Under the effects of the Pandemic, consumers and businesses grapple with their own “Reset.”
By Wolf Richter. This is the transcript of my podcast last Sunday, THE WOLF STREET REPORT.
We’ve got the weirdest economy ever. A disputed number of people lost their jobs early on in the Pandemic, with figures ranging from 22 million to 33 million people who lost their jobs, depending on whether we looked at the monthly jobs report or the number of people having filed for unemployment.
Since then, millions of people have been hired back by restaurants, gyms, hotels, and other enterprises that had shut down. This was followed – and that’s the phase we’re in now – by more layoffs but further up the corporate chain, with higher-paying jobs now getting axed. Initial unemployment claims of newly laid-off workers have remained horribly high, at over 800,000 a week, and have risen recently.
But wait… at the same time that this jobs fiasco is playing out, retail sales – so that’s goods bought online and in stores – after plunging in March and April have spiked to record highs.
This does not include services such as insurance, airline tickets, hotel bookings, rent, healthcare, etc. And we know that airline passenger revenue at Delta, for example, has collapsed by 83% from a year ago in the third quarter, according to Delta’s quarterly earnings report. Many hotels remain closed.
In August, spending by Americans on services was still 7.4% below a year ago. And spending on services is the largest part of consumer spending.
But they plowed record amounts of money into buying goods, such as electronics, appliances, cars, bicycles, exercise equipment, and the like. According to government data, the amount that Americans spent on durable goods in August spiked by 12% from February, just before the Pandemic.
Consumers and businesses have changed – and those changes range from the banal, that we might be tempted to just brush off if it weren’t so radical, to the profound, creating shortages or supply gluts, and price spikes, and other distortions, with some business hugely benefitting, and with others getting wiped out, and with lots of new businesses being created to take advantage of, and cater to, those changes. And those changes are now everywhere.
Sales of laptops and PCs have been declining periodically in the US for a decade, as consumer switched to smartphones as the primary electronic device, and consumer laptops had been written off as a dying business. They just couldn’t compete with the smartphone for the kinds of things most consumers want to do. Businesses still bought lots of laptops and PCs, but consumers pulled back.
Then came working-at-home and learning-at-home, and suddenly everyone needed a laptop, and multiple laptops in some families. Schools and households scrambled to line up low-end laptops for remote learning, and suddenly there were reports of shortages of Chromebooks and other lower-end machines.
In the third quarter, 16.5 million laptops and PCs were shipped to the US. That’s up over 11% from a year ago, the fastest growth rate in over a decade, according to Gartner which tracks computer and smartphone shipments – and that wasn’t enough to satisfy soaring demand. Hence the shortages.
Within weeks into the lockdowns, there were reports of booming business at bike shops, and soon there were reports that bicycles had sold out, and that manufacturers all concentrated on making more bicycles, and stopped selling components as individual components because they all went into the bikes, and suddenly there were reports of bicycle-component shortages.
There have been reports that hot tubs and jacuzzies are sold out into next year, as people built out their back yards and decks, and you gotta have a jacuzzi there.
People, with so much time on their hands, suddenly bought seeds and gardening equipment, and planted herb gardens and vegetable gardens and fruit trees. While many of them will soon give up on those projects, others are having a blast doing it – and that has long-term consequences, including how consumers are spending their time.
Now there is a shortage of coffee filters as people make coffee at home instead of drinking it at work, or stopping by a Starbucks or Peet’s to drink it on the way to work. Costco, when I asked them about it because I’d not been able to find coffee filters there, they told me that they’ve been out of filters for months. Our Trader Joes has been out in recent weeks every time we went by there. Safeway has run out too, with only sporadic supply. A week ago, I was lucky and grabbed the last box off the shelf.
Not that I need filters to make coffee. I have a selection of Italian stovetop espresso makers, I have a French press, I have a cloth filter, depending on what mood I’m in, but it’s curious that coffee filters show up on the shortage list. And people who discover that they can make coffee at home that is a lot cheaper and maybe also better than what they get on the way to work or at work may well stick with it. The act of making coffee can be a cheap pleasure – the smells and sounds of it, and that might have permanent consequences.
Over the summer – with flying still an issue and vacations nixed by travel bans – sales of RVs and camping equipment soared, and there were reports of camping equipment being in short supply, as people flocked to National Parks and State Parks to enjoy the outdoors and get away from crowded places, only to run into booked-out camping sites and crowded places. Lots of people discovered or rediscovered the beauty of camping, and that will have long-term consequences.
Oh, and puppies. This business suddenly skyrocketed, apparently, with people spending so much time at home, and with kids going nuts, and with people who live by themselves getting lonesome. And the “companion animal industry,” as it’s known, suddenly boomed. That’s not just the puppies, it’s the dog food and supplies and toys, and the vet, and all the other things that go with owning a dog. And that has long-term consequences.
And then there is the issue of haircuts. When barbershops closed, a lot of men bought electric hair clippers and learned how to cut their own hair. Suddenly, there were YouTube videos showing guys what to do and not to do with their clippers, and some of these videos got many millions of views, and whole business models sprang up, teaching guys how to cut their own hair. If a video gets 5 million views, the ad revenues are starting to pile up.
But the first consequence was, you guessed it, a shortage of hair clippers. Manufacturers and vendors had a booming business in hair clippers.
As in so many of these issues, there are long-term consequences. Now months into cutting our own hair, many of us have gotten pretty good at it. It’s fairly quick, if you’re not too picky, you don’t need to go anywhere to get it done and save all this time, you can do it on the first Saturday each month as a ritual and always look neat and trimmed.
It’s really very practical – and it saves a little money along the way. Personally, I enjoy cutting my own hair, and I’m experimenting with it, and now I have the cut that I truly deserve.
And if I screw it up, my wife knows what her role is in this endeavor. She has to say, great haircut! Or, cute haircut! Or similar. We got that down pat. And always get a good laugh out of it.
Many couples have come to a new understanding of how to harmoniously conduct their relationship, with so many things now different, including working from home and learning at home, and maybe sitting on top of each other all day.
