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2017-03-15 21:57 by Karl Denninger
in Editorial , 2908 references
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Look, this is math.

I don't want credit.  I don't care if you never admit you talked with me.

Seriously -- I don't care.  This isn't about glory.

It's about the Republic and its survival.

The arithmetic is clear.  It's irrefutable.  There's no discussion to be had.  It's fact.

I called this in the 1990s when I ran MCSNet.  I called it again in 2011 in Leverage.  I've been raising Hell about it since 2007 on this blog.  It wasn't hard and I claim no special knowledge or insight.  All that was required was reading the MTS and either a $3 calculator or a piece of paper and a pencil.  An act, I remind you, that every CEO does every single month -- that is, reading the financial statements.

Look, I get it.  The political side of dealing with this is hard.  You're going to******off a lot of very powerful and wealthy people.  They're going to get very angry.

The bottom line is this: You have the ability to put a stop to all the medical scams now -- right now -- using existing law.

If you don't then the nation fiscally dies.  Ryan's bill or no bill; doesn't matter.

If you do it then "insurance" is something that 95% of Americans need only for catastrophic events because the cost of medical care will fall by at least 80% and for most items by 90% or more.  Said insurance will be cheap - under $100/month for a family, and about $25-50/month for a single person.

Nobody will need "insurance" for routine events because they will be able to pay cash.

Birth control will cost under $10/month.

Routine labor and delivery will cost under $1,000.

This isn't hyperbole -- it's fact.

We know this is true.

We know because The Surgery Center of Oklahoma performs cardiac bypass surgeries all day long for $10,700, complete, no surprises, no extras including complications that may arise -- done.  $10,700, period.

The hospital across town charges five to ten times as much.

But even the prices at The Surgery Center, nice as they are by comparison, are chock-full of monopolist price fixing. Why? Supplies, devices and equipment are all provided under monopolist, price-fixed schemes for starters.  We know this because the same bypass surgery is about $2,000 in India where there is no such collusion, the doctor was trained in the United States and the supplies and devices are the same as in the US but unlike in the US the suppliers have to compete for business.  The difference is that in India competition reins because there is no hiding the cost, there is no extortion via "explanation of benefit" statements from providers and thus price reflects competitive pressure not only on cost but quality of service between providers.  Not surprisingly the complication rates in India for that surgery are lower than they are here in the United States.

You can find bills for routine childbirth from the 1960s -- including epidural, doctor and nursing charges, charges for care of the baby, three nights in the hospital, soup-to-nuts.  Inflate them by the CPI to today's price.  You wind up right around $1,000.  Routine, vaginal childbirth certainly hasn't changed in the last 40 years in terms of what's required.  The only "change" is that the medical establishment has decided to ramp the price by a factor of ten and screw you out of the money.  It has been able to do so only because there is no competitive option available to you.

In Tokyo, Japan, you can have an MRI done for $200 or less on a walk-in basis -- cash.  How much does an MRI cost here in the US?  You can literally fly to Narita from any major city in the US, take the NEX to Tokyo, have the MRI done and read then get on the NEX again and fly back for less than it costs to have the scan done in the United States.  There is a person on my forum who was just quoted over $5,000 to have said scan done here in the US yet he can fly to Narita round trip and have the scan done for $1,200 -- $1,000 of which is his airfare!

He can fly to Japan four times and have four MRI s done for the cost of one here in the US including four intercontinental airplane rides!  If the price of the scan being 20 times higher here in the US doesn't meet the definition of a scam would you please explain what would?

The entire medical system in this nation is a massive fraud and scam.  It's not a mistake, it's not an error, it's not an aberration it's a scam, it's robbery and everyone involved ought to be in prison.

You're out of time Mr. President.

You either do the right thing with regard to medical care, now, or this nation dies.

We either do the right thing or we let Paul Ryan and his buddies in the Congress, along with the doctors, hospitals and lobbyists and others screw millions of Americans -- a crime for which all of them should be indicted, tried, convicted and hanged.

You choose.

The math is clear.

The facts are clear.

The acts by which these individuals and corporations screw America are illegal. These laws, which include both ruinous civil and felony criminal penalties barring said conduct were passed over 100 years ago and are embodied in 15 United States Code.  They were challenged in the 1970s, the case went to the Supreme Court and the insurance companies and their buddies lost.

