Unless Healthcare is Revamped – Unemployment Will Rise


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Healthcare costs have continued to outpace inflation and just about everything else within the economy. Generally speaking, prices rise when demand increases relative to supply. The scheme of Obamacare was to force the youth to buy healthcare they did not need to pay for everyone else. The fines have been less than the costs so many of the youth just pay the fine. Forcing people to buy insurance to artificially lower the costs failed because healthcare is no different and has risen, not declined, with the false rise in demand.

Additional forces have also been contributing namely political decisions from Obamacare, additional taxes, and increased regulations have combined to impact healthcare costs. There has also been the notorious increase in lawsuits which influence the cost of malpractice insurance for medical practitioners forcing costs to also rise. Congress would never introduce Tort Reform because there are too many lawyers who would see their big paydays vanish.

McDonald’s is starting to replace people with auto-self-serving. Now Wendy’s is doing the same thing. Wendy’s plans to install self-ordering kiosks at 1,000 stores by the end of 2017. McDonald’s already beat them to the punch but we are witnessing this trend in many other businesses as well, such as movie theaters and airports. Corporate costs will decline with robots and automated order machines contributing to increasing corporate profits since they are not lowering prices. American Airlines is really anti-consumer. They charge $200 to speak someone to change your ticket when the ticket cost is even just $174. Healthcare costs rising faster than everything else will force companies to abandon workers whenever possible and this is impacting both manufacture as well as services.

So, what is the issue? Is it really just hourly wages? No! Any business with more than 25 employees are being hit with rising healthcare costs that amount to a monopoly from which the only possible relief is to eliminate people. Many small companies have tried to pay healthcare and have been forced to keep raising the deductible. Effectively, healthcare is devolving into catastrophic coverage. Many doctors are refusing to take people on government programs including Medicare because the government cheats them and is slow to pay.

Bill Gates may have been great at creating Microsoft, but when it comes to economics and law, he is off in the Cloud lost in his mind. What he has come out as a solution is to tax machines as if they are people? Gates said, “You’d think we’d tax the robot at a similar level” as humans and then the taxes a company pays would support society? So we become a world of couch potatoes?

Just maybe, we stop the subsidizing of healthcare, introduce Tort Reform, and replace government workers with robots to eliminate taxation on the people. That would be one alternative if we are looking at this new future world. In places like Greece, it is the government that accounts for 40% of GDP. In the USA, Fiscal Year 2017 is estimated at a total of all US government spending, federal, state, and local, to be $7.04 trillion. This will be 36% of GDP.

The US National Defense will be 4% of GDP while government pensions will be 7% plus government healthcare will be 8% compared to welfare is only 2%. Even education is 6% and that is highly questionable for it is really subsidizing the socialist philosophy. Our problem is government workers – not welfare or even military.

We need robots to replace government.

Market Talk- March 1, 2017


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It was the speech that most claimed lacked substance that just did exactly what most thought it couldn’t – rally global stock markets. Yes, Japan’s Biz Cap-Ex released at 3.8% compared to the previous 1.3%; that woke markets, then Manufacturing PMI released a smidgen worse but when the JPY started to fall, everyone blamed Trump. The fact that the market has re-priced a March hike from 50% to 80% hardly made the pages. The Nikkei loved  the weaker Yen especially moved were key exporters all adding to the strong 1.5% rally. Shanghai and Hang Seng were small better bid (bit disappointing as China PMI better than expected) but in late US trading the futures market have added an additional 1% across the board.

I find it quite amusing that the pages announcing in Asian time zone “no substance”, lacked detail and disappointing – suddenly claim that $1tln will help infrastructure and defence stocks. Europe benefitted both on data and action as fresh money finally found its way into the market. All core indices saw gains of around 2% whilst both the Euro and GBP traded weaker. Mixed bag of tricks on the data front but probably a tad better for Germany which did see a small sell-off in bunds but then treasuries were down nearly 2pts so probably not that exciting really!

The US market could not wait to open with a 100 point gain seen in the opening minutes. By lunchtime time we were over 300 points higher, breaking both the psychological 21k for the DOW and the 2400 level for the S+P. Data was mixed initially but finished better (ISM 56 forecast was released at 57.7) with most talking FED. Towards the close we are pricing in a 80% chance of a move in March but many may wish to wait Janet Yellen when she speaks Friday. Given the DXY recent performance (now around 101.75), the rise of the S+P (+7% YTD) and 2yr yields their highest in nearly 8yrs the chances are this could be the start of the FED back in play.