When gyms closed, it gave rise to exercising at home and outdoors. And there was a surge in equipment sales, all kinds of exercise machines, including bike trainers, and weights and all kinds of rubber straps and the like. And of course, the bicycles I mentioned a minute ago.
What I really enjoy seeing is the huge number of people now exercising outdoors, in the beauty of the San Francisco waterfront, at Aquatics Park, the Marina Green, Crissy Fields. And lots of people, with pools closed, bought wetsuits and started swimming in the beautiful but cold and polluted Bay. There are water polo teams training in the Bay now.
The beauty of this place is just stunning, and locals – not just tourists – are now discovering it. The vibes are incredible, social distancing and masks and all. I’m not sure how much of it will stick, but some of it will.
This Pandemic has knocked us off track, and we had to do things differently, and suddenly we discovered new things that were always right in front of us but we didn’t see them.
Using a different metaphor, the Pandemic has forced consumers and businesses out of a rut. Everything is now being looked at with fresh points of views.
One of the consequences of this fresh thinking is that companies have discovered what is efficient, in terms of working from home, and what isn’t, and they’re now building permanent hybrid models where, after the Pandemic, part of the work will be done from home, and some of the things will be done in the office, or in a meeting place.
And the office sector of commercial real estate has to think very creatively. And there will be lots of turmoil.
All these changes have big consequences. A considerable part of business travel has now been revealed as unnecessary, as an inefficient use of time, as a waste of human and financial resources. And the travel industry will struggle for years coping with that change.
And there are suddenly a record number of new businesses springing up as entrepreneurs see opportunity in the shifting behavior and consumption patterns, and in the different ways that businesses are operating.
In the first quarter this year, so mostly before the Pandemic, business applications fell for the second year in a row. This data was released by the Census Bureau. It’s based on actual business applications and not on sampling.
In the second quarter, so that’s April through June, while the lockdowns were happening, business applications, instead of plunging, surprisingly rose a smidgen compared to a year ago.
And in the third quarter, as some of these new trends became clearer, business applications skyrocketed 82% from a year ago, to a record of nearly 1.5 million, by far the highest for any quarter in the Census Bureau data going back to 2004.
Obviously, these business applications also include a lot of desperate people who’d lost their jobs and decided to make a go of it on their own. It includes older people, meaning people over 50, with lots of experience who’ve been tarred and feathered and driven out of town by blatant ageism, and they’re striking out on their own. Maybe they’re staying within their field, or maybe they’re striking out into a completely new direction, maybe a passion of theirs that they finally decided to turn into a business.
But so-called high-propensity business applications also hit a new record. These are business applications that have a higher likelihood of turning into businesses with actual employees and payroll. So these are businesses that have plans to grow into larger businesses with employees, not just a guy-on-his-own operation.
These high-propensity business applications soared by 66% in the third quarter compared to a year ago, to over 500,000 applications – by far the highest ever in the data going back to 2004.
This surge in new business formations is another indicator that the Pandemic knocked us out of our rut, for better or worse, and that people are doing things differently, and that they want to do things differently, and that the last train to Old Normal has long ago left the station.
And everyone is trying to figure out where to go from here, how to move forward, and how to do things differently and maybe better, and more efficiently, maybe even create a new business.
The destruction of the pandemic has been widespread and massive, and it continues. What are the barbers and salons going to do that used to cut our hair? Are people who bought a bicycle and who’re now riding outside ever going back to pedaling away on an exercise bike in the gym and watch TV? Surely some people will. But others will not.
For many people, the old normal was just fine. And some may be just trying to make it through this period. And they’re struggling to get back to the old normal, even if they can’t because too many things – big and small – have changed. However this is going to turn out, and there are lots of uncertainties, we do know that it has thrown many people and businesses into utter turmoil.
But as people and businesses are trying to figure out how to navigate this turmoil, and find their place in it, they’re already working on their own version of a “reset,” where so many things will be different, and with lasting consequences. For the optimists among us, that could be a good thing. You can listen and subscribe to THE WOLF STREET REPORT on YouTube or download it wherever you get your podcasts.
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“Italian stovetop espresso makers”
Nothing beats an old-fashioned Moka Pot.
We grew 90% of our herbs and veggies this year in vegetable beds totaling 200 sq ft with enough to spare to distribute to our neighbours.
My freezer is full of frozen greens and berries and I have tons of winter squash for the next few months.
”Cowboy coffee” is the only way to go with any pot IP, and surprised anyone from Idaho would suggest otherwise…
Put the coffee and the water in the pot, any pot, and just let it ride on the chuck wagon until it’s needed, then heat it up and serve it.
The guy who taught me that back in the earlier 1960 era, had done exactly that all the way through his service in what was left of the Calvary as an MD in the Army Medical Corps in WW2…
Still works every time, with not sort of expenditure for filters or fancy machines of any kind,,,
And, if you want the ultimate buzz, just boil it a bit or more,,,
What you’re describing is acrid coffee, which is widespread and plentiful in Idaho (including at Starbucks). Wolf was talking about an Italian espresso – the rich smooth kind.
I’ve heard of this thing called coffee
oh yah, quit in ’98 when I worked in Portland at Nike
afternoon latte breaks, etc.
don’t miss it
Time to stop drinking out of your helmet soldier!
Whats the deal with “reset” ?? Sounds like Klauses WEF verbiage?
Can u put an article out on what u really think is happening? Or link to one u have written that i may have missed?
I also have several .. stove top espresso makers.
I’ve gone through several .. electric manual coffee machines .. 12 mths warranty .. what should I have expected !!
Back to reality for me.
1) FDR vaccine holiday will be soon over in Jan 2021.
2) But if it’s a 1:1 tie more people in CA will die.
3) If the president win, there will be vaccine drought in CA dreaming, because the vaccine will be sold out.
4) The 39M Californians will be subjected to the deadly Cycotike Storms
until CA own medical team confirmation. Thereafter vaccine dripping.
