Category: zerohedge

Authored by Elias Marat via TheMindUnleashed.com,

With the pandemic continuing to sink its claws into the United States, economic conditions have also failed to improve for millions of people. As a result, nearly one-third U.S. households – representing 32 percent – have still not made their full housing payments for the month of July, according to a survey from online rental platform Apartment List.

And with public health experts warning people to continue to “Stay at Home,” the slogan is taking on a perverse new meaning as humanitarian disaster looms for some 28 million people in the U.S. who are facing eviction and homelessness in the immediate future.

About 19 percent of those surveyed were unable to make any housing payment in the first week of the month, while 13 percent paid a portion of their rent or mortgage.

The numbers represent the grim fact that for four months now, a “historically high” amount of U.S. households have been unable to pay their housing bill, either on time or in full. It also represents an increase from 30 percent in June and 31 percent in June.

According to Apartment List, those most likely to miss their payments were younger, low-income, or renters. Other experts warn that Black and Latino families face the highest risk of eviction. They also may be entering the start of a rapid and vicious cycle, the report suggests.

“Delayed payments in one month are a strong predictor for missed payments in the next,” Apartment List says. Indeed, 83 percent of households who paid the entirety of their May housing costs in a timely way did the same in June, but only 30 percent of households who were late in May did so in June.

As the economic crisis continues to spiral unabated, tens of millions of Americans continue to survive on unemployment while their economic stimulus checks have long been gone.

“The economic fallout from the pandemic does not appear on track for the quick V-shaped recovery that many had originally hoped for,” Apartment List notes.

And with unemployment benefits expiring while eviction bans and moratoriums that deferred rent payments are being lifted by local governments, experts and advocates are warning that we could see a tsunami of mass evictions across the country that exceeds anything ever seen.

Emily Benfer is the chair of the American Bar Association’s Task Force Committee on Eviction and co-creator of the COVID-19 Housing Policy Scorecard with the Eviction Lab at Princeton University. In an interview with CNBC, Benfer explained that the current public health crisis will soon see tens of millions of people losing their homes in the coming weeks.

“We have never seen this extent of eviction in such a truncated amount of time in our history,” she said. “We can expect this to increase dramatically in the coming weeks and months, especially as the limited support and intervention measures that are in place start to expire.”

“About 10 million people, over a period of years, were displaced from their homes following the foreclosure crisis in 2008,” she added.

“We’re looking at 20 million to 28 million people in this moment, between now and September, facing eviction.”

The reporter asked me why I’m so invested in preventing #eviction.

Because it would be unconscionable to let 20+ million adults & children fall into homelessness, debt & the associated harm, especially when we can prevent it.

Maybe the question should be, why isn’t everyone?

— Emily A. Benfer (@emilyabenfer) July 10, 2020

Legal aid groups and housing advocates are expecting an avalanche of cases as eviction moratoriums and rent deferral moratoriums have ended in quick succession. And across the country, there has been a 200 percent jump in calls to 211 call centers that refer people to social service providers, reports Yahoo! finance.

And as the moratoriums are lifted, county courts are facing hundreds, if not thousands of eviction cases flooding in – in Memphis, local county courts saw a backlog of 9,000 eviction cases when hearings resumed last month.

“In many ways, the wave has already begun. We need to work to stop it from becoming a tsunami and we’re running out of time,” said Diane Yentel, president of the National Low-Income Housing Coalition. “We’re seeing now a really frankly horrifying confluence of increasing evictions in states where new coronavirus cases are surging.” 

According to the COVID-19 Eviction Defense Project (CEDP), one in five of the 110 million Americans who rent their homes – over 20 million people – are at risk of eviction by the end of September. And these aren’t simply low-income families, but people who fell on rough times recently due to the shock of the pandemic, explains CEDP Co-Founder Zach Neumann – and the number is expected to dramatically jump when unemployment benefits run out at the end of the month.

“You have a lot of folks who had strong incomes, in a lot of cases high five-figure or low six-figure [salaries],” Neumann explained.

 “They didn’t have a lot of savings, lost their jobs or were furloughed, and there was not any severance attached to that, but had rents that were in line with the salaries they were earning. The client pool economically looks a lot different than it has in the past.”