2’s closed 1.28% (+5bp), 10’s at 2.46% (+10bp), Bunds 0.0.28% (+8bp) closes US/Germany spread at +218bp. France 0.91% (+3bp), Italy 2.11% (+4bp; can you really believe Italy trades 35bp through the USA!!!), Greece 6.75% (-22bp), Turkey 10.66% (+7bp), Portugal 3.89% (+6bp) and finally Gilts 1.19% (+4bp).

Leonardo DiCaprio is a Complete Idiot


Do as I say not as I do … lol

Key Interview – Treasury Secretary Steven Mnuchin Talks To Neil Cavuto…


Treasury Secretary Steven Mnuchin gives Fox Business News’ Neil Cavuto an interview to discuss President Trump’s timeline for the ObamaCare repeal, budget and tax reform. The interview is int…

Source: Key Interview – Treasury Secretary Steven Mnuchin Talks To Neil Cavuto…

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Why Do Majority of Fund Managers Cannot Beat the S&P500?


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QUESTION: Marty; The Mises Institute said “Martin Armstrong is one of the most famous economic forecasters alive” and others call you the legend. I have watched your numbers and timing targets. I bought the Gold Report in 2016 and to watch gold peak exactly to the day you highlighted years ago and in so many other markets, you have proved your point. This is humanly impossible so you must have discovered a model that reveals the regularity of everything showing there is no such thing as randomness. My question is simply this. The majority of fund managers could not even beat the S&P500. Many funds had their worst year since 2009.  I made more money in the account I traded using your forecast than I did in the funds I gave to managers. Would you consider publishing funds that use you so we would know who to trust since you are not interested in going back to funds management?

PG

ANSWER: We are considering that. As 2016 began, USA Today reported that 66% of fund managers could not match the S&P500. Back in 2014, 86% of investment managers lost money. Studies back in 2013 showed the same general ratio that only 24% of active mutual fund managers outperform the market index. Last year, 2016 was the WORST year for fund managers picking stocks. The London FT reported that active fund managers last September were lagging behind the stock market. Stockpickers in their semi-annual survey found that 90% of all managers fell short of benchmark.

This is a HUGE problem. The crisis in funds management illustrates what I have been warning about. OPINION is your worst enemy. I try on this blog to cover the world range of topics. To be a good hedge fund manager. the first thing you MUST do is be on top of everything unfolding in the world ALL the time. The tsunami waves of market corrections and breakouts ALWAYS unfold from an international perspective. Even the US media never really talked about BREXIT until about 10 days before it even took place. You cannot successfully invest or manage money and be oblivious to world trends.

We will consider licensing our model to firms for public use.

Small Business was the Backbone of the Economy


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QUESTION: Mr. Armstrong; My family have been lifelong democrats and operated a small local business. We were never in the multi-million dollar class, but always found ourselves considered to the the unholy rich. I remember Joe Biden saying that 90% of small business made under $100,000. Those are most likely individuals and not small business who actually hire people. Obamacare devastated our net bottom line and I have seen the light. You wrote before that small business was the backbone of the economy. Why have the democrats always been against small business?

Curious on your take

Tax Defining RichANSWER: The problem stems from the fact that to collect money, the top bracket for income tax has progressively been lowered. Back at the time of World War I, the definition of the rich was someone who earned $2 million. Considering a car was $300, that was a lot of money. Then for World War II, the definition was raised to $5 million. There were songs like We’re in the money, we’re in the money; from the Gold Diggers of 1933, reflecting the boom times. The government even printed $10,000 bills.

The rhetoric has been Marxist since the Great Depression, but they call it “progressive” or “liberal”. The definition has changed dramatically so $250,000 is now the equivalent of being super rich during the Great Depression earning $5 million.

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Today, small businesses make up: 99.7% of U.S. employer firms, 64% of net new private-sector jobs, 49.2% of private-sector employment, 42.9% of private-sector payroll, 46% of private-sector output, 43% of high-tech employment, and 98% of firms exporting goods. Joe Biden’s justification that the Democrats do not tax small business is just not true. What he counts as small business is self-employed which can be anything from a handyman to jockey racing horses freelance. That is substantially different from small business that actually employs people.