I don’t get Disney complaining about Covid lockdown rules and not working to implement safety. Same goes for all US manfacturing. Apparently the Chinese are eating our lunch here as well. Recent poll said a substantial number of US workers were considering quitting their jobs because of virus safety issues. Government did not mandate these things in a vacuum. Why aren’t the airlines rushing out a safe-to-fly airplane. Who knew flying in MAX would be “that” dangerous?. Not unlike the 1970s, a lot of people driving gaz guzzling cars and no gas! Asian subcompacts were selling at a premium during a recession while US auto industry had it wrong, or perhaps not? How many HP does that new Mustang have? More than twice what a diesel semi tractor has. We’re consumers first last and always.
Close to 20,000 Amazon and Whole Foods workers have had coronavirus (these are Oct 1 figures).
Disney is dependent on theme park revenue and the associated hotel room revenue for those going the parks. The movies aren’t exactly making much money right now either. There is no way to make money off of the parks at a reduced enough capacity to be safe, it simply costs too much to run the parks. In Florida, the CCP-19 standards are not exactly effective (look up the crowd sizes). If Disney world in Florida closes down, Disney will be in serious financial trouble.
Sitting at home consuming Chinese made goods Delivered by underpaid gig workers using printed money is an incredible accomplishment of human ingenuity.
Even if you’re not a 1% and you exist in this nirvana you are 1% compared to rest of the worlds poor.
Dollar General’s board of directors last month approved $2 billion in share buybacks.
The company will pay $123 million in “appreciation bonuses” to workers this year.
$2B = ~$14K
$123M = $an insult
The workers should have bought DG stock with their bonuses.
Amazing that you would consider a bonus paid to employees – the people who have already agreed to work for the rate without a bonus – an insult. Employee wages are always a percentage of earnings, not a split of the profits. Maybe Dollar Gen could make the bonus bigger but why, when any bonus paid will be viewed as an insult?
Amazing that you wouldnt understanding these bonuses as essentially hazard pay in response to an event unforeseen at the time of hiring, and fail to appreciate that the amount and occurrence of the bonus come to be through a process of informal negotiation!
I think DG runs a good operation. They opened a store about 3 miles from me that I pass at least twice a week while I am out. In and out in five minutes in clean well organized well priced store with nearly all the things you need for modern life except fresh produce and fresh meat. Saves a lot of trips to grocery store which usually is tougher to socially distance and limit inside time.
Shopping at any Dollar General is a stab at your own paycheck with the race to the bottom for wages.
May we all see better days!
You hold a colored moving object in your hand and push a button on it. Solid objects that you chose with the button appear on your doorstep the next day.
If that isn’t MAGIC, I don’t know what is!
Tales of this will be mythogical wonderment in the centuries to come as people hunt under rotten logs for grubs to eat.
Mother nature has a way of hastening the demise of empires that have outlived their purpose. The Roman Empire suffered two plagues in the last half of its existence that had a great effect on its viability and resilience and hastened it on its way. Perhaps natures way is destruction.
The Roman Empire lasted 1,500 years…
Sailing to Byzantium?
The Roman Empire devolved over centuries.
Perhaps the worst part of the process was when the provincial governors were given the right to keep any tax over and above what Rome demanded. The governors over-taxed and destroyed the peasantry in Anatolia and elsewhere.
This wasn’t a simple question of tax rates. It was a question of giving in to corruption.
Remember that Rome counted on the peasantry to show up with weapons or weapons and a horse to fight.
If they were too poor or demoralized, that would lead to military defeat.
It’s still true that the internal economics of countries, includng the U.S., and the education of a country’s people determine the maximum military strength 25 or 50 years hence.
Rome debased its silver and gold coinage
The Empire part only lasted about 500 years.
For about 500 years before that, Rome was a class stratified Republic, with much less centralized political power.
And for the hundreds of years before that, things get pretty tribal and hazy.
And the Venetian Republic, 1000 years.
Exactly! And it didn’t decay like Rome. It was conquered by Napoleon.
Your comment is misleading. Covid fatality rate is 2.5%, higher than the Spanish Flu of 1918. The scant mitigation has helped keep it at bay, but wait a week.
Follow the money is right, the naysayer cash.
Please provide numbers and citation. Thank you.
Also, does somebody pay you people to say “wait a month” or “wait a week”?
Its been 8 months. I’m still waiting.
Waiting for Godot
https://ourworldindata.org/mortality-risk-covid makes it look like 2.5 to 3%
You can do the math yourself and get a rough idea: >8,200,000 confirmed cases. >220,000 deaths. That’s north of 2.5%
The similar number for the flu is much lower.
Weirdly, this number is hard to find on the CDC website. I am sure it’s there but I looked a bit and found statistics that were related but not this number, either explicitly calculated by “confirmed cases” or by estimated cases.
My first comment, which points to two sources that put the U.S. rate at > 2.5%, is in moderation.
The numbers can vary, depending on how you do the calculation, but it’s undoubtedly much higher than typical influenza.
I know, it was posted at the end of September on the CDC site and strangely its gone missing.
The numbers i saw via age group were all 99. something until you reached the 70+ age group. Then it dropped to like 94% i think. Strange that they just vanished. Fits for just about everything with regards to COVID. Nobody knows the truth, wonder why that is when its such a major health concern.
Go to the John Hopkins site, no of deaths/ no of deaths and number recovered, currently 4%. The number does vary according to the infection rate. While infection rates are rising the death rate appears to drop, like now. Everything we know we learned the first week. There will probably be 1/2M US deaths, deaths continue after infections end. People are being reinfected. Herd immunity means those most likely to die already have. It in no ways implies real immunity in this case. This is novel virus and only a genetic sequenced vaccine, which has never been made before, will prove reliable. China released the code as soon as they had it. As a public information campaign this has been a disaster, and the results have been pretty much in line with early predictions. The real variable is the infection rate which responds well to basic measures.
Why are you only dividing by cases? Why not divide by the entire population?
