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Commentary on The Capital Markets- Category [Consumer]

So now the Mazda has turned (quite a bit) beyond 20,000 miles in -- here's another update.

One sentence: I love the car.

I've had occasion to make several 14+ hour drives in it now, and it continues to impress.  No, it's not the fastest vehicle on the market (by a long shot) nor is it, on specs, the most-impressive in other areas -- although it's damn good.

But on balance this vehicle is damn hard, indeed, nearly impossible, to beat.  It is returning a mid 30s fuel economy overall and it runs on regular unleaded (which has become an even-bigger money-saver .vs. diesel as gas prices have come down but diesel not nearly as much; you'd have to average about 47 mpg on a diesel car to get an equivalent cost-per-mile now.)

The stock tires and brakes continue to perform quite well and I estimate I have about half or more remaining life on both.  The only maintenance necessary has been oil and filter changes, and I have run three sequential oil analysis checks on the engine with exemplary results; wear metals have been extremely low and there has been no fuel dilution detected.  Oil consumption between changes has been insignificant with no make-up required.

I did add a short-shift kit to the manual transmission reducing throws by about 30% front-to-back. For about $100 I love it.

The most-impressive part of the vehicle is simply how comfortable and easy it is to drive over very long distances without material fatigue.  The stereo upgrade I installed continues to impress as well but lack of driving fatigue in a car is mostly about driving posture, comfort, controls and similar.  Getting this balance right is hard; I've owned a lot of cars and even those known for this aspect of their ownership experience (e.g. higher-end Volvos) lose materially to what Mazda is delivering.  When price is factored in there is simply no contest.

My refit of the trunk lighting for better illumination, on the other hand, failed (due to snagging of the wires at the LED modules while loading and unloading.) I recently re-did that with strip LEDs that are virtually impossible to harm even with significant impacts and expect that to be a permanent fix.

In terms of additions the only recent one is a receiver so I can mount a bike carrier at the trunk.  That works very well but there's a material price to using it found in fuel economy -- specifically, about 4mpg on the highway!  Yes kids, aerodynamics matters a lot, especially at highway speeds, even though with a rear-mounted carrier the bikes are entirely within the profile of the vehicle.  Of note my road bike does fit inside the trunk quite easily with the wheel removed and the seats folded, but it's a hell of a lot easier to simply rack it off the trunk instead, and the rack setup I have doesn't prevent the trunk from being opened and accessed even with bikes mounted on it.  In short convenience costs money.

I have also discovered that it is quite-possible to mount a roof rack on the car as there are hard-points on the roof itself and replacement gutter covers with removable ports are available at a reasonable cost.  I'm quite-curious if the roof has the same spacing and gutter width dimensions as the CX-5; if it does then pulling the rails from one of those and fitting them to the "6" may be possible.  Aesthetically that would be very pleasing and eventually I'll get around to finding out.

One note: If you want one of these and think you may want to refit the audio system away from stock buy it before the new year because the 2016 model has the same sort of highly-integrated (and nearly impossible to retrofit) system found in the "3".  It's incredibly offensive for a car manufacturer to effectively lock you into today's technology when it comes to infotainment when a car should, and with decent maintenance will, last a decade or more.  In my view this is nothing more than an attempt to force you to come back and buy another one due to annoyance at the lack of future compatibility, where you could otherwise spend a few hundred bucks and resolve that issue.

In short, yeah, I still really like the car.

A lot.

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Does it ever end?

This morning's retail sales report was a disaster.

Yes, the headline number was up 0.46%.  Last year, same month comparison, it was up 1.91%, both unadjusted.

Down the line it's the same story.  Last year autos were down 3.76% this month.  This year they were down 6.18%!

Last year furniture was up 10.3% on the month.  This year it was up 7.7%.

Last year electronics were up 28.98%.  This year 32.32%, heh, a brighter light.  Guess what - that's because there were basically no deals to be had on so-called "Black Friday."

Last year building materials were down 8.878%.  This year it was down 9.44%.

Last year food and beverage stores (for home consumption) were up 1.67%.  This year?  0.32%.  Are people are out of money for entertaining at home?

Last year health and personal care (usually a bad category in November) was down 3.82%.  This year?  Negative 5.1%.

Last year gasoline was down 9.29%.  This year it was down 9.4%.  No, gentlemen, the collapse in gas prices over the last month did not translate.