It's not a close call.

It's not a matter of opinion.

It's settled law.

You, as President, are able to direct the AG to enforce said 100+ year old law.  In fact, as head of the Executive branch of government, which is responsible for enforcement of the law, it is your job to do so.

Or not.

As Barack Obama didn't.

As Bush didn't.

As Clinton didn't.

As Bush before him didn't.

Four Presidents willfully, intentionally and knowingly refused to enforce 100+ year old law that would have immediately and permanently put a stop to the medical scams and the escalation of cost.

I get it.  This expansion from 3% to 19% of GDP over the last 30ish years has put a half-percent a year on GDP expansion that would not otherwise have taken place.  It has made "growth" look better.  It has wildly expanded the "market cap" of various public companies and their stock prices, including pharmaceutical firms and other health-related conglomerates, along with insurance companies.  It is politically enticing to continue doing it, except for one small problem: 10% expansion annually at 3% of GDP is 0.3% of GDP, a relatively small number both percentage wise and in terms of dollars.  At 19% it's 1.9% of GDP -- a much larger percentage and dollar amount, more than six times as much.

Oh, and this exponential growth, which your predecessors and now you have allowed, is also responsible for more than half of the Federal Debt, all-in, as that same expansion has added to Medicare and Medicaid spending.

I understand that collapsing health care from the current 19% to 3-4% of GDP will produce a huge recession.  It will produce a monstrous movement downward in the stock market.  That freed-up spending will go somewhere else in the economy and the recession produced will be quickly recovered from -- probably like 1920/21, in fact when the entire drop and recovery took less than two years.  The cost of operating a business will drop like a stone; not only will employee costs drop so will any firm's and individual's liability insurance where injury is a risk insured against.  From car insurance to business liability to trucking firms these costs will drop tremendously -- and be reflected in the competitiveness of American business.

This is not a matter of choice any more Mr. President -- other than on time.  We can either do it now, take the adjustment and become the most-competitive place to do business in the Western World or we can keep playing this game right up until our economy and budget collapses -- and collapse it will if you do not put a stop to this crap now.

Last fiscal year the Federal Government spent $1.417 trillion on Medicare and Medicaid, 9.3% more than the $1.297 trillion it spent the previous year. Last year was not an aberration; it was in fact very close to the historical expansion rate from the 1990s forward.  Spending has almost quadrupled on these programs since FY 1998.  Total outlays in 1998 were $1.651 trillion of which Medicare and Medicaid comprised 23%. Last fiscal year 37% of all fiscal expenditures were made on these two programs.  The ACA (Obamacare), for all of its warts, only managed to dampen that rate of expansion in spending for two years, after which it returned to trend.  At this rate of spending expansion within the next four years the government will attempt to spend $2.02 trillion on these two programs combined which will blow an approximately $600 billion additional hole, per year, in the deficit.  That will not be able to be financed since if it you ignore this issue it will be clear that within 10 years the government would try to spend $3.4 trillion per year on the same two programs -- an utter impossibility under any rational expectation for economic expansion.  The impact on private health spending has been even larger on a percentage-of-increase basis due to the blatant cost-shifting that is well-documented in myriad reports and is responsible for a large portion of the stunting of economic progress in America that has occurred over the previous two decades.

We can't keep doing what we've been doing Mr. President.  We cannot continue to allow the monopolists in the medical and health-insurance industries to continue to expand their influence -- and consumption of GDP.  Not for long.  Not for the rest of your first term, and certainly not into the second.  That's the math, like it or not.

Further, that math was either known to you or you would have known if you looked before you ran for President, which means you took the job without any ability to claim "surprise."  Thus, it is not only reasonable to expect you to resolve this problem now, in the present time (particularly given that you have tools as the head of the Executive to do so) it is also quite reasonable for the people to hold you personally to account as President if you don't.

We either admit to what we've been doing and stop the scam or it will overtake the economy and our ability to pay -- both in the government and otherwise, within the next 4-5 years.

We either stop it now or it destroys the economy, asset prices and the nation.

This isn't politics.  It's math.

The facts are what they are.  Demonstrating them is easy and irrefutable.

I'm a (long) day's drive from DC and about the same from Mar-a-Largo.

