NYC Journal

You know that I think on my feet, and I don’t realize things immediately.

I have outlined how debt is a major historical problem that has repeated patterned outcomes.

I just want to be honest and say none of the news is surprising, but it is like on my Jeep Scrambler with the Corvette engine, I kinda drove around with a broken gas gauge. Pretty much the wire on the sending unit came loose, and therefore no signal.

I knew I got 15 miles per gallon so with simple math I knew how much range I had. The interesting thing with the Jeep is that with the big tires and the flywheel action, no matter how fast or slow I drove I got a steady 15 MPG.

So being human I would keep on driving, even though I knew I should get gas. Pretty much irrational disregard, but when the engine would sputter and I ran out of gas every time I was deeply surprised.

Pretty much we are at that time where we need to fuel up.

I guess the bigger message here is about the abuse of credit, and how it has gone too far. The hell to pay will happen, and like empty tank of gas, the sputtering and the surprise just hasn’t happened yet.

”Don’t be surprised,” I say.

Cal
 
It seems like the U.S. has taken the role of being the big switch for controlling the world’s oil supply. The U.S. is reported to use fracking to break new oil production records, and even though OPEC+ is trying to moderate the world supply with production cuts they are not able to move the markets like the U.S. Is right now. Pretty much the production cuts only limit market share for Saudi Arabia and Russia.

China is bypassing the world oil supply by getting energy from Russia, and it is paying with its currency instead of using Dollars.

Know that commodities are usually traded in U.S. Dollars. Anyways that’s how it works in the world markets. China and Russia are bypassing that for now, but what if things go wrong with China? Not good for Russia if they own a lot of Chinese currency. Big Kaa-boom. A kinda risky gamble.

In a way getting oil and natural gas from Russia is kinda strategic for China because otherwise the limits of not having a blue water Navy means that any oil would say have to travel through the Indian Ocean which it cannot protect or defend. The U.S. meanwhile could use our Navy to curb energy shipments to kill their economy.

So if the Chinese economy implodes, will the Russian economy also get taken down?

An article suggested that oil should remain below $100.00 a barrel in 2024. Actually I’m surprised that the Middle East situation did not really effect oil supplies and the price of oil. The U.S. Navy is kinda reassuring free passage, and the attacks on shipping is somewhat tamed and limited.

The U.S. policy is kinda relying on cheap energy to help tame inflation, and also by exporting oil it supports a strong Dollar that hurts Russia and China. By China and Russia being in bed over energy pretty much we might be able to kill two economies with one stone. If China goes south surely Russia will suffer and bleed.

In the FX currency exchange, China has been unloading/selling U.S. Dollars. Analysts say to bolster their own currency. Makes no sense to me when China needs foreign capital. One explaination though is the price of gold which is priced in Dollars. If you follow the money know that China and India are buying gold.

Gold is a good store of value and a universal currency. Not a bad asset to own if you expect monetary instability like a bank crisis, defaults, credit crunches, currency devaluation. Something to consider that might be true. Am I wrong?

Anyways a huge board game is being played out, called “Cold War II” where the idea of the game is destroy your opponent’s economy. The Russians are known to be great Chess players, but what happened? They really are not thinking three or 4 moves ahead. The Chinese expression, “Time is the best weapon,” seems not to be working for China.

So now controlling energy prices is a strategic goal in the U.S. Seems like the goal is to keep oil prices under $100.00 a barrel needs to be maintained. Exporting oil and undercutting OPEC+ controls seems like an imperative. Pretty much the shipping lanes need to remain secure or there will be hell to pay.

Oil and energy is being used as a weapon In Cold War II. How will this play out? Who’s economy will get damaged the most in 2024?

Cal
 
I was able to do my last of my shopping after yesterday’s shopping with “Maggie.”

I stopped by the local bike shop in Mohegan Lake on my way to the Health Food Store. I bought a blue bike helmet sized for a toddler and a really loud and annoying bell for the grandson’s vintage tricycle.

We wonder if he will put it with our helmets that he plays with that we store on a wire plant stand.

This kid thinks he too cool on his bike. LOL.

The grand daughter we got a Singer sewing machine. She took a sewing class, and this is the same machine they use. Her old machine went south.

