It's "Bonus Friday"!!
I mentioned above I felt like I'd seen properties that looked like pot grower's places... and that they'd make sense now in retrospect?
This place up in Willits, maybe about 2.5 hours north of the Bay Area, is one of those "retrospective" places....
If you look at the first seven pictures of this... 1bd/1ba... ... organic geodesic yurt hybrid (???)... it silently screams, "Professional Stoner." It's the sort of place where a guest wanders in circles because his buddy living there mischievously says, "Where's the bong? Oh... I left it in the corner..." and then giggles himself into hysterics while staring up at the soft, puffy ceiling.
Anyway... photo 20 reveals the tell-tale signs of water-tanks & PVC piping.
"But where is the greenhouse? Or the loops & plastic covering?" Those were the only "tells" I knew of pot farming.
Now that I've come to believe that "Stoned-henge Rounds" are an outdoor propagation variant, it all comes together in photos 24 & 25. This looks like a pot farm that was abandoned before this season, given the growth of non-psychoactive weeds in those rounds.
Meanwhile, if you check out the "Price Activity" in the listing, you'll note that this property listed as first "Active" in... October 2021... which would have been right after last year's harvest.
Interesting comp: ~$300K will currently buy ~160 acres in remote NorCal.
I am not a trader, so have little on that topic to contribute, but I am very glad to provide something - anything! - here for others, given the generosity of those here who have enriched my market understanding for years.
Okay, so I realized two things. First, last night I was wondering why I was encountering these listings all of sudden. And then it struck me and I felt very stupid for having been so slow: "Of course - it's harvest season! Right now!"
These properties are "all of a sudden" being listed because their associated final harvest has been secured and it is time to move on.
For today's episode, I move southeast of the Bay Area in the region affectionately known as, "the Road to Kirkwood."
Kirkwood is a ski resort - I believe the highest in local elevation, and therefore with some of the region's most reliable snow - frequented by Bay Arians of a certain stripe. It is not among the ritzy "Tahoe resorts" per se, because it isn't, in fact, on the lake; nor does one have to drive over the infamous Donner Pass to reach it. Kirkwood possesses precious little in the way of "après ski" but it has some exceptionally challenging runs: once on a lift there, a ski patrol dude told me that it is the preferred resort for all the seasonal workers looking to ski on their day off. It is a relatively unassuming but large & varied resort, and it is where the wife & I have primarily taken our beloved spawn to learn to ski.
Accordingly, I have kept an eye out for properties "on the Road to Kirkwood" that would serve the role of ski cabin, although now more out of curiosity than intention, since we will be empty nesters in due time, and the period for "amortizing" such a purchase with weekend ski trips with our sons has passed.
Anyway, here is a listing from yesterday, on one of the Roads to Kirkwood:
This one struck me, because of three things. First, the description indicates, "private property with rolling southern facing hills": that suggests "growers." Second, the description also indicates, "the last tenant left the a mess": setting aside the grammatical misuse there of duplicative articles, I once had occasion as a young, broke man to rent a home from someone who had grown pot previously in it (only learned this after the fact... interesting story, but I digress). They, too, had left a mess.
Hmm... stoners are messy.
Third, photo 8 shows the usual telltale signs: a large plastic structure for holding well water and what looks like the remnants of a white plastic cover. Suggestive but not determinative. Then, photo 11 shows haphazard PVC piping... which is very suggestive.
Then, there are photos 13 & 14.
WTF are those? It looks like some sort of agrarian Stonehenge tribute laid out in a forest clearing. Maybe the messy renters were practicing Druids? And they mounted these round structures for religious purposes? Maybe Druids are simply messy because... it's part of their forest-clearing agrarian Stonehenge rituals?
So, I did some googling, and what do you know!? I don't think they were Druids! The photo below from here suggests the messy renters were very likely growers probably using a variant of a raised-soil trellis system in the forest clearing, where available soil was suboptimal.
I never knew about this burlap-rounds growing approach until I looked at this listing on the Road to Kirkwood. Pretty interesting! I'm persuaded it was a pot farm.