You name the place and time.

I'll be there -- with the laptop, charts and figures.

I have only one "ask" -- you listen and then act predicated on that which is obvious given the numbers -- politics be damned.

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2017-03-15 20:56 by Karl Denninger
in Editorial , 235 references
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You figure out the rest.

Do or do not.

There is no try, and there is no excuse either.  I tire of hearing the latter.

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2017-03-14 12:40 by Karl Denninger
in Health Reform , 2615 references
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Where is the discussion of facts when it comes to health care?

Why do we keep talking about the cost of "health insurance" when that's a symptom and not the problem?

Why do we keep talking about "subsidies" (tax credits, etc)?

If you're coughing incessantly because you have lung cancer do you simply take a cough suppressant and call that a "fix" when you stop coughing for a while?

That entire line of discussion, which is the only discussion being held politically and in the news, is a fraud.

Why?

Two reasons: First, "health insurance" is not insurance to the extent it covers an event that is either certain to happen or has already happened. Insurance is a thing you buy to cover a possible future event you cannot pay for yourself.  It is less expensive than the event will be only because the probability is less than 1.0 -- that is, the event is unlikely.  If the event is either certain or worse, has already happened then the probability is 1.0 and the cost of "insurance" against such an event is always more than simply paying for it in cash because the insurance company has costs it must cover or it will go out of business.

Let me repeat that just in case you missed it: The cost of insuring against a bad event is directly and mathematically determinable by the cost and probability of said event.

Second, due to the above mathematical fact if you wish to decrease the amount "insurance" costs there is only one way to do it: You must decrease the cost of the event, the probability of the event or both.

This is arithmetic, not politics and anyone arguing otherwise needs to be indicted, tried, convicted and imprisoned for their intentional act of fraud upon the public because that's exactly what they're doing -- defrauding you.

I don't care if they're pundits, media personalities, Congresspeople or the President -- and I remind you that The President is well aware of how insurance actually works since he's been a Real Estate developer and operator for decades.

Now let's address the only two means by which we can lower health insurance costs.  And lower them we can -- by 90% or so, and quickly too -- in fact, within months.

First, insurance must be actual insurance.  In other words it must only cover events for which p < 1.0.  By definition those are events that are neither certain to happen (e.g. routine, every-day visits to a doctor) or have already happened (e.g. pre-existing conditions.)

While you might be able to buy fire insurance on your house if it's on fire (or you are in the process of setting it on fire!) the cost of that insurance will always be more than the fire damage to said house because the probability is 1.0 and the company has to cover its cost and make a profit or it goes out of business.  It is therefore always cheaper to simply pay cash for the fire damage than to buy said "insurance" and this is true irrespective of what you're "insuring" -- including health.

Again, this is math, not politics.

Second, we must address both "p" (probability) and "c" (COST.)

We must address "p" (probability) because it will directly and grossly reduce the cost of insurance since it is a multiplier to cost.  Reducing "p" by 10% directly reduces cost of insurance by 10% all other things being equal.

We must address "c" (cost) because that not only reduces the cost of insurance (but on a smaller basis than "p" since it's multiplied by the fraction of risk) for the person who has already had the bad thing happen to them medically it enables them to pay directly for the treatment required. I remind you that paying directly is always going to be cheaper than running that same payment through an "insurance" company (typically by about 10-20%) because said company has costs that have to be covered.

Let's take "p" on first.  An utterly enormous amount of health expense occurs because people choose to be overweight or obese.  As noted in a previous Ticker the American Diabetes Association claims $250 billion a year is spent by Medicare alone due to both the disease and its effects.  Best guess is that another $150 billion is spent by Medicaid (which they don't specify.)  This is for one disease and essentially all of that money doesn't have to be spent.  It is spent because people choose to consume foods that promote and exacerbate the condition rather than reduce or even eliminate its effects.  The cost of changing what you put in the pie hole, medically, is of course zero.  Therefore for each person who is diabetic (Type II) and makes said lifestyle change resulting in either the control or elimination of the harm to their body from same we eliminate all of the health spending by said person on said disorder!