U.S. Census information from 2008 identified a total of 27,281,452 businesses in the United States. The number of businesses operated by proprietors with no employees numbered 21,351,320, which were the self-employed individuals. The Small Business Administration defines small business as fewer than 500 employees – which to me is not small. Add to this the number of businesses having fewer than 500 employees and the number of small businesses comes to 27,262,983. Now, let’s subtract this number from the total number of businesses identified by the census. This produces the number of businesses with more than 500 employees amounts to 18,586. Small business amounts to 99.7% of businesses in the United States.

Big corporations only employ about 38% of the private sector workforce while small businesses employs 53% of the workforce. In fact, over 99% of employing organizations are small businesses and more than 95% of these businesses have fewer than 10 employees. As I stated above, small businesses accounted for 64% of net new jobs created. In fact, many of these new jobs are also new companies. The startup rate in 2010 was the highest it has been in 15 years, but that is because 60% of graduate from college cannot find employment in the field that they paid for a degree. Many are FORCED to start their own business typically one-man bands. The rise in startups is because there has been shrinking roles available in big business as many are replaced by technology.

Small business ALWAYS grow faster creating more jobs than big business with 500 employees or more. In fact, historically, small businesses grow faster at a rate of 3.4% compared to big business which grows on average only 1.3%. Over the years, I have noted why big business slowly die. The boards become dominated by lawyers and accountants and lose touch with entrepreneurship as well as creativity – i.e. Steve Jobs.

The government always focuses on big business because they have the lobbyists who fund campaigns.  During the 2007-2009 Crisis, neither the Troubled Asset Relief Program (TARP) funds nor industry bailouts specifically helped small businesses. In fact, slightly more than 20% of the small businesses get loans from banks and do so only with collateral. Therefore, big bailouts and TARP never “stimulate” the economy. Democrats always hate tax cuts and call it trickle down economics. But when it comes to bailouts, they only focus on the rich because they donate to their campaigns. Democrats talk out of both sides of their mouth. If you want to “stimulate” the economy, directly address small business – NOT the big companies who will not hire anyhow.

Then there is a huge divide between big business and small business. Big corporations are able to claim health insurance policies for employees as a business expense. Employees pay for those policies with pre-tax dollars. A self-employed business owner could not deduct his health insurance. There was a one-year self-employed health insurance tax deduction in the Small Business Jobs Act, but the Democrats would not allow that to be extended.Small businesses who work from home are entitled to take a home office deduction, but some 60% never deduct it for it often results in an audit and the deduction is notoriously difficult to calculate and thus a grey area the IRS loves to attack.

The bottom line is that Democrats rant and rave about the rich, but when it comes to helping small business, they screw them all they can and help big business because they donate for their campaigns. That’s the simple truth.

Teamsters Local 707 Goes Bankrupt


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The Pension Crisis on the horizon is far worse than anyone can imagine. This is the final straw that will break the back of socialism the same as communism fell. Pensions are in a state of crisis for they lost money in stock in the 2007-2009 crash and then sold the bottom shifting to government bonds and then interest rates plummeted when they needed 8% to survive. The management skills have been nonexistent for the propaganda has always been that government bonds present no risk when in fact they are UNSECURED DEBT and the riskiest of all investments long-term.

2017 CountdownYellow Roadway company is one example of how things have changed. The company was allowed to skip its pension contributions for 18 months. When the company restarted paying again, it was at 25% of the previous rate. The Pension Fund for local 707 began to implode, with roughly 700 workers paying into a fund supporting more than 4,000 retirees. Local 707’s fund pays out $48 million a year — and takes in $7.5 million in contributions. Those who have been contributing will get nothing at all for the contributions. The whole thing is a house of cards that caves in.

We wrote in the Pension Report: “As we approach 2017, everything you once thought was secure for your future will unravel.” Indeed, the Sovereign Debt Crisis and the Pension Crisis start to surface here in 2017.

The Obama-Boehner Debt Crisis


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The debt deal struck by President Barack Obama and the then House Speaker John Boehner back in October 2015, was done purposefully to ensure that the debt crisis would not unfold under Obama and the Democrats.  John Boehner never saw a government role of red tape he never cherished.  The debt deal was absurd that the $20 trillion mark for the US debt ceiling as of March 15, 2017 would become permanent. Sure, on the one hand this could lead to a severe budgetary crisis this summer if the Democrats try to use this to discredit Trump since the media will blame Trump and not Obama.