I’m glad all the shopping for Christmas is done. Bah-Hum-Bug.

Cal
 
Wars are inflationary. “The money has to come from somewhere,” I say. “Someone has to pay.”

In Russia their economy is actually growing. Military spending and government spending now is a big/huge part of their GNP. Pretty much if the war ends it would lead to an economic collapse.

Meanwhile resources are stretched because of sanctions and shortages have created an inflationary environment. To keep a lid on inflation interest rates might have to go double digit, meanwhile the standard of living is not so great in Russia.

What I describe in Russia, is also true in the U.S., we are no less evil. Our spending on defense equipment, war funding, and government spending have grown, and are a significant part of our economy. Pretty much we are paying for a war economy, and we need to know that.

Our defense related stocks are making profits because of wars and instabilities. The world is arming up.

We do not have boots on the ground insulates us from thinking we are at war, but dig in and realize that if Ukraine loses, the security of Europe is in danger. It is not only the Ukrainians that need our support.

In China there is an on going “securitization” of bad debt. The ploy is to unload bad debt from the banks so that the defaults, bad loans, and non performing loans are not on the books.

Meanwhile in China terms for buying property have been loosened to attempt to dry up the glut and oversupply, but that devalues and undercuts the bloated market for real estate that was sold and is owned already. China is trying to revive a dead fish that already smells rotten. Mucho dumb.

Anyways, kinda like a game of Three Card Monty. Someone needs to book a loss, and really who takes the hit? Just because you group and package debt to spread the risk, does not mean the risk is less. Remember CDO’s and Mortgage Backed Securities in 2007-2008. Bad debt remains bad loans that still are loses.

BP oil and some shipping companies are going to avoid shipping in through the Red Sea. Oil prices responded upward. Longer routes and disruption cost money and add to costs. Remember that controlling oil supply has a strategic interest, as well as a economic policy to tame/control inflation.

Separately there are headlines critical of the FED for pivoting early and promoting inflation. I’m not alone with my thinking.

Seems like solving debt problems with more debt is still happening. Just borrowing more money can’t go on forever.

I guess a time of “forced-austerity” will have to happen at some future time. It would be wise to have either mucho low interest loans or no debt. The payback certainly will be hard.

Cal
 
I finished scraping paint, gel stained the upstairs bathroom doorway, and hung the refinished door.

A new designer shade “Maggie” ordered came in, and I hung that also.

We kinda miss the grandkids. Maggie mentioned building another house in the back backyard…

Thursday we will have them and we will start with some partial/early Christmas presents.

The rain was not that bad. The wind did gust and on a drive to Home Cheapo I saw some downed trees along Bear Mountain Parkway along the road that were wind blown.

U.S. credit card debt exceeded 1 trillion dollars for the first time. Car loan defaults are not good either and are increasing.

It was around the Credit Crisis that I added up all the credit card maximums I held, and if I maxed out all my credit cards the debt would be an eigth of a million dollars or $125K. Kinda crazy, and of course I would never do anything like that, but I guess some people did.

I locked my credit reports, and I also let cards die off from not getting used.

It was just so easy to exploit credit is the point, but that time of free-money is gone.

It seems that rerouting shipping around Africa takes an additional 14 days, and this will effect supply lines. Of course this could lead to shortages and could be inflationary. Added costs also. Delays also add costs.

Meanwhile the markets are accelerating upward. Clearly the recent FED announcement is inflationary. The “Wealth-Effect” will also elevate spending.

Pull-ups are my weakness. On a rested up day I can do 8 in a set, but less in the second set, and less in the third set. I can feel my midsection, lower back, and abs tightening up. Visually in the mirror my arms are getting bulky. I alternate doing one set one day and then three sets the next. With pushups I can do 65 in a set and these are in better form going lower. I have cleavage.

Cal
 
MFM,

Back in the day Navy SEALS were issued a Rolex Submariner. Also the Panerai was a military watch.

Before there were Navy SEALS in WWII six Italian Navy divers used repurposed torpedos to tow mines for a sneak attack. It was a suicide mission To sink three British ships dock in Alexandria Egypt. Pretty much they took these three ships out of the war, but they got captured.

I love the story because it is so crazy.

Today the G-Shock might fit the bill.