There are myriad other diseases and disorders associated with being obese and overweight.  Hip and knee damage, eventually leading to (expensive) replacement surgeries, for one.  Heart attacks and strokes (many caused by high blood pressure that, again, is often a result of being overweight) for another.  These are all avoidable costs and if we wish to address the cost of health care reducing "p", the probability of bad events, is a key item.

It is absolutely true that personal choice is a huge factor here and the government does not have the right to tell you how or what to eat.  However, you do not have the right to demand that someone other than yourself pay for the consequences of your personal decisions.

It is therefore perfectly reasonable to put in place a protocol that says if you are overweight or obese and diabetic then the lifestyle change in terms of what you put in the pie hole that has a near-100% record of reducing or eliminating your need for drugs and medical procedures and has a cost of zero will be the only option offered under said publicly-funded programs until and unless you prove, by individually-shown test, that it doesn't work in the case of your particular metabolic makeup.

Doing this for one disease alone would cut roughly $400 billion off the federal budget this year and every year thereafter and would cost the patient exactly zero on top of it.

Can we extend this demand to private health care policies by force?  No, but we can certainly allow companies to multiply their pricing by the change in "p" that not following such a lifestyle, if you're overweight or obese, comes with.  Since this one disease is such a huge component of said spending my best guess is that the surcharge for refusal would likely be 25% or more and if you're already diabetic then it can (and should) be an immediate disqualifier for any coverage of any consequential event whatsoever unless you prove, by individual test, that the lifestyle change outlined above doesn't result in control of your condition.

Second, we must break all the monopolies in the medical system.  There are in fact simple ways to do this, requiring no new laws, which I've outlined before going way back in time.

If you force price transparency by treating any health provider who refuses to do so, or who tries to bill on a discriminatory basis as committing a criminal act under existing consumer protection and anti-trust laws (at both the State and Federal levels) you will instantly and permanently remove all so-called "network" games, break the monopoly pricing games played by the health industry and as a result competition will cause prices to fall like a stone.

It's worthless to even attempt to argue that this "can't" or "won't" work because we know it does.  The Surgery Center of Oklahoma does exactly this right here, right now, today and their pricing with the monopolist-laced chain of supplies for drugs and surgical devices still undercuts "traditional" hospital prices by 80%.  For example a cardiac bypass is $10,700 -- cash, all-in, one-price and if there's a complication taking care of that is included.

Can you come up with $10 large to save your life if you need it?  Almost-certainly, even if you're poor.  Yes, it would be a lot of money for someone without material means, but remember -- we're talking about a price that's anywhere from 1/10th to 1/5th of what that same procedure costs in a "traditional" hospital setting and you're choosing between that and death.

Don't tell me it can't be done and wouldn't result in these sorts of cost reductions because it is being done right now, right here, today and has resulted in these cost reductions -- even with a huge part of the medical scamjob monopolist games still embedded in their pricing because they can't get away from the drug monster in their ORs at present.  In other words their pricing is high (probably by 20% or so) compared to what it would be if we stopped all of the monopolist games.

Here's the bottom line folks -- if you think "health insurance" costs too much you're being misled.  The problem isn't health insurance it's the cost of health care.  The solution to the problem is to first require firms to offer true insurance (that is, does not cover events where p = 1.0) then require all providers to post prices and charge everyone the same amount.

Next, using existing law you then indict and prosecute all violations of 15 USC Ch 1; the health insurance and related industries already tried to claim exemption in a case that went to the Supreme Court in 1979 and they lost.  It is therefore simply a matter of political willpower to get out the handcuffs and start issuing indictments.  That will further collapse prices since now providers will be forced to compete for business.

To put numbers on this we're talking about "health insurance" for catastrophic events being something that costs the average person well under $100 a month and for virtually everyone they would pay only a few hundred dollars more a year in direct, uninsured cost.

With the cost of care collapsed to 1/5th of what it is now for the truly indigent we can certainly afford to help -- but for nearly everyone we won't need to, because even those of modest means can afford to pay cash at a price 1/5th of what is charged in the United States today.

The obvious question is "Why won't Donald Trump or Congress take this position, since it's clear on the math that it will solve the problem permanently and at the same time nearly eliminate both the Federal budget deficit and all State and Private Pension budget problems at the same time?"

The answer is quite simple: Doing so will cause an immediate and deep recession as the health industry collapses from ~19% of domestic output back to its historical level of about 3-4%.

