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The Station: Zoox seeks out rain and Tesla fans go on the attack — again

The Station is a weekly newsletter dedicated to all things transportation. Sign up here — just click The Station — to receive it every weekend in your inbox. Hello readers: Welcome to The Station, your central hub for all past, present and future…

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The Station is a weekly newsletter dedicated to all things transportation. Sign up here — just click The Station — to receive it every weekend in your inbox.

Hello readers: Welcome to The Station, your central hub for all past, present and future means of moving people and packages from Point A to Point B.

TechCrunch’s Rebecca Bellan and Aria Alamalhodaei were a bit ambitious this week, which means I dialed back some of the other parts. Let’s go!

But before we dive in, I wanted to give a nod to the inaugural effort of the Indy Autonomous Challenge, which was held Saturday. The IAC brought together students from 21 universities from 9 countries, who were charged with programming driverless racecars to compete in a  high-speed autonomous race. The winning team, which received the $1 million grand prize, was the Technical University of Munich. I did not attend, but was told by a few folks who were there that it was a small, yet fun event and solid foundation had been established for this to continue in future years.

As always, you can email me at kirsten.korosec@techcrunch.com to share thoughts, criticisms, opinions or tips. You also can send a direct message to me at Twitter — @kirstenkorosec.

Micromobbin’

Let’s start the week with a new-ish company and this week’s unsung hero of micromobility: Zoba.

Zoba, a Boston-based startup that runs fleet optimization for many major micromobility companies, including Spin, just announced a $12 million Series A raise.

The company’s AI runs behind the operator’s fleet management software. Zoba’s software takes into account shifting local regulations and basically helps micromobility companies get as many customers on vehicles as possible, while being as efficient as possible and helping to adhere to a company’s bottom line.

While we’re on the subject of bottom lines, Lime said CEO Wayne Ting said the third quarter of 2021 would be the company’s second profitable quarter, adjusted for EBITDA, of course. While Lime wasn’t able to generate more sales or revenue to increase top line growth, it seems it was able to increase efficiency in a way that quite possibly has led to profitability. But we’ll have to take their word for it. Nothing can be certain until the company goes public and dishes up those earnings.

Bolt Mobility is launching both an in-app navigation system for its e-scooters, called “MobilityOS,” as well as a new scooter with a built-in smartphone holder that also uses the scooter’s battery to charge the phone! Let’s see how that one goes. Is it safer to just listen to audio directions and occasionally try to check your phone while riding, or is it safer to take a cheeky peek down at the screen every now and again?

Helbiz has partnered with mapping company Fantasmo to integrate its parking tech into Helbiz’s e-scooter app. Fantasmo’s camera-positioning tech detects the exact location of e-scooters and validates parking within eight inches or less via a rider’s phone camera. The integration will roll out in Miami first.

Voi is making a Copenhagen comeback as the city aims to become the world’s first carbon-neutral capital by 2025. Voi, based in neighboring country Sweden, is bringing 800 e-scooters to the Danish metropolis for the next year; the service could be extended another two years if all goes well.

Niu Technologies, a Chinese electric motor scooter manufacturer, announced it would start making e-bikes in order to help grow its international presence. The e-bike series includes a 15 mph and a 28 mph version. The bikes are pretty heavy at nearly 100 pounds, due to large aluminum frames and oversized dual suspension.

Japanese motorcycle manufacturer Kawasaki says it’s going all-electric in developed countries by 2035, which really gives it plenty of time to get its model together and keep selling gas-powered motorcycles in the meantime.

To compete with Ola’s amazing success selling electric scooters (the big ones, not the kick ones), Honda announced it would be selling the same in India. Honda Motorcycle & Scooter India told the Economic Times it would have a product within the next financial year.

Finally, at the Micromobility America conference last month, micromobility legend Horace Dediu presented the 10 commandments of micromobility, which I now present to you. I do think you should watch the video, as well.

1. Nobody invented micromobility. “Micromobility is the confluence of thousands of ideas and the work of thousands of people.” A range of enabling technologies, like lithium ion batteries becoming cheaper, led to this micro outcome.

2. Most trips are short, which means short trips are more important. 50% of trips are from 0 to 5 miles. That number could actually increase if people have more access to a vehicle that’s designed for shorter trips.