The March 15, 2017 (Ides of March) date will be used by the media to try to stop Trump tax cuts. As always, politicians put-off whatever they can to keep hiding the truth to create fake reality and the press chimes in. This date marks the end of the debt deferral scheme struck by Obama and Boehner. When this delay expires, the deficit limit is supposed to be frozen at $20 trillion. It then becomes a law AND SOME PEOPLE ARE ALREADY TOUTING THE END OF THE WORLD. Of course, without reform and debt restructure, this cannot become reality. A rise in interest rates alone will increase the servicing and blow-through the debt ceiling. So expect a lot of yelling and incrimination – but at the end of the day, they will still have to raise the debt ceiling – AGAIN! Welcome to 2017!

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Yes, this debt crisis is right on time with our forecast made decades ago. Of course, the politicians will be faced with the collapse of socialism. Where will the money come from to keep all of these programs going? The Democrats will call for a massive tax increase as if that will produce something different than a Great Depression as Europe has inflicted upon the Greeks. Honestly, politicians should NEVER be allowed to play with spending. They cannot manage anything and their self-interest of pretending to do a job while lining their own pockets should be a criminal act.

Everything could come to a halt and the Democrats will then try to blame the Republicans. This is how government works – always create a crisis and blame the other party. Obamacare is falling apart as more and more insurers bailout, costs skyrocket, and Social Security goes off the cliff. The Democrats will try desperately to prevent tax reductions for they are closet communists because they want to control your assets with a backdoor where the multinational corps can pay for exceptions. The deficit limit must then be further increased, but oddly enough, Trump is probably the best person to deal with a debt crisis. Trump will at least understand the debt and has previous spoke about restructuring the debt.

All this chaos can reach havoc proportions in the debt markets, but the stock market can be the biggest benefactor for parking money when bonds are not a wise choice. Obama pushed the biggest tax increases for Obamacare off into 2017 to prejudice the next president. Last September I wrote: “Come 2017, we are likely to see Obamacare also collapse.”  Obama has done a tremendous amount of damage as did Boehner. They created the Veteran Health Crisis not paying to take care of the troops and instead gave them a suicide crisis hotline to call rather than healthcare. The lethal combination of backroom dealing has left Trump with little room for action unless he makes a real reform. Just watch how even the press will not attribute everything to Trump.

Trump inherits a pre-programmed time-bomb and Obama has organized protests to try to make sure Trump is blamed for everything Washington created since World War II. The Democrats want to prevent Trump from lowering taxes on companies and citizens, build walls and add border guards to stop the drug trade and increase security authorities because of terrorism. Trump vowed to do more for the veterans when the Democrats cut everything they could in the VA and military. Then there is Trump’s plan to cut off funds to intervening in the world and spend that money home on an infrastructure program.

So as the National Debt is reaching $19,979 trillion, debt has more than 160% since 2000. Under Obama, there was a massive expansion of new debts on the order of nearly $10 trillion dollars taking advantage of cheap interest rates. Obama increased the debt more than the past 43 US presidents combined in nominal terms. Nevertheless, the USA has the only economy that is viable in the West. The American banking system is not shaking as is the case in Europe.

The US economy is holding up the world for about 70% of the US economic output is generated by domestic consumption. If the American consumer stops, Europe and Asia collapse in overall economic growth. So the debt crisis looming on the horizon depends entirely up how bad the Democrats and the press try to spin this to hurt Trump, but they will shoot themselves in the foot. This time, the mainstream media will more likely than not create a serious economic decline in public confidence by trying to pin all the blame on Trump. On top of all this, Moody’s downgraded 24 governments during just the first half of 2016. The rating agencies will downgrade the USA now only because Trump is in office and they do whatever the establishment tells them to do.

Analysis of Global Temperature Trends, January, 2017, what’s really going on with the Climate?


The analysis and plots shown here are based on the following two data series. First NASA-GISS estimates of a global temperature shown as an anomaly (converted to degrees Celsius) as shown in their table Land Ocean Temperature Index (LOTI) and shown in the following Chart as the red plot labeled NASA. This plot is shown as a twelve month moving average to minimize the large monthly swings and better show trends; the scale for the temperatures is on the left. Second NOAA-ESRL Carbon Dioxide (CO2) values in Parts Per Million (PPM) which are shown in the following Chart as a black plot labeled NOAA. This plot is shown exactly as the data from NOAA is presented and there is no need for a moving average the scale for CO2 is shown on the right.