Said recession won't last very long because that money will get redeployed in other areas of the economy but until it does the impact on GDP will be severe, immediate and deep -- and both Congress and Trump know it.

Oh, and it will put a whole bunch of lobbyists out of business too.

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2017-03-13 05:00 by Karl Denninger
in Editorial , 948 references
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Adulting is, simply put, the process of being an adult.

It appears to be deceptively simple: Get a job, pay rent or a mortgage, meet your utility bills so the power and water stay on, and have enough left for transportation and groceries.

Too bad it's not that simple.

See, adulting also includes anticipating likely or worse, mathematically or physically certain -- or highly likely -- events.

For example your car will wear out.  Your house will require a new roof.  Your refrigerator, dishwasher, clothes washer and dryer and coffee maker will fail.  They're mechanical things and most require some sort of maintenance -- but even if not it is a certainty that at some point all will require replacement.  You had better budget for these events in advance lest you not have the money when they turn turtle on you.

If you allow yourself to become overweight you are much more likely to require medical attention.  If you allow yourself to become obese then your odds go way up for a whole host of really nasty problems: Heart attack, stroke, diabetes, the destruction of your hip and knee joints and more.  In fact it is virtually certain you will have weight-related medical problems serious enough to impair your enjoyment of life and cost you tens if not hundreds of thousands of dollars.

Now add to this the facts in this post I authored, particularly relating to the economic scamjob aimed directly at you in the form of the medical system.

Six years ago, approximately, I decided that the people of this nation would not, as a group, "adult."

I therefore decided that the only way to reduce the risk to myself of finding myself severely disabled, broke, dead or probably all three within a relatively short period of time (a decade or two) was to get rid of the spare tire I was carrying around on a permanent basis.

That required not a diet but a lifestyle change.

So I did it.

Let's talk about what you put in the pie-hole for a minute.  What part of being an adult with an allegedly functional brain allows you to believe that if you eat what farmers feed pigs, cows and other animals to make them fat on purpose you will become and remain thin and healthy?  Isn't it far more likely that if you eat grains you will get fat exactly as does said cow or sow right before they're slaughtered?

By changing what I ate because I decided to adult in that regard (and thus dropping 60lbs) I made it far less likely that I will run into said medical scamjob.  I also, at the same time, came to terms with acceptance of my mortality if I did face that anyway -- in other words, no, they're not going to get all of my resources; I'm going to dispose of them as I wish instead to those who I wish and if that means I die earlier than I otherwise would then so be it.

But what's adult about allowing the fantasy-land crap to be sold to you without consequence not only by food producers but so-called "experts" in the form of "dieticians" and "doctors" who we now know were and are peddling factual falsehoods?  Low fat? That means high-carb, because it has to; you have to replace the fats with something.  The original "7 nations" study was riven through with fraud, and that's been known for a couple of decades.  There are multiple populations in the northern latitudes (e.g. Arctic) which had historical zero obesity rates and introduced modern "foods" -- all of them blow up like balloons.  What were they eating before?  Animal flesh, almost-exclusively -- for obvious reasons (plants don't do so good up there for a huge part of the year!)  If saturated fat is so bad then explain the zero obesity rates among a population that almost-exclusively eats venison and fish -- right up until they add pasta to the mix, at which point they turn into fatties.

Now continue by explaining how adult it is for you to silently allow this garbage to be peddled not only to you but also to your children, with utterly-predictable outcomes?  Let me remind you: Over half of all adults are either overweight or obese.

While we're on this subject let's talk about how adult it is for you, or anyone else, to scream about "fat-shaming."  You're really going to tell me that someone pointing out that you're killing yourself is "abusive"?  Since when does that constitute anything other than telling you the truth?  Do you like being lied to? Do you like being coddled all the way into a box 6' under ground?  That's exactly what arguing against "fat-shaming" is!  You ought to thank those who make you feel uncomfortable in this fashion because they just might, if their criticism jolts you into adulting, save your life!