3. Cars are a bundle. You can substitute the short trips with smaller vehicles, and you can substitute the bigger trips with bigger vehicles that are shared, like planes, trains and buses.

4. The smaller it gets, the bigger it gets. And by this he means volumes. For example, Android and iPhone sales far surpass those of PCs and other revolutionary computers, even though they came to market much later. In terms of vehicles, Dediu expects micromobility vehicles to grow much faster than electric vehicles in the future.

5. You can’t get there from here. There are more cars than ever in all of our cities and countries, and based on adoption curves, that number will only increase exponentially. Even if you tried to electrify all cars, emissions would still rise beyond legal limits. But with micromobility, we could have twice the number of drivers with half the amount of emissions.

6. Don’t dig where there’s no treasure. All infrastructure is a sunk cost. All the arguments we have about not changing infrastructure are based on the massive costs associated with infrastructure builds, but those are fallacies. We’ve destroyed infrastructures in the past. Inner-city highways can be demolished, too.

7. They promised flying taxis. We got bike lanes. Hundreds of billions of dollars have been spent on big moonshots like autonomous vehicles and flying cars, but the simple bike lane is far better and more revolutionary than “any of this crap.”

8. You sell miles, but customers buy smiles. The transition to micromobility will happen because people are happy with the vehicles and like riding them.

9. Micromobility is a mind for the bicycle. Micromobility absorbs data, software, intelligence and sensing. It’s cheaper and builds on the shoulders of giants, and it’s increasingly the smartest machine on the road. “The power of software allows us to invest in solutions to overcome most of our machines’ shortcomings.

10. Cities always win. Micromobility is urban freedom. Cities have gone through much worse than coronavirus, and they all came back stronger than ever. Cities are antifragile, the more you stress them, the stronger they become.

— Rebecca Bellan

Deal of the week

money the station

Welp … I’m not ready to call peak urban air mobility quite yet, but we might be getting close.

HT Aero, an urban air mobility company that’s an affiliate of Chinese electric vehicle manufacturer Xpeng, raised an eyebrow-raising $500 million in a Series A round. The company said it will use the funds to acquire top-tier talent, advance R&D and “continue to gain airworthiness provision and certification” as it advances toward the next generation of its vehicles, according to Deli Zhao, founder and president of the company.

The company recently revealed its fifth-generation flying vehicle, the Xpeng X2, which can handle autonomous flight take-off and landing for certain city scenarios, back-end scheduling, charging and flight control. The company says it wants to provide UAM solutions for individual consumers, rather than businesses, which would certainly be in line with Xpeng’s goals.

Other deals that got my attention …

AirGarage, a startup that works with parking real estate owners and offers a full-stack software and management service for their lot or garage, closed a $12.5 million Series A round led by a16z, with participation from existing investors Floodgate, Founders Fund and Abstract Ventures. AirGarage has more than 200 locations across 30 states under its management.

Alaska Airlines launched a new venture capital arm, dubbed Alaska Star Ventures. The aim is to find and invest in emerging technologies to help decarbonize air travel. Its first investment was to put $15 million into the Los Angeles-based UP.Partners’ inaugural venture fund. UP.Partners’ $230 million early-stage fund is focused on mobility technologies. Woven Capital, the investment arm of Toyota Motor’s Woven Planet Group, Standard Industries, Hillwood and OSM Maritime have also invested in the UP.Partners fund.

Ally Financial, the automotive finance giant, plans to acquire credit card company Fair Square Financial for $750 million, reported Automotive News.

BMW i Ventures invested an undisclosed amount into Our Next Energy Inc., a Michigan-based energy storage solutions company working to develop longer range, lower cost batteries for electric vehicles.

FlixMobility, the $3 billion-German transportation startup, showed it’s pretty darned interested in the U.S. market. The company agreed to acquire Greyhound Lines, the iconic U.S. bus network, from U.K.-based owner FirstGroup. The deal, which includes a vehicle fleet, trademarks and related assets and liabilities, has an enterprise value on a debt-free/cash-free basis of $46 million, with an unconditional deferred consideration of $32 million with an interest rate of 5% per annum alongside that.* (Check out Ingrid Lunden’s article to get deeper into the details, including what that * is all about)

Flock Freight, the trucking logistics company, raised a $215 million Series D round led by SoftBank Vision Fund 2, making it the industry’s most recent unicorn at a valuation of more than $1 billion.