In the meantime, the threat of homelessness has coincided with a dramatic spike in coronavirus infections across the U.S. South and the West, hitting struggling tenants disproportionately. And with states like Texas pausing reopening plans, evictions hearings are still proceeding – but on Zoom. As a result, tenants who lack access to technology are often robbed of their ability to flex their legal rights.

Housing advocates are urgently calling for nationwide protections in the form of a uniform eviction moratorium and federal aid through the Health and Economic Recovery Omnibus Emergency Solutions or HEROES Act and the Emergency Housing Protections and Relief Act of 2020. However, the Republican-controlled Senate is expected to block both measures.

Renters across the country are also forming tenant’s unions and demanding that rent be deferred indefinitely. Some tenants, such as the Acacia Apartments residents in Denver, Colorado, are already waging a rent strike – potentially showing the how people across the country who are struggling to keep a roof over their heads plan to keep fighting even in the face of their landlords’ eviction threats.

Update: Watch live

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A fire broke out Sunday on the USS Bonbomme Richard at US Naval San Diego, injuring several sailors according to authorities.

Developing story: A #fire broke out aboard US #Navy‘s #amphibious assault ship USS #BONHOMME RICHARD LHD6 Sunday morning 12 July around 1000 PDT while pierside at the San Diego #Naval Base. At least 3 fire alarms reported. Images gathered from various sources around the net pic.twitter.com/EzOjpHP6KT

— Chris Cavas (@CavasShips) July 12, 2020

Explosion with at least one injury at the USS Bonhomme Richard. #shipfire pic.twitter.com/HooWIRcjU4

— SDFD (@SDFD) July 12, 2020

A three-alarm fire was declared on the amphibious assault ship, reported at 8:51 a.m. according to local station CBS8, citing the San Diego Fire-Rescue department. As the fire progressed, the ship was reportedly evacuated.

More views of the #fire burning now on board US #Navy amphibious ship USS #BONHOMME RICHARD LHD6 at 32nd Street Naval Station in San Diego. Reports so far indicate 3 sailors, 1 SDFD fireman injured. At the moment the fire seems to be growing pic.twitter.com/icPblRJOEV

— Chris Cavas (@CavasShips) July 12, 2020

At least one sailor has been treated for smoke inhalation. Fire appears to have broken out in the hanger deck. pic.twitter.com/AbeH9UHq5J

— Sentinel (@StratSentinel) July 12, 2020

San Diego scanner: fire on USS Bonhomme Richard is getting worse, firefighters are “going defensive” and evacuating ship

— Steve Lookner (@lookner) July 12, 2020

Smoke could be seen from a distance as the fire burned. Meanwhile, just before 11 a.m. an explosion was reported resulting in at least one injury, according to the report. 

3RD Alarm fire on USS Bonhomme Richard (LHD-6) at Naval Base San Diego.

SDFD & Federal Fire have unified command for what sounds like a below deck fire, possibly in a hanger bay

Initial reports of an explosion & injuries.

As both a fireman & a sailor, thoughts with all aboard. pic.twitter.com/eDnLBYZ2SA

— Gregg Favre (@GreggFavre) July 12, 2020

Developing…

Despite the non-stop deluge of market-pumping vaccine trial press releases and leaks that seem to move futures even when the news is entirely procedural (ie when a new human trials get the green light to begin), we haven’t seen any coverage of a Russian vaccine trial that has reportedly become the first in the world to finish all clinical trials.

Vadim Tarasov, the director of the Institute for Translational Medicine and Biotechnology, told Sputnik that clinical trials of the world’s first coronavirus vaccine on volunteers at the Sechenov First Moscow State Medical University have been successfully completed.

“Sechenov University has successfully completed tests on volunteers of the world’s first vaccine against coronavirus,” Tarasov said.

The university began clinical trials of a vaccine produced by Russia’s Gamalei Institute of Epidemiology and Microbiology on June 18, meaning the university managed to distill the entire process trial process down to just 3 weeks.

As for the volunteers, the first group will be discharged Wednesday, while the second will be discharged July 20.