Now let's talk about some of the other things you deal with daily.  Why are you on either Verizon or AT&T?  Unless you have some sort of negotiated business account, that is, in which case it might make sense.  If you need Verizon's coverage buy it via Straight Talk!  The exception: If you need tethering, which these days is a lot less likely with free WiFi damn near everywhere.  Are Sprint and T-Mobile worth considering?  Maybe, but not on their "unlimited" plans, which are insanely expensive unless you have three or four heavily-used lines.  Might they make sense if you have two teens?  Maybe, if you force the teens to pay their part of the bill -- which means they need a job!  Otherwise, no: $90 gets you a 5Gb data allowance on two lines from Straight Talk and you pick the carrier -- T-Mobile, AT&T or Verizon (depending on what your phone is compatible with) and if you're single there's no penalty since it's $45/line, period.

Are those "cheap on-contract phones" worth it?  No.  They're not cheap; multiply the additional cost per month times the contract term and tell me how "cheap" that iPhone is.  Here's the answer: About $1,000 or more than if you just paid cash for it!  Are you nuts?

On social media?  Why? So you can preen for the camera and brag about your smug, smiling face and how "beautiful" you are? I hope you realize that the cost of doing so is that thousands of entities get to build a detailed, down-to-the-minute database on you both through your actions and those of your so-called "friends" which they inextricably and immediately link to you personally.  This allows them to hose you and that's exactly what they do with all that information -- use it to extract money from you without you being directly aware of it.  What part of being an adult meshes with playing egomaniac on Facesucker?  That's the sort of thing an emotional child does -- "look at me, how pretty I am."  Please explain to me how posting a picture of the fabulous view you have while eating a nice meal enhances your personal experience.  It doesn't -- the mere act of drawing your phone to take the picture detracts from your immersion in the moment itself. You're not posting that picture because it pleases you you're doing at the cost of your pleasure because you are trying to impress others.

A personal anecdote on this point: Recently I drove some 14 hours to attend a live music performance.  There were a lot of people with their phones out for most of it.  I did snap a couple of pictures, one of them before the performance began - but the rest of the time my phone was in my pocket and on complete silence (including no vibrate.)  Why?  Because just the act of drawing it to take a single picture that one time broke the zen-like state I was enjoying immensely by taking in the music -- not just sound, but sight and all other senses as well.  You cannot do that with a camera in your hand no matter how small or easy it is to grab it.  You do an insane amount of damage to experiencing life around you when you start snapping and posting to social media.  I noticed a couple of people other than myself in that theater who just went into the zone and did the frisson thing -- but most had their phones out snapping away which is an utterly-certain way to immediately lose that state.  If you don't let yourself get there you have no idea what you're missing, by the way: It's an experience that's nearly as good as sex.

Now let's take analysis of this "paradigm shift" a step further: This behavior is insanely destructive to your real-world interpersonal relationships.  You see, there is always someone with more "-er" no matter who you are.  Pick an attribute -- skinnier, prettier, faster, richer, etc.  Social media is all about trying to show off your -er -- which means you and your partner both see all the other -ers.  Guess what: As soon as a relationship becomes competitive in that fashion whatever you had built up until that point is destroyed and can never be recovered as it was.  It only takes one of you to fall into that trap just once and the damage done to your relationship is mortal. If you want to know why all the "good ones" appear to be gone that's the reason and you're a willing and voluntary part of it.  Your friends don't have to call you and actually spend time talking with you on a regular basis to keep contact any more; they simply post on some social media site instead. By being a part of this you personally lose twice in a fashion far beyond and worse than the data mining and exploitation that organizations and people serve upon you: First by deleting from your life the more-intimate and close personal interactions you used to have but no longer do the depth of your associations is essentially destroyed and then you compound the damage when you destroy the fundamental character of your closest interpersonal relationship by allowing a competitive angle to enter into it.  You'll find out real fast if you delete (not just "walk off", but actually delete) those social profiles exactly who gives enough of a damn about you to call and arrange to spend some time face-to-face.  Hint: There's nowhere near as many people who give a **** about you as you think there are; your "friends" social media postings are really all about them, not you.