Gatik, the autonomous vehicle startup, reached a strategic lease and vehicle maintenance agreement with Ryder System, Freightwaves reported.

River, an Indian startup focused on the electric two-wheeler market, came out of stealth with $2 million in backing from Maniv Mobility and TrucksVC.

Yummy, the Venezuelan delivery super app founded in 2020, raised $18 million in a Series A round aimed at accelerating the company’s proposed expansion throughout Latin America. Anthos Capital led the latest round, with additional participation from JAM Fund, whose founder Justin Mateen was an investor in the startup’s $4 million seed round.

Policy corner

the-station-delivery

Hello everyone! Welcome back to Policy Corner.

The big news this week is the appointment of Missy Cummings, former Navy fighter pilot and engineering professor at Duke University, to a senior safety advisory role at the nation’s top vehicle safety regulator.

This kind of appointment might not typically get much notice from the general public. But Tesla fans sure did (side note from transportation editor and The Station creator Kirsten Korosec: the AV industry absolutely took notice; they just didn’t comment publicly). The reaction from a community of Tesla owners and shareholders was loud — a torrent of concern and vitriol that frothed forth on Twitter and that at times devolved into attacks on Cummings gender and character.

Cummings has been a vocal critic of Tesla’s Autopilot advanced driver assistance system, and more recently, its rollout of the “Full Self-Driving” beta program to thousands of drivers across the United States. On the McKinsey Global Institute podcast last month, she called attention to what she referred to as “mode confusion,” or when the driver doesn’t have sufficient understanding of the capabilities (and limitations) of a system.

“We’ve known about this for a long time in aviation, but this is new learning for the automotive world,” she said on the podcast. “We see this when people think that Autopilot and Full Self-Driving actually mean those things, and people climb in the backseat or take their hands off the steering wheel and don’t realize the trouble they’re in, and the car crashes.”

Just as news of the appointment was circulating, Tesla CEO Elon Musk tweeted “Objectively, her track record is extremely biased against Tesla.” That tweet fanned the growing flames of dissent from Tesla fans, many of whom are also shareholders. A petition has even been circulated on Change.org requesting her removal.

Supporters of Tesla have also called attention to Cummings’ service on the board of Veoneer, a Tier 1 company that supplies automakers with advanced driver assistance software and the accompanying hardware such as radars, lidars, thermal night vision cameras and other vision systems. It’s the lidar — a sensor that most in the industry with the exception of Tesla believe is required to offer fully automated driving — that triggered Tesla fans. Qualcomm recently reached an agreement to acquire Veoneer.

Her critics suggest that the National Highway Transportation and Safety Administration may take a more conservative stance on ADAS and Tesla in the future. (It should be noted that NHTSA has in the past has generally taken rather laissez faire approach with Tesla; anything beyond that will seem as if the regulatory gates have come crashing down on the automaker.) It is unclear whether she will take an advisory role in the investigation into Autopilot currently underway at NHTSA, which was opened following 12 incidents of Teslas crashing into parked emergency vehicles.

Kirsten here with a side note on this issue: Missy Cummings first protected and then ended up deleting her Twitter account because she was not just trolled; she received death threats, which are being investigated, according to my sources.

Update: FSD software beta was rolled back Sunday. Musk tweeted Sunday “Seeing some issues with 10.3, so rolling back to 10.2 temporarily. Please note, this is to be expected with beta software. It is impossible to test all hardware configs in all conditions with internal QA, hence public beta.”

The other piece of news that caught my eye this week  ….

Uber and Lyft have been lobbying the government to include provisions to boost electric vehicle adoption in the $3.5 trillion budget reconciliation bill currently being debated in Congress.

The two ride-hailing giants have made sweeping, ambitious pledges that all rides booked on their platforms will be taken in an electric vehicle by 2030 — a goal that each company is unlikely to reach without hefty government support.

Both companies consider cost and lack of charging infrastructure to be two key obstacles to larger EV uptake, according to reporting from E&E News. And it’s true that for many, electric vehicles remain prohibitively expensive, especially compared to the plethora of used internal combustion engine vehicles available… well, basically anywhere.

“Our population of drivers who use our app, they are coming from lower-income communities, and they’re serving mobility in urban areas,” Adam Gromis, a sustainability policy manager with Uber, told E&E News. “So for us, we want to see slow charging in underserved neighborhoods and multiunit dwellings, and we want to see fast charging in urban areas and areas of high mobility demand.

