wrong … or that Baltimore is a complete outlier that’s not representative of the rest of the earth …. but, I doubt it.
  • The data probably doesn’t indicate that the earth is cooling … but, it sure as hell doesn’t support a global warming narrative.
  • Somebody’s gotta explain to me: if the data shows that my average   local temperatures have dropped almost 3 degrees in 2 years — why should I believe (with near certainty) that the earth will be a couple of degrees hotter in 50 or a hundred years if I keep driving my SUV.

This circle doesn’t square…

It looks like a duck, it walks like a duck, it quacks like a duck so …

July 29, 2022

In Biden-speak: It must be an eagle
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Of course, we’re talking about the “R” word – Recession.

In a prior post, we “followed the data” to observe that:

The past 10 times the U.S. economy experienced two consecutive quarters of negative economic growth, the NBER subsequently confirmed (holistically after-the fact)  that  a recession had occurred.

For details, see: When is a 2-quarter GDP drop not a recession?

Well, as expected, GDP fell for the second consecutive quarter and Team Biden — dismissing the data — stuck to its “reimagination” of a recession … claiming that the 2-quarter drop does not indicate that we’re in a recession.

Here’s what’s interesting …

Biden’s crack team of economists (Yellen, Deese, Bernstein) and media flacks (CNN, AP, Politico)  are on record proclaiming exactly the opposite … that a 2-quarter drop in GDP is RECESSION.

Want some evidence?

Team Tucker did a deep dive into their digital archives,

Here’s a 5-minute then & now montage that nails Team Biden’s hypocrisy… well worth viewing.

click to view (5 min.)
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Source

So much for following the data…

Marketing 101: The dogs have to eat the dogfood…

July 28, 2022

Some interesting data on EVs from Consumer Reports
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Earlier this year, Consumer Reports surveyed over 8,000 people on the subject of EVs.

The question that drew most of the headlines asked about “purchase intent”.

Which statement below BEST describes your thoughts on buying or leasing an electric-only vehicle if you were to buy or lease a vehicle today?

The answer:

  • 14% said that they would definitely get an EV;
  • 22% would consider getting one;
  • 35% would consider “in the future, not today”;
  • 28% wouldn’t even consider getting one.

image

Of course, you can look at the glass as half-full or half-empty…

  • Looking only at the “top box”, 14% are hot-to-trot right now
  • Combining the top 2 categories, 36% would definitely get an EV … or at least seriously consider getting one (Note: This was CR’s headlined conclusion)
  • Combining the top 3 categories, 72% are open to the idea of getting an EV some day … i.e. they are “definite maybes”

On the flipside, looking only at the “bottom box”, 28% say that they wouldn’t even consider getting an EV, not now or in the future.

28% translates to about 65 million gas-fueled vehicles currently on the road.

I that a big number (i.e. a show stopper) or a small number (i.e. a “so what?”)?

Draw your own conclusion …

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That was CR’s headline question.

What  I found more interesting was a question about EV ownership, now or ever.

The general finding: 95% have never owned or leased an EV.

No news there, since EVs are just getting started in the market.

But…

image

Let’s dig a little deeper on the other 5%…

The total sample was pretty big — just over 8,000 people.

So, 400 people in the sample currently or previously owned an EV.

Of the 400, 160 currently own an EC.

That leaves 240 who previously owned an EV, but don’t currently own one.

What’s up with that?

That’s 60% of the 400 who apparently “tried” an EV but went back to a gas guzzler.

Hmm.

In my prior life as a marketer, I would have gotten pretty concerned if the majority of customers who “tried” my product didn’t repurchase it … or worse, chucked it after buying it.

In marketing parlance it’s called “buyer’s remorse”.

In plain English, it’s a sign that the dogs aren’t eating the dog food.

Think about it.

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Tech Talk

P.S. Yeah, I know that 400 is a small sample and that EVs are continually improving, so today’s (and tomorrow’s) EVs are better than yesterday’s.

I still think it’s a red flag.

While on the subject …

“Purchase intent” surveys tend to be biased high.

If people aren’t really shelling out any buckos, they’re more likely to say that they’ll buy something … especially if the price of the product isn’t included in the question.

So, the purchase intent results reported above are very likely overstated.

When is a 2-quarter GDP drop not a recession?

July 26, 2022

Team Biden’s PR stunt reimagining what a recession is, in Biden-speak, pure malarkey.
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Team Biden’s crack team of political-economists is apparently trying to front-run this weeks GDP release by moving the goal posts.

Not by a couple of feet … or to the stadium parking lot … but to another stadium.

They’re saying “A recession is not fairly defined by a 2-quarter drop in GDP.  It needs to be evaluated holistically, after all related data is available and analyzed. And, that takes time. Maybe a year or so after the GDP decline.”

That’s partially true.

The NBER — the “official” recession sanctioning body — does consider multiple factors (i.e. more than simply a 2-quarter drop in GDP)  when declaring that a recession has occurred.

But, here’s an acid test question that cuts to the crux of the matter:

Out of the past 10 times the U.S. economy has experienced two consecutive quarters of negative economic growth, how many times was a recession officially declared (holistically after-the fact) by the NBER?

Answer: All 10 times !

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Source: AEI 

Said differently, post-WWII – a 2-quarter drop in GDP has been a perfect indicator of a recession.

In that time period, the NBER has always “holistically” confirmed  a recession after a 2-quarter drop in GDP

Nonetheless, Team Biden would advise:

Don’t generalize from your personal experience …and certainly don’t rely on the data … trust us Team Biden economists when we say that everything is fine & dandy.

These guys have no conscience.

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P.S. The pundit consensus seems to be that Team Biden’s front-running “reimagination” is an attempt to defuse the impact of of a bad GDP number.

Obviously, they already know what the “top secret” number is.

Wouldn’t surprise me if the reported number is an infinitesimal increase in GDP.

That would give Biden a chance to boldly proclaim: “See, I told you that we’re not in a recession. The economy is strong.”

Naw, they’re not that smart…

 

Marketing 101: “Reasonable reach”

July 25, 2022

It’s only possible to incentivize buyers to buy something that they can reasonably afford.
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Last week, Transportation Secretary Pete Buttigieg spoke a Climate Control truth out loud:

image

Recognizing the uh-oh of his comment, he tried to soften it by saying:  “We could have no pain at all by making EVs cheaper for everyone.” Source

Wrong, Mayor Pete.

Making an EV cheaper?

Right now, for example, Ford’s base model Lightning F-150 pickup costs $39,974, a mere $10,000 more than its gas-powered version. Source

Of course, government can make that $10,000 go away with the stroke of a pen.

How?

Simple: subsidies to car buyers and manufacturers.

But, Mayor Pete, there are two pieces to the puzzle … the $10,000 price differential is one problem … the $39,974 (or, $29,974 after possible government subsidies) is a bigger one given that

image
Source

You see, Mayor Pete, about half the country doesn’t have the scratch to buy more than a week’s food and gas.

A shiny new car isn’t on their radar, whether it’s $39,974 or $29,974 … or $65,000 for crowd-swooning Tesla.

Why?

It’s out of their “reasonable reach”.

And, by the way, the “reach” is getting more difficult these days …

As the headline teased:

Last November, 32% of Americans said they were ill-equipped to cover a $400 emergency expense.

But this year, that number has risen to 49%, according to a YouGov survey for the Economic Security Project conducted online in May .

It’s clear that more Americans are having trouble covering unplanned expenses than in the past.

It’s easy to see why fewer Americans have cash reserves in the bank now compared to last November.

Living costs have been soaring over the past six months due to inflation, and wages aren’t rising at a steady enough pace to keep up.

That’s forced many people to dip into their savings rather than reserve that money for other purposes. Source

Simply put: An EV isn’t within the reasonable reach for most Americans … and the reach is getting longer as savings erode and inflation shreds buying power.

Or, as the original Grandma Homa used to say more colorfully:

“If you don’t have a pot to piss in, don’t go shopping for Cadillacs.”

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P.S. to Mayor Pete

According to the WSJ:

Most nonrich consumers will likely opt for gasoline-powered cars for decades to come. 

So, the auto industry is gambling on big electric vehicles – loaded with exciting, high-tech gadgets – aimed at the rich.

For example, Nissan is giving up its pioneering electric Leaf in favor of a big electric SUV aimed at affluent shoppers. 

Ford is placing bets on the Mustang Mach-E; GM on the Hummer EV, 

Some $526 billion is currently being invested to create dozens of mostly high-end electric vehicles aimed at the 17% of buyers who constitute the luxury market.

Regulators everywhere are structuring their electric-vehicle industries based on subsidies from less-affluent people who continue to buy gas-powered cars.

 

Part 3: Putting the “E” in EVs

July 20, 2022

How much electricity is currently generated? How is it generated? So what?
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In Parts 1 & Part 2, we concluded:

    • The U.S. currently consumes about 4 trillion kWh of electricity per year
    • About 1.5 trillion kWh (about 40% of the total) is consumed in residential use … about 1/2 of that is used by HVAC & hot water heaters
    • A scant amount of electricity is currently being consumed for “transportation” … and, practically all of that is used by public transit systems.
    • If all vehicles currently on the road were to be replaced by EVs, recharging their batteries would consume an additional 1 trillion kWh of electricity.

All of which raises a couple of  central questions: Does the U.S. have the electricity generation capacity to service a full national fleet of EVs?

Short answer: no.

So, where will the additional electricity come from?

Today, we’ll set the context by looking at our current supply of electricity…

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According to the U.S. Energy Information Administration (EIA)….

Total U.S. electricity generation in 2021 was about 4.12 trillion kWh.

There are four fuel “sources” for electricity generation: natural gas (38%), coal (22%), renewables (20%) and nuclear (19%).

in the past 10 years, total electricity generation has stayed virtually constant at around 4 trillion kWh … but the mix of fuel sources has changed.

image

Coal and nuclear power have declined in the overall mix of fuel sources … coal by a lot, nuclear by a little … natural gas and renewables have increased and are, together, account for about 60% of fuel for electricity.

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Digging deeper in the  category of renewable fuel sources….

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  • From 2011 to 2021, electricity fueled by renewables increased by over 60% to 826 billion kWh … which is accounts for 20% of the electricity generated.
  • About 2/3s of the increase is attributable to wind power … which provides about half of the renewable fuel used to generate electricity … and about 9% of the total fuel that goes into electricity generation.
  • Almost 1/3rd of the increase is attributable to solar power … which provides about 3% of the total fuel that goes into electricity generation.

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Takeaways

  • Electricity generation has stayed practically constant for more than 10 years at around 4 trillion kWh
  • Some area of the country have experienced brown outs (rationed supply of electricity), primarily during periods of hot weather … suggesting that, during daytime hours, the electricity generation capacity is at capacity.

It is commonly assumed  that there is available nighttime capacity.

  • Over the past 10 years, coal usage as an electricity fuel has been cut in half … replace by natural gas (2/3rds) and renewables (1/3rd).
  • But, 20% of electrical generation (899 B kWh) is still being fueled by coal
  • Nuclear power — about 20% of the fuel mix — has been slowly declining as old plants are being retired … and no new plants being built.

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Bottom line: To meet Biden’s aggressive climate control objectives, electrical generation will need to be increased by almost half … 1 Trillion kWh for EVs and 899 Billion kWh to totally phase out coal.

Part 2: Putting the “E” in EVs…

July 19, 2022

So, how much electricity will EVs eventually require?
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In Part 1, we looked at current demand for electricity and concluded:

  • The U.S. currently consumes about 4 trillion kWh of electricity per year
  • About 1.5 trillion kWh (about 40% of the total) is consumed in residential use
  • A scant amount of electricity is currently being consumed for “transportation” … and, practically all of that is used by public transit systems.

Of course, EV demand for electricity will increase.

By how much?

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Let’s look at our prior ballpark estimate:

A full “incredible transition” to EVs would increase consumer / residential electricity demand in the U.S. by over 40% (640 billion kWh / 1.5 trillion kWh = 43%)

Data, sources & calculations

  • in 2019, “there were almost 229 million Americans who have driving licenses
  • The 229 million collectively drove over 3.2 trillion miles.” Source
  • From what I can ascertain,  on average, a Tesla gets about 5 miles per kWh of stored charge. (e.g. a T3, 50 kwh battery gets 250 miles of range).
  • So, 3.2 trillion miles of driving requires 640 billion kWh of additional electricity.