The story comes with a caveat. The trials were solely intended to show that the vaccine is safe for human consumption and use. Several trials for therapeutics and vaccines in the west have also completed at least some trials proving safety. According to Alexander Lukashev, the director of the Institute of Medical Parasitology, Tropical, and Vector-Borne Diseases at Sechenov University, the safety objective was successfully achieved.

“The safety of the vaccine has been confirmed. It corresponds to the safety of those vaccines that are currently on the market,” Lukashev told Sputnik.

Apparently the results were encouraging enough that a “vaccine development plan” is already being rolled out by the developer to mass produce the vaccine.

‘Never-Trump’ neoconservatives working to get Biden elected are planning to teach the president’s most ardent supporters a lesson in cancel culture.

Two groups, the Lincoln Project and Republican Voters Against Trump – described by the Washington Post as a “rebellion that began four years ago” – has “transformed in recent weeks into a potentially disruptive force in this year’s presidential race.”

Republican Voters Against Trump have collected hundreds of first-person testimonials from people claiming to be former Trump supporters, with which the group has begun running campaign ads in North Carolina, Arizona and online – and plans to spend $10 – $15 million in Pennsylvania, Michigan, Wisconsin and possibly Florida according to the report.

One of their ads will air on “Fox News Sunday” in North Carolina and Arizona and will spotlight 15 Republicans who cast their vote for Trump in 2016 but will now vote for Biden.

The Lincoln Project, meanwhile, is the brainchild of GOP strategists Rick “confederate cooler” Wilson, John Weaver, Steve Schmidt and former NH Republican Party Chair Jennifer Horn. The husband of Trump adviser Kellyanne Conway, George Conway, is also involved with the project.

A White House insider anonymous told WaPo that the two endeavors, particularly the Lincoln Project, are “scam PACs” run by “beltway swamp creatures whose candidates can’t win.”

These are the same people who supported independent candidate and former (?) CIA operative Evan McMullin in 2016.

And now for the punchline – which is that the never-Trump cabal is planning to target lawmakers and media figures who support the president.

According to the Lincoln Project’s John Weaver, “dispatching Trump does not dispatch Trumpism,” citing Fox News‘s Tucker Carlson – the highest rated cable host in history, as well as Republican Sens. Tom Cotton (AK), Josh Hawle (MO) and others.

With growing ambitions, a hit list: After ‘dispatching’ President Trump, the pro-Democratic Lincoln Project hopes to ‘dispatch’ others: Tucker Carlson, Tom Cotton, Josh Hawley, more. ‘Our task won’t be finished when Joe Biden takes the oath of office.’ https://t.co/zs2zmG2x8Q pic.twitter.com/6BKKGzSiUc

— Byron York (@ByronYork) July 12, 2020

“The next battle will be making sure those from his ilk do not get the next Republican nomination,” said Weaver. “Our task won’t be finished when Joe Biden takes the oath of office.“

Authored by Charles Hugh Smith via OfTwoMinds blog,

The greater fools still partying in the first-class lounge are in denial that even the greatest, most technologically advanced ship can sink.

On April 14, 1912, the liner Titanic, considered unsinkable due to its watertight compartments and other features, struck a glancing blow against a massive iceberg on that moonless, weirdly calm night. In the early hours of April 15, the great ship broke in half and sank, ending the lives of the majority of its passengers and crew.

The usual analogy drawn between the Titanic and our financial meltdown stems from the initial complacency of the passengers after the collision. Some passengers went on deck to play with the ice scraped off the berg, while most returned to the festivities still working their magic as midnight approached.

The class structure of Edwardian Britain soon came into play, however; as the situation grew visibly threatening, the First Class passengers were herded into the few lifeboats while the steerage/Third Class passengers–many of them immigrants–were mostly kept below decks, sealing their doom.

But there are even more compelling analogies than initial complacency turning to panic. Consider this diagram of the great ship:

The large black rectangles on the lower deck represent the coal bunkers; they were located adjacent to the boilers which powered the engines. Though the ship only scraped against the iceberg, as Titanic explorer Robert Ballard explains, that was enough to pop rivets and open hull plates:

The glancing blow that ruptured the Titanic’s hull over a distance of roughly 250 feet (out of a full length of 882 feet) and admitted water into six of her compartments sealed her fate.