NASA published data as stated in the first paragraph is shown as an anomaly, but what is a temperature anomaly?  An anomaly is a deviation from some base value normally an average that is fixed. There were two problems with the system that NASA picked which were number one there is no “actual” global temperature and two since climate is a variable there cannot be a real base to measure from. NASA known for its science and engineering expertise back in the day thought it could get around these issues and created a system to do so. First they developed a computer model which took readings from all over the planet and made significant adjustments to them called homogenization and came up with the estimated global temperature. Second they picked the period 1950 to 1980 (30 years) and averaged the values and came up with 14.00 degrees Celsius and make that their base.  Then they took the calculated temperature and subtracted the base from it which gave them the anomaly. The problem is that both the base and the anomaly are arbitrary.

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Now that we have a base to work with we are going to add to the previous Chart three things. The first is a trend line of the growth in CO2 since that is the entire basis for climate change according to the government through NASA and NOAA. That plot is superimposed over the black plot of the actual NOAA CO2 values as the cyan line labeled as the CO2 Model and one can see there is a very good fit to the actual NOAA values so there should be no dispute about its validity.  This plot allows us to make projections as to future global temperatures according to the level of CO2. The second added item is James E. Hansen’s Scenario B data, which is the very core of the IPCC Global Climate models (GCM’s) and which was based on a CO2 sensitivity value of 3.0O Celsius per doubling of CO2. This plot is shown here in lavender and is part of a presentation that Hansen showed to congress in 1988 when the UN was about to set up the International Panel on Climate Change (IPCC) and this plot is labeled as Hansen Scenario B which Hansen stated was the most likely to happen based on his theories’.  The third item is the current plot of the most likely temperature of the planet based on the growth of CO2 published by the IPCC. This plot is shown in Red and is labeled as IPCC AR5 A2 as that is the table where the data was found. This plot is a GCM computer projection of the planets temperature based to the complex relationships developed on the levels of CO2 by the IPCC through NASS and NOAA.

It can be seen in this Chart that the lavender plot and the Hansen plot are very close from 1965 to around 2000 after that, from 2000 to 2014, there is a very large and growing deviation reaching close to .5 degrees Celsius in 2014, which is not an insubstantial number.  Also of note is that there doesn’t seem to be a good correlation between the growth in CO2 and the increase in the planets temperature. The CO2 is going up in a log function and the Temperature was going down in a log function until recently where it reversed and is now going up in a log function. That major change in direction that occurred between 2013 and 2014 is the subject of this paper.

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The next Chart is developed from the raw data from NASS and NOAA as shown in the first Chart.  This plot was made first by adding ten years blocks of temperature and CO2 as indicated in the Chart and diving by 120 to give an average for each.  Then the average Temperature was divided by the average CO2 to give degrees of temperature increase per PPM of CO2. After that was plotted it appeared that there were two different curves the first was from block 1965-1974 through block 2004-2014 shown as Black Dots and the second was from block 1995-2004 through block 2005-2016 shown as Black Dashes. When trend lines were added they were both almost perfect fits to the raw data and so you cannot see the data points very well on the Chart.  These blocks were picked to represent the entire period of time where we had both NASA temperature data and NOAA Co2 levels.

On the following Chart are two sets of color coded information. The first is Cyan plot and the Cyan box with the equation in it along with the R2 value 0f 1.0 are for the first series from block 1965-1974 through block 2004-2014. The other is the Red plot and the Red box with the equation in it along with the R2 value of 1.0 which are for the first series from block 1965-1974 through block 2004-2016. We can speculate on how this change has happened but it cannot be said that the plot change is not real; however additions data over the next few years will be required to actually prove that something has changed.

In summary the Cyan data set indicates a diminishing effect of CO2 on global temperature for about 54 years and the Red data set represents an increasing effect of CO2 on global temperature for the past 2 years. Since both data sets have an R2 value of 1.00 the trend lines cannot be in question.

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Before we get into a possible explanation to the drastic change from the Cyan data to the Red data that occurred in 20014 we need to consider other factors than CO2 on Climate change.  The fault that occurred in the work that was done in the 1980’s was in assuming that there was an optimum or constant global temperature and therefore any change that was being observed was from the increasing amount of CO2 in the atmosphere.  There may have been correlation but it was never proved that there was causation (high R2 value) between CO2 and global temperatures. With that assumption, which limited options, we moved from true science into the realm of political science.  True science has an open mind and finds relationships that work in matching observations with predictions.  Political science changes history and/or facts to match the desires of the politicians. Since the politicians control the money political science is what we get; which means that what we get may not be technically correct.