What do other sources day?

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The Energy Institute at the University of Texas analyzed the likely additional energy required by state for a full transition to EVs.

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The UT-EI conclusion: On average across states, 30.9% more electricity will be needed to electrify EVs … with wide variability across states.

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All States’ Data

The 30.9% translates to over 1.25 trillion kWh of added electricity required … almost equal to all of our current residential consumption of electricity.

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In August 2021, the NY Times asserted (without attribution or analysis):

If every American switched over to an electric passenger vehicle, analysts have estimated, the United States could end up using roughly 25% more electricity than it does today.

Working the NYT’s estimate …

Their 25% — apparently based on total U.S. electricity consumption —  implies that we’ll need an additional 1 trillion kWh of electricity

The 1 trillion kWh of electricity is roughly equal to  66% of our current residential electrical consumption, (1 trillion / 1.5 trillion = 66%)

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The Brattle Group is a research consultancy that “combines state-of-the-art analytical techniques and practical industry experience to answer complex economic, financial, and regulatory questions”.

Brattle analysts did a detailed “assessment of the investments needed across the electric power sector to support the deployment of 20 million EVs in the U.S. by 2030.

Brattle’s conclusion: 20 million EVs will add 60–95 TWh of annual demand and 10–20 GW of peak load to the system.

Taking the low end of Brattle’s range (60 TWH per 20 million vehicles) and scaling that number up to all 239 million vehicles currently on the roads …  717 billion kWh of additional electricity will be needed for a full “incredible transition” to EVs … with a high estimate of 1.135 trillion kWh of electricity required (equal to about about 75% of current residential electricity consumption).

239 million vehicles / 20 million = 11.95

11.95 x 60 TWH = 717 TWh

One Terawatt Hour is equal to 1 billion  Kilowatt Hours. Reference

So, 717 TWh = 717 billion kWh

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So, how much electricity will EVs eventually require?

  • UT Energy Institute: 1.25 trillion kWh
  • Brattle Group (high): 1.135 trillion kWh
  • New York Times: 1 trillion kWh
  • Brattle Group (low): 717 billion kWh
  • HomaFiles estimate: 640 billion kWh

Our back-of-the envelop estimate was on the low side.

Looks like 1 trillion kWh is a reasonable (and easy to remember) estimate of the electricity load that an “a full “incredible transition” will add to the system … a 25% to 30% upper to our current levels.

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Next up: So, where’s that electricity going to come from?

Putting the “E” in EVs…

July 18, 2022

Starting point: How much energy do we consume now?
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A couple of weeks ago, I posted some ballpark estimates of how much additional electricity would be consumed in the U.S. if Biden’s “incredible transition” materialized and all of us were driving shiny new EVs.

My conclusion: A full “incredible transition” to EVs would increase consumer / residential electricity demand in the U.S. by at least 50% (640 billion kWh / 1.34 trillion kWh)

For details see: Update: What if Oprah gave all of us EVs?

At the time I asked for ideas re: sources of (1) “hard” numbers re: electricity generated and consumed, (2) analyses of how much EVs will add to electricity consumption and (3) “real” plans to bolster U.S. energy production and distribution (i.e. “the grid”).

A couple of you pointed me to some info sources … THANKS!

So, let’s work the numbers, starting with electricity consumption

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According to the U.S. Energy Information Administration (EIA)….

Total U.S. electricity consumption in 2021 was about 3.93 trillion kWh.

Of that total, the 3.8 trillion kWh is classified by the EIA as “retail sales”.

Of that total, “residential retail sales” account for almost 1.5 trillion kWh about 40% of total “retail sales of electricity”.

For reference: We previously ballparked total residential electrical consumption at about 1.34 trillion kWh (10,715 kWh per household x 125 million U.S. Households)

image

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Drilling down further

Between 1/3 and 1/2 of residential electricity consumption is driven by home HVAC systems (air conditioners and furnaces) … hot water heaters (14%) and washers & dryers (13%) push the cumulative total to almost 75% or residential use. Source

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Takeaways:

Rounding up a bit for simplicity:

  • The U.S. currently consumes about 4 trillion kWh of electricity per year
  • About 1.5 trillion kWh (about 40% of the total) is consumed in residential use
  • The majority of residential use attributable to HVAC systems and hot water heaters.

Important: Note that only a scant amount of electricity is currently being consumed for “transportation” … and, practically all of that is used by public transit systems.

Said differently, the electricity consumed by EVs is currently rounding error.

But, that will change…

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Next up: How much electricity will Es consume?

The $100 Trillion World Economy

July 14, 2022

A great contextual chart by the Visual Capitalist
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Highlights:

  • The aggregate World GDP number: $100 trillion
  • The U.S. has been the world’s largest economy since 1871
  • But, China is projected to surpass the U.S. by 2030
  • Russia — the small circle at the 6 o’clock position on the chart — is the 11th largest economy @ $1.8 trillion … less than 1/10th the size of the U.S. economy … smaller than Canada, Italy and both California and Texas.

click here to enlarge
This infographic visualizes the 100 trillion global economy by country GDP==============

The Top 10

imageclick here to view the ‘all countries’ list

How much did Sen. Stabenow save driving her EV from Detroit to DC ?

July 13, 2022

The Detroit News pegs the savings at less than $10.
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A couple of weeks ago, Michigan’s Sen. Debbie Stabenow took a  trip from Lansing, MI to Washington, D.C., in her Chevrolet Bolt EUV to tout the benefits of driving electric.

Stabenow crowed: “I went by every single gas station, it didn’t matter how high it was.”

English translation: Get an EV and stop whining,peasants.”

So, how much did she save?

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To answer the question, the Detroit News ran  the senator’s trip through two popular charging apps, A Better Route Planner (ABRP) and Chargeway.

According to ABRP, Stabenow’s Bolt EUV used almost 200 kWh of energy on the 600 mile trip.

So, ABRP estimates that Stabenow paid (and probably expensed) about $80 for electricity.

Note: Charging station operator Electrify America’s charging rates across Michigan, Ohio and Pennsylvania are a uniform 43 cents per kWh.

In comparison, a comparably equipped, gas-powered Trailblazer SUV gets 33 mpg on the highway.

At $5 per gallon, that works out to about $90 in gas bill (600 mile / 33 mpg x $5 per gallon).

So, Stabenow saved about $10.

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The News, apparently doing some rounding, pegged the savings at $8.

The News also pointed out that the Bolt is priced about $5,000 higher than the Trailblazer ($28,195 to $22,995).

And, channeling an analysis by Chargeway, The News concludes that Stabenow’s EV added more than three hours to the a gas-fueled 9 hour, 30-minute Lansing-to-D.C. road trip (13 hours, 9 minutes total) … attributable to charging time (added distance to charging stations, wait time, actual charging time) and slower speeds.

Note: Chargeway assumes an average speed of 60 mph on the Bolt EUV’s Lansing-to-D.C. trip while ABRP assumes 65 mph

But for EVefficiency, ABRP urges drivers to travel at, for example, 55 mph in the long leg between Toledo and Pittsburgh. Ohio and Pennsylvania have a 70 mph speed limit.

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Paraphrasing the News’ conclusion

Get an EV if:

  • You’ve got the $$$ to buy one
  • You plan to use it for commuting, not road trips
  • Your employer Or somebody else) provides free-to-you charging
  • You can charge it overnight in your garage or driveway (at economical electricity rates)

Otherwise, you may want to hold off for awhile…

The Hill: ”R.I.P. Green New Deal”

July 11, 2022

The 3 reasons that AOC’s Green New Deal is staggering
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Interesting opinion piece in left-leaning The Hill

Merrill Matthews is a resident scholar with the  Institute for Policy Innovation which professes itself to be “a non-profit, non-partisan public policy think tank.”

Merrill opines:

“We had such high hopes (that the Green New Deal) would save our planet; save our economy; and, most of all, save our party from the coming November red tsunami.”

Note: Doesn’t sound non-partisan to me.

But he concedes that: “There is very little chance of resurrecting the Green New Deal (now or after the November elections.”

He asks rhetorically: “Where did things go off track?”

Speaking some quiet truth out loud, Merrill soberly cites 2 strategic miscalculations that climate controllers have made:

  1. Pushing for higher gas prices
  2. Relying on unelected bureaucrats & courts

Taking those one at a time…

=============

High gas prices

One of the necessary ingredients for the Green New Deal was high gasoline prices.

We need those high prices to push millions of reluctant Americans to embrace electric vehicles.

When we surveyed the pubic over the years, many people (44 percent in a 2018 survey) said they would be willing to pay somewhat higher gasoline prices to fight climate change.

So, we thought the recent jump in gasoline prices would be, if not welcomed, at least tolerated.

But we were dead wrong.

It turns out that high gasoline prices hit low-income families the hardest — the very people we progressives claim we want to help.

More importantly, those high prices have enraged most voters.

==============

Unelected Bureaucrats & Courts

We thought that we could still depend on federal agencies and the Supreme Court to impose what couldn’t pass Congress.

We knew it would be difficult getting the Green New Deal through Congress, even with Democratic majorities in the House and Senate.

Especially since we included so many items that aren’t actually related to the environment, like higher wages and social justice and equity demands.

For years it seemed the Supreme Court was willing to interpret the law favorably for us. That era appears to be over.

As Justice Neil Gorsuch wrote, “The Court does not purport to pass on the wisdom of the EPA’s course. It acknowledges only that agency officials have sought to resolve a major policy question without clear legislative authorization to do so.”

============

The “so what?”

Merrill says:

If we want sweeping environmental reforms, we will have to turn to our democratically elected representatives in Congress or the state legislatures to pass them.

That means if we’re to make progress on our environmental agenda, we will have to sit down with the other side and see where we can find common ground.

That’s a tall order.

But if we really think the environment is important, maybe we should try to do it the way the framers of the Constitution envisioned and rely on the legislative branch rather than the judicial branch to make our laws.

==============

My take:

None of the above is surprising “new news”.

But, I credit Merrill with speaking the truth out loud … that sky high gas prices and circumventing legislative processes were (are?) part of the plan … all along.

Sometimes, you reap what you sow…

Shocker: Americans losing confidence in “institutions”…

July 7, 2022

So says the most recent Gallup poll.
=============

According to Gallup: Americans are less confident in major U.S. institutions than they were decades ago … or even a year ago.

In the 1980s,”high confidence in institutions” hovered around 45% … that dropped to 40% in the 1990s … then dropped again to about 35% in the period 2007 to 27% in 2022.

image

Gallup observes that:

The largest declines in confidence (from 2021 to 2022) are 11 percentage points for the Supreme Court — as reported in late June before the court issued controversial rulings on gun laws and abortion, and …

15 points for the presidency, matching the 15-point drop in President Joe Biden’s job approval rating since the last confidence survey in June 2021.

Congress dropped 5 percentage points (from its prior 12% level) and to a new low of 7%

image

The highest confidence ratings go due small business and the military (despite the Afghanistan debacle which is apparently laid at the feet of the Biden administration).

Note: Big business is down 4 percentage points to 14%

Next highest confidence levels go to police and the medical system.

  • Republicans give the police a 67% confidence rating; Dems give the police a low 28% confidence rating.
  • The criminal justice system is down 6 percentage points to 14%

Public schools are down 4 percentage points to 28%.

Newspapers and TV news are down to 16% and 11% respectively.

Dems give newspapers a 35% confidence rating and TV news a 20% rating; Republicans give those news outlets 19% and 13% ratings, respectively.

===============

Anybody surprised?

Numbers: Some context for the abortion debate.

July 5, 2022

Birth rates & abortions … how many, where, who and how likely to be restrcted.

=============

U.S. Births

According to the CDC:

> The number of births has declined by an average of 2% per year since 2014.

> In 2020, 3,613,647 births were registered in the United States, down 4% from 2019

image

============

Birth Rates

> The general fertility rate (GFR) for the United States in 2020 was 56.0 births per 1,000 females aged 15–44

The general fertility rate in 2020 was  down 4% from 2019 … a record low rate for the nation

image

> Birth rates continued to increase for females in age groups 35 to 39 and 40 to 44a record high.