I only got the Panerai because I was thinking the Rolex might need service so I would need a backup. The Panerai stands out because it is a big watch, and I have a slim wrist. Pretty much the deployment rubber strap is set on the smallest setting. The face of the watch with the strap lugs is as wide as my wrist.

Cal
 
Cal, to me a watch is to tell time-not to impress people. There are very few people who I would care to impress. I like the G-shock because it's tough.
My first one survived 2 trips thru the washer and dryer! I have 3 of them right now and a dual time 100 meter watch and my 4 time zone Casio. (for trips to the west coast).

I have a Rolex knock-off that's my dress watch. it's such a good copy, it fooled my cousin who has a real Rolex his wife gave him.

I'd rather spend my $$$ on cameras, lenses and film etc.
 
MFM,

The truth is that the Rolex actually made me a lot of money. It also taught me about finance, debt loads, and risk.

On Wall Street the culture is to buy a Rolex with your first bonus. It’s a kinda right to passage for newly hired traders fresh out of grad school with their Ivy League MBA’s.

For me it marked a big change in attitude. I knew pretty much I had to move forward, be assertive and aggressive, and pretty much take on big risk. Otherwise I saw a bleak future.

A recent headline was that 80% of Americans are not better off after the Pandemic. Pretty much 80% are falling behind or are getting left behind. The new record of 1 Trillion dollars of credit card debt represents debt-slavery happening to 80% of Americans who are living on credit. My 80/20 split where the top 20% is “The Protected Class” came to mind.

I like to think of myself as pragmatic and practical, but I was a performance artist. I mostly wear clothes I call rags because they are used frequently and display wear and tare, but when I dress up I get looked upon and treated in a very different way. I’m still the same person, but I’m not seen that way.

Case in point: when I took a class at FIT the professor wanted to see me dressed in my Paul Smith suit, so I wore it to class. On the walk downtown walkers yielded and stepped aside. I found that interesting. It was as if I could murder someone with a cop looking on and the cop would not arrest me. Class is armor was evident to me.

Then in the class at FIT this hot girl with deadly smoky eyes said to me, “You look like an Asian version of James Bond.”

I learned a lot about image. My friend Eddy-Jeff said to me, “When I think of you I don’t see you as Chinese.”

I asked him what he meant, “When I think of you I basically think of you as a white boy.”

I took no insult, and truthfully I though about it. Pretty much when Eddy-Jeff thought of Chinese as a group it was not flattering. My thoughts were of people like my father who were poor, could not speak English, and people who escaped China as peasants.

I realize even though I am a person of color that knows discrimination and oppression, that also I can “pass” as white and can enjoy “white privilege.”

I grew up poor. Poverty is daily punishment and is loaded with shame. I was so poor I wore no underwear at times because I had none. I know hunger.

After I closed my margin account, I bought “Maggie” a big emerald cut diamond ring. When she was married they were poor and she never had a ring. In a way it was a way to move forward for her and a reminder that she is no longer poor.

Shortly thereafter I went to the diamond district and I bought an antique gold “mine-cut” diamond ring from the 1850’s. This ring was my reminder that I am no longer poor. It is a trophy of sorts that once graced British nobility in a time where the sun never slept on the British Empire. I amped up my diamond with a second pinky ring that is made of Platinium that is from the 1880’s.

Basically I have two rings that have mine-cut diamonds that are designed to “bling” under candlelight and gaslight: one is from the Victorian era; and the other the Edwardian era.

Understand there is a post-colonial message here: these rings once graced the ruling class and were a display of power and wealth in an empire, but now they grace the left pinky of a Chinese skinny bitch.

Anyways treasure to me, kinda important to me, and a reminder of where I came from, history, and where I am now. I understand that part of this display of power and wealth comes from the Ghetto. Hard to understand maybe if you didn’t begin there. Pretty much a F-U to oppression, discrimination, and hate to wear proudly.

Cal
 
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Because the U.S. has flooded the oil patch, Oil futures have not become elevated, even though the Red Sea and the Suez Canal are not being utilized as short-cuts.

They site that the Russian tankers carrying oil will likely not get impeded or attacked from Yemen parties backed by Iran.