Do you drive an SUV or big pickup?  Why?  Those are the vehicles with both the worst fuel economy and the highest profit margin for the car companies!   You're insane to own one unless you have a solid need.  If you regularly haul plywood sheets or similar for work then a pickup makes sense -- of course.  If you have more than two kids then you can probably justify an SUV.  If you own a boat on a trailer or a travel camper you need a vehicle that can pull it.  But these are 10% situations -- most people drive these things and pay in excess of $40,000 for one yet they have none of these actual needs.  I bought my Mazda 6 for just over half that much, it returns nearly 38mpg on the highway, and in the low to mid 30s around town.  Oh, and it runs on regular gas -- no premium or mid-grade required.  I've now got almost 100,000 miles on it with nothing more than oil and filter changes, couple of sets of spark plugs plus a set of tires and brakes -- and everything in it works perfectly.  My cost per mile is less than half that of the nice lady next to me in her "midsized" SUV, and probably a quarter of that of the dude in the lifted pickup on the other side!  Oh, and it's cheaper to insure too since it's less car to replace if I get in a wreck.

Have, or can find, an older car in decent shape?  Keep it running with good maintenance. My '03 Jetta TDI is still on the road, the kid has it (she got the title on her 18th birthday), it's got over 200,000 miles on it and I just put a set of back brakes in it for $80 and an hour and a half of my time (which, incidentally, she got to help with and now she knows how to do it.)  It drives better now with that 200k on the clock than a lot of new cars.  It needs a temperature sender (the current one is leaking a bit of coolant) which is $35 and sitting on my counter to be put in as soon as the kid has a day off where the car will be completely cold so I can drain the coolant before I pull it.  It burns nearly zero oil between 10,000 mile changes and long ago I put a CAT fuel filter head in it so a $20 CAT common-rail rated fuel filter, running at something like a sixth of its design flow rate, lasts for close to 100,000 miles -- basically, it's a "change it once every few years" thing now with vastly superior protection for the pump and injectors than the car came with originally.  Sure, it's a bit less-refined, a bit louder, the interior is somewhat worn and such compared against a new car but it gets damn near 50mpg all day long, everything works in it and it has a good shot at making it to the point that's legal to order a drink!  Cheap to insure? You bet. Collision? Why? Wreck it, it's gone; it's way off the end of the depreciation curve. Cheap to operate?  Oh hell yeah.  800 miles between fills on the highway, if you can keep your foot off the loud pedal.  I might have done something right raising her because she loves the car; in fact, she's said she prefers it to mine!

Got a kid or two?

Did you or will you sign papers so they can get "student loans"?  Did you "support" them in taking said loans in any way, shape or form?

You're either insane, abusive or both.

Do you think such a decision is "good" or "helps" them?  Do you realize that nine out of ten jobs created since the bank blowup in 2008 do not require a college degree?  That's not a stat I had to dig for, it's right there if you bother to look -- but nobody does, or talks about it.

Is college a good investment if you have to finance it?  Almost never!  Why?  Because you cannot control for risk (you get sick before you graduate, you graduate but there are no jobs in-field that pay enough to cover the payments comfortably, you flunk out outright, you get a job when you graduate but then lose it and cannot find another that pays enough, H1b visa holders decimate the salaries in your field, etc) and yet if any of those bad things happen you are ruined.  If you spend already-acquired capital (savings) then the worst thing that can happen is that the effort you put in previously is dissipated.  If you take a loan since it cannot be discharged they will chase you relentlessly, even to the point of garnishing your Social Security payments if it takes that long, penalties will be immediately added if you default which cannot be removed (by law) and interest will continue to accumulate until you pay it off.  What's even worse is that half the snowflakes in college think the government will let them off the hook -- which means what they really believe is they can steal their education from everyone else in America!  Is it ever sane -- or adult -- to put yourself in a position where just one piece of bad luck leaves you with your "best option" being stuffing a gun in your mouth?  NO!  Never mind that if you do manage to steal those funds someone might take sufficient umbrage at your thieving ways to kill you outright and perhaps even eat you.

While we're on your kids and school let's talk for a moment about your silence while the local High Schools and Junior Highs all got rid of shop class.  You know, where you learn the basics of how to run a lathe, use a drill press, wire something, maybe do a bit of work on a car?  The so-called "modern" 18 year old doesn't know how to change the oil on his or her car or put the spare tire on if they get a flat!