> Birth rate among teenagers continued its steep decline: In 2020 the birth rate for females aged 15–19 was 15.4 births per 1,000 …down 8% from 2019 ….and another record low

With those numbers as context, let’s look at the abortion numbers…

==============

Abortions

According to the pro-abortion Guttmacher Institute:

> The number of reported abortions in the U.S. has declined over 40% since the 1980s

image

In 2020…

  • 930,160 abortions were performed in the U.S..
  • The abortion rate was 14.4 per 1,000 women (in child-bearing age groups)
  • The ratio of abortions to pregnancies was 20.6% … about 1 in every 5 pregnancies

=============

Abortions impacted by Dobbs

According to CDC data (for 2019):

68% of all abortions were performed in blue states and 32% in red states … call it 2 out of 3 in blue states.

Blue states currently have the most liberal abortion rights which will, at a minimum, be retained … or, most likely, will be expanded.

Note: The vast majority of pro-choice protests seem to be happening blue states or, in some cases, in red states by by out-of-state blue staters

Less than 300,000 abortions per year (297,651 to be precise) are in blue states and, thus,  at  risk of being banned after Dobbs.

==============

Blue state “bans”

The number of full bans on abortion is likely to be far less than 300,000.

Why?

Every abortion ban enacted or proposed includes an exception to protect the life or health of the mother.

According to the CDC, 92% of abortions take place in the first trimester … 43% in the first 6 weeks.

Many (most? all?) blue states are likely to permit abortion in the first 6 weeks or the first trimester.

That cuts the number of abortions at risk of being banned down to about 150,000,at most … and, more likely, down to well under 100,000

==============

Other “ban” mitigating actions

According to Guttmacher, 54% of all abortions already are “medication abortions” (i.e. pills) that are FDA approved for use within the first 10 weeks of pregnancy.

image

My hunch: Those pills will likely flow across state lines, e.g. via difficult-to-stop online pharmacy sales.

=====

And finally, many companies have already declared that they will pay travel expenses for employees traveling to abortion-permitting states.

While obviously an added hassle for abortion seekers, it does provide access.

=============

And, for the record

14 weeks is the cut-off for “abortion on request” for practically all Europen0an countries.

Maher noted that the majority of the U.S. still has more abortion freedoms than a lot of countries in Europe, where they set a shorter time-frame on abortion limits
Source

=============

Those are the numbers from the CDC and the pro-abortion Guttmacher Institute.

Draw your own conclusions…

Happy 4th of July

July 4, 2022

Kick back … enjoy your friends & families … be thankful for our freedoms.

image

More reasons that government is ambivalent about inflation…

June 30, 2022

Bottom line: All levels of government benefit from inflation.
=============

Recently, Biden raised eyebrows when he blurted that we’re in an “incredible transition” away from fossil fuels … and inflated gas prices are the price to be paid.

I’m surprised that so many folks are surprised that Biden thinks high gas prices are good … and that his claim of “all things being done” to arrest further gas price spikes is just window dressing.

In a prior post, we spotlighted the world’s worst kept secret, revealed publicly by Biden’s press secretary

image1

English translation: “If high gas prices bother you, get on our climate control program and buy an electric car.”

============

OK, that’s one reason that Biden’s people are ambivalent or maybe even enthusiastically supportive of skyrocketing gas prices.

And, there are other reasons that all levels of government — local, state and Federal — have some degree of ambivalence (or enthusiasm).

As the WSJ puts it:

One irony of inflation is that while it’s bad for working Americans, it’s great for the government.

Tax revenues soar as nominal profits and incomes rise.

“Overall state and local government receipts including federal aid are already 23% above pre-pandemic levels … thanks to Congress’s gusher of spending.”

image

How does that happen?

Let me count the ways…

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At the Federal level:

(1) inflation devalues the national debt

(2) higher nominal wages push some tax filers into higher Federal tax brackets

(3) increasing asset prices boost capital gains and push some tax filers into higher Federal income  tax brackets

=============

At the State level:

(1) higher wages and capital gains push some tax filers into higher state income tax brackets

(2) higher retail prices increase state sales tax revenues … assuming that consumers continue to buy the same “real” volume of goods.

=============

At the Local level:

(1) higher wages and capital gains push some tax filers into higher local income tax brackets

(2) higher retail prices potentially increase local sales tax revenues

(3) higher real estate prices push real estate assessment values higher and boost local real estate tax collections.

==============

And, there’s a blue state slant to all of this:

The WSJ observes:

Progressive states with higher tax rates are especially flush (with tax revenues).

Democratic states in particular are building in new structural spending in the form of higher pay and pensions for public unions.

As Jen Psaki might say if she were still frequenting the podium: “suck it up”.

What’s the fundamental difference between oil prices and electricity rates?

June 29, 2022

Hint: Who (or what) sets the prices?
===============

This week, the G7 leaders reached “an agreement in principle to begin the process of imposing price caps on Russian oil.”

The agreement on oil, would aim to limit how much money Russia can earn from each barrel of oil it sells on the global market, reducing the fossil fuel revenues Russia is relying on to finance its war effort.

It would also attempt to stabilize global oil markets — and hopefully bring down prices.

It remains unclear how caps would work, and there is more speculation than specifics. NY Times

Hmm.

Coupled with my recent digging on EVs, the G-7 agreement lit my light bulb, so to speak.

I asked myself: “What’s the fundamental difference between oil prices and electricity rates?”

Well, oil prices are set “by the market” … largely driven by supply and demand … subject to some governmental supply policies (e.g. OPEC supply agreements and capped pipelines) … and short-lived price controls (that invariably backfire).

Electricity rates (i.e. “prices) are controlled by state regulatory agencies… electric companies submit pricing plans that must be approved by government bureaucrats.

Hmm

So, under the umbrella of climate control — less oil, more electricity — governments intend to wrest near total control of energy prices away from “the market”.

Is that a good idea?

The economist side of me says: “Nope”.

I’m surprised that pundits haven’t explored this “wrinkle” in Biden’s “incredible transition” plan.

An unintended second-order consequence or part of the plan.

Draw your own conclusion.

Update: What if Oprah gave all of us EVs?

June 27, 2022

Would the electric companies be able to supply the increased load?

Note: While at the beach last week, I got some helpful input from loyal readers and trusted sources which I’ve tried to incorporate into the original post.

==============

In a prior post we ran some back-of-the-envelope numbers on EV ownership.

The conclusion: With $5 per gallon gas and 14¢ per kWh electricity, a shiny new EV would practically pay for itself … albeit taking 20 years to break even.

Key assumptions: (1) A typical EV with a 50 mWh battery has a range of about 250 miles (2) All electricity drawn for charging is stored in the battery (i.e. charging efficiency is 100%)

Caveats: (1) Doesn’t consider the cost of an in home charging station (for faster charges) which would lengthen the breakeven time frame (2) Doesn’t consider differences in lifetime maintenance costs which likely favors EVs and would lower the breakeven time frame 

Let’s assume that life expectancy (for you and for an EV) is generally longer than the breakeven time frame … and ask a broader question:

If there were a groundswell of EV demand, would electric companies be able to generate enough electricity to keep the EVs charged (and the rest of our electricity-based lives operating “normally’}?

Suppose, for example, that Oprah gave all of us an EV today.

How much electricity demand would be added on to the U.S. electrical grid?

Again, let’s run some more back-of-the-envelope numbers…

==============

  • According to the U.S. Energy Information Administration (whatever the heck that is): In 2020, the average annual electricity consumption for a U.S. residential utility customer was 10,715 kilowatthours (kWh)

For reference: My home’s annual electricity consumption runs about 27,500 kWh

Before you accuse me of being an energy glutton, consider…

The Tennessee Center for Policy Research estimates that Al Gore (former VP and current Climate Control Advocate) has a 20-room home that “devours” nearly 221,000 kWh annually … that’s about 20 times the national average … and about 10 times my home’s usage 

  • There are about 125 million households in the U.S.  We’ll assume that each household is a “residential utility customer”.
  • That makes total residential electrical consumption about 1.34 trillion kWh (10,715 kWh x 125 million)

=============

  • According to Federal Highway data reported by Metromile, in 2019, “there were almost 229 million Americans who have driving licenses, and they collectively drove over 3.2 trillion miles.”

Note: I’ve seen estimates that range all the way up to 7.5 trillion miles.  To give EVs every benefit of the doubt, we’ll use the low number

  • Again, from what I can ascertain, a Tesla gets about 5 miles per kWh of stored charge. (e.g. a T3, 50 kwh battery gets 250 miles of range).
  • So, 3.2 trillion miles of driving requires 640 billion kWh of additional electricity.

Note: The above assumes that “filling” a battery is like filling a gas tank  — i.e. a gallon “flowing in” is a gallon “stored for use”.

This assumption probably understates the amount of electricity that is required to recharge a battery … maybe by a lot!

Bottom line: A full “incredible (fast) transition” to EVs would increase consumer / residential electricity demand in the U.S. by at least 50% (640 billion kWh / 1.34 trillion kWh)

=============

Key question: will the electric companies (and the country’s electrical grid) be able to meet the increased demand?

Keep in mind that:

  • In some (many?) parts of the country power plants are currently fueled by coal, gas and nuclear power — all of which are deemed taboo by climate control zealots.
  • Key components (or full units) of solar panels and windmills are sourced from China … and neither modality has been proven to generate a dependable flow of energy “at scale”.
  • Some parts of the country have a history of electrical outages — e.g. unplanned weather outages and rolling blackouts.

But, a trusted source reminded me that the electrical companies — while sometimes stressed during peak daytime hours — have substantial unused capacity during nighttime hours.

That unused capacity can be tapped by “demand management” that nudges EV owners to charge their batteries overnight instead of during the day.

Note: I’m trying to track down hard data re: U.S. electricity generation capacity.  Any ideas re: sources?

For example, nighttime electricity rates (i.e. prices) are generally lower than daytime rates … and that differential can be widened to coax overnight EV charging.

That’s true, but overnight charging at home — even with nighttime rate discounts — isn’t exactly a gimme.

  • For example, many urban car owners park overnight on the street where there’s no access to a personal (or public) electrical outlet.
  • Other drivers park in driveways and would need to run extension cords from house outlets to their cars.  Good idea?
  • And, charging via a standard 110/120 outlets is a slow process … adding only a few miles of range from an overnight charge.
  • To up the charging speed requires 220/240 service and a fast-charging station … which adds to the initial EV “investment”.

So, leveraging unused nighttime electrical capacity may be a partial solution, it doesn’t close the supply-demand gap that EVs are virtually certain to create.

How’s that gap going to be closed?

I’d sure like to see the plan…

 

 

 

Beach Week …

June 20, 2022

Taking a stress-reduction break … back next week.

image

Bethany Beach, Delaware

============

Follow on Twitter @KenHoma

>> Latest Posts

#HomaFiles

What if Oprah gave all of us EVs?

June 18, 2022

Would the electric companies be able to supply the increased load?

Short answer: Nope.
==============

In a prior post, we ran some back-of-the-envelope numbers on EV ownership.

The conclusion: With  $5 per gallon gas and 14¢ per kWh electricity, a shiny new EV would practically pay for itself … albeit taking 20 years to break even.

Let’s assume that life expectancy (for you and for an EV) is longer than 20 years … and ask another question:

If there were a groundswell of EV demand, would electric companies be able to generate enough electricity to keep the EVs charged (and the rest of our electricity-based lives operating “normally’}?

Suppose that Oprah gave all of us an EV today.

How much electricity demand would be added on to the system?

Let’s run some more back-of-the-envelope numbers…

==============

  • According to the U.S. Energy Information Administration (whatever the heck that is): In 2020, the average annual electricity consumption for a U.S. residential utility customer was 10,715 kilowatthours (kWh)

  • There are about 125 million households in the U.S.  We’ll assume that each household is a “residence”.
  • That makes total residential electrical consumption about 1.34 trillion kWh

=============

  • According to Federal Highway data reported by Metromile, in 2019, “there were almost 229 million Americans who have driving licenses, and they collectively drove over 3.2 trillion miles.”

Note: I’ve seen estimates that range all the way up to 7.5 trillion miles.  To give EVs every benefit of the doubt, we’ll use the low number

  • From what I can ascertain, a Tesla gets about 5 miles per kWh of stored charge. (e.g. a T3, 50 kwh battery gets 250 miles of range).
  • So, 3.2 trillion miles of driving requires 640 million kWh of additional electricity.