A decade ago when I started looking at “climate” change the first thing I did was look at geological temperature changes since it is well known that the climate is not a constant; I learned that 52 years ago in my undergrad geology and climatology courses in 1964. The next paragraph explains currently observed patterns in climate related to this subject.

Ignoring the last Ice Age which ended some 11,000 years ago when a good portion of the Northern hemisphere was under miles of ice the following observations give a starting point to any serious study on the subject. First, there is a clear up and down movement in global temperatures with a 1,000 some year cycle going back at least 3,000 to 4,000 years; probably because of the apsidal precession of the earth’s orbit of about 20,000 years for a complete cycle. However about every 10,000 years the seasons are reversed making the winter colder and the summer warmer in the northern hemisphere. 10,000 years from now the seasons will be reversed. Secondly, there are also 60 to 70 year cycles in the Pacific and the Atlantic oceans that are well documented. These are known as the Atlantic MultiDecadal Oscillations (AMO) in the Atlantic and as La Nina and El Nino in the Pacific. Thirdly, we also know that there are greenhouse gases such as carbon dioxide that can affect global temperatures. Lastly the National Academy of Sciences (NAS) estimated that carbon dioxide had a doubling rate of 3.0O Celsius plus or minus 1.5O Celsius in 1979 when there were only two studies available and one for sure and maybe both were not per reviewed.

The result of looking objectively at the three possible sources of global temperature changes was a series of equations based on these observations that when added together produced a sinusoidal curve that seemed to follow NASA published temperatures very closely.  Since this curve was based on observed temperature patterns it was called a Pattern Climate Model (PCM) which has been described in previous papers and posts on my blog and since it is generated by “equations” many assume it is some form of least squares curve fitting, which it is not. It does seem to be related to ocean currents.

As can be seen in the following Chart the PCM there is a 69.1 year cycle that moves the trend line up and then down a total of 0.29O Celsius and we are now in the downward portion of that trend (-.01491O C per year) which will continue until around ~2035.  This short cycle is clearly observed in the raw NASA data in the LOTI table going back to 1880. Then there is a long trend, 1036.7 years with an up and down of 1.65O Celsius (.00396O C per year) also observed in the NASA data. Lastly, there is CO2 adding about .0079O Celsius per year so currently they all basically wash out at -.0039O C per year, which matches the current holding pattern we are experiencing. After about 2035 the short cycle will have bottomed and turn up and all three will be on the upswing again.  Note: the values shown here are only representative as the actual model uses many more places than what are shown here.

When using the 12 month running average for global temperatures up until 2014 the PCM model was within +/- .01 degrees of what NASA was publishing in their LOTI table since the early 1960’s as shown in the next Chart. Further the back projection of the PCM plot matched historical records and global temperatures going back past the time of Christ. It should also be consider that geologically CO2 levels have reached levels many times that of the current 400 ppm without destroying the planet so the current hysteria over the current small numbers can only be explained by political science not real science.

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The nest step in this analysis is to put all of the known data and projections into one Chart which will contain: NASA’s table LOTI global temperature estimates, NOAA’s actual CO2 values, the CO2 model projections, the PCM model global temperature plot, Hansen’s Scenario B 1988 global temperature plot, and lastly the IPCC AR5 A2 global temperature plot. With that done we can look at the results and try to make some sense of what is going on with the various arms of the federal government that are promoting that carbon based fuels be eliminated since they are responsible for the global temperature level  going up.  As previously started when the government pours money into the sciences the sciences respond with technical papers the support the governments views, this is what I call political science verses real science as was done prior to the 1980’s; money talks and BS walks as everyone on the street knows.  This Chart views a good overview of the current situation showing all the facts and all the projections.

This Chart contains no manipulation of the data and the only change that was made was to convert the NASA anomalies back to degrees Celsius to make it more readable to lay people.  This is only a change in units and has no bearing on the look.  A subject not broached here is that of the NASA homogenization process itself and the base period from 1950 to 1980. The portion in the black circle contains the NASA base period of 14.00 degrees Celsius and the reason it’s brought up here is that the Homogenization process causes the global temperatures to move around since the entire data base all the way back to 1880 is recalculated each month.  But since the base has to stay at 14.00 degrees Celsius the program must be set to not allow changes in that period of time. I’m sure the programmers have fun with that. Prior work here has shown how this creates a teeter totter effect with the data plots, some of which have recently been significant.