According to the spending transparency platform OpenSecrets, Uber and Lyft have each spent close to $1 million so far in the first half of the year on lobbying efforts, though each employed fewer lobbyists overall. Data on third quarter lobbying spending is not yet available.

— Aria Alamalhodaei

Notable reads and other tidbits

Keeping this short — and a bit of a mishmash — this week.

Elon Musk’s Boring Company received initial approval to build a transportation system that would shuttle passengers in Tesla vehicles via a network of tunnels under Las Vegas. The special use permit and franchise agreement would allow the Boring Company to expand its Vegas Loop system beyond its current 1.7-mile footprint that connects the Las Vegas Convention Center campus to a 29-mile route with 51 stations that would include stops at casinos along the Las Vegas Strip, the city’s football stadium and UNLV. It would eventually reach the McCarran International Airport.

Lyft released its first and long overdue safety report.

Miles, the universal rewards app that lets users earn miles for every mile traveled, has launched in Japan. The expansion aims to build off of Miles’ marketplace, which now offers users 500 personalized rewards from 350 brands, including Garmin, Hulu, Japan Airlines, Red Bull and Under Armour.

Motional, the autonomous vehicle joint venture between Hyundai Motor Group and Aptiv, is partnering with Transport for New South Wales too help the Australian state better understand the technology and possibilities that come with a driverless ride-hail service.

Plus, self-driving truck technology developer, said it plans to expand into Europe. The company has hired Bosch veteran Sun-Mi “Sunny” Choi as senior director of business development to accelerate that European expansion.

Rivian, which filed to go public, said in a recent regulatory filing that it expects to record a quarterly net loss of up to $1.28 billion due to costs associated with the start of production of its debut truck. The net loss for the period ended Sept. 30 will range from $1.18 billion to $1.28 billion, according to the preliminary results.

Stellantis, the automaker formed through a merger with Fiat Chrysler Automobiles and Groupe PSA, reached a preliminary deal with LG Energy Solution to produce battery cells and modules in North America.

Tesla continued its profitability streak, reporting net income of $1.62 billion in the third quarter. That’s a nearly fivefold increase from the $331 million it earned in the same period last year. The record-setting profit came thanks to record sales and despite a global chip shortage and supply chain constraints that have affected the industry. Notably, Tesla was able to earn that record net income (on a GAAP basis) even as the vast majority of its sales came from its cheaper Model Y and Model 3 electric vehicles.

Wolfe Research went out and rode in an Argo AI autonomous test vehicle. The tl;dr is that they saw great progress and the vehicle was able to navigate an environment packed with cars, double parked trucks, street-cleaners, e-bikes, aggressively driven scooters, and pedestrians. “For the most part the vehicle performed complex decisions (yielding or not yielding to pedestrians, unprotected left turns, adjusting to construction),” the report said. Their takeaway: “We tested an Argo’s AV. And it reinforced our view that this technology is coming sooner, with potential for greater disruption than investors currently appreciate.”

Zoox, the autonomous vehicle startup acquired last year by Amazon, is expanding to Seattle. The company plans to open in 2022 an engineering office and operations facility, which will act as a base for its autonomous vehicle testing. The company, which today employs more than 1,300 people, tests its autonomous vehicles in San Francisco, Las Vegas and Foster City, California, near its headquarters. The company started testing its autonomous vehicles on public roads in Las Vegas in 2019.

I spoke to co-founder and CTO Jesse Levinson and he said Zoox has been eyeing Seattle as a test site for years. The company even completed a small pilot in the city in late 2019. The frequency of rain in the area is one of the primary reasons Zoox picked Seattle, Levinson said.

Zoox has developed some advanced weather proofing, including what Levinson described as “active rain mitigation” for its sensors. “We’re very excited about that and we want to test it and validate it in the rain; Seattle is a great place for that,” Levinson said.

While Zoox is setting up operations in the city where Amazon is based, Levinson emphasized that the two companies still operate separately. The Zoox office and operations hub will not be housed on the Amazon campus, for instance. Zoox will take advantage of its proximity to Amazon to work with the company on various collaborations in the future, Levinson said, describing that as an “extra bonus.”