Note: The above assumes that “filling” a battery is like filling a gas tank  — i.e. a gallon “flowing in” is a gallon “stored for use”.

This assumption probably understates the amount of electricity that is required to recharge a battery … maybe by a lot!

Bottom line: A full “incredible (fast) transition” to EVs would require at least a 50% increase in electricity generation for consumer / residential use (640 kWh / 1.34 trillion kWh)

=============

And, where may I ask, will all of this additional electricity come from, given that power plants are fueled by coal, gas and nuclear power — all of which are deemed taboo by climate control zealots.

Solar panels and windmills sourced from China?

Sorry, but I’m betting the under on those.

So, how we gonna do it, Joe?

Looks like there may be some holes in the U.S. energy plan

There is a plan, right?

 

What if Oprah gave me an EV?

June 17, 2022

How much would my electrical demand increase?
==============

In a prior post, I worked through numbers that explain why my electric utility company sent me an email alert of “ABNORMAL USAGE” … followed by an insinuating alert asking me: DO YOUR DRIVE AN EV?’

The post’s numbers show how EV-charging likely triggered the “unusual usage alert” … and a subsequent series of EV charges led the electric company to infer (incorrectly) that I was on the EV bandwagon.

The email alerts got me wondering…

I asked myself: How much more electricity would I use if Oprah gave me an EV and I ditched my gas-sipping SUV?

Let’s work the numbers…

============

  • Like an average American, I drive about 13,500 miles each year Source
  • From what I can ascertain, a Tesla gets about 5 miles per kWh of stored electricity. (e.g. a T3, 50 kwh battery gets 250 miles of range)
  • So, my lowball annual charging consumption would be at least 2,700 kWh … some at home, some at charging stations

Note: The above assumes that “filling” a battery is like filling a gas tank  — i.e. a gallon “flowed” is a gallon “stored”.

This assumption probably understates the amount of electricity that is required to recharge a battery … maybe by a lot!

==============

For simplicity, let’s assume that I do all of the charging at home…

  • Our home’s annual electricity consumption runs about 27,500 kWh

Note: According to the U.S. Energy Information Administration: In 2020, the average annual electricity consumption for a U.S. residential utility customer was 10,715 kilowatthours (kWh).

Before you accuse me of being an energy glutton, consider…

The Tennessee Center for Policy Research estimates that Al Gore (former VP and current Climate Control Advocate)  has a 20-room home that “devours” nearly 221,000 kWh annually … that’s about 20 times the national average.

  • Again, I estimate that my annual charging consumption would be at least 2,700 kWh

  • That’s about 10% of my current TOTAL electricity usage.

=============

So, is a 10% increase in my electricity consumption a good thing or a bad thing?

Let’s monetize it…

  • In 2021, I was charged 11.5¢  per kWh
  • Currently I’m being charged 14¢ per kWh … a 20% increase over 2021 rates
  • So, my @home charging charge (<= I love the alliteration) would be about $400.
  • My Audi Q5 SUV gets about 25 MPH
  • So, driving 13,500 miles annually requires about 540 gallons of gas.
  • At Biden’s induced $5 per gallon, that’s a whopping $2,700 annually.
  • The electrifying cost benefit of my hypothetical EV: $2,300.

Of course, the savings depend on $5 (or higher) gas prices and 14¢ (or lower)electricity.

My hunch: Gas prices fall like a rock when Biden is sent packing in 2024 … and electricity prices will keep going up since the industry is already at capacity (think: rolling blackouts) with demand rising

=============

Of course, Oprah’s not giving me an EV, so I’d have to buy one to get the savings.

Tesla T3’s go for about $50,000.

With $2,300 a year in cost savings, it would practically pay for itself. … albeit taking 20 years to break even.

Unfortunately, that’s a bit longer than my actuarial life expectancy, so I think I’ll hold off buying one.

============

Of course, there’s even more to the story.

The above is an incremental analysis that only adds one user (me) to the electrical grid.

Surely, BGE could accommodate that small increase.

But, what if there was a veritable groundswell towards EVs?

We’ll tackle that question next, by asking “What if Opah gave everybody an EV?”

Stay tuned…

More:“KENNETH HOMA, do you drive an EV?”

June 16, 2022

Let’s dig into the numbers…
=============

Earlier this week, I posted that I had gotten two “alert” emails from BGE, my electric company.

The first email was a “NOTICE OF UNUSUAL ACTIVITY” …euphemistically asking  “what the hell is going on at your house?”

I reported that my son had charged his new Tesla overnight, and that probably triggered the alert.

The second email was more direct: “DO YOU OWN AN EV?” It showcased a chart that my energy efficiency had dropped from the borderline of “good” and “great” … all the way down to “fair”

image

Again, I pointed a finger at my son’s periodic Tesla charging.

==============

Well, a couple of loyal readers politely challenged my inferences and doubted that EV-charging was the impetus for BGE’s email alerts.

So, I retrieved some numbers and did some back-of-the-envelop number crunching.

Let’s work through the numbers…

=============

  • According to the U.S. Energy Information Administration: In 2020, the average annual electricity consumption for a U.S. residential utility customer was 10,715 kilowatthours (kWh).
  • Our home’s annual electricity consumption runs about 27,500 kWh …  which averages out to about 75 kWh per day.
  • When my son charges  at my house, it’s for about 8 hours, drawing about 40 kWh … about 5 kWh per hour of charging
  • So, based on an average day’s electricity consumption at my house, that’s a 50% spike in electricity consumed (40 /75 = 53%).

==============

  • For reference, our biggest electrical draw is the HVAC that services our upper 2 levels (which get hottest in the summer and coldest in the winter)… with a smart thermostat that capture usage data.
  • Our upper level HVAC uses 5,300 kWh per year … about 20% of our total consumption … about 15 kwh on an average dayon hot days (high 80s and 90s) it spikes about 50% to 22 kWh
  • When BGE sees that spike, they know it’s a hot weather-related  event
  • When I got a 40 kWh Tesla charging spike on an average day, BGE red flagged me … since it was out of pattern … and sent the “unusual activity” alert.
  • When the spike happened a few times, BGE apparently concluded that I must have bought an EV which I’m charging from one of my home’s 110 circuits … and warned that I should brace for higher bills.

Bottom line: BGE drew reasonable analytical conclusions at the first spike … and after noticing a couple of spikes.

But, to answer their question : “No, I don’t drive an EV … I don’t own a EV … but, occasionally, an EV sleeps overs at my house.”

==============

BGE’s question and my readers’ nudges really started me thinking about EVs.

For openers, I asked myself: “What if I did own an EV.  How much more electricity would I consume?”

That’s next up…

How low can the stock market go?

June 15, 2022

We don’t give investment advice, but …

Just before the 2020 election, we posted a JP Morgan’s stock market forecast.

At the time, JPM advised clients that the S&P could nosedive to 2,500 (down 25% from its level at the time) if there was a “Blue Wave” with Biden getting elected and Dems taking both the Senate and the house. See the bottom right quadrant of the below matrix.

image

At about the same time, a B of A analysis concluded that a Blue Wave would be good for the market.

The post-lockdown surge in stock prices made B of A look like savant seers … and JPM’s forecast look downright silly.

Now, it’s looking like JPM had the fundamentals right … but were ahead of the curve.

Draw your own conclusion.

=============

P.S. A 25% drop from the 3,850 S&P peak would put the S&P at about 2,900.

Fasten your seatbelts.

How to double the time it takes to take a car trip…

June 14, 2022

Simple: Buy an EV and download a charger-finder app.
=============

Last year, my wife and son took their annual weekend trip to Cleveland to visit some relatives and go to an Indians’ (err, Guardians’) baseball game.

In prior years, the trip from DC to Cleveland took under 6 hours.

Last year it was over 10.

What changed?

Her gas-efficient Audi A4 was left in the garage.

His Tesla hit the road … and  the hunt for EV chargers started.

Apparently, their experience is neither unique nor time-obsoleted.

==============

A recent WSJ article chronicled a writer’s EV travel from New Orleans to Chicago and back in a shiny new EV.

The Goal: Roundtrip from New Orleans to Chicago and back (2,000 miles) in 4 “leisurely” days.

=============

The plan:

Given our battery range of up to 310 miles, I plotted a meticulous route, splitting our days into four chunks of roughly 7½-hours each.

We’d need to charge once or twice each day and plug in near our hotel overnight.

While we’d be fine overnight, we required fast chargers during the days.

==============

Charging Stops – The Dream 

Fast chargers tend to be located in parking lots of suburban shopping malls, or tethered to gas stations or car dealerships.

ChargePoint — which manufactures and maintains many fast-charging stations — promises an 80% charge in 20 to 30 minutes.

That’s  longer than stopping for gas — but, on the bright side, “it’s good for a bite or bathroom break.”

==============

Charging Stops – The Reality

It turns out not all “fast chargers” live up to the name.

At our dealer’s fast-charging station, our dashboard tells us a full charge, from 18% to 100%, will take 3-plus hours.

Fastest charge: 25 minutes.

Longest “fast” charge : 3 hours

While there are already thousands of charging options between New Orleans and Chicago, most were are classified as Level 2, requiring up to 8 hours for a full charge.

And sometimes, charging stations are only open during business hours at, say, gas stations or car dealerships … or, may require an attendant to turn it on.

And sometimes, you get beat to an advertised “open” charging station by another driver — or get shocked by an unexpected “out of service” sign

=============

The Economics

Over four days, we spent $175 on charging.

We estimated the equivalent cost for gas  would have been $275.

That $100 savings cost us many hours in waiting time.

A gas-fueled 2-day trip can be EVed in 4 days, with some white-knuckle situations along the way.

=============

The Urban Divide

This was a surprise to me…

The car’s highway range actually was worse than its range in cities.

Indeed, highway driving doesn’t benefit as much from the car’s regenerative-braking technology which uses energy generated in slowing down to help a car recharge its battery

But, a battery’s charge can be stretched by using cruise control to  reduce inadvertent acceleration and deceleration … and by:

Turning off the car’s cooling system and the radio, unplugging phones and other devices and lowering the windshield wipers to the lowest possible setting while still being able to see in the rain.

In other words, shelve all of the car’s creature comforts.

Yipes!

=============

PS For added color, read the whole article:

I Rented an Electric Car for a Four-Day Road Trip. I Spent More Time Charging It Than I Did Sleeping.

Scroll down the article for an accompanying video The Electric Vehicle Road Test..

“KENNETH HOMA, do you drive an EV?”

June 13, 2022

That’s the subject line of an email I got from BGE – our electric company”
==============

I opened the email expecting either:

(a) a lecture that I will be personally responsible for high gas prices and the climate-induced end of the world because I drive a mid-sized SUV, or

(b) a congratulatory note profiling me (post-grad degree, blue state resident) as a likely Tesla owner.

Neither was the case.

It was an emergency alert that my electricity usage had spiked … and my relative efficiency had dropped from the “good-great” borderline, all the way down to the orange “fair” category.

“BGE is sending you this alert to let you know that you are using more energy than usual and may be trending towards a higher bill.”

image

As the subject line indicated, they naturally assumed — since temps have been COOLER than average (i.e. relatively low A/C usage) — that the likely suspect for a drop that drastic had to be in-home EV charging.

Interesting, right?

Well, in fact, my Tesla-owning son had had been visiting and occasionally overnite charging the car’s battery.

Not a big deal once we ID’ed an outlet that wouldn’t trip a circuit breaker or dim the house lights.

Recollecting, I did get one “What the hell is going on at your house?” email from BGE … but, I didn’t connect the dots.

BGE’s EV email did that for me.

Interesting that BGE assumed that EV charging was a likely suspect of high energy use.

Hmm.

What does that suggest we’re in for this summer when temps finally rise above average and HVACs are running full-steam.

Blackout warnings are already being headlined.

Add EV charging to the mix, and Biden have his next “Putin’s fault, nothing I can do”  crisis.

That may be the straw that breaks the camel’s back re: Biden’s “incredible transition from fossil fuels”…

=============

PS Remember when red used to be the color assigned to the lowest performing category?  Now, to be politically correct, it’s orange

Hmm

Wonder how orange became synonymous with “bad”?