Trying to navigate their website is insane. Its almost like they’re trying to make it hard to get the answer you’re looking for. So we have 222,000 deaths as of today. Divide that by the population of 330,000,000 and what number do you get? Something like .00074
Percentage based on current ballpark numbers (8.6 million = confirmed infections. 222,000 = confirmed deaths.)
ABS(( ( 8,600,000 – 222,000 ) / 8,600,000) – 1 ) * 100) = 2.51% mortality rate. Much deadlier than the flu.
And just for gits and shiggles… Lets do herd immunity for the US population.
331,000,000 * 0.0251 = 8,308,100. That’s a scary number.
The only potential replacements for America as the world’s superpower are having their problems from the current plague.
From what I quickly googled by “DATABASE OF PESTILENCE IN THE ROMAN EMPIRE”,
the pestilence has been striking romans multiple times a century since 200 BC in recorded history.
Suggesting that the virus was the root cause of Roman empire fall 6 centuries later is not convincing.
I’ve noticed a lot of thirty somethings walking around the neighbourhood these last few months holding hands.
What about the increase in the population from all this excess excitement?
Baby items, furniture etc.
China will have to ramp up it up even more now…..
Should hit just after the first of the year in my estimate
Yeah they probably think protected sex means you wear a mask.
Divorce attys doing good bidness.
Holding hands will not create babies. Do more research. :-)
I was so waiting for this ?
It does help you move up the queue for…
Hmm…poor economics make for poor population growth in the post Pill universe.
And US population growth has seen some of the slowest percentage increases in US history since 2010.
A fair chunk of it is aging demographics, but 20 years of a stagnant at best economy (follow the ZIRP, the Fed knows all…) has gutted Americans’ ability to start families.
Australia’s population is expected fall by the greatest number since WWI when they shipped off soldiers to fight in the Mother Country’s Big War.
You can still see the numerous monuments to those that died in WWI all over the country and in small towns. Seven men died from one local school here at a time when the entire citiy’s population was 744.
Population growth was one the connerstones of Australia GDP growth over the past ten years or so, but it really hasn’t helped GDP per Capita though which has stagnated or actually fallen in some recent years.
Wolf, you hit the nail on the head for me with all those examples. We couldn’t find the cheaper Chromebooks for home-learning (it was painful buying an expensive one for my 4th grader, but luckily I found one priced on the lowish end for my 1st grader). I started doing my own hair (bleaching highlights, yikes!) and don’t know if I’ll ever go back for color at a salon. Probably just cuts because they’re so cheap, at least comparatively to color/bleaching.
I’m still utterly confused about the housing market. OC Register sent out their housing edition yesterday that CA housing prices are skyrocketing, up 17% at a record high. The graph they included shows prices are on top of a gigantic peak (presumably peak…because prices eventually have to come down, right?). Are these all investors scooping up houses as rentals or flippings? Are houses officially like stocks and don’t adhere to any rhyme or reason??? ?
I truly hope the Housing Is A Human Right movement gains traction soon. ???
“Human right” means wherever the committee decides to put you. Probably on Marvin Gardens.
Keep your eye on sales volume…selling 33% fewer houses (made up number for illustration) at 20% higher prices isn’t really telling anybody much economically.
For the 10 years following 2008, during the long slow slog to get anywhere back near 2008 prices, CA sales volumes were about 50% of the 2003-2007 boom years.
Everything revolves around Fed gutted interest rates…once they have to go up even a little bit (see Fall/Winter 2018) fewer and fewer buyers can afford the monthly mortgage payments at CA’s idiotically inflated home prices.
Sales volume dwindles, prices follow with a lag as prices have to come down to make monthly mtg payments affordable in any non-ZIRP universe.
My neighbor sold their house in three days last month. The listing doesn’t show up as sold, it shows up as listing removed. The house they bought also doesn’t show up as sold.
Violation of MLS policy.
I know several cases that were FSBO:
Friend bought place at the beach FSBO. She is a paralegal. Did all closing. I financed. No realtor, bank or lawyer.
Another friend sold her vacation home to her son. She financed. My paralegal friend again is doing all paperwork. No bank, realtor or lawyer.
Builder in small development sold his last two houses built without realtor. He always tries to do that, but if it doesn’t sell in a couple of months he will list.
“The listing doesn’t show up as sold…”
Hmm…so you think that the aggregate statistics are not 95%+ accurate?
That non-recorded home sales are somehow making up a large, substantial, macro-economically meaningful percentage of home sales?
They used a realtor, a big national company. There was a sign on the property until the closing.
Maybe we should hope for a COMMON SENSE IS A HUMAN NEED MOVEMENT and understand that:
1. Life is unfair
2. Some people are lucky
3. Some people are unlucky
4. Some people are in the right place at the right time
5. Some people are in the wrong place at the wrong time
When I lived in Japan I always had a bad feeling every time I was driving the car and stopped under one of those multi-story highways………what if an earthequake strikes right now was always my thought…………….
Or hearing about the person that got killed by tiles falling off a roof or even worse, some lady getting killed by a truck tire that flew off a truck and hit her on her way to do the daily shopping.
I’m starting to think all the new “businesses” popping up are delivery businesses.
The delivery vans are dropping off things about once an hour in my suburban neighborhood. It’s usually packages, but I see a lot of food delivery too. The vans are mostly Amazon, FedEx, and UPS, but I see a lot of unlabeled vans too.
Today, I saw a guy delivering a package from a van from Budget Rental Car. Even if you don’t own a van, apparently you can rent one for the week, pack it up with cheap Chinese goods, and deliver them 12 hours a day. I bet some guys are working 16 hour days doing this.
I assume Amazon is currently setting up thousands of these new “businesses”, in order to market a turn-key opportunity to independent delivery drivers. Every time I log into Facebook I see an ad suggesting that I become one of them. You sign up and they likely set you up with everything you need – truck, packages, business registrations (probably), policies, job manual, route, etc.
I’m sure you’d make a decent wage, but you’d have no chance to make anything more with Amazon looking over your shoulder.
If your bad at math, you’ll make a lot of money working as an Amazon deliver driver.