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The next Chart will be a look at the period from 2010 to 2020 so we can see the detail of the past few years where a change in CO2 of only a few ppm has caused a major change in the global temperature way beyond anything previously shown in any published NASA data. There are two black ovals on the Chart one at the top of the Chart which is a black oval around the CO2 levels for 2012, 2013, 2014, 2015 and part of 2016 and it’s very obvious that there has been very little change, maybe 7 ppm or about 1.9%. Then at the bottom of the Chart is another black oval around the NASA global temperature levels for 2012, 2013, 2014, 2015 and part of 2016 and its very obvious that there has been a very large change, almost .45 degrees Celsius or about 3.1%. There has never been such a large increase in temperature from such a small increase in CO2.

By contrast the previous comparable period of the last part of 2010 through 2013 shows about the same increase for CO2 at 1.1% but no increase for global temperature but actually small decrease. Worse it appears that this current strange upward trend will continue as the values shown here are based on a 12 month moving average and the current values being published by NASA have been very high for the past 7 months and therefore I would expect the NASA plot to be well over 15.00 Celsius within a few months and certainly before the end of 2016. After COP21 the need for Fake Warming was no longer needed and so we are seeing a downward trend developing. With the new administration we may see the end of data manipulation from NOAA and NASA and a return to real science political science.

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In summary, the IPCC models were designed before a true picture of the world’s climate was understood. During the 1980’s and 1990’s CO2 levels were going up and the world temperature was also going up so there appeared to be correlation and causation. The mistake that was made was looking at only a ~20 year period when the real variations in climate all move in much longer cycles of decades and centuries.  Those other cycles can be observed in the NASA data but they were ignored for some reason.  By ignoring those trends and focusing only on CO2 the models will be unable to correctly plot global temperatures until they are fixed.

Lastly, the next chart shows what a plot of the PCM model, in yellow, would look like from the year 1400 to the year 2900. This plot matches reasonably well with recorded history and fits the current NASA-GISS table LOTI data, in red, very closely, despite homogenization.  I understand that this model is not based on physics but it is also not true curve fitting. It’s based on observed reoccurring patterns in the climate. These patterns can be modeled and when they are, you get a plot that works better than any of the IPCC’s GCM’s. If the conditions that create these patterns do not change and CO2 continues to increase to 800 ppm or even 1000 ppm than this model will work well into the foreseeable future.  150 years from now global temperatures will peak at around 15.750 to 16.000 C and then will be on the downside of the long cycle for the next ~500 years.

The overall effect of CO2 reaching levels of 1000 ppm or even higher will be about 1.50 C which is about the same as that of the long cycle.  The Green plot on the Chart shows the observed pattern with no change in CO2 from the pre-industrial era of ~280 ppm. CO2 cannot affect global temperatures more than 1.500 C +/- no matter what the ppm level of CO2is. The reason being that the CO2 sensitivity value is not 3.00 per doubling of CO2 but under 1.00 C per doubling of CO2 as shown in more current scientific work.

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The purpose of this post is to make people aware of the errors inherent in the IPCC models so that they can be corrected. 

The Obama administration’s “need” for a binding UN climate treaty with mandated CO2 reductions in Europe and America was achieved as predicted at the COP12 conference in Paris in December 2015. To support this endeavor NASA was forced to show ever increasing global temperatures that will make less and less sense based on observations and satellite data which will all be dismissed or ignored.  Within a few years the manipulation will be obvious even to those without knowledge in the subject, but by then it will be to late the damage to the reputation of science will have been done.

 

Sir Karl Raimund Popper (28 July 1902 – 17 September 1994) was an Austrian and British philosopher and a professor at the London School of Economics. He is considered one of the most influential philosophers for science of the 20th century, and he also wrote extensively on social and political philosophy. The following quotes of his apply to this subject.

If we are uncritical we shall always find what we want: we shall look for, and find, confirmations, and we shall look away from, and not see, whatever might be dangerous to our pet theories.

Whenever a theory appears to you as the only possible one, take this as a sign that you have neither understood the theory nor the problem which it was intended to solve.

… (S)cience is one of the very few human activities — perhaps the only one — in which errors are systematically criticized and fairly often, in time, corrected.

 

NY Teamsters Pension Becomes First To Run Out Of Money As Expert Warns “Pension Tsunami” Is Coming


Tyler Durden's picture

The New York Teamsters Road Carriers Local 707 Pension Fund has won the unfortunate award for “First Pension to Officially Run Out of Money.”  According to the New York Daily News, and a host of angry former truck drivers who’ve had their pension benefits slashed, the Pension Benefit Guaranty Corp. (PBGC) has officially been forced to step in and take over payments to retirees of the Local 707, albeit at a much lower rate.