Think about it…

“My high school SRO’s nickname was Barney Fife”

June 9, 2022

What’s reasonable to expect from School Resource Officers?
==============

In a prior post  we asked the question: “So, would YOU have charged the Uvalde school shooter?”

I admitted that I probably wouldn’t have … and laid out 4 criteria that might have motivated me to act:

  1. A threatened family member, e.g. a grandkid
  2. Some probability greater than zero that the periled life would be saved
  3. Enough physical might and equipment to. conceptually, get the job done.
  4. A probability greater than zero that charging wouldn’t  simply be a futile suicide mission.

Draw your own conclusion as to whether those criteria are reasonable and compelling.

==============

I ended that post with WSJ, columnist Peggy Noonan’s opinion regarding the first police officers on site at Ulvade — namely, the SROs:

It was their job to go in.

If you can’t cut it, then don’t join and get the badge, the gun and the pension.

We can’t let it settle in that the police can’t be relied on to be physically braver than other people.

An implicit agreement in going into the profession is that you’re physically brave.

Let’s add some perspective to Noonan’s castigation….

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An armed SRO in every school?

There seems to be a consensus building that all school’s should have an armed law enforcer on site.

I’m OK with that but…

Keep in mind that are over 130,000 K-12 schools in the U.S. Source

  • Elementary schools: 87,498
  • Secondary schools: 26,727
  • Combined schools: 15,804

Assuming an average of $50,000 (per year, per SRO) in wages, benefits and equipment, that works out to about $6.5 billion annually.

But, it’s not about money, it’s about kids’ lives, so let’s push that number aside and move on.

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How to staff those 130,000+ positions?

Ideally, I personally would like to see a former Navy Seal, Army Ranger or Green Beret … well-armed (yes, with a so-called “assault rifle”) … standing (not sitting) at the single (locked) access door to my grandkids’ schools.

But, that’s not a reasonable expectation.

First, there aren’t enough of them to staff 130,000 schools

Second, even if there were, they wouldn’t take the job … it’s not in their DNA to hang out waiting for lightning to strike.

So, who do we get to fill the SRO positions?

Newbie or “pastured” police officers?  Retired military? Rent-a-cops?

As former Democratic Congressman Harold Ford, Jr. put it: “My high school SRO’s nickname was Barney Fife”

For younger readers, Barney Fife was a self-confident but inept police officer on the Andy Griffith Show.

He was on the police force in the rural, crime-free town of Mayberry RFD … and, for fear that he might hurt himself (or somebody else), he was only allowed to carry an unloaded gun with a single bullet tucked in his shirt pocket. Source

That’s a bit harsh, but realistically, probably more representative than, say, Rambo-clones.

SROs draw relatively small paychecks  … and, given the long odds of being confronted with a crazed active shooter, don’t really anticipate that they’ll need to put their lives on the line.

If they did, many wouldn’t want the job … and most would want higher pay.

===============

And, how will they be equipped?

Will SRO’s carry automatic weapons, wear body armor and have ready access gun fire shields?

My hunch is that many (most?) folks would understandably find that sort of personal protection equipment to be emotionally disturbing to the school students.

So, the SRO’s would have to make do with handguns and bullet-proof vests.

Not exactly a fair fight against a well-armed active shooter.

===============

Bottom line

All of the above not withstanding, I’m all for SROs in every school.

But, I think we need to constrain our expectations about what they’re able to do.

Going mano-a-mano to neutralize a crazed assault-gunner isn’t a realistic expectation, Ms. Noonan.

It’s not part of the “implicit agreement”.

Rather expect SROs to train teachers & students, red-flag (aka, “profile”) trouble-makers, keep the doors locked and call. for help if and when hell breaks.

That’s not all bad … and, in fact, can be a critical part of providing school security.

More on that in a subsequent post.

So, would YOU have charged the Uvalde school shooter?

June 8, 2022

Think hard before you answer the question.
=============

Last week in the WSJ, columnist Peggy Noonan opined:

I don’t understand those saying with nonjudgmental empathy, “I’m not sure I would have gone in.”

Hmm.

I understand that nonjudgmental empathy completely, Peggy.

I hate to say it, but I doubt that I would have run in.

For perspective, here are some things that I would do:

  • I’d donate a critical organ to one of my grandkids … even if the likelihood of my survival was far less than 50-50
  • I’d run in front of an oncoming bus to try to save an inattentive grandkid who wandered into harm’s way.

OK, so what makes those situations different than charging the Uvalde shooter?

  • First, they’re my grandkids … literal “skin in the game”
  • Second, there’s some likelihood that I might save the periled kid
  • Third, I think (maybe mistakenly) that I would be physically equipped to succeed.
  • Fourth, both “rescues” would be risky, but they’re not certain suicide missions.

Remove any of those 4 conditions and the likelihood of my intervening goes down.

Does that make me a coward … or a bad person?

Maybe, but I don’t think so.

Just shows that I’m human … and, reasonably rational, right?

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An Uvalde case example

For the record, there was one local law officer (who was not part of the official rescue team) who did run in with a shotgun to save his wife (a teacher) and his daughter (a student).

Run that case against my 4 personal criteria.

His immediate family was involved, his wife & daughter were not in the shooter-barricaded classroom, he was armed (albeit with only a shotgun), and he had law enforcement training.

He had his family’s “skin in the game”, there was a reasonable likelihood of success, and he had some training & equipment … so it wasn’t a certain suicide mission.

So, with this perspective, would you have gone into the school?

==============

BTW: Noonan dismisses my argument.

She’d argue that my criteria don’t apply to law enforcement officers since:

It was their job to go in.

If you can’t cut it, then don’t join and get the badge, the gun and the pension.

We can’t let it settle in that the police can’t be relied on to be physically braver than other people.

An implicit agreement in going into the profession is that you’re physically brave.

Whoa, Peggy.

In a subsequent post. I’ll offer an alternative point-of-view on the “implicit agreement” that Noonan asserts …

How many gun-related deaths in the U.S. last year?

June 7, 2022

And while we’re at it, how many Fentanyl-related deaths?
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With the understandable recent concern about gun-related deaths, I did some data digging.

For the record:

I consider each and every homicide to be a tragedy.

I have never owned a gun or shot a gun … and I have no plans to do either.

But, I do support Constitutional rights that are explicit in the Constitution.

Gotta follow “the science” and the data, right?

Pew — an unbiased source if there is one — has crunched the numbers, compiled mostly by the “scientists” at the CDC.

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The answer to the headline question:

In 2021 — according to the CDC — there were 45,222 firearms-related deaths in the U.S.

image

The 45,222 is a much lower number than I expected … and drilling down further…

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Suicides – Homicides

According to Pew & the CDC, more than half of the 45,222 gun-related deaths were suicides (24,292) …  homicides totaled 19,384 – about 50 each day.

image
There were 611 law enforcement-related gun deaths in 2021 (they’re lumped into the 3% “other” category).

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Mass murders.

The Gun Violence Archive, an online database of gun violence incidents in the U.S., defines mass shootings as incidents in which four or more people are shot, even if no one was killed (excluding the shooters).

Using this broad definition, 513 people died in these incidents in 2020.

Pew’s conclusion: The fatalities in mass shooting incidents in the U.S. account for a very small fraction  of all gun murders that occur nationwide each year.

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Firearms

According to FBI data analyzed by Pew. Handguns were the instrument of death in the vast majority of gun-related deaths.

“Rifles” – the category that includes guns sometimes referred to as “assault weapons” – were involved in 3% of firearm murders.

Note: Though Pew doesn’t draw a correlation, it’s probably not coincidental that the “rifle” numbers and the “mass murder” numbers are essentially the same.

==============

School Killings

According to James Alan Fox, a criminologist at Northeastern University who has been tracking these events for decades and helps keep the AP/USA Today/Northeastern Mass Killing database:

School massacres like the one in Uvalde are exceptionally rare events. They actually occurred more often in the 1990s than recently.Source

Prof. Fox notes that school shootings are undeniable tragedies, but that “the annual odds that an American child will die in a mass shooting at school are nearly 10 million to 1, about the odds of being killed by lightning or of dying in an earthquake.” Source

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Drug Overdose Deaths

For perspective, let’s draw a comparison…

According to WebMD – channeling the CDC:

U.S. deaths attributed to drug overdoses topped 100,000 last year for the first time.

Specifically, in 2021, drug overdose deaths increased 15% to 107,622 … more than double the number of gun-related deaths … and quadruple the number of gun-related homicides.

Fentanyl accounted for 71,238 deaths … almost 3 out of 4 drug overdose deaths

In 2022. with Fentanyl flowing freely across the southern border, it’s widely expected that Fentanyl-related deaths will soar.

==============

Something seems out of whack, doesn’t it?

Biden: “Reduced the ruble to rubble”

June 6, 2022

Shades of Bush’s “Mission Accomplished”
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After (kinda) imposing supposedly draconian sanctions, Biden claimed a quick victory when the Russian ruble tanked in the financial markets.

Perhaps, a premature end zone dance by the “Big Man”.

Here’s where we stand now.

image

True, immediately after the initial round of sanctions were announced, the ruble — which was trading around 80 rubles per dollar — devalued to about 150 rubles per dollar.

Said differently: Before the sanctions, $1 could “buy” about 80 rubles.  Soon after the sanctions were announced, $1 could buy 150 “devalued” rubles.

Yep, started to look like rubble.

But, not so fast…

After about a month, the ruble was right back where it was pre-sanctions — trading at about 80 rubles per dollar.

Now, it’s trading at 63 rubles per dollar …

English translation: The ruble has gained value (vs. the U.S. dollar) since the sanctions were initiated.

How can that be?

Couple of reasons offered up by pundits:

  • Many of the sanctions were announced but still haven’t been fully activated.  For example, Germany is still dragging its feet on oil sanctions.
  • Some large countries aren’t on the sanctions’ bandwagon … think China and India, which are now buying Russian oil at a discount
  • Putin has gone big time on currency manipulation … e.g. boosting interest rates, restricting bank withdrawals, and…
  • And, Putin has started requiring that oil and gas sales be transacted in rubles (not dollars or euros)

The last point is particularly problematic since countries that are dependent on Russia for oil and gas … are still buying oil and gas from Russia at historically high rates.

image

A couple of teaching points:

> Until the U.S. re-ramps domestic oil & gas production — to satisfy domestic & foreign demand — the bad guys will continue to rake in the dollars (err, rubles)

> Putin may be crazy … is certainly evil and ruthless … but he’s not stupid … so he shouldn’t be under-estimated … on the battlefield and in the financial markets.

So, whose economy is taking the hit — our’s or Putin’s?

Biden: “Don’t blame me, blame the Pandemic and Putin”

June 3, 2022

“And, by the way, it’s a global problem, not just a U.S. problem.”
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That’s the gist of Team Biden’s “message” as it is stumping hard this week to let Americans know that Joe’s economic plan is working splendidly …. and that any perceptions of a bad economy are simply that: “perceptions”.

In a prior post, we channeled an analysis done by the the San Francisco Fed (FRBSF) that concluded:

In 2021, a relatively “normal” level of inflation (around 2%) was evident   in the major OECD countries — Canada, Denmark, Finland, France, Germany, Netherlands, Norway, Sweden, and the UK, but…

During the same period, inflation was more rampant in the U.S.  Specifically:

During the 1st 3 quarters of 2021, U.S. core CPI grew from below 2% to 4.7%.

In contrast, the OECD average increased at a more gradual rate from around 1% to 2.2% (over the same period).

image_thumb[2]

That clever analysis by the FRBSF demonstrates that:

In the 1st 3 quarters of 2021, about 80% of the U.S. core inflation rate increase is statistically attributable to factors specific to the U.S. That is, only about 20% is attributable to globally common pandemic effects.

We ended the prior post with a question…

So, what are those specific factors?

=============

Well, the FRBSF analysts took a statistical whack at that question, too.

Their underlying analytical logic focused on fiscal stimulus programs in the U.S. and the OECD countries:

One way to get a read on this tangle of support programs is to directly measure disposable personal income in each country.

This measures the amount individuals have left to spend or save after paying taxes and receiving government transfer payments.

It is a relatively comparable measure across countries that incorporates the overall magnitude of net pandemic transfers

And, the answer is…

image

Real disposable personal income for the OECD countries increased only moderately during the pandemic (2020 & 2021).