How about spelling?
Harrold made no spelling errors. He made a grammatical error. What’s *your* excuse for calling someone else out without knowing the difference?
Happy to help.
The thing about these new *businesses* is that if they only have one customer, Amazon, they are not businesses. The *owners* are sharecroppers and Amazon is *the boss*.
The first rule I learned about negotiating, when I started SW contracting, is that you have to be able to walk away. If you can’t walk away, you aren’t negotiating, you are just arguing over the terms the client is going to dictate.
I have to admit that sometimes the look on a clients face when you say no is priceless.
Is there a problem with crime with this increase in home deliveries. My brother and father both were robbed shortly after having a stranger at their home for a charity donation and the other was just someone turning around in driveway. I would assume that most are ok if they are working, but some of the gig delivery people look like they are on tough times.
Send them to Australia.
They need help – really, really bad too.
Australia Post is taking 22 days to deliver a parcel from Perth to Melbourne. Last one from Sydney took 22 days to get to me.
Domestic letters are still a mess too. Nine days from Sydney to Melbourne.
While domestic mail still takes forever, international mail is a mixed bag. Last letter fron Belgium took 5 weeks to get here.
Going the other way, I sent a letter to the UK: took 9 days from the time I dropped in the village mail box to delivery in the UK!!!!
Heard similar comments from others sending things overseas too.
So it appears that the problems are with internal mail, but international mail going out of the country doing quite okay.
Lee, Australia Post cut back on postal delivery so they could afford to give 4 top executives Cartier watch’s, no joke, the CEO has been asked to step aside.She should have been sacked immediately.
Yeah, that’s what you get when you hire the former CEO of a vitamin company.
And before that Australia Post hired a former investment banker to run the company.
Australia Post is a LOGISTICS company.
They should have hired some former logistician from the military that understood movement of goods and people, but that would have made too much common sense!!!
And yes, the movement of parcels and mail still hasn’t improved one bit over the past month.
I’m pretty much done buying stuff that requires it to be sent in a parcel.
Waiting two or three weeks for it to arrive and then have to send it back if there is something wrong with it……………..
The US economy is still running on normalcy bias. That is to say, the vast majority of people still do not understand the real implications of what the virus and the coming depression is going to do to this economy, and how bad this is going to get.
This is a slow motion train wreck that will take years to unfold.
It is like Wolf’s love for San Francisco, and how he does not seem to see the deterioration. I read yesterday that a major drug store is closing 2 stores in SF because the theft and robbery have gotten so bad, it made them unprofitable. The thing about SF is that the good neighborhoods are just walking distance from the bad.
I guess we all perceive things the way we want them to be. Unfortunately, when paradigms shift, if our perceptions blind us to the changes, it often means we become victims of the new realities.
They closed two stores because there is not enough business. Tons of brick-and-mortar stores have closed in San Francisco — and in the US. There are estimates that in the US overall, 25,000 brick-and-mortar stores will have been shuttered in 2020. And this has been going on for years. So the closing of two little-bitty drug stores is a sign for you that SF is going to heck? This nonsense gets tiring after a while.
There are 6 Walgreens within 15 minutes walking distance from our place. There are 3 within 5 minutes, plus 2 CVS. They will need to close more of them. I never understood why they plastered all these drugstores everywhere. This started about five years ago. 3 of those Walgreens and 1 CVS are new.
Look I get it, you love SF, but you cannot expect us to ignore all the articles about the impact of Prop 47 which stopped the prosecution of thefts under $950. It did have a huge impact and made shoplifting go ballistic and give the green light to homeless and criminals. Do you really expect us to believe all these news reports are fake? Next you will be telling us no one is shitting in the streets…..
I used to love SF too, but it has gone down the drain and that’s the truth.
Sure, there are problems. All cities have problems. But the other cities I lived in all had bigger problems, and fewer rewards. Some had so few rewards that I always wondered why the heck I ever lived there.
Yes, theft of less than $950 at stores, and car-window break-ins are big problems here. No one is going to dispute that. The latter can be avoided by not EVER leaving ANYTHING on the seats. Locals know that, tourists don’t. And so tourists get targeted. It’s a nasty issue.
Let me guess. You get your news from ZeroHedge?
I realize they haven’t really covered the Prez’s bank account in China. See, two people can play at this game :)
San Francisco now has the highest rate of property crime of America’s twenty largest cities thanks in part to Prop 47.
Guns, ammo, and kayaks were also sold out until recently in Indiana. Paper towels and baby wipes are hard to find now.
And baby formula. Which you can then buy at double or triple price online.?
I couldn’t find wipes for weeks when this all started. They’re pretty much in stock now.
Hmm.. I wonder. It hasn’t been 9 months quite yet.
Australia had to start limiting sales of baby formula as Chinese black market people were buying truckloads of it and shipping it to China to sell. Australian shelves were bare. People in China do not trust many foods manufactured there.
I think coffee filters might be out of stock because people are making filters for their masks. One of my siblings does this. Supposedly better than or equal to N95. I personally buy American made certified filters for my mask.
Ran into the bicycle parts shortage a couple of months ago. Needed a replacement pedal. Finally found one. So now I have one pink pedal.
Also discovered last week plastic toolboxes are not to be had anywhere in town. My suspicion is the injection molding machines are being used for something else. Why would there be a run on toolboxes?
My barber died about 20 years ago. Wife has been cutting my hair ever since. Probably $2,000 ahead less the price of a set of clippers.
Are we going communist. Bitch and complain about everything that’s happening. Quit a job. What the heck is gonna support them, their little tea garden. Let’s put on our big boy pants and get back to work. Work on your family, for your home and for your neighborhood
The top 10% got shielded in 2020 from the mean reversion stock market “Creative Destruction” by J-Pow. The Fed attempts to deny any roll in income inequality, yet their own data paints a different picture. According to recent Fed data, the top 1% own 52.4% of stocks, the top 10% own 88.2%. The Fed data link below is the proof, just scroll down from 1989 to 2nd quarter 2020 and prepare to to J-Pow-ed. Guess the fed is “Doing God’s Work”, just like Goldman Sachs CEO stated in 2009? This will end poorly…pun intended…
A young engineer, WFH during the week, charge his Prius on weekends,
while waiting for Jordash food delivery calls.