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“Extreme Events”: US Cancer Deaths Spiked In 2021 And 2022 In “Large Excess Over Trend”

"Extreme Events": US Cancer Deaths Spiked In 2021 And 2022 In "Large Excess Over Trend"

Cancer deaths in the United States spiked in 2021…

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March 16, 2024

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"Extreme Events": US Cancer Deaths Spiked In 2021 And 2022 In "Large Excess Over Trend"

Cancer deaths in the United States spiked in 2021 and 2022 among 15-44 year-olds "in large excess over trend," marking jumps of 5.6% and 7.9% respectively vs. a rise of 1.7% in 2020, according to a new preprint study from deep-dive research firm, Phinance Technologies.

Algeria, Carlos et. al "US -Death Trends for Neoplasms ICD codes: C00-D48, Ages 15-44", ResearchGate, March. 2024 P. 7

Extreme Events

The report, which relies on data from the CDC, paints a troubling picture.

"We show a rise in excess mortality from neoplasms reported as underlying cause of death, which started in 2020 (1.7%) and accelerated substantially in 2021 (5.6%) and 2022 (7.9%). The increase in excess mortality in both 2021 (Z-score of 11.8) and 2022 (Z-score of 16.5) are highly statistically significant (extreme events)," according to the authors.

That said, co-author, David Wiseman, PhD (who has 86 publications to his name), leaves the cause an open question - suggesting it could either be a "novel phenomenon," Covid-19, or the Covid-19 vaccine.

"The results indicate that from 2021 a novel phenomenon leading to increased neoplasm deaths appears to be present in individuals aged 15 to 44 in the US," reads the report.

The authors suggest that the cause may be the result of "an unexpected rise in the incidence of rapidly growing fatal cancers," and/or "a reduction in survival in existing cancer cases."

They also address the possibility that "access to utilization of cancer screening and treatment" may be a factor - the notion that pandemic-era lockdowns resulted in fewer visits to the doctor. Also noted is that "Cancers tend to be slowly-developing diseases with remarkably stable death rates and only small variations over time," which makes "any temporal association between a possible explanatory factor (such as COVID-19, the novel COVID-19 vaccines, or other factor(s)) difficult to establish."

That said, a ZeroHedge review of the CDC data reveals that it does not provide information on duration of illness prior to death - so while it's not mentioned in the preprint, it can't rule out so-called 'turbo cancers' - reportedly rapidly developing cancers, the existence of which has been largely anecdotal (and widely refuted by the usual suspects).

While the Phinance report is extremely careful not to draw conclusions, researcher "Ethical Skeptic" kicked the barn door open in a Thursday post on X - showing a strong correlation between "cancer incidence & mortality" coinciding with the rollout of the Covid mRNA vaccine.

Phinance principal Ed Dowd commented on the post, noting that "Cancer is suddenly an accelerating growth industry!"

Continued:

Bottom line - hard data is showing alarming trends, which the CDC and other agencies have a requirement to explore and answer truthfully - and people are asking #WhereIsTheCDC.

We aren't holding our breath.

Wiseman, meanwhile, points out that Pfizer and several other companies are making "significant investments in cancer drugs, post COVID."

Phinance

We've featured several of Phinance's self-funded deep dives into pandemic data that nobody else is doing. If you'd like to support them, click here.

 

Tyler Durden Sat, 03/16/2024 - 16:55

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Gen Z, The Most Pessimistic Generation In History, May Decide The Election

Gen Z, The Most Pessimistic Generation In History, May Decide The Election

Authored by Mike Shedlock via MishTalk.com,

Young adults are more…

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March 16, 2024

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Gen Z, The Most Pessimistic Generation In History, May Decide The Election

Authored by Mike Shedlock via MishTalk.com,

Young adults are more skeptical of government and pessimistic about the future than any living generation before them.

This is with reason, and it’s likely to decide the election.

Rough Years and the Most Pessimism Ever

The Wall Street Journal has an interesting article on The Rough Years That Turned Gen Z Into America’s Most Disillusioned Voters.

Young adults in Generation Z—those born in 1997 or after—have emerged from the pandemic feeling more disillusioned than any living generation before them, according to long-running surveys and interviews with dozens of young people around the country. They worry they’ll never make enough money to attain the security previous generations have achieved, citing their delayed launch into adulthood, an impenetrable housing market and loads of student debt.