But, there are 2 obvious spikes in the amount of disposable income that Americans “enjoyed” during that same period:

Specifically, the two peaks in U.S. disposable personal income reflect the CARES Act, signed into law (by President Trump) on March 27, 2020 … and the American Rescue Plan (ARP) Act, signed (by Biden) in March 2021.

Both Acts resulted in an unprecedented injection of direct assistance with a relatively short duration.

==============

OK, let’s overlay the above 2 charts…

image

The visually obvious conclusions that can be drawn:

1. The Trump era stimulus (CARES Act) appears to have been absorbed by the economy … with transfer payments (e.g. stimulus checks) largely offsetting lost wages … hence little impact on inflation in 2020.

2. But, the Biden ARP stimulus (passed with no GOP votes) appears to have literally broken the inflationary camel’s back … by infusing an unnecessary (and excessive) level transfer payments in the U.S. economic system … igniting a rampant surge in inflation (that was not comparably realized in OECD countries).

And, keep in mind, that this analysis was pre-Putin’s Ukraine invasion.

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Bottom line: Sorry, Joe …  your excessive stimulus program — coupled with your war on domestic oil & gas production — account for the lion’s share of our current inflation woes.

Man-up and fix the problem!

Biden: “Inflation is a global problem!”

June 2, 2022

“Don’t blame me, blame the Pandemic and Putin”
=============

OK, I paraphrased the 2nd quote a bit, but that’s the gist of Team Biden’s “message” as it is stumping hard this week to let Americans know that Joe’s economic plan is working splendidly …. and that any perceptions of a bad economy are simply that: “perceptions”.

Today, let’s look at the Biden’s lead assertion … that inflation isn’t isolated to the U.S. … it’s a worldwide problem.

He implies — and sometimes says — that’s proof positive that his policies have nothing to do with the problem.

Really?

True, inflation is evident in the major OECD countries — Canada, Denmark, Finland, France, Germany, Netherlands, Norway, Sweden, and the UK — but there’s a “but” … and it’s a big “but”.

The economic research group at the San Francisco Fed (FRBSF) recently published an analysis that concluded:

Before the pandemic, U.S. core CPI inflation remained, on average, about 1 percentage point above the OECD sample average.

Early in 2021, however, U.S. inflation increasingly diverged from the other countries.

U.S. core CPI grew from below 2% to  4.7% (in Q3, 2021).

In contrast, the OECD average increased at a more gradual rate from around 1% to 2.2% (over the same period).

image

First, a couple of technical points:

  • For data comparability, the FRBSF analysis focuses on the core CPIwhich excludes energy and food.
  • Restricted by the timing of data availability, the FRBSF analysis only runs through the 3rd quarter of 2021 … all before Putin’s invasion of Ukraine.
  • Since 2021-Q3, the year-over-year core CPI has increased from 4.7% to 6.2% … and, including food & energy, the year-over-year inflation number is over 8%

Those points notwithstanding, the FRBSF analysis is quite revealing.

  • During 2019, pre-pandemic, the core inflation rate hovered around 2% in the U.S.
  • In 2020,  the U.S. core inflation rate actually dropped to about 1.5% … lower than the pre-pandemic rate.
  • Post-Biden’s inauguration in early 2021, the U.S. core inflation rate increased from 1.5% to 4.7% in Q3, 2021 … an increase of 3.2 percentage points.
  • During that same period, the average OECD core inflation rate increased from 1.5% to 2.2% … an increase of .7 of a percentage point.

Bottom line: Given a U.S. core inflation rate of 4.7% … and using the 2.2% OECD average as a baseline for “global inflation” …  only about 20% of the U.S. core inflation rate increase since early 2021 is statistically attributable to common global inflation pressures (.7 percentage points divided by 3.2 percentage points equals 21.8%).

Said differently, about 80% of the U.S. core inflation rate increase since early 2021 is statistically attributable to factors specific to the U.S.

Sorry, Joe.

============

Next up: So, what are those specific factors?

Biden: Greatest job creator … blah, blah, blah.

June 1, 2022

Here’s a handy de-coding chart for you…
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Team Biden is stumping hard this week to “message” that Joe’s economic plan is working splendidly …. and that any perceptions of a bad economy are simply that: “perceptions”.

About those “perceptions”…

Biden has a 35.5% approval rating on handling the economy in the RealClearPolitics average because:

(a) Ordinary families are feeling the pain first-hand and they “believe their lyin’ eyes” every time that they pass a gas station price sign or (try to) shop at a grocery store.

(b) Everybody knows deep down that jobs have returned because pandemic shutdowns are ending, not because of anything constructive that Biden has done.

Let’s dive down on that second point: new job creation.

Below is the Fed chart of total non-farm employment going back to the start of the Trump administration … with a couple of defining milestones.

image
click chart to enlarge

(A) Employment was 143.2 million when Trump took office.

(B) Prior to the Covid lockdowns, total employment reached 152.5 million … an increase of 9.3 million

(C) The Covid lockdown sidelined 22 million workers … employment dropped to 130.5 million

(D) In the  final year of the Trump administration, about 12 million jobs were regained … pushing employment back up to 142.5 million (which was 700k lower than when Trump took office)

(E) Currently — after a about a year of Biden — employment is at 151.3 million … up 8.8 million since his inauguration … but still 1.2 million lower than the pre-Covid level

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My take

(1) Seems reasonable to credit Trump with about 9 million jobs created during the “normal” period preceding the Covid pandemic.

(2) Less reasonable to tag Trump with “causing” the destruction of 22 million jobs during the Covid pandemic … true, he OK’ed the lockdowns … but, it’s reasonable to argue that the job losses were transitory, i.e. regainable once the pandemic passed.

(3) To that last point, during Trump’s last year, about 12 million of the Covid-related job losses were regained (i.e. not “created”)

(4) Since Biden’s inauguration, another 8.8 million jobs were regained from the Covid drop … pushing employment up to 151.3 million … still more than 1 million shy of the the nation’s pre-Covid employment level.

So, is Biden — as he claims —  the greatest job creation president ever?

Those are the numbers … draw your own conclusion.

My stress-reducing weekend.

May 31, 2022

I don’t like to get personal, but…
==============

It has been a couple of high stress weeks (months?) for everybody, given runaway inflation, a diving stock market,  out-of-stock baby formula … and, of course, last week’s school tragedy.

So, it was with enormous personal relief that I had a stress-free Memorial Day weekend (save for picking between the pepperoni and cheese pizza).

The essence of the weekend formula:

First, no TV news … and almost no internet (save for fact-checking disputed word-spelling and sports bets).

Specifically, the only TV “look-ins” were the NCAA Women’s Lacrosse Championships … only Netflix was a PG-friendly comedy … except for Wordly (usually played in small groups), no video games … nobody glued to their phones.

Key point: no TV or internet news.

Amazing how liberating from stress that is…

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Second ingredient: family!

We’re very lucky to have 8 wonderful grandkids … ranging from 1-1/2 to 13 … with 3 hovering around the 2 year-old mark.

Note: Their parents are pretty great. too.

My most time spent was sitting on the beach watching  the cousins playing together in the water.

Most active(?) time was fishing off the dock with the kids.

Maddie (9) caught 5 fish and had a big one get away.

image

Note: I never dreamed that I’d be bonding with my grandkids by fishing — an activity that I’d never done until they coaxed me into it.

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The “lucky guy” moment to remember: boating with the 5 oldest grandkid-cousins.

image

Yes, I do know how lucky I am and I cherish all these moments.

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Honorable Mention: While family and a TV blackout were the primary stress-reducers, I’d be remiss if I didn’t give a shout-out to Mike’s Hard Lemonade.  Cheapskate that I am, I’m hustling to reverse-engineer Mike’s recipe. Any ideas?

WSJ: “When young men snap”

May 26, 2022

The recurring cause of mass shootings.
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Earlier this week, I posed the question: How much stress can Americans endure before cracking?

My central thesis: My point: Escalating stress levels are evident … and spreading like wildfire across geographies, demographics, and age groups.

I ended by asking: Where’s the breaking point — individually and collectively? … and, What will “the great break” look like?

Mine was a cosmic-level question.

Then came the tragedy at Robb Elementary School which made the question very real, and very specific.

Dem politicos immediately seized the opportunity to call for stricter gun control laws.

GOP politicos called for more police and “hardening” school access.

IMHO, the WSJ hit the nail on the head in their editorial Young Men, Guns and Guardrails which argued, in part:

The problem of how to stop mass shootings by disturbed young men is one of the hardest in a democratic society.

Stopping mass shooters like the one in Uvalde, Texas, will be harder than passing a law.

The societal challenge is anticipating when a young man — and it is nearly always a young man — will snap.

Today’s young killers … are typically from middle-class families.

They  with access to smartphones and X-boxes.

Their deficit is social and spiritual.

The rise of family dysfunction and the decline of mediating institutions such as churches and social clubs have consequences.

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My take:

Two of the most disparaged social institutions in America these days are religion , which provides a moral compass …  and the nuclear family, which traditionally provided youngsters with nurturing, moral support and a grounding in right and wrong.

Now, actualizing the mantra that Hillary Clinton coined that “It takes a village”, there’s a reliance on “the  village” … an amorphous array of institutions, individuals and values that muddles mores and liberate parents from their  responsibilities.

When “right & wrong” are muddled, there is no moral clarity.

When  “the village” is responsible, nobody is responsible.

And, when “the village” fails us, we’re screwed.

And, we wonder why things are going haywire…

Biden promises “an incredible transition” from fossil fuels…

May 25, 2022

Translation: Suck it up and pay at the pumps.
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Let’s go to the verbatim:

When it comes to the gas prices, we’re going through an incredible transition that is taking place that, God willing, when it’s over, we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over.

Here’s the video:

image

Gotta love it when Biden goes off the teleprompter and blurts the truth.

> What most people surmised: not only does he not care about the spike in energy costs, his handlers have convinced him that it’s a good thing since it’ll force people to buy $60k EVs, ride “safe” subways, and lace-up their walking shoes.

> The cost is certain and immediate — especially to lower and middle-class Americans — and the hypothetical benefits are disputable and, at best, decades off.

See 16 Reasons why I’m lukewarm on climate change … and Greater threat to the planet: Putin or climate change?

> But, it’s worth the certain pain since “we’ll be stronger and less reliant on fossil fuels when this is over.”

> Biden’s caveat: “GOD WILLING”

================

That makes me feel a lot better, Joe.

How much stress can Americans endure before cracking?

May 23, 2022

Or, aggregating the question: How much stress can America endure?
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Recently, I’ve noticed a couple of trends.

Practically everybody I know has gotten sick in the past couple of months … some Covid, but mostly prolonged colds and intestinal “issues”.

And, everybody seems stressed out.

Think those 2 “indications” are related?

============

Stress factors

Inflation is gnawing at everybody and forcing hard choices.

Every trip to the grocery store is what a friend euphemistically calls “an unfulfilling experience” … with noticeably higher prices (every week), smaller packages and empty shelves.

The gas price spike may be the straw that will break the economic camel’s back … with neon signs every couple of miles reminding people that prices are are out of control

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Housing costs

Next up will be housing costs.

Last week, I chatted up the Amazon Prime driver who was handing me a package.

He said he loves his job, loves living in the area …  but just had his rent bumped up to $3,800 a month.

That’s almost $50 grand a year, sports fans.

My bet: He’s not making much more than that driving the truck … if he’s even making that.

The driver frowned when I opined that the sky-rocketing real estate prices of the past few years still haven’t fully made their way thru the system … and higher interest rates will eventually be passed through to rental rates.

============

Retirement nest eggs

For awhile, our retirement nest egg sheltered us a bit .. making all of the above inflation effects annoying, but not sleep shattering.

But, a 20% drop in the stock market has quickly deflated financial cushions and pushed a lot of retirees into the inflationary pool (cesspool?) with everybody else.

============

Social pressures

Then there are the “social issues”.

Many people have residual Covid fears — still being stoked by Fauci & Friends — and have anxieties when going to sporting events, restaurants or even weddings & funerals.

Understandably, nobody seems eager to head into crime ridden urban centers for a night of entertainment.

The lockdowns took a toll.

Many (most? all?) companies are having a hard time coaxing employees back to the office (and getting productivity back on track).

