North Point of View

I've had a Roomba now for almost 15 years. Often times it gets stuck. You got to pick it up. You got to move it. You've got to give it a kick. Well, you know, it is kind of primitive software. But then I thought, you don't need very complicated software. You just got to make sure you've got enough sensors and the sensors, conveying location information, then we should be fine. To me, that's the problem with the robot. So the more sensors you put in there, I think the better it will operate because, they can't see. The technology is blind. Read The Singularity, a book by Ray Kurzweil. He basically says around 2040 we'll have machines that will be able to repair themselves, but also to invent themselves. This is also where you get a little worried about those, doomsday science fiction stories where the machines take over the world.

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It's not just Evergrande who just blew up, but the number two and number three, they've also all crashed and burned. Then when you go down to the much smaller developers, it's a raging forest fire. People are trying to get their money back from the bank because deposits they made for the construction of apartments or houses, it's not happening. These developers don't have the money and they can't proceed. When you go to the bank to get your money, you can't get your money. What we've seen in the last six, seven, eight months is actual protests outside the banks and in the streets. In China, that's a no no. The population is getting angry and picking up sticks and clubs and whatever they can, because, you know, this is how revolutions get started.

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You and I talked about this a few years ago. One of the videos about the slowing population growth rate. And I was lucky during most of my career, the population growth rate for the US was one to 2%. It was 2% and it dropped towards 1.41%. But that was enough to sustain GDP growth of 2 to 3 and a half percent. And so I could do a lot of good calculations based off of demographic growth. Look at Japan, they have positive GDP growth, but they have negative population growth.

Negative workforce growth is still shrinking. Japan is what I've been looking at the most and all the adaptation that they've had to do. The simple example is in Japan, they don't have enough medical people. We don't either but you go online in Japan and you say, I'm sick, and then the A.I. comes and this is ten years ago.

It's not just recent, not this A.I. bullshit, that we're talking about these few years. This goes back then because doctors are viewed as encyclopedias. You list the symptoms, the symptoms are consistent with these diseases. Then you ask a few more questions to narrow it down. And these last two diseases get the same medical treatment. Then it's reviewed by a nurse. And if the nurse isn't sure, they check with the doctor. But basically the nurse clicks the box and prescription sent to the pharmacy, and then the pharmacy then deliver it to your house. That's where we need to go.

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In this episode, Mark Hall and Dr. Walter Kemmsies discuss the fundamental structural pieces that are in place for 2024 and some weaknesses in the overall structure.

Excerpt:

The Department of Defense for decades has had a list of essential industries. I was on the government's corona virus task force in 2020, and we needed to know what really, really had to be protected. My contribution was included the DOD website.

We were extremely dependent on China for our supply of active pharmaceutical ingredients. That didn't make sense to be 95% dependent on a single country. That's stupid. What happened during COVID proved exactly the point that you shouldn't be so dependent. China shut down exports of a lot of things, and especially in the medical area. There's no judgment there on China, its just that and any country could have done that.

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2024 is still going to be very volatile. The Houthi attack in the Red Sea isn't going to be solved in the next few weeks, so it walks into 2024. The situation with Israel is not going to be resolved that quickly either. We've got at a minimum, several months or could be years. So it's a very volatile year. Just looking at it from that perspective, no end in sight with Putin and the war in Ukraine. It’s also an election year and the politics in the U.S. are kind of ugly, but what do we tell people about the stock market during the election year? Buy stocks. They always did better in election years than almost any other years. So you've got these two forces against each other. I'm going to stay in the stocks and biting my nails and trying not to look at my 401k.

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When COVID hit us, we flopped like a rock. We gave Americans five and a half trillion dollars. That boosted the economy way above the trend line and we've been trying to get back to that trend line since. In in 2019 we were at $500 billion a month of retail sales. One would have said that by 2023 we're going to be maybe at $550 billion but we're currently at $600 billion a month and we've been there now for 18 months. Right now it's still nail biting territory for retails companies like Macy's, Walmart, Amazon or Target. The big fear is how do we converge back to the trend line? And if you do converge, is it by sales falling like a rock, recession or is it by over time where the difference begins to fade away?

Tune in to find out what grade Jerome Powell and the Federal Reserve get from Prof. Kemmsies.

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A zero percent inflation rate may look elegant mathematically, but the mathematical model built represents no universe that any human being has ever lived in.

Back then, Milton Friedman, the Nobel laureate, said that he thinks inflation target should be two percent. He didn't say zero, and there were a lot of economic commentaries about this. If you target zero percent inflation, you're making it really, really hard for a new company to emerge and drive productivity growth through the economy and take us into the future.

In today's economy, two percent may not be the answer either. So how much inflation is good?

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Japan's recession during the 90's lasted over two decades and the stock market was flat for literally 20 plus years. It is considered one of the longest-running economic crises in recorded history. Mark Hall and Walter Kemmsies continue their discussion from previous episode regarding China's current debt situation and what are the parallels with Japan of the 90's.

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A recent article in the Savannah paper reported the partnership between Hyundai and Georgia Tech on hydrogen technology. Even though E.V. just got here, could they be headed out already? The question is… is today's E.V. the Betamax of yesterday?

Hyundai announced in Savannah their big presentation, they mentioned hydrogen four times and E.V. twice. Is that a sign of what’s to come?

A year ago, an interview given by Mr. Toyoda (CEO of Toyota Motor Co.) said he had very serious doubts about the E.V.s. He wasn't buying in. He felt that it was dangerous not to also invest in hydrogen.

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The threat or the worry over recession has been the theme or a sub-theme for the last year. At the same time the stock market has been on a run. If we're so worried about a recession, why does the stock market continue to climb?

A recession has been predicted now for the last 12 months and the economy seems to be sort of chugging along pretty well. But why would you be concerned? One is the yield curve has been inverted. When the yield curve inverts, inevitably there's a recession soon after. But when you look at the history of this indicator, you don't get the recession until the yield curve un-inverts but currently it’s still inverted.