And they’re fed up with policymakers from both parties.

Washington is moving closer to passing legislation that would ban or force the sale of TikTok, a platform beloved by millions of young people in the U.S. Several young people interviewed by The Wall Street Journal said they spend hours each day on the app and use it as their main source of news.

“It’s funny how they quickly pass this bill about this TikTok situation. What about schools that are getting shot up? We’re not going to pass a bill about that?” Gaddie asked. “No, we’re going to worry about TikTok and that just shows you where their head is…. I feel like they don’t really care about what’s going on with humanity.”

Gen Z’s widespread gloominess is manifesting in unparalleled skepticism of Washington and a feeling of despair that leaders of either party can help. Young Americans’ entire political memories are subsumed by intense partisanship and warnings about the looming end of everything from U.S. democracy to the planet. When the darkest days of the pandemic started to end, inflation reached 40-year highs. The right to an abortion was overturned. Wars in Ukraine and the Middle East raged.

Dissatisfaction is pushing some young voters to third-party candidates in this year’s presidential race and causing others to consider staying home on Election Day or leaving the top of the ticket blank. While young people typically vote at lower rates, a small number of Gen Z voters could make the difference in the election, which four years ago was decided by tens of thousands of votes in several swing states.

Roughly 41 million Gen Z Americans—ages 18 to 27—will be eligible to vote this year, according to Tufts University.

Gen Z is among the most liberal segments of the electorate, according to surveys, but recent polling shows them favoring Biden by only a slim margin. Some are unmoved by those who warn that a vote against Biden is effectively a vote for Trump, arguing that isn’t enough to earn their support.

Confidence

When asked if they had confidence in a range of public institutions, Gen Z’s faith in them was generally below that of the older cohorts at the same point in their lives. 

One-third of Gen Z Americans described themselves as conservative, according to NORC’s 2022 General Social Survey. That is a larger share identifying as conservative than when millennials, Gen X and baby boomers took the survey when they were the same age, though some of the differences were small and within the survey’s margin of error.

More young people now say they find it hard to have hope for the world than at any time since at least 1976, according to a University of Michigan survey that has tracked public sentiment among 12th-graders for nearly five decades. Young people today are less optimistic than any generation in decades that they’ll get a professional job or surpass the success of their parents, the long-running survey has found. They increasingly believe the system is stacked against them and support major changes to the way the country operates.

Gen Z future Outcome

“It’s the starkest difference I’ve documented in 20 years of doing this research,” said Twenge, the author of the book “Generations.” The pandemic, she said, amplified trends among Gen Z that have existed for years: chronic isolation, a lack of social interaction and a propensity to spend large amounts of time online.

A 2020 study found past epidemics have left a lasting impression on young people around the world, creating a lack of confidence in political institutions and their leaders. The study, which analyzed decades of Gallup World polling from dozens of countries, found the decline in trust among young people typically persists for two decades.

Young people are more likely than older voters to have a pessimistic view of the economy and disapprove of Biden’s handling of inflation, according to the recent Journal poll. Among people under 30, Biden leads Trump by 3 percentage points, 35% to 32%, with 14% undecided and the remaining shares going to third-party candidates, including 10% to independent Robert F. Kennedy Jr.

Economic Reality

Gen Z may be the first generation in US history that is not better off than their parents.

Many have given up on the idea they will ever be able to afford a home.

The economy is allegedly booming (I disagree). Regardless, stress over debt is high with younger millennials and zoomers.

This has been a constant theme of mine for many months.

Credit Card and Auto Delinquencies Soar

Credit card debt surged to a record high in the fourth quarter. Even more troubling is a steep climb in 90 day or longer delinquencies.

Record High Credit Card Debt

Credit card debt rose to a new record high of $1.13 trillion, up $50 billion in the quarter. Even more troubling is the surge in serious delinquencies, defined as 90 days or more past due.

For nearly all age groups, serious delinquencies are the highest since 2011.

Auto Loan Delinquencies

Serious delinquencies on auto loans have jumped from under 3 percent in mid-2021 to to 5 percent at the end of 2023 for age group 18-29.Age group 30-39 is also troubling. Serious delinquencies for age groups 18-29 and 30-39 are at the highest levels since 2010.