Parents are legitimately concerned about their kids’ education.

As one soccer mom put it recently: “My daughter is dumber now than she was 2 years ago.”

Charge that to virtual schooling … and changed curricular emphases in the schools … less reading, writing and arithmetic … more “social awareness”.

A case on point…

From a trusted source: Girls at one local middle school try to avoid using the school’s (“girls”) restroom ever since a gender-fluid, biological male started using their facilities.

If they can’t “hold it”, they make restroom stops a group activity.

And on … and on … and on.
==============

My point: Escalating stress levels are evident … and spreading like wildfire across geographies, demographics, and age groups.

Where’s the breaking point — individually and collectively?

What will “the great break” look like?

Geez, it’s hard to be optimistic…

Musk tags Biden: “Anchorman”

May 19, 2022

It would be funny if it weren’t so true … and so sad.
==============

Remember when Trump tagged Jeb Bush as being “low energy”?

Those 2 words effectively ended Bush’s well-funded, well-staffed run for the presidency.

That gets us to Musk’s musings about Biden.

In less then a minute, Musk shredded Biden … saying out loud what we’ve all been thinking.

Referencing  the classic comedy “Anchorman”, Musk opined that the real president is whoever loads the teleprompter … in effect, labeling Biden as “Anchorman”.

Flashback: In “Anchorman”, Will Ferrell plays Ron Burgundy –  a buffoonish. clueless TV newsman — who simply reads whatever shows up on his teleprompter … with often shockingly  hilarious results.

Here’s the 1-minute clip … well worth watching.

image

Musk’s shots-across-the-bow:

  • “It’s hard to tell what Biden is doing to be totally frank.”
  • “The real president is whoever controls the teleprompter. The path to power is the path to the teleprompter.”
  • “I do feel like if somebody were to accidentally lean on the teleprompter, it’s going to be like ‘Anchorman.’
  • “Biden is being held captive by the “Squad”, unions and trial lawyers — unlike Barack Obama, who was quite reasonable”
  • “The Trump administration, leaving Trump aside, there were a lot of people in his administration who were effective at getting things done.”
  • Biden’s administration, doesn’t seem to get a lot done. It doesn’t seem to have the drive to just get stuff done. That’s my impression.”

=============

Musk’s observations are an “Emperor’s new clothes” moment.

Next time you see Biden at a podium or on the fake oval office set, just think of Ron Burgundy.

Then, things will make a lot more sense.

Elon may have rung a bell that can’t be unrung…

=============

Again, the 1-minute clip is well worth watching.

Biden: “Don’t blame me, blame the Pandemic and Putin”

May 18, 2022

“And, by the way, it’s a global problem, not just a U.S. problem.”
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In a prior post, we channeled an analysis done by the the San Francisco Fed (FRBSF) that concluded:

In 2021, a relatively “normal” level of inflation (around 2%) was evident   in the major OECD countries — Canada, Denmark, Finland, France, Germany, Netherlands, Norway, Sweden, and the UK, but…

During the same period, inflation was more rampant in the U.S.  Specifically:

During the 1st 3 quarters of 2021, U.S. core CPI grew from below 2% to 4.7%.

In contrast, the OECD average increased at a more gradual rate from around 1% to 2.2% (over the same period).

image_thumb[2]

That clever analysis by the FRBSF demonstrates that:

In the 1st 3 quarters of 2021, about 80% of the U.S. core inflation rate increase is statistically attributable to factors specific to the U.S. That is, only about 20% is attributable to globally common pandemic effects.

We ended the prior post with a question…

So, what are those specific factors?

=============

Well, the FRBSF analysts took a statistical whack at that question, too.

Their underlying analytical logic focused on fiscal stimulus programs in the U.S. and the OECD countries:

One way to get a read on this tangle of support programs is to directly measure disposable personal income in each country.

This measures the amount individuals have left to spend or save after paying taxes and receiving government transfer payments.

It is a relatively comparable measure across countries that incorporates the overall magnitude of net pandemic transfers

And, the answer is…

image

Real disposable personal income for the OECD countries increased only moderately during the pandemic (2020 & 2021).

But, there are 2 obvious spikes in the amount of disposable income that Americans “enjoyed” during that same period:

Specifically, the two peaks in U.S. disposable personal income reflect the CARES Act, signed into law (by President Trump) on March 27, 2020 … and the American Rescue Plan (ARP) Act, signed (by Biden) in March 2021.

Both Acts resulted in an unprecedented injection of direct assistance with a relatively short duration.

==============

OK, let’s overlay the above 2 charts…

image

The visually obvious conclusions that can be drawn:

1. The Trump era stimulus (CARES Act) appears to have been absorbed by the economy … with transfer payments (e.g. stimulus checks) largely offsetting lost wages … hence little impact on inflation in 2020.

2. But, the Biden ARP stimulus (passed with no GOP votes) appears to have literally broken the inflationary camel’s back … by infusing an unnecessary (and excessive) level transfer payments in the U.S. economic system … igniting a rampant surge in inflation (that was not comparably realized in OECD countries).

And, keep in mind, that this analysis was pre-Putin’s Ukraine invasion.

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Bottom line: Sorry, Joe …  your excessive stimulus program — coupled with your war on domestic oil & gas production — account for the lion’s share of our current inflation woes.

Man-up and fix the problem!

Biden: “Inflation is a global problem!”

May 16, 2022

“Don’t blame me, blame the Pandemic and Putin”
=============

OK, I paraphrased the 2nd quote a bit, but that’s the gist of his inflation speech last week.

Today, let’s look at the Biden’s lead assertion … that inflation isn’t isolated to the U.S. … it’s a worldwide problem.

He implies — and sometimes says — that’s proof positive that his policies have nothing to do with the problem.

Really?

True, inflation is evident in the major OECD countries — Canada, Denmark, Finland, France, Germany, Netherlands, Norway, Sweden, and the UK — but there’s a “but” … and it’s a big “but”.

The economic research group at the San Francisco Fed (FRBSF) recently published an analysis that concluded:

Before the pandemic, U.S. core CPI inflation remained, on average, about 1 percentage point above the OECD sample average.

Early in 2021, however, U.S. inflation increasingly diverged from the other countries.

U.S. core CPI grew from below 2% to  4.7% (in Q3, 2021).

In contrast, the OECD average increased at a more gradual rate from around 1% to 2.2% (over the same period).

image

First, a couple of technical points:

  • For data comparability, the FRBSF analysis focuses on the core CPIwhich excludes energy and food.
  • Restricted by the timing of data availability, the FRBSF analysis only runs through the 3rd quarter of 2021 … all before Putin’s invasion of Ukraine.
  • Since 2021-Q3, the year-over-year core CPI has increased from 4.7% to 6.2% … and, including food & energy, the year-over-year inflation number is over 8%

Those points notwithstanding, the FRBSF analysis is quite revealing.

  • During 2019, pre-pandemic, the core inflation rate hovered around 2% in the U.S.
  • In 2020,  the U.S. core inflation rate actually dropped to about 1.5% … lower than the pre-pandemic rate.
  • Post-Biden’s inauguration in early 2021, the U.S. core inflation rate increased from 1.5% to 4.7% in Q3, 2021 … an increase of 3.2 percentage points.
  • During that same period, the average OECD core inflation rate increased from 1.5% to 2.2% … an increase of .7 of a percentage point.

Bottom line: Given a U.S. core inflation rate of 4.7% … and using the 2.2% OECD average as a baseline for “global inflation” …  only about 20% of the U.S. core inflation rate increase since early 2021 is statistically attributable to common global inflation pressures (.7 percentage points divided by 3.2 percentage points equals 21.8%).

Said differently, about 80% of the U.S. core inflation rate increase since early 2021 is statistically attributable to factors specific to the U.S.

Sorry, Joe.

============

Next up: So, what are those specific factors?

Biden: Greatest job creator … blah, blah, blah.

May 12, 2022

Here’s a handy de-coding chart for you…
==============

Below is the Fed chart of total non-farm employment going back to the start of the Trump administration … with a couple of defining milestones.

image
click chart to enlarge

(A) Employment was 143.2 million when Trump took office.

(B) Prior to the Covid lockdowns, total employment reached 152.5 million … an increase of 9.3 million

(C) The Covid lockdown cut employment by 22 million … down to 130.5 million

(D) In the  final year of the Trump administration, about 12 million jobs were regained … pushing employment back up to 142.5 million (which was 700k lower than when Trump took office)

(E) Currently — after a about a year of Biden — employment is at 151.3 million … up 8.8 million since his inauguration ,,, but still 1.2 million lower than the pre-Covid level

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My take

(1) Seems reasonable to credit Trump with about 9 million jobs created during the “normal” period preceding the Covid pandemic.

(2) Less reasonable to tag Trump with “causing” the destruction of 22 million jobs during the Covid pandemic … true, he OK’ed the lockdowns … but, reasonable to argue that the job losses were transitory, i.e. regainable once the pandemic passed.

(3) To that last point, during Trump’s last year, about 12 million of the Covid-related job losses were regained (i.e. not “created”)

(4) Since Biden’s inauguration, another 8.8 million jobs were regained from the Covid drop … pushing employment up to 151.3 million … still more than 1 million shy of the the nation’s pre-Covid employment level.

So, is Biden — as he claims —  the greatest job creation president ever?

Those are the numbers … draw your own conclusion.

Pew: 38% believe that “human life” begins at conception…

May 10, 2022

… and thus, they believe that a fetus is a person with rights of life, liberty and the pursuit of happiness.
==============

Some interesting survey data from Pew

Let’s start with the overall context.

Should abortion be legal in all or most cases?

While there has been a recent upward trend in the percentage of Americans who think that abortion should be legal in all cases, the current percentage is now the same as it was 25 years ago.

image

Similarly, the current percentage of Americans who think that abortion should be illegal in all cases is now the same as it was 25 years ago.

==============

Does human life begin at conception?

Probably not coincidental to the above findings, the “illegal in all cases” percentage is practically identical to the overall percentage of Americans who believe that “human life begins at conception, so a fetus is a person that has human rights” to life, liberty and the pursuit of happiness.

image

=============

The question of when human life begins is central to the abortion debate.

Of the 44% of Republicans who do not think that life begins at conception (100% minus 56%), 86% agree that abortion should be legal in all or most cases.

Among Democrats, 77% do not think that life begins at conception …. 80% think that abortion should be legal in all or most cases.

Hmm.

It’s likely that the 20% of Dems who do not think that abortion should be legal in all cases are those in the 23% who think that life begins at conception.

image

Note that the percentage of Democrats thinking that abortion should be legal in all cases has trended upward in the past 15 years … the percentage of Republicans thinking that abortion should be legal in all or most cases has stayed constant over the same period.

===============

What about mother’s health and rape cases?

While percentages are higher among Democrats, a majority in both political parties agree that abortion should be legal when a mother’s health is threatened … and in rape cases.

image

Note: There are varied interpretations of “threatens the woman’s health” … ranging from serious disability or death … to minor depression or lifestyle changes.

============

What about unhealthy babies?

A slim majority thinks that abortion should be legal in all cases when the baby is likely to be born with severe disabilities or health problems … an additional 25% thinks that “it depends” … only 1 in 5 firmly rule it out.

image

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Bottom line

The question of when life begins is central to where people stand on the abortion issue.

Reminder: Hillary Clinton, in a classic Freudian slip, acknowledged of “unborn persons deserving rights” … and President Biden, has recently referred to “unborn children”.

Draw your own conclusions…

Maher: “Ending Rowe v Wade won’t set the U.S. back 50 years.”

May 9, 2022

And, a few other shots across the narrative’s bow.
=============

image

On his show last week, Maher — a usually reliable darling of the left — opined:

Pro-choice protestors’ claim that ending Roe V. Wade would send U.S. abortion rights back 50 years is ‘factually inaccurate.’ 

The ruling is not ‘settled law’ and it would not have the drastic impact pro-choice defenders believe it would.

‘Most abortions now, even when you go to a clinic, are done with the pill’. 

The pill. And pills are easy to get in America.’

‘So, you know, for the people who say we’re going back to 1973, we’re not. That’s just factually inaccurate.’

More specifically, Maher confessed:

I learned things this week that are pretty basic things that I did not know about abortion.