Considerable hullabaloo attended the attempt in the summer of 1996 to raise a piece of the hull from the debris field, but far more interesting was the ultrasound investigation of the area of the bow damaged by the iceberg. These images revealed six small tears or openings affecting the first six compartments. Just as we had surmised in 1986, the great gash was a myth and the actual openings into the ship seem to have been the result of rivets popping and hull plates separating.

This offers a very powerful analogy to the fatal damage inflicted on our financial system by an apparently “glancing blow” with the pandemic shutdown. Just as the Titanic was mortally wounded not by great tears in its hull but by the buckling of steel hull plates, so the U.S. (and thus global) financial system is sinking from similarly “glancing” blows.

The actual damage could have been contained–do you sense another analogy about to surface?– had the fifth watertight bulwark–shall we call it “the bulwark against systemic failure”?– extended a few decks higher. But inexplicably, this watertight barrier did not extend as high as the other watertight bulkheads.

Though the water gushing through a three-foot gash in the forward engine room was held back by the ship’s great pumps, as the bow sank lower then water seeped over the fifth watertight bulkhead and gushed into the boiler room, extinguishing the fires that powered the pumps.

This generated a feedback loop: the higher the water rose, the more boilers were extinguished and the less power was available to the pumps.

And so against all “rational odds,” the ship’s apparently minor structural design flaw led to its inevitable loss as the mighty pumps lost their battle against the rising water.

To all the “experts,” the risk of collision with an iceberg were considered low, while the risk of catastrophic damage were considered essentially zero. Hmm, does that remind you of our financial system circa September 2019, just as the great U.S. economy’s hull was buckling?

Now we have the Great Pumps of Federal Reserve money-printing and Stimulus, which in a close analogy are pumping trillions of dollars into the sinking U.S. economy. But just as the engines of the Titanic lost power as the water extinguished the boilers supplying steam to the engines, so the stimulus is only keeping the rising water temporarily at bay– it is not actually saving the “engines” of the economy from sputtering.

And what are those engines?

1. Debt, which must increase to fuel spending, income and thus taxes

2. Rising assets, which provide the basis for ever-more borrowing

3. Government borrowing, which enables government spending to keep rising without regard to actual tax revenues or the health of those being taxed

4. Rising employment as vast borrowing and spending creates new jobs

The ice-cold water is splashing into each of these engines. As assets fall then there is simply no foundation (collateral) to support more borrowing. As debt is paid down rather than expanded, then spending falls. As spending falls, so do revenues, profits and employment, all of which crimp tax revenues.

The last engine is government borrowing. To those still standing on the sloping deck, cheering the “good news” of Big Tech’s meteoric ascent to the heavens of bubble overvaluation, this seems like the engine which can never be extinguished. Through thick and thin the Federal government and the state and local governments (via muni bonds) have been able to borrow and spend stupendous sums seemingly without consequence.

The demise of this last great engine will surprise as many as the sinking of the Titanic did, but it is as inevitable as the sinking of the great ship. The pumps can only hold the water back for a while, but the Stimulus magic will expire sooner than anyone imagines.

As the government scrambles to find buyers for endless trillions in new U.S. bonds (and trillions more in new corporate debt, new mortgages, new consumer debt, student loans, new muni debt, etc.) then interest rates will rise and the great engine of ever-greater debt will hiss and sigh as the water rises and then go silent and cold.

The first-class passengers have already been ushered to their lifeboats. They’ve sold to the euphoric passengers buying Big Tech’s parabolic ascent and the greater fools still partying in the first-class lounge who are in denial that even the greatest, most technologically advanced ship can sink, taking everyone in denial down with it.

The sinking is not a possibility, it is an inevitability.

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My recent books:

Will You Be Richer or Poorer?: Profit, Power, and AI in a Traumatized World ($13)

(Kindle $6.95, print $11.95) Read the first section for free (PDF).

Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic ($6.95 (Kindle), $12 (print), $13.08 ( audiobook): Read the first section for free (PDF).

The Adventures of the Consulting Philosopher: The Disappearance of Drake $1.29 (Kindle), $8.95 (print); read the first chapters for free (PDF)

Money and Work Unchained $6.95 (Kindle), $15 (print) Read the first section for free (PDF).