For further discussion please see Credit Card and Auto Delinquencies Soar, Especially Age Group 18 to 39

Generational Homeownership Rates

Home ownership rates courtesy of Apartment List

The above chart is from the Apartment List’s 2023 Millennial Homeownership Report

Those struggling with rent are more likely to be Millennials and Zoomers than Generation X, Baby Boomers, or members of the Silent Generation.

The same age groups struggling with credit card and auto delinquencies.

On Average Everything is Great

Average it up, and things look pretty good. This is why we have seen countless stories attempting to explain why people should be happy.

Krugman Blames Partisanship

OK, there is a fair amount of partisanship in the polls.

However, Biden isn’t struggling from partisanship alone. If that was the reason, Biden would not be polling so miserably with Democrats in general, blacks, and younger voters.

OK, there is a fair amount of partisanship in the polls.

However, Biden isn’t struggling from partisanship alone. If that was the reason, Biden would not be polling so miserably with Democrats in general, blacks, and younger voters.

This allegedly booming economy left behind the renters and everyone under the age of 40 struggling to make ends meet.

Many Are Addicted to “Buy Now, Pay Later” Plans

Buy Now Pay Later, BNPL, plans are increasingly popular. It’s another sign of consumer credit stress.

For discussion, please see Many Are Addicted to “Buy Now, Pay Later” Plans, It’s a Big Trap

The study did not break things down by home owners vs renters, but I strongly suspect most of the BNPL use is by renters.

What About Jobs?

Another seemingly strong jobs headline falls apart on closer scrutiny. The massive divergence between jobs and employment continued into February.

Nonfarm payrolls and employment levels from the BLS, chart by Mish.

Payrolls vs Employment Gains Since March 2023

  • Nonfarm Payrolls: 2,602,000

  • Employment Level: +144,000

  • Full Time Employment: -284,000

For more details of the weakening labor markets, please see Jobs Up 275,000 Employment Down 184,000

CPI Hot Again

CPI Data from the BLS, chart by Mish.

For discussion of the CPI inflation data for February, please see CPI Hot Again, Rent Up at Least 0.4 Percent for 30 Straight Months

Also note the Producer Price Index (PPI) Much Hotter Than Expected in February

Major Economic Cracks

There are economic cracks in spending, cracks in employment, and cracks in delinquencies.

But there are no cracks in the CPI. It’s coming down much slower than expected. And the PPI appears to have bottomed.

Add it up: Inflation + Recession = Stagflation.

Election Impact

In 2020, younger voters turned out in the biggest wave in history. And they voted for Biden.

Younger voters are not as likely to vote in 2024, and they are less likely to vote for Biden.

Millions of voters will not vote for either Trump or Biden. Net, this will impact Biden more. The base will not decide the election, but the Trump base is far more energized than the Biden base.

If Biden signs a TikTok ban, that alone could tip the election.

If No Labels ever gets its act together, I suspect it will siphon more votes from Biden than Trump. But many will just sit it out.

“We’re just kind of over it,” Noemi Peña, 20, a Tucson, Ariz., resident who works in a juice bar, said of her generation’s attitude toward politics. “We don’t even want to hear about it anymore.” Peña said she might not vote because she thinks it won’t change anything and “there’s just gonna be more fighting.” Biden won Arizona in 2020 by just over 10,000 votes. 

The Journal noted nearly one-third of voters under 30 have an unfavorable view of both Biden and Trump, a higher number than all older voters. Sixty-three percent of young voters think neither party adequately represents them.

Young voters in 2020 were energized to vote against Trump. Now they have thrown in the towel.

And Biden telling everyone how great the economy is only rubs salt in the wound.

Tyler Durden Sat, 03/16/2024 - 11:40

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Copper Soars, Iron Ore Tumbles As Goldman Says “Copper’s Time Is Now”

Copper Soars, Iron Ore Tumbles As Goldman Says "Copper’s Time Is Now"

After languishing for the past two years in a tight range despite recurring…

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March 15, 2024

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Copper Soars, Iron Ore Tumbles As Goldman Says "Copper's Time Is Now"

After languishing for the past two years in a tight range despite recurring speculation about declining global supply, copper has finally broken out, surging to the highest price in the past year, just shy of $9,000 a ton as supply cuts hit the market; At the same time the price of the world's "other" most important mined commodity has diverged, as iron ore has tumbled amid growing demand headwinds out of China's comatose housing sector where not even ghost cities are being built any more.