Stable, but also unstable…

OPEC+ would have to drive oil prices down below $60.00 a barrel to kill U.S. market share. This is the threshold where fracking costs are covered. Not easy to kill a market, but OPEC did it before. Lots of pain…

Pretty sure that Russia can’t afford lower oil prices. They were/are a major exporter of energy.

Also the lack of quick passage effects Europe more than the U.S. Natural Gas especially will become a bottleneck for Europe.

If China’s economy gets traction, then oil demand will go up, and this game would change, but I don’t see how China can reverse the downward deflationary spiral. The damage is too great.

Remember that 4 out of 5 recessions are caused by energy prices. Energy is a weapon today used to destroy economies.

Cal
 
Cal,
I’m pretty sure the US Govt would never have spent Rolex money on its mmbers. It’s well known that Bulova, Benrus, and especially Seiko (US Special Forces) were widely issued. A Rolex may have been open purchased by a member then entered into inventory, but from what I can find it has never been in the military National Stock. Doesn’t mean it wasn’t, but it would have been a one-off or probably a gift upon retirement.
Phil
 
I used “Navy SEAL Rolex” and found that from inception in 1962 through 1983 Rolex Submariner’s were issued to Navy SEALs in that time period.

MFM’s G-Shock is a durable military watch. Today’s Navy SEAL’s are issued a Lumenox that costs less than $500.00 that was designed especially for Navy SEAL’s. This watch is available to the general public.

I have seen Navy SEAL Rolexes being sold that have engravings to denote its military issue.

Cal
 
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Many retiree’s want to “age in place.” Pretty much though 70% will need assistance sometime in that period. In other words over 2/3rds of retiree’s will need some form of being taken care of or need some form of assistance.

For “Maggie” I am that caregiver, not only in the future, but kinda right now already. She does not drive, she only does light cooking, and pretty much I do the prison work and cleaning. Anyways she already had a hip replacement and is 70. I’m grounded in the reality that my caregiving will only grow.

A lot is riding on our decision to age in place. Pretty much Maggie would not be able to manage the maintenance and upkeep on the house. She is the person who realized how much she depends on me and my health.

The good thing is that we both are not overweight or plagued with the chronic illnesses of aging: heart disease, diabetes, Cancer, high blood pressure, or obesity.

We have a good chance of being in that 30% of being able to age in place, but at anytime things could go wrong. We hope for the best, but you never know…

Life is a gamble… In retirement we have to make tough decisions, and of course the future, especially today is fraught.

Cal
 
“Maggie” is attending her local Meet-Up at Peekskill Coffee. This presented an opportunity to plug in some guitars and adjust some pickups on some of the guitars I did some work on.

The Cabronita had the neck replaced with a shorter scale (24 3/4 inch), but I had to raise the action (string height) to account for less tension and more string excursion. I discovered that I could easily remove the 22d fret and shorten the fingerboard. I would do this because of my style of playing the end of the neck. For me where the 22d fret is located is a sweet spot for my picking.

The guitar I installed slightly higher output pickups in advanced into something special. I adjusted the neck pickup really close to the strings, and pretty much it produces a very clear and articulate tone that is more like or closer to a bridge pickup, but more balanced. This guitar is semi-hollow and pretty much would be a great-great guitar for old school jump-blues like old T-Bone Walker.

I am pleased.

One day I hope to have the attic insulated and somewhat sound proofed. Pretty much a digital printing studio, a listening room for a 300B tube stereo, and a music studio.

I’m looking into modular homes that are kinda the higher end that utilize SIP’s (Structual Insulated Panels). Pretty much pre-fab and better insulated and tighter than a stick house. I already have a building lot that is my back-backyard. Of course you kinda get what you pay for.

Not sure where it is going, but of course my mind wanders and wonders. I could likely defray a lot of the construction costs if I erect the shell myself. I would have to hire the licensed professionals for the electric, HVAC, and plumbing. My thoughts are to explore my curiosity, and the cost feasibility.

You never know. Anyways something to do. My thinking would be for a modest home, 3 bedrooms, 1 1/2 baths, maybe only 1500 square feet. The plot is only a 40x100, but it is the back of a dead end and has a great view.