Teamsters Local 707’s pension fund is the first to officially bottom out financially — which happened this month.

“I had a union job for 30 years,” Chmil said. “We had collectively bargained contracts that promised us a pension. I paid into it with every paycheck. Everyone told us, ‘Don’t worry, you have a union job, your pension is guaranteed.’ Well, so much for that.”

“It’s a nightmare, it has just devastated all of our lives. I’ve gone from having $48,000 a year to less than half that,” said Chmil, one of five Local 707 retirees who agreed to share their stories with the Daily News last week.

“I don’t want other people to have to go through this. We need everyone to wake up and do something; that’s why we’re talking,” said Ray Narvaez.

Of course, the Teamsters 707 and other Teamster pension boards attempted to submit plans that would have cut benefits in order to prolong payments to retirees but those plans were universally rejected by the Obama administration…better that the pensions just run out of cash completely.  Per Pensions & Investments:

The Obama administration is in denial about the necessity of cutting pension benefits under the Multiemployer Pension Reform Act of 2014 to try to put distressed multiemployer plans on sounder financial footings and make them more sustainable. It must face reality and order the Treasury Department to stop blocking action.

So far the department, required under the act to approve proposed reductions, has rejected proposals by the Teamsters Central States, Southeast & Southwest Areas Pension Plan and the Road Carriers Local 707 Pension Fund.

Ten plans total have applied for cuts, including the New York State Teamsters Conference Pension and Retirement Fund, Syracuse, whose Aug. 31 application is too new to be listed on the Treasury’s website.

The Road Carriers 707 application stated that the plan projects it will become insolvent in February — only about five months away — absent suspension of benefits.

As desperate as the plan’s financial situation appears to be, the Treasury denied the application.

And while the Local 707 pension was the first to dry up, it certainly won’t be the last…

Also on the brink of drying up are the pensions for two Teamster locals — 641 and 560 — in New Jersey, union officials said. Plus 35,000 Teamster members upstate who are part of the money-hemorrhaging New York State Teamsters Pension Fund.

Bigger than all of New York’s Teamster locals combined is the Central States Pension Fund — another looming financial disaster that could leave 407,000 retirees without pensions across the Midwest and South.

Teamster

 

Meanwhile, under the maximum benefits provided by the PBGC, many former Teamsters, like Ray Narvaez, said their monthly retirement checks have been slashed by two-thirds.

Then Narvaez, like 4,000 other retired Teamster truckers, got a letter from Local 707 in February of last year.

It said monthly pensions had to be slashed by more than a third. It was an emergency move to try to keep the dying fund solvent. That dropped Narvaez from nearly $3,500 to about $2,000.

“They said they were running out of money, that there could be no more in the pension fund, so we had to take the cut,” said Narvaez, whose wife was recently diagnosed with cancer.

The stopgap measure didn’t work — and after years of dangling over the precipice, Local 707’s pension fund fell off the financial cliff this month. With no money left, it turned to Pension Benefit Guaranty Corp., a government insurance company that covers pension.

Pension Benefit Guaranty Corp. picked up Local 707’s retiree payouts — but the maximum benefit it gives a year is roughly $12,000, for workers who racked up at least 30 years. For those with less time on the job, the payouts are smaller.

Narvaez now gets $1,170 a month — before taxes.

Of course, as the Central States Pension General Counsel notes, the real “pension tsunami” will come when the massive “municipal and state plans go down next.”

The same crisis now hitting Local 707 has been stewing among numerous Teamster locals around the country for the past decade, he said, and that includes in upstate New York.

The trucking industry — almost uniformly organized by Teamsters — has suffered enormous financial losses in its pension and welfare funds due to a crippling combination of deregulation and stock market crashes, Nyhan said.

“This is a quiet crisis, but it’s very real. There are currently 200 other plans on track for insolvency — that’s going to affect anywhere from 1.5 to 2 million people,” said Nyhan. “The prognosis is bleak minus some new legislative help.”

And it’s not just private-sector industries that are suffering, he added.

“Municipal and state plans are the next to go down — that’s a pension tsunami that’s coming,” he said. “In many states, those defined benefit plans are seriously underfunded — and at the end of the day, math trumps the statutes.”

We’re looking at you Illinoi