*  *  *

If you found value in this content, please join me in seeking solutions by becoming a $1/month patron of my work via patreon.com.

Things are going so splendidly with China right now, the U.S. has officially come out and warned citizens that there is a heightened risk of arbitrary law enforcement – and detention – for visitors to the Asian country.

The State Department is telling Americans to “exercise increased caution” in China, noting that there is a chance they could be banned from exiting the country, according to Reuters. 

The U.S. State Department told citizens in China last week: “U.S. citizens may be detained without access to U.S. consular services or information about their alleged crime. U.S. citizens may face prolonged interrogations and extended detention for reasons related to state security.”

The warning continued: “U.S. citizens may be detained without access to U.S. consular services or information about their alleged crime.”

U.S. citizens in China could wind up facing “prolonged interrogations and extended detention”, the State Department continued.

The alert comes at a point where tensions between China and the U.S. appear to be on the rise. Despite the Phase 1 trade deal supposedly going forward, blame for coronavirus pandemic and China’s reporting of the virus to the world continue to be points of contention for the Trump administration.

At the same time, the U.S. has taken a far more hawkish view on Chinese companies doing business in the U.S., including names like Huawei, Hikvision and TikTok. The Trump administration is taking the threat of IP theft from these companies far more serious than China would probably like and, as a result, it appears the State Department believes China could wind up retaliating. 

“Washington and Beijing recently exchanged visa bans against each other’s officials,” Reuters also reporting, making note of how tensions continue to be on the rise.

Australia issued a similar warning to its citizens last week, which China called “completely ridiculous and disinformation.”

USA Today is the latest MSM outlet whose ‘woke’ progressive staff is so anti-Trump that they deemed the American eagle a ‘nazi’ symbol, after the Trump campaign rolled out t-shirts featuring the iconic bird.

The ‘fact check’, brought to us by USA Today‘s Will Peebles, takes its direction from anti-Trump GOP operatives at the Lincoln Project as well as Jewish progressive group, Bend the Arc – the latter of which tweeted on July 1: “The President of the United States is campaigning for reelection with a Nazi symbol. Again”

The President of the United States is campaigning for reelection with a Nazi symbol. Again.

On the left: an official Trump/Pence “America First” tee.

On the right; the Iron Eagle, the official symbol of the Nazi party.
⁰It’s not an accident. Bigotry is their entire brand. pic.twitter.com/mSOBxwf7Wa

— Bend the Arc: Jewish Action (@jewishaction) July 1, 2020

USA Today took the bait, publishing a fact-check which was heavily ‘ratio’d’ on Twitter – meaning, more people are slamming the outlet than ‘liking’ or ‘retweeting’ their post. 

After their initial tweet came under fire, the outlet issued a lame ‘clarification’ noting “the eagle is a longtime US symbol, too.”

Oh…

Reactions have been hilarious, with many pointing out that it’s the icon used by the Speaker of the House:

And the US Marines… pic.twitter.com/iuYfJrDogu

— Josh (@audrum1) July 12, 2020

Ever see the back side of a quarter? pic.twitter.com/q85QALy2uP

— 🇺🇸BᴏᴊɪSɴᴏᴡQᴜᴇᴇɴ🇺🇸⭐️⭐️⭐️ (@bojisnowqueen) July 12, 2020

The symbol is also on our money pic.twitter.com/m4RzdooeBL

— kwmckinley (@kmclt) July 12, 2020

Hi Bill – @bsternbe

How does it feel to see @USAToday become a complete joke? Will you accept an editorial explaining why people are correct to consider your organization a left-wing propagandist.

Bill runs the Editorial Page. pic.twitter.com/3NxCbRGPOR

— Todd Ξ Herman (@toddeherman) July 12, 2020

Wut??? Have you seen the Speaker of the House’s Mace??? It’s been in use since 1842??? pic.twitter.com/iQrtjqfpP3

— Dog guy (@Catsorange1) July 12, 2020

In retrospect, it’s impressive that it lasted as long as it did.