Look folks, rough stuff -- maybe very rough -- is coming.  I don't know if it's going to happen right now or a few years from now but it is coming.  It always does.  Always.  We've had an extraordinary period over the last 30 or so years where the "pain points" have been relatively benign.  We've not had really any ugly wars involving the United States, we've not had really ugly economic dislocations and generally-speaking the US has been pretty calm.  The odds of that holding up given the internals of federal spending which are easily visible to anyone who cares to look are slim and none -- and Slim just left with your sister and a bottle of Jack Daniels.  It's a fair bet he's gonna get some and you're gotta get it up the back door.

Wake up.  We've chosen as a nation to stick our collective heads in the sand and pay attention to the dog whistles on the left and right instead of demanding a stop to the scams.  Those scams are in the process of overcoming our economic environment -- like it or not, believe it or not.

Either figure out your path to reduce your footprint and dependencies in all related respects or accept that when it comes, and it will soon enough, likely within the next couple of years, you're going to be completely screwed at best.

It's called adulting and you're running out of time to start doing it.

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2017-03-11 05:00 by Karl Denninger
in Editorial , 614 references
[Comments enabled]  

I have been prodded by readers over email to write on this for the last few days (while I'd been out hiking on the AT, incidentally -- guess how much I give a crap about "technology" and "tracking" while out there having a nice walk in the woods with only the bees and bears for company?)  But, since people keep asking, here it is:

My one-word summary: Meh.

Somewhat more-lengthy summary:
smiley

Want a bit more detail?  Ok, if you're too dense to be unable to do understand the above two.

There is nothing in there that surprises me or is news. 

In fact, if you've read this column for any length of time at all you are well-aware that I've highlighted these very "vulnerabilities" on dozens of occasions.  I put the word "vulnerabilities" in quotes for a reason: You don't care, and neither does anyone else or devices like "Smart TVs" would not have one person using them, "Alexa" would have never sold a single unit and the various fruity things would not have nearly 50% market share in the United States.  Facefart would be a zero -- literally -- as would LinkedIn and SNAP would have failed to price their IPO.

The manifest weight of the evidence is that the American people do not care that they are product.  They do not care that the very fact that they are on Facebook causes all sorts of data to be associated with them personally by name and then sold to anyone who cares to buy.

This probably includes people with nefarious intent; as I have pointed out before on these very pages if you were a terrorist and wanted to target, oh, say, military members, or police officers it would be trivial to determine with a very high degree of certainty who those people are and exactly where they live by buying said data sets and correlating them, and it would not be difficult or expensive to do it either.  That would make your intended evil deed quite easy to carry out.

It's a damn good thing there really aren't that many terrorists out there who can put together cells totaling a few hundred people inside the US and who don't care if they get "caught" (because they're prepared to die for their cause) or we'd have a really severe and immediate problem.  A problem, I remind you, that you have each individually created by using these "services", by believing "free and always will be" means what it says and more.

But I do know with utter certainty what we do have in this country and the evidence for it is clear, convincing and without question: A bunch of companies that have, will and do buy the very same data, run the very same correlation analysis and then use that data to screw you up the butt on a daily basis costing you thousands of dollars a year you would not and should not be spending otherwise.

How do we know that's absolutely true?  Because if it wasn't then Facesucker and other "social media" firms would not exist as exactly zero of them could generate any meaningful amount of revenue.

Someone's paying the bill that makes same possible and the "someone" is you.  If you think you're not you're certifiably insane.

I hope you like buttsex because you're sure as hell getting plenty of it from these companies; that the CIA is playing the same game is neither surprising or, for that matter, "news" -- if you've been reading The Market Ticker, that is.  After all you created that target-rich environment for them and you continue to make it more-so on a daily basis!

Will Wikileaks latest cause you to delete (not just stop using or suspend) your Facesucker account?  I bet not, and I bet you know it too. Will it cause you to delete your Snapchat account? No.  LinkedIn?  You're joking, right, despite their record as one of the worst when it come to spamming and data mining.

What it will do is lead to yet another round of those who read these pages making excuses.

Quit with the faux "surprise" or even "outrage." You can stop this crap right now by every one of the enabling firms and have been able to do so for years by simply sticking up the middle finger and refusing to prostitute yourself in order to preen on "social media" and similar.  You haven't and you won't, so let's cut to the chase, shall we: STFU and swallow -- you've not only consented in the past you're doing it right now, today and as a result we know exactly what to call this.

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