Like in Europe, the modern countries of Europe — way more restrictive than we are or what they’re even proposing.

If you are pro-choice, you would like it a lot less in Germany and Italy and France and Spain and Switzerland.

============

Here are the facts that support Maher’s claim:

14 weeks is the cut-off for “abortion on request” for practically all Europen0an countries.

Maher noted that the majority of the U.S. still has more abortion freedoms than a lot of countries in Europe, where they set a shorter time-frame on abortion limits
Source

Hmm.

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P.S. Maher also claimed that most pro-lifers are women.

Gallup’s numbers don’t support that claim:

image

Gallup: 49% "pro-choice", 47% "pro-life"…

May 6, 2022

… with partisan and regional skews.
=============

Let’s stick with the numbers…

For the past 15 years or so, roughly an equal number of people have self-identified as “pro-choice or pro-life..

In its most recent polling, Gallup pegs the split at 49%  pro-choice, 47% pro-life … within the margin of polling error … and tracking with respondents’ views on “moral acceptability”.

image

==============

So what to do?

About 1 in 5 (19%) think that abortion should be illegal in all circumstances … that’s about 40% of the pro-lifers.

About 1 in 3 (32%) think that abortion should be legal in all circumstances … that’s about 60% of pro-choicers.

But, a near majority (48%) — made up of some pro-lifers and some pro-choicers — think that abortion should be legal “only under some circumstances (e.g. rape, incest, health of mother).

image

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Spinning the numbers

Both pro-lifers and pro-choicers try to lay claim to the 48% who think abortion should be legal in some cases.

Pro-lifers emphasize that roughly 2 in 3 80% (19% + 48%) favor restrictions on abortion.

Pro-choicers emphasize that 80% (32% + 48%) are in favor of allowing abortions … neglecting the part about some restrictions.

==============

The partisan divide

No surprise, abortion views vary by political identification.

About 3 in 4 Republicans (76%%) think that abortion is morally acceptable.

But, about 2 in 3 Democrats think that abortion is no harm, no foul.

And. of course, Independents are split down the middle with 51% thinking that abortion is morally acceptable.

image

=============

State to state

Gallup acknowledges that abortion views on morally acceptability and restrictions varies state-to-date … but doesn’t provide polling numbers.

Seems reasonable to expect that the bluest  West Coast and coastal Northeast states are pro-choice and favor fewer restrictions (if any).

And, it seems reasonable to expect that the redest Heartland and Bible Belt states lean pro-life … and favor restrictions (some total).

So, the question boils down to: Is either group entitled to force its views and laws onto the other group.

Good luck forging a consensus on that question…

Irony: Abortion debate heats up right before Mother’s Day…

May 4, 2022

That’s among many head-scratchers…
=============

Listening to pundits on both sides of the abortion issue following the the leaked Supreme Court document, I’ve been struck by a couple of head-scratchers.

Let’s start with…

> “Happy Mother’s Day” … surely, the timing was motivated by politics but, coincidentally, it hit in the week running up to Mother’s Day.

Really?

BTW: To be politically correct, should we be saying “Birthing People’s Day”?

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> Women’s Rights … We’re in a new age of gender ambiguity and fluidity … with a SCOTUS appointee saying that one need be a biologist to to define “woman”.

If we can’t pin down “woman”, how there be “women’s rights?”.

Shouldn’t it “people’s rights”?

==============

> “My body, my choice” …. that is, unless you’re talking about vaccine mandates.

Strikes me that many in the pro-choice contingent were among the most ardent supporters of vax mandates.

Hmm

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> “An unborn child” … In his extemporaneous reaction to the leaked document, President Biden remarked about decisions “to abort a child”.

Oops.

The media is just playing the comment to be another case of Biden’s sloppy tongue (and thinking).

Apparently, they forget that in 2016, addressing the abortion issue, Hillary Clinton declared that “the unborn person doesn’t have constitutional rights” — like the right to life, liberty and the pursuit of justice. Source: NYT

Did she say “person’?

I see a pattern here…

==============

> “Rule of Law” … When protesters breached the Congressional Halls on January 6, it was broadly and understandably condemned by most people as violating the Constitution and “rule of law”

But, when a leaker violates the SCOTUS process — trying to “motivate the base” and intimidate  Justices before a final vote — it’s a case of ends justifying means.

Situational ethics?

============

> Misinformation… For the past week, the chatter has been about the need for a Federal “Misinformation Panel”.

Hmm.

The leaked SCOTUS opinion draft clearly states that the proposed ruling does not “make abortion illegal”. It simply relegates abortion decisions to the states.

And, it makes clear that abortion is fundamentally unique issue in that  “abortion destroys . . . potential life”.

So what?

Other issues — such as the right to interracial marriage, the right to obtain contraceptives, the right to engage in private, consensual sexual acts, and the right to same-sex marriage — do not “involve the critical moral question posed by abortion.”

Therefore, the draft abortion ruling would not apply to or set precedent for the other flashpoint issues.  Source

Of course, that hasn’t stopped Pelosi, Schumer, et. al., from hitting the air waves bellowing that the proposed ruling would jeopardize those other issues.

Misinformation?

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I could go on, but this is making me dizzy…

Fail: Getting reimbursed for Covid in-home test kits…

May 2, 2022

But President Biden promised…
=============

Flashback to January when Covid was running rampant.

Belatedly (as usual), President Biden announced a 2-pronged “bold” program to get “free” Covid testing kits into the homes of all Americans.

Prong #1: Distribute 500 million testing kits via the USPS.

Prong #2: Require all insurance companies to reimburse for kits purchased at retail.

===============

We previously posted about #1 — the “free” test kits that Joe was going to send right to my mailbox.

For the gory details, see:

Here comes the USPS … with 500 million free test kits

Hey Joe, Where are my test kits?

Joe says my free test kits are in the mail…

In a nutshell…

At the time time of Joe’s announcement (mid- January), nasty cold & flu symptoms were hitting my family. We wanted to test for Covid but didn’t want to stand in a line with other potentially contagious people.

On the first possible day (Jan.18), I ordered our gov’t supplied test kits … promised delivery in 7 to 10 days.

They finally arrived in mid-February, long after our family symptoms had passed …and as the Covid rampage was starting to wane.

But…

============

Being a belt & suspenders kinda guy,  I backstopped Joe’s mail program with prong #2 and bought some test kits at Costco … expecting, since Joe promised, that I’d be reimbursed by one of my 3 health insurers (Medicare, Blue Cross & Shield, UHC – Rx).

The good news: the Costco supplied test kits arrived in the mail a day or 2 later.

The rest of the program (the reimbursement part) was, as I largely expected, a complete train wreck.

Let me explain…

Read the rest of this entry »

Memo to Netflix: Password-sharing is a symptom, not the disease.

April 28, 2022

Like cable, you’ve got lots of listings, but relatively few that are worth paying for.
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Last week, Netflix announced that it, in its last quarter, lost 200,000 subscribers when analysts were expecting a gain of more than 2.5 million users.

Whoa, Nellie.

That’s a “statistically significant” miss for sure … not a smaller than expected gain, a loss!

And, the company gloomed that it will lose another 2 million in its current quarter.

Understandably, “the market” was “disappointed” and immediately shaved a cool 1/3 off the Netflix market cap.

image

Hate to pile on, but that’s on top off a prior (and bigger) 1/3 drop earlier in the year.

image

So, what’s the problem?

NFLX management chalks it up to to password-sharing … to many freeloaders who aren’t paying for the value that they’re getting from the NFLX “product”.

I beg to differ.

I think NFLX has an inflated view of how much continuing value it delivers … and, even if that’s not true, it’s value is eroding by the day.

Let me explain.

Read the rest of this entry »

For Elon, now comes the hard part.

April 26, 2022

Will his noble intentions get “trumped”?
===============

Last week, we asked the question: Will Elon be the dog that caught the bus?

We opined that — of the key assets that Musk is buying — all are a bit problematic.

  • The brand name is polarizing and arguably passé
  • The subscriber base is largely populated by left-leaning media and politicos …  and woke, pro-censorship loyalists who are likely to defect from an open information platform.
  • Ditto for advertisers, many (most?) of which are likely to “go Disney” and run for the hills rather than risk being outed as inadequately woke … or worse than that, being taint-branded as supporting free speech.
  • The hardware infrastructure — computers and communications network — are in place and operation .. but replicable.
  • The softwarethink: message transmission and control algorithms — are up & running … and being managed.
  • The human assets — proficient and mission-dedicated — are the biggest question marks given their zeal for progressive politics and “moderated discourse”

That gets us to Musk’s biggest challenge: Getting the organization aligned with his “open forum” vision … and, operating for (not against) Musk’s goals.

Consider an analogy: Trump’s efforts to mobilize the Federal government to his America First agenda.

Please, let’s stipulate to, but put aside, Trump’s personality issues and focus on his policies.

Trump was actively sabotaged by the enforcement agencies — think: “Intelligence Community”, FBI, IRS — and slow-rolled by the career bureaucrats who make “the system” work (or, not work depending on your perspective).

Remember Chuckie Schumer’s admonition to Trump:

“Let me tell you, you take on the intelligence community, they have six ways from Sunday at getting back at you.” Source

It’s easy to imagine Musk running into similar roadblocks as he tries to shift Twitter 180 degrees from politically moderated  discourse  to an open forum of alternative views.

Twitter has about 7,000 employees that will need to buy into Musk’s vision.

That’s a reach given their numbers, their technical expertise, their access to the algorithms … and, oh yeah, their deeply embedded political leanings.

Getting them on board (or replaced) will be a monumental organizational transformation.

The good news: If anybody can do it, it’s probably Musk.

Go get ‘em, Elon.

What goes around, comes around…

April 25, 2022

The crash & burn of CNN+
=============

Just in case you missed it…

CNN announced last week:

“CNN+, the streaming service that was hyped as one of the most significant developments in the history of CNN, will shut down on April 30, just one month after it launched.”

A couple of twists to the story…

It’s reported that a former employer of mine, McKinsey, strategy study for CNN.

Specifically, it’s reported that McKinsey forecast that CNN+ would attract 2 million subscribers within 2 years … and 4 million by 2026 when the streamer had its mojo working at full speed.

That forecast struck many pundits as “rosy” since CNN currently gets less than 1 million viewers … free in cable bundles.

The rapid crash & burn is epic.  It’ll be an oft-taught case in b-schools.

==============

To put things in perspective…

A (former) CNN+ producer preemptively chastised prospective gloaters …

image

Ms. Smith was promptly taken to the hoop by SD Gov. Kristi Noem:

image

Check and mate!

So you don’t cry too many tears for the CNN+ employees, rest assured that they’ll be getting severance packages that make Biden’s Build Back Better scheme look frugal.

According to CNN:

All CNN+ employees will continue to be paid and receive benefits for the next 90 days to explore opportunities at CNN, CNN Digital and elsewhere in the Warner Bros. Discovery family.

Staffers who aren’t absorbed elsewhere in the company will receive a minimum of six months of severance.

In other words: 21 months pay for 12 month’s works.

In comparison, most of the Keystone workers were sub-contractors who got diddly-squat when Biden abruptly shut down the project.

There’s no record of Ms. Smith tweeting that folks should show compassion for the Keystone workers…

Will Elon be the dog that caught the bus?

April 21, 2022

Good intentions, but what exactly is he buying … and what are chances for success?
===============

These are the questions that I’d usually pose to my MBA students when we were doing an M&A case in class.

Let’s apply them to Elon Musk’s bid for Twitter.

So far, most the reaction to Musk’s bid for Twitter has been at the philosophical / political level: Will his purchase open the town square for open information exchange … or, open the floodgates for existence-threatening “misinformation”.

I buy that Musk’s goal of open discourse is on the up-and-up, so I’m all for his acquisition.

That said, my questions are at more tactical level:

> What exactly is he buying?

> What are his chances of success if he gets “it”?

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On the first question, the simplistic answer is that he’d be buying control of  “an up and running communications platform”.

OK, but let’s dissect that a bit.

What are the key component parts?

  1. A well recognized, valuable brand name?
  2. An established base of subscribers and advertisers?
  3. An in-place infrastructure of  hardware, software and people?

Which of the above offer enough enough value to justify a $43 billion outlay?

Let’s take them one at a time from a Musk perspective…

Read the rest of this entry »


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