Four months after OPEC cobbled together a record production cut to offset the demand destruction unleashed by the covid-19 lockdowns, R-OPEC+ (i.e., OPEC plus Russia and a bunch of non-OPEC exporters) is set to slowly resume pumping more after an alliance of producers led by Saudi Arabia wants to increase oil production starting in August, amid signs that demand is returning to normal levels following coronavirus-related lockdowns Bloomberg and the Journal reported overnight.

Bloomberg confirms as much, noting overnight that “having successfully doubled crude prices over the past few months through unprecedented output cuts, the OPEC+ alliance led by the Saudis and Russia is poised to begin unwinding these stimulus measures. As fuel demand recovers with the lifting of coronavirus lockdowns, the producers are about to open the taps a little.”

According to the report, alliance members will meet via zoom on Wednesday to debate the group’s current and future production, which include plans to restore some 2 million in production following the record production cut in April which saw Saudi Arabia push for a 9.7 million b/d in production stoppages as the pandemic led to a collapse of oil demand. More from BBG:

The JMMC will consider whether the 23-nation alliance should keep 9.6 million barrels of daily output off the market for another month, or restore some supplies as originally planned, tapering the cutback to 7.7 million barrels.

As the demand recovery gains traction, members are leaning toward the latter option, according to several national delegates who asked not to be identified. Shipping schedules for August are already being set, so the course is more or less locked in, one said.

While all this sounds great in principle, in practice it will likely send the price of oil crashing because just as there was a massive uphill battle in April to get everyone on the same page (and even that did not stop oil from hitting a record negative price on April 20), so now that production quotas are being eased, the result will be a furious scramble to outproduce everyone else, as OPEC’s most characteristic feature is exposed for the entire world to see: cheating.

“If OPEC clings to restraining production to keep up prices, I think it’s suicidal,” a person familiar with the Saudis’s thinking told the Journal. “There’s going to be a scramble for market share, and the trick is how the low cost producers assert themselves without crashing the oil price.”

“When they look at prices over the quarter, when they look at green shoots of demand pick-up, I think they feel good,” RBC commodity strategist Helima Croft told Bloomberg. “I do think they are cognizant though of some of the potential clouds on the horizon.”

Still, with OPEC+ oil exports generating far less state revenues than pre-covid, the oil producers have little choice but to agree to pump more even if it means sharply lower prices (and yet another round of production cuts in a few weeks). Indeed, producers’ relative optimism coincides with a Friday report from the International Energy Agency showing the worst effects of the coronavirus on global oil demand have passed, although as we showed on Friday, it now appears that record numbers of cases are once again starting to impact mobility and travel.

Indeed, as Bloomberg admits, A second wave of the pandemic threatens another slump in oil consumption, while the billion-barrel mountain of inventories that piled up during the first outbreak still looms. If OPEC+ increases supply just as the market falters then prices could crash once again.

Despite draconian production cuts, Brent remains down 31% since the beginning of the year, at $43.24 a barrel, while West Texas Intermediate futures, the benchmark in U.S. oil markets, have traded at around $40 a barrel since late June after falling below zero at one point in April.

As a reminder, back in late Q1, the market was generally ignoring news of the covid pandemic until the March 6th failure between Saudi Arabia and Russia to agree on a production cut quote (a mistake which was promptly remedied a month later), at which point stocks imploded and the S&P saw a record number of limit down overnight future sessions.

Is OPEC+ about to unleash another round of market chaos?

The Tesla Model Y was supposed to be the next big thing for Tesla. But it looks as though things aren’t quite turning out exactly as the company had planned (or how Elon Musk suggested they would on conference calls).

For example, remember when Musk claimed they “were not too worried about demand” when discussing the Model Y on Tesla’s Q2 2019 earnings conference call? Hint: it was the same call he said that the company would be doing 1.25 million Model Y deliveries per year. 

At this time Musk knew that the Model Y order book was dramatically below the Model 3 at the time of initial Model 3 deliveries.

Zach pointed out the Model Y would be built in geography across the world implying Fremont would likely be building Model Ys only for NA. pic.twitter.com/XLV7auGf45

— JC Oviedo (@JCOviedo6) July 11, 2020

Like many Tesla delusions of grandeur, that idea seems to now be out the window, as Tesla is hurriedly slashing prices on its Model Y in what appears to be a rushed effort to create demand for a vehicle that has gotten nothing short of totally horrifyingly reviews. 