This revelation makes me realize that a handful of properties I've reviewed in recent weeks and thought, "Hmmm.... that looks like a pot grower's place, but the grow-area doesn't make any sense to me," will probably make sense now in retrospect now that I understand that this is a distinctive trend....
Not forced. Required as part of their special status. Normally it always works in their favor. This wasn't in the playbook. Used to be in the old days that they would short against the upcoming auctions. Until 2009, they were always net short. Of course, that was wrong in 2007-08, which is why they went bust and collapsed the financial system. Today is a mirror image of that. They were record net long at the bond market price top in July 2020. And they've never gotten net short. Not even for a day. Positioned wrong all the way. They made money on stocks to cover for it. But now that game is done too.
Markets Face Catastrophe as Dealers Mitigate Too Little Too Late
Moral hazard never dies.
But isn‘t it moral hazard too when 93% of those cute Portugese finance their new houses via ARM‘s although they knew exactly how catastrophic the consequences can be? They play with fire and know that the state, the ECB or the Germans will bail them out.
The screaming has started.
Yes the torrent of fed criticism has begun.
More and more public pressure will be placed on the fed to pivot.
But pivoting is no solution.
It will just lead to more inflation.
There are no good solutions left.
Can't wait for the requisite Cramer meltdown to "do something".
The fed has just let the market find its own level on rates.
The calls to pivot are profoundly anti market.
I did the thing today that brings me the most joy and which is the greatest use of my fleeting time on this dumpster-fire planet.
I sat next to my wife somewhere and we watched our boy play baseball.
Life is good.
Glad to hear your procedure went well. Great call on the markets. Been following closely. I am in the metals business and what we are seeing are premiums on products across the board are rising on the bid and offer side. Although the paper price is going down, rising premiums are offsetting some of the pain. Number of large wholesalers are running out of inventory.
Maybe Powell will come out and give another speech?
Maybe he'll even travel to Jackson Hole and invite the plutocracy to attend?
I called that speech "stupid," because it was a substitute for action.
The Fed never hesitated to cut rates in between meetings the past 30 years.
It should have raised rates once between meetings to demonstrate some measure of catch-up.
It should raise rates today.
Tell me I'm wrong.
That's not a bad practice...
The monthly chart will never lie to you.
I've come up with a million scenarios in my head when looking at the daily...then I go to the weekly and those scenarios I've dreamt up in my mind start to fall apart. The monthly....usually drives it all home.
The monthly chart is like a good instructor looking over your shoulder.
The Aug candle in AAPL is now confirmed as we close Sep.
In this respect...what's true in the daily is true in the monthly.
"I will judge what I see this month, by the next month to follow..."
Although...that decline from the August 14 candle peak in the weekly?
Well...it's beautiful...but you might want to watch for support points from 130 to 140.
You have me on these movie quotes. I avoid modern movies. I have an archive of movies from 1928 to 1952 that is so large, well...trust me...the collection is extensive by any measure and I prefer to just watch the old stuff.
Although, Tom(Tom is my right hand man) got me a DVD of some Pi movie over a decade ago. Said the guy in it reminded him of me...that is until I watched the thing. The guy was a hot mess. I walked away wanting to either fire him or take a good long look in the mirror. I still haven't decided...
No more financial movies...they scare me.
My favorite movie is uh...let me see. I'd probably pick a Tyrone Powers movie for a top pick. Uh...While I loved 'Razor's Edge' because I'm also a fan of Gene Tierney(She's absolutely scary in "Leave Her to Heaven" and Clifton Webb IS an all time favorite of mine.), and I believe 'This Above All' was superb because of the ever beautiful Joan Fontaine...I'd have to go with...Nightmare Alley and Nightmare Alley would just barely edge out Laura. If my hand was forced...I'd have to say this is my top 5.
1) Nightmare Alley and/or Laura
2) The Razor's Edge
3) The Red Shoes and/or This Above All
4) To Have and Have Not and/or Key Largo
5) Algiers and/or Casablanca.
Why do I put Algiers on the same level as Casablanca? Because of its simplicity.