“You’ve got the look.”
New business applications might be soaring to “take advantage” of upcoming government programs. Why drink at the well once (1200 checks) if you can also get your fill through a “business”.
This is a fun article. As for hair I don’t have as much these days but the lean areas are the easiest to see. Fortunately my step daughter was visiting but is military. So I got my 1st military haircut. So I trimmed the beard to match. Many folks don’t recognize me. And its easier to find ticks.
Coffee filters? Necht. We always use a press anyway. Just don’t drink the bottom. Fresh ground beans and a press is a delight.
Lastly, “For many people, the old normal was just fine.” Yup. We live in the forest. Off grid with no utilities at all including two bars of signal close by a cell booster. TG for satellite stuff. Many wouldn’t/couldn’t live without their microwaves and hair driers. And wood ticks? No way :-)
Meanwhile…..in the cocaine and vodka capital of the world……other wise known as DC…….a congress full of drunken sailers is about to spend another 2.2 trillion dollars they don’t have. Dancing naked on the table tops.
You would think they would at least spend something on infrastructure and get something for it…..nah……just grab the cash and give it to their buddies.
In the new USA casino…..a year from now the airline executives will be taking huge bonuses for their great work in obtaining government bailouts.
The party continues…..til it don’t……
and theses jokers dads told my dad to just shut up and dig when he wanted a toilet break in the coal mines in 1930.
Never could figure out with all the trillions of dollars spent by Obama and now the trillions of dollars being spent by Trump where it all went.
Geez with all the bs going on about solar and green they could have spent $100 billion a year on solar systems for houses and now you’d have a huge industry making panels and installing them as well with the added benefit of a huge increase in generation capacaity during the day.
Even at an inflated price of US$10,000 a system that would have meant 10 million systems a year and over 10 years that would have probably put a system on about 2/3rds of the single family houses in the USA.
You would probably jump off a cliff if you knew where all the money was going. I have nephew about 50. He worked for 20 years or so but had some health problems. He got on disability, but idle time got him with the wrong crowd and he got locked up for stealing due to drug problem. His disability checks keep on coming and he got the $1200 Covid check all while being locked up. Politicians make the policy and as long as GDP keeps going up and they get re-elected all is well.
Doesn’t matter when it is .000000000001200 of a trillion
I bought a $100 wetsuit, and swim in Monterey Bay with the dolphins and seals. Much better than the dirty pool at my old gym. Cheaper too.
I’m waiting for the RV bust. Lots of pp going to find out RV travel was not really their thing.
When the oil bust started happening in the last two years, I was in North Dakota on a business deal. OIlfield workers were abandoning RVs and trailers like mad and just leaving them in rancher’s open fields. There will be a second wave of this when the payments can’t be made on the ones purchased this year and no one wants to buy them.
My girlfriend was ramping up to buy one until the pandemic hit, they demand crushed her dreams. I am looking forward to seeing the prices drop, maybe even get one for myself. I figure in a worst case scenario, while they can get the house, finding me in an RV will be tough.
Next generation housing….
1) When u drive straight above a parking lot bump u can destroy your car. Drive like a scout, hit each bump at thirty degrees, one tire at a time, cross the bump slowly.
2) GMC new EV $120K Hummer will do it for the sophisticated people when they press a button. GM Hummer is superior to the Rubicon.
3) Hummers stopped selling after anti tanks missiles blew them up.
4) GM Hummer price will drop to $60K – $70K to appeal to the upper middle class.
5) GM will gradually phase out ICE, importing inexpensive EV from China, to appeal to low end buyers.
6) Tesla EPS 0.67 vs $0.55 is doing great today. Tomorrow GM will overrun Tesla. GM is the future.
7) A DOW down thrust will eliminate both.
Auto manufacturing is a sorry business with too much capacity as nearly every country wants to have a domestic automobile industry and very high capital investments. Better off being in the candy bar business or tooth paste business than making cars imho. You don’t here of candy bar business or tooth paste business needing a subsidy or handout. No extra points because your business has a lot of complexity.
Some concerns that EV batteries/ cars are explosive/ flammable according to reports online. I’d proceed with caution with any EV tech
ICE vehicles have blown up and they burned for over 100 years. And they still do. No one cares because they’re ICE vehicles and have 15 gallons of explosive fuel on board, and they’re expected to catch fire or blow up, and they always have. Even today, Ice vehicles catch fire as much as or slightly more than EVs. But the timing may be different. Most ICE vehicles that catch fire do so while they’re being driven. EVs sometimes do so while being parked, which is rare for ICE vehicles.
“Obviously, these business applications also include a lot of desperate people who’d lost their jobs and decided to make a go of it on their own.”
Obviously, these business applications also include a lot of desperate people who decided to try to game the system and get forgivable PPP loans as newly-formed corporations.
The PPP loans were based off of the average payroll last year. You aren’t eligible if you started a business this year. Nearly all the grants being given out also require you to have started your business last year or earlier and have filed taxes in 2018 or 2019.
If you start a business before the end of this year and make at least $1 in sales and file the taxes, you might be able to pull off some grant next year before the pandemic ends. They better make sure they file those taxes.
Lot of income from unemployment insurance, $1200 stimulus checks, not paying rent, mortgage or student loans. Many move back in with Mom and Dad boosting disposable income. Looks to be making up for shutdown costs and lost wages.
Americans are consumerists until they max out credit. Best advertising effect in history. Highest time preference in the world. Can’t see one inch past their noses until anvil drops on head. No surprise as to what is going on right now.
US Treasury prices are falling and bond yields going up. The 7,10, 20, 30 year maturities are still low but today closed at 0.59%, 0.82%, 1.39%, 1.63%.