The pro-Tesla lot over at electrek noted that Tesla had slashed the price of its Model Y to under $50,000 in what it calls a “surprise move” and a “significant price drop”. We call it a “desperate move”. 

“The automaker didn’t explain why it was reducing the price of its new electric SUV today,” electrek wrote. 

Let us try to help them along with some theories about why the company may have dropped the price. For example, as electrek was reporting on the price drop, the internet was offering up nearly unlimited reasons to not go out and buy a Model Y. 

Like this panel dragging along the freeway after a bolt fell off…

@elonmusk @Tesla Model Y plastic panel dragged on the freeway bc a bolt fell off. All service centers are closed. What are we supposed to do? Can’t drive back up… pic.twitter.com/7Jq134etvk

— Jason Chun (@jasonchun05) July 12, 2020

Or paint peeling off the bumper of a brand new car…

@Tesla service is terrible. paint is peeling off my model y bumper and they refuse to repair because it’s outside of the 7-day return window. car has 180 miles on it. pic.twitter.com/oFb7O5eiJl

— Steven Le (@stevenle08) July 9, 2020

Or horrendous looking panel designs…

Dear @elonmusk better do a tour of the factory and review the model Y mfg. process. Your quality control manager is allowing huge defects to get through the build and shipped to customers. I have one on order, is making many of us nervous. Higher a quality person from Toyota pic.twitter.com/1HZVQXVH8i

— A-Rod (@singularity59) July 9, 2020

As word gets out that the Model Y is likely a money pit (if you can even get service for it), more and more demand will likely dry up. Not only could the numbers look ugly for Tesla when they go to report them (assuming they tell the truth), but one astute observer noted that many models and estimates for Tesla would likely have to be adjusted downward if the Model Y turns out to be a full-fledged flop.

Robust Model Y demand is embedded within every sell side model and forms the basis for why the sell side is currently modelling $TSLA‘s revenues to grow 38% in 2021.

As the Model Y continues to reveal itself to be a giant flop, these estimates will need to be cut materially. pic.twitter.com/lmCEsPwjZE

— JC Oviedo (@JCOviedo6) July 11, 2020

And then there’s the non-astute observers…

“Again, this shows why as a consumer you shouldn’t buy the early production of a new Tesla vehicle,” electrek editor Fred Lambert wrote, as if that is an actual reasonable criticism for any car company that gives half a sh*t about its vehicles. 

“Not only you are likely to have more quality issues early in the production ramp, Tesla has also started a partern of reducing the price after having worked through its backlog of pre-orders and starting to improve cost with higher volume production,” he concluded.

Hey, Fred, we’ve got some real estate in Alaska we’d like to sell you. It’s totally useless and unlivable but we’ve emblazoned it with a Tesla logo and rumor has it that the land was blessed by Elon Musk himself…give us a call.

Authored by Mike Shedlock via MishTalk,

Why 3 weeks?

That’s how long it takes to reserve a one-way U-Haul outbound.

“Everyone is leaving. No one is coming,” a U-Haul agent told us a few weeks ago.

Illinoisans Leave State in Record Numbers, and So Are We

On January 2, 2020 I announced Illinoisans Leave State in Record Numbers, and So Are We

I am pleased to report we loaded our U-Haul rental yesterday and I am on the road driving to our new home in Utah. 

Right now we are just a few hours  into the trip, but we have crossed the state line and are now in Iowa.

Goodbye Illinois

On February 12, Wirepoints noted If the wealthy flee, ordinary Illinoisans will be left holding the progressive tax bag. 

Yep, and we have had enough. 

We were paying about $15,000 a year in property taxes on a home now worth about $380,000 or so. We have a beautiful 1 acre lot, surrounded by 30 white or and burr oak trees 100-200 years old.

But property values are sinking. We will sell the house for a lot less than we paid for it 20 years ago.

Property taxes are a killer and taxes in general are going to rise in Illinois. 

Why Utah?

I discussed Utah in my October 5, 2019 post Escape Illinois: Get The Hell Out Now, We Are