Copper surged almost 5% this week, ending a months-long spell of inertia, as investors focused on risks to supply at various global mines and smelters. As Bloomberg adds, traders also warmed to the idea that the worst of a global downturn is in the past, particularly for metals like copper that are increasingly used in electric vehicles and renewables.

Yet the commodity crash of recent years is hardly over, as signs of the headwinds in traditional industrial sectors are still all too obvious in the iron ore market, where futures fell below $100 a ton for the first time in seven months on Friday as investors bet that China’s years-long property crisis will run through 2024, keeping a lid on demand.

Indeed, while the mood surrounding copper has turned almost euphoric, sentiment on iron ore has soured since the conclusion of the latest National People’s Congress in Beijing, where the CCP set a 5% goal for economic growth, but offered few new measures that would boost infrastructure or other construction-intensive sectors.

As a result, the main steelmaking ingredient has shed more than 30% since early January as hopes of a meaningful revival in construction activity faded. Loss-making steel mills are buying less ore, and stockpiles are piling up at Chinese ports. The latest drop will embolden those who believe that the effects of President Xi Jinping’s property crackdown still have significant room to run, and that last year’s rally in iron ore may have been a false dawn.

Meanwhile, as Bloomberg notes, on Friday there were fresh signs that weakness in China’s industrial economy is hitting the copper market too, with stockpiles tracked by the Shanghai Futures Exchange surging to the highest level since the early days of the pandemic. The hope is that headwinds in traditional industrial areas will be offset by an ongoing surge in usage in electric vehicles and renewables.

And while industrial conditions in Europe and the US also look soft, there’s growing optimism about copper usage in India, where rising investment has helped fuel blowout growth rates of more than 8% — making it the fastest-growing major economy.

In any case, with the demand side of the equation still questionable, the main catalyst behind copper’s powerful rally is an unexpected tightening in global mine supplies, driven mainly by last year’s closure of a giant mine in Panama (discussed here), but there are also growing worries about output in Zambia, which is facing an El Niño-induced power crisis.

On Wednesday, copper prices jumped on huge volumes after smelters in China held a crisis meeting on how to cope with a sharp drop in processing fees following disruptions to supplies of mined ore. The group stopped short of coordinated production cuts, but pledged to re-arrange maintenance work, reduce runs and delay the startup of new projects. In the coming weeks investors will be watching Shanghai exchange inventories closely to gauge both the strength of demand and the extent of any capacity curtailments.

“The increase in SHFE stockpiles has been bigger than we’d anticipated, but we expect to see them coming down over the next few weeks,” Colin Hamilton, managing director for commodities research at BMO Capital Markets, said by phone. “If the pace of the inventory builds doesn’t start to slow, investors will start to question whether smelters are actually cutting and whether the impact of weak construction activity is starting to weigh more heavily on the market.”

* * *

Few have been as happy with the recent surge in copper prices as Goldman's commodity team, where copper has long been a preferred trade (even if it may have cost the former team head Jeff Currie his job due to his unbridled enthusiasm for copper in the past two years which saw many hedge fund clients suffer major losses).

As Goldman's Nicholas Snowdon writes in a note titled "Copper's time is now" (available to pro subscribers in the usual place)...

... there has been a "turn in the industrial cycle." Specifically according to the Goldman analyst, after a prolonged downturn, "incremental evidence now points to a bottoming out in the industrial cycle, with the global manufacturing PMI in expansion for the first time since September 2022." As a result, Goldman now expects copper to rise to $10,000/t by year-end and then $12,000/t by end of Q1-25.’

Here are the details:

Previous inflexions in global manufacturing cycles have been associated with subsequent sustained industrial metals upside, with copper and aluminium rising on average 25% and 9% over the next 12 months. Whilst seasonal surpluses have so far limited a tightening alignment at a micro level, we expect deficit inflexions to play out from quarter end, particularly for metals with severe supply binds. Supplemented by the influence of anticipated Fed easing ahead in a non-recessionary growth setting, another historically positive performance factor for metals, this should support further upside ahead with copper the headline act in this regard.

Goldman then turns to what it calls China's "green policy put":

Much of the recent focus on the “Two Sessions” event centred on the lack of significant broad stimulus, and in particular the limited property support. In our view it would be wrong – just as in 2022 