Last year clothing stores were up 13.3%.  This year?  14.23%.  Ok, make it two (somewhat) brighter lights.

Last year sporting goods (always a common gift) were up 25.67%.  This year?  21.62%.

Last year general merchandise stores (e.g. department stores) were up 14.12%.  This year?  13.17%.

Last year miscellaneous store retailers were down 8.46%.  This year sales collapsed by 12.31%.

Last year, the Internet will save us sellers (non-store retailers) were up 11.81%.  This year?  9.71%, a big miss over last year as well.

Finally, people generally don't drink as much in bars and restaurants in November, probably because they're too schnocked to get out of the house over Thanksgiving.  Ok, last year that category was down 1.59% on the month.

This year it was down 4.2%.

Where's the "strong" in that report, eh?

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2014-12-08 07:52 by Karl Denninger
in Consumer , 444 references
 

Seriously.

This weekend I've spent a bit of time in a few retail stores.

Where are the deals?  They're missing, really.

I can't find them at all.  Retailers are notorious for marking things up in the fall and then having great "sales" that aren't really sales, but there are usually a few deals to be had in various things you might want or need.

I'm not seeing them this year in any material sense -- not even in places where you usually do see them.

For instance, last year you could buy a 4TB hard drive (very nice if you happen to need one; that plus a $30 enclosure makes an excellent gift for someone who has a computer and doesn't back it up -- and you know damn they should!) for about $100.  This year that same drive (literally) is 30-40% more.  That's unheard of in the technology sector, but the "not on sale" price was around $140ish, so what's really happened is that there are no sales.

There are many other examples -- including things like BluRay players and other consumer electronics, where the deals are typically actually pretty decent.

If you look at the stocks of many of the retail firms they're a disaster, with many (Abercrombie anyone?) off 30, 40, even 50%.

How does anyone square a craptastic consumer economic picture as measured by actual performance of real firms selling real goods with the claimed "retail sales" reports and sky-high asset prices?  That's your puzzle for the week, and if you're one of those who believes in those market unicorns you may wish to add some eggnog to your evening ritual in an attempt to sleep well through the night.

PS: Gravity is a bitch....

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No, really?

Spending tumbled an estimated 11 percent over the weekend from a year earlier, the Washington-based National Retail Federation said yesterday. And more than 6 million shoppers who had been expected to hit stores never showed up.

Friday night the excuse was that everyone shopped Thursday (WalMart started with their promotions at 6pm local time in most stores.)  But by Monday, well, that excuse evaporated as the damage simply wasn't able to be explained away.

Remember, the NRF claimed this would be a "record" year.  Well, it's not.  Not thus far anyway.  And there is no particular reason to believe it will be through the rest of the season either.

Why?

Perhaps consumers are tired of the in your face crap and ever-creeping-earlier "christmas" nonsense.  Maybe they are taking to heart the idea that an Elf bar-b-ques a baby reindeer and serves it to Santa for every Christmas "thing" displayed or talked about before Thanksgiving.

Or maybe the consumer is simply tapped out and tired of being treated as a retreaded ATM machine to be screwed out of every dime they have with cheap Chinese garbage that breaks on command a week after the warranty expires.... never mind the deals that aren't really deals and the off-brand garbage peddled as "door busters."

PS: "Cyber Monday" appears, thus far, to be a bust as well - despite all the spam that online merchants sent out....

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Logic says that the "vape" craze, which has reached into people who have never smoked and might never choose to smoke actual cigarettes, is materially safer than smoking itself.

The logic appears to be sound, but it may also be wrong according to researchers:

Tokyo (AFP) - E-cigarettes contain 10 times the level of cancer-causing agents as regular tobacco, Japanese scientists said Thursday, the latest blow to an invention once heralded as less harmful than smoking.

...

Researchers commissioned by Japan's Health Ministry found carcinogens such as formaldehyde and acetaldehyde in vapour produced by several types of e-cigarette liquid, a health ministry official told AFP.

Exactly how these two chemicals wind up being produced is not yet known with certainty, but both are reasonably-simple molecules.  Very small amounts are normally present in the environment (from both natural and man-made sources) but concentrated they're both bad news.

The theory appears to be that the heating of the vapor results in the production of these chemicals and that poor control of the heating process may exacerbate the amount produced.

Much more study is needed but if you're using one of these things in the belief that you're materially better off in terms of safety than by smoking an actual cigarette please be aware that in terms of health risks it may actually be better, believe it or not, to smoke!

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