I am hearing a 1.3% to 1.4% 10 year, 2.0 to 2.1%% 30 year treasury yield in the next 3 to 4 months. Bond funds, bond ETF’s, individual bonds will lose even much more than the 3% to 8% already lost in the last 6 months. It could another 1994 or worse.
Read a book a long time ago that said interest rate predictions were woefully bad and I think recent history has born that out. You might be right. I did get lucky and top ticked the 5 yr CD rate at our local credit union at 2.8% but that has been about the only time I got it right. Pretty much I always try to stay away from long end of bond curve as I don’t want to make an interest rate bet.
I am the same Old School, I don’t like going long term for many reasons but I was forced in a way. I did not know my income coming in after my unemployment benefits ran out or if my next job was going to take a long time and at what pay.
I was going to lose my job in Summer 2010 and being 55 years old having a $350,000 IRA and CD’s coming due, $275,000 so I saw 4.55% to 4.6% 30 year US treasuries bought through treasury direct and some through my brokerage account in end of March to April 2010. They were all or near par. They topped out at around 4.8%.
Luckily my wife and I were debt free, mortgage paid, 2 cars paid off, no credit card debts etc. It looks like that was a really good move because the last almost 11 years keeping track the highest I found is 4.0% 30 year treasuries near par. Most times 3% to 3.5% were at best for 30 year US treasury maturities.
I could only find contract and part-time jobs making only 65% of my last long term full time job for 29 years. It took me 9 months to find work. My weekly loss in net paycheck was $245 a week or $375 a week gross. Well with my wife working still but only 31 hours a week and my reduced paycheck we managed to save most of the yearly interest from our 30 year US treasuries, $275,000 in 11 years or so.
In 11 years we bought many CD’s for 7 and 10 years in 3% to 3.25% range with most of the interest coming in and some shorter term for liquidity. We are both retired now and with social security and these US treasuries, CD’s interest are able to live decently and keep saving most of the interest from our investments,$28,000 a year.
I remember just this beginning century year 2000, CD rates in the 6% to 8% range. The grand manipulators of interest rates really are scared of their debt junkie ways blowing up in their faces. CD rates in the 1% or less now.
Thanks Wolf. One of the most upbeat posts in quite some time. Cheered me up, made my day.
Yeah. It was jarring in a pleasant sort of way. Had to read it twice.
I read it, while listening to the podcast!
I don’t know what the deal with paper has been this year. They clean out the toilet paper, then paper towels, then baby wipes, then coffee filters.
Oh, I get it now, coffee filters are the most versatile of them all, they perform the other 3 functions and filter coffee too. So keep a stack in every room. Just one dollar for 150 filters at Dollar Tree. I suppose they can be washed out too?
Of course, if worse comes to worse, one-dollar bills are next in line. There sure are plenty of those. Maybe $5 dollar bills used if desperate.
“Using a different metaphor, the Pandemic has forced consumers and businesses out of a rut. Everything is now being looked at with fresh points of views.”
Actually, I and everyone I know feel like we’ve been forced into a terrible rut. The future is not bright and I’m not wearing shades. America is just a few supply shortages aways from riots and total breakdown. Millions will lose their homes and apartments in the coming months. I see real fear in people’s eyes. Forbearance will turn to foreclosure and ruin.
California sunshine tends to make people overly optimistic.
to my dear BROTHER ROBERT, your California sunshine comment made me smile when i read it earlier and it made me think… and you need this story more than me so i won’t keep this secret or wait to take a photo of Wolf’s card:
DEAR BROTHER ROBERT:
i feel ya. i don’t know what else to say and i’m not in much of a position to write anything to try and cheer you up from here in san francisco. but Brother Robert you sound like you’re FDOB, drooling with no bed sheet.
FDOB=Face Down on Bed:
term of Stephen Sayadian– who did “Cafe Flesh” as Rinse Dream, director. he did a sci fi art porn from 1980 that had a trippy new wave post apocalyptic feel. most people in this time of the story can’t have sex without dying, so they look like half dead zombies who go to venues such as Cafe Flesh, to watch the few people left who can have sex without getting sick and dying. they’re artful and if you do a search for Cafe Flesh, you’ll see even from the clean cut vignettes how i got this way. Stephen Sayadian is my favorite film director–porn or non-porn– of all time and i got to meet him and be his friend and when i was blue, he asked which level of FDOB, as it has levels with no sheets or sheets. the no sheets stained mattress drooling face down form of FDOB is the worst to come back from and what most of us are doing).
i put all that in here when it wasn’t necessary, because we need the freaks to come back and make SENSE of all this. i need the freaks. i feel straight as hell for even READING Wolfstreet. but to be wild you’ve gotta have your math add up. my mom taught me that if you’re gonna be different, people will always try to catch you at something to teach you some kind of lesson, so your math has to add up.
right now the freaks are simply people with heart and i’m gonna tell you a story i was gonna save and keep between a few of us offline and here, but you need it more than i need to be private:
so check this out, Brother Robert:
Mr California Optimism here, i smiled at that. i loved that. but check this out:
so i’m drooling FDOB for weeks and James leaves for a few days and i’m all sobs. he’s blue so i’ve been keeping it together til he visited a friend and i could just waaaail.
i’m tapping out. on it all. this city, all of humanity, america as an experiment in anything but “GET UP OLD MAN BEFORE I FUCK YOU RIGHT THERE” kinda love.
so Wolf sends me in this card that i wanted to photograph and have him put up but it’s a Japanese scene of these tiny people in boats being nearly lost in the waves but they’re not, they’re just riding the waves and it’s PRETTY…
(more art to the rescue, dig?…)
and i smile. love the art. it speaks to me: just ride the WAVES girl!
and i’m CRYING because Wolf has enclosed a $100 bill from someone only identified as “an occasional commenter,” someone who apparently wrote nicer things about ME than Wolf, so Wolf said, “he said to give you the mug and for me to keep the $100, but you already have a mug so i’m gonna send you the $100 because he actually meant it for YOU.”