I also apologize...I probably should have called this a top 10, but...the titles I list and/or....for me are just too close to call and any list without African Queen...or since I'm a goldbug at heart...no mention of "Treasures of the Sierra Madre" really isn't complete. Maybe...I'll sit and think about it for awhile and come up with a top 10 instead.
I'd imagine most of these are probably free on youtube.
Nightmare Alley is a must watch in my opinion.
Pretty soon it will be a trillion. That's $80 billion a month added to the defecate. $80 billion a month in additional Treasury supply. $80 billion a month that the market will be forced to absorb.
Catastrophic. The clock is ticking for Fed monetization to resume. They're waiting for hard evidence of disinteryflation.
"Hello, Chairman Powell? This is, umm, some very responsible participants on Wall Street. We think it's important that you know that, umm, we are seeing some, umm, 'financial risk' here and, umm, there's been some, umm, 'dramatic moves.' And we thought we should communicate this very important information so that, you know, you might maybe do that sorta Bank of England thing, to really 'calm markets.' Because, this isn't about us or our overcompensated livelihood... like we said, we are very responsible participants on Wall Street... but this is just, you know, 'financial risk' & 'dramatic moves' and 'calm markets.' So, if you could also do that thing where you buy the stuff and everyone relaxes and everything goes up, it's win-win all around. We have some thoughts on those purchases... actually we have a list here... because we are trying to be helpful...."
The math is so simple & devastating. Let's say since the start of the pandemic that a 30-year mortgage for a $1m home required 20% down & you could finance the balance at 3.0%.
N = 360
FV = $0
PV = $800,000
i = 3.0/12 = 0.25
Calculate PMT = $3,372.83
Let's say that the $3,372.83 monthly mortgage payment reflects the maximum some couple can afford to buy a house. Well then, at 7.0%, what is the maximum loan they can afford?
PMT = $3,372.83
N = 360
FV = $0
i = 7.0/12 = 0.58888
Calculate PV = $506,962.
Assume 80% LTV, maximum closing price is... ($506,962./0.8)= $633,702.
That's a 37% cut in purchasing power for our couple from 3.0% to 7.0%. This is so gruesome.
So then, you can sorta say, "Everyone who bought after [Enter Year] is underwater, because of the financing costs."
The productive benefit of American mobility within a continental economy should not be underappreciated.
A lotta young workers are stuck for the foreseeable future in their first homes.
Payrolls are typically paid either weekly, bi weekly, or twice a month. The largest collections are at the end of the month. Likewise, in between, day to day, the collections are volatile. So if you compare a partial month to a complete month, you may get a whacky result.
There's also the problem of collections that differ in the same month year to year because they both may not end on a weekday. And using reporting days vs. calendar days also can cause a skew since a huge percentage of US workers have 7 day work weeks.
Last year, weekly payers would have made their last deposit for September on October 1. So that would reduce the September total below what was actually earned in September. Also, this year by only comparing collections through 9/21, you are including 6 weekend days. 6 * 30/21 = 8.6. Last year's full month would have included earnings for 8 weekend days.
So there are a lot of ways for there to be a haywire result using your method. Even a direct month to month calendar method often has wacky results. A little smoothing using fixed time periods corrects for that, with the downside being that it does result in a lag of a week or so. That's usually not a problem if you apply TA to the chart.
In the end I have always felt that good analysis requires a visual. Numbers alone just don't do it for me. TA works just as well on economic series as it does on prices, maybe even better.
The recent trend on that chart is pretty clear. That's why I immediately saw a red flag in your post.
When analyzing data, in comparing time periods always be sure to compare like to like, and make a visual. Seeing is believing. That's why I put tons of charts in my reports. I need to see it.
I find myself not entirely identifying with Prof. Siegel's indignation. He thought the June lows were the lows, and said future surprises were likely to be to the upside... only 11 days ago.
Maybe his indignation is actually to a margin call...?
although when the Fed starts easing rates you should start falling. I think in the year of quantitative tightening and quantitative easing the effects will be almost immediate both in terms of stock prices and interest rates. so in the old days there may have been a lag but in the last couple of cycles, not.