Single family homes for rent or sale is a hot commodity here in Westchester. Location-location-location…

My local Audi dealer sent me an invite. They also want to buy my A4, saying they will pay above book value. Why would I do that? They say they are trying to build up their pre owned inventory. No need to buy a new car they say… These solicitations are not limited to our car, but also our home.

Understand: shortages. Shortages lead to inflation. If housing prices are declining nationally, they are not really moderating in the New York Metro area.

Cal
 
The U.S. and China have received warnings about a credit downgrade next year from Moodies. Basically too much debt and spending. JPM and Finch also are on the same page.

Lowering of a credit rating would make any debt crisis worse. The cost of borrowing will make paying back debt even harder. Certainly if a credit rating is lowered economies either here in the U.S. or in China will slow down and compound the burden of debt.

In Canada in the early 90’s they experienced a lowering of their credit rating, and it took a decade of austerity to get their AAA rating back. At that time Canada had a liberal government, but they had to cut government spending line by line to unwind the spending.

Today in the U.S. a good part of our economy and GNP is government spending. What happens when the government has to stop the credit binge and the spending?

Pretty much our debt level is about 70% of GNP. How much further into debt before our credit rating gets lowered, maybe next year? How rude would be austerity? Anyone with big debt will get buried.

Just imagine a household abusing credit and living on debt. The 1 Trillion dollar record amount of credit card debt, indicates high debt levels in households. Now just imagine that our government is doing the same: living on credit to pay bills.

Pretty much any debt burden will get harder to pay because with a credit rating lowering higher interest has to be charged to cover risks of default. It will be even higher interest rates that will bury the consumer and stress households that have a record level of credit card debt.

Kaa-Boom.

BTW IMHO it would be fraught and difficult to do what Canada did in the early 90’s here in the U.S. Our economy is bigger, our population is bigger, and our problems are bigger also.

Hope you have a low mortgage rate locked in, and you also locked in a low rate on your student loans at record low rates.

Know the remedy for easing or eliminating debt is inflation, which is a debasing or devaluation of currency. Look at the value of hard assets like gold to store value, also real estate. Paper assets like stocks and bonds might not do so well for a long time.

The situation in the Red Sea and Suez Canal with impeded shipping and added costs is inflationary, and it took a few days for the markets to realize that particularly Europe is exposed, and that supply line disruptions can and will lead to inflationary pressures.

Remember 4 out of 5 recessions are caused by energy prices. Europe clearly is in trouble. Know that the European Union economy overall is about the size of the U.S. economy. Don’t discount the spillover and slowdown in Europe into the U.S. and China.

Expect the markets to begin deflating the recent rally that happened after the FED announcement. Look out below. Wake up time…

Know that a slowing economy also makes difficulty for paying back debt. “The money has to come from somewhere.”

Cal
 
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A headline is that more people have left New York than any other state.

Not surprise with an aging population and the cost of living.

“Maggie” and I kinda run countertrend, but our time line is for the long run and is considering climate change, global warming, and water supply.

Some of Maggie’s family relocated to the Carolina’s. The future a decade out certainly will be different. More intense heat, drought, and severe storms predicted. Anyways this is science… I find it remarkable how short sighted Americans can be.

Oh-well.

Cal
 
We had the 9 year old grand daughter today. Tomorrow will be another episode of “Hell-Boy” with the 16 month old grandson who is so advanced that he already is experiencing the terrible twos.

I put a 2.35 wide tire back on the Yo Eddy because the Maxxis Minion DHF was too wide for the rear because of the side nubs.

I tried to use the 2.5 wide tire as a front tire on the steel IBIS, but it rubbed on the brake arch. Oh-well.

At least I tried to go crazy, but it didn’t work.

On January 8th an article that includes “Maggie” will get published in the Washington Post about Digital-Burnout amnd quitting being a digital influencer, which is what her book is about. Some of my photos will be published in the book.

I had to sign a release for the British publication/release of the book because it reveals some personal information that will become public knowledge.

Yesterday I made a friend at A.J.’s shop named Scot, who is a 60 year old. He did endurance events and assembled a 4 man team to race 24 hours at Canaan. Pretty much this is like 24 hours at Lemans except its doing laps on mountain bikes that involved night riding. Pretty crazy, and I love it.

Scot lives near Blue Mountain Preserve like me, but in Cortlandt.

What a boring life I have.

Cal
 
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