so then i’m sobbing a most beautiful sob. face up off the mattress as if i’d gone to the post office in despair back when i first started this book racket, and i’d wanna quit… and i’d get a tiny little card all covered with tiny lettering saying how much they need what i wrote” and i’m IN… IN for ANOTHER DECADE.
so when a programmer i loved called me a “has been celibate author who supports Trump” when i was planning on voting 3rd party for the 1000 year hope that one will come into existence, and then he dedicated an Ellington song called “Kitty” so all on the inside would know, i decided it was Spartacus time to make my meaningless vote for anyone in california actually mean something to ME, so i decided that if we could no longer have free speech in california, i’d stand by my brothers at the gym, the three white cats who speak of watching fox news on the low, and keep it secret lest they be called anti-christs, and instead of just defending them whenever anyone comes up and assumes that as a colored girl i’m fine with the so-called “good” side’s supposed love of black life while racking up quite a lot of black men’s bodies between them over decades… (shrug)…
so that’s what a kiss blown in the wind can do. make me wanna stand up and fight another day.
and you know what? i was INSTANTLY DONE WITH BEING BORED DESPONDENT AND DESPAIRING FOR THE FUTURE because i expected a beat down whenever i yelled to any friends i was voting trump before they could get close and reject me, but i got not only “whatever,” but the younger mixed races of kids who had to work in the burnt orange sky came up to me and are way more open minded about reality because they don’t go to college and live on credit… their math has to add up.
and that showed me where my “underground” was gonna catch hold. young ones in their twenties, the ones who’ve already been screaming for god in the fetal position (as one admitted).
they don’t have a place in this …ANY of this. and they’re smart and have energy and i for one am now belonging to them and will help them shine.
all because of a card in the mail and Mr California sends along a $100 bill he could’ve kept and no one would known cared or …
THIS is magic stuff y’all. deep love in something other than his little world of one wife. if i was him and had his wife i’d say “screw y’all. have you seen my WIFE? it’s amazing i post once a WEEK.”
true true indeed.
i still have the $100 bill because James swooped it into the drawer because i’m not careful as i was more into putting the card and envelope in places i could see. the card is before my Ganesha thing Basul gave me to make an alter and i wanted Wolf’s address on the envelope because i thought loooong and hard about how to best spend this windfall!
so i spent a few days and decided: i ordered art supplies to do b/w line art because cartoons and cartoonists have made this city before and it’s coming back so it’s time to be what i originally came here as in ’94– a cartoonist.
before i tried to become some high faluten b.s. author!
—anyhow, i ordered nice envelopes and paper (along with a tiny kolinsky sable brush raphael 8404 the rolls royce of brushing! –and some big size bristol and tracing paper), but the nice envelopes are so’s i can make an ART thank you card back to this secret person, via Wolf.
so that’s what’s happening while you were doing other things. and thus i also have to trust that a lot of other healing sweet magic is happening and radiating elsewhere… unbeknownst to me, either!
there. i was gonna write all that on my own web site but i think i just blew it here. / this is why actors keep motivations secret and writers keep stories to themselves; poof! they go so fast.
so there. that’s was for YOU, my Dear Brother Robert./ i figured you needed this more than anyone on my triggering site.
Wolf’s more elegant about not inserting subtle guilt trips. me? no such luck! (wink) you’d better appreciate it even though Wolf will wince at the LENGTH of this.
but Wolf is a common sense guy, not real big on swaggering, so he’ll likely hate this. but i complimented his wife so for HER, he’ll leave it.
i’m a manipulative whore when i wanna be aren’t i?
and thanks, Lisa Hooker. i was too damn blue to write you. i left the innerwebs for the most part after that.
i’ll photograph the card and art to Anonymous Sweetheart and Wolf can share it with the class if he wants.
sharing this story made ME re-live it and feel good yet AGAIN. maybe i will write it.
but the coda was that the next morning, James had the classical music station on instead of my KPOO, and the song ended and the announcer said, “Next is the addagio from the ballet, SPARTACUS…”
i’m wobbling back in the game.
(shrug)… i don’t know if this story does anything to you but it reminds me to pay the energy and love forward, you know? this is powerful stuff.
no money can touch it. / that’s why James put the $100 bill in the drawer before i accidentally tossed it aside as i cried over the card.
the art supplies get here monday so this is a long thank you timeline. i think i’m rebelling against email immediacy and disappearance. i wanna step UP my response like how i wanna do Motorcycle Steve’s trip here from back east. you KILL romance the moment you take this stuff the least bit for granted and don’t serve it back your way even better. take time… but plot plan scheme… on how to blow someone’s MIND with a worthy response.
enough people do this–and it doesn’t take as many as you’d think—and this city will come back. it’s a magic place. and if you MOVE, wherever you go will have its magic. just pay attention.
i’m not out of it. just in to fight another day and that’s the motto underneath the AA one about one day at a time.
Robert, those who riot and despair will forfeit their future.
The survivors are already out of the rut and off-roading independently on all 4 wheels of personal freedom.
The only thing you really need to fear is the fear they’re selling you on. It’s not for your benefit, but for theirs. We have to respect COVID just like we respect the flu, other health issues, hurricanes and earthquakes, but we don’t have to cower in fear.
I think you are right about that. In NC we might get 10 days of sunshine or a week of clouds and rain. Everyone starts getting depressed after a week of rain until the sun returns. Now is our only ideal weather. Highs in the 70’s, lows in the 50’s and lonely blue skies and relatively low humidity most days. Six weeks or so and then colder weather starts.
Wolf something is sure ,if you spend money in a bike ,or bought a haircut machine and now you have developed a habit it is likely you would not change easily.
It is easy change a behavior once it is set.
Spending more time at home with neighbors and friends and gardening with the dog(s),. Sounds good!
Reading so many comments leaves me with the exception of a few, too many are suffering from “Cabin Fever”.
And then there are those whose lives have to be constantly “validated.”
May we have better days!
I say .. have you read this article on Wolf Street ?? & read the comments also.
Best comments section I have found. ✔⭐⭐⭐⭐⭐
We have the will, we the people of planet earth are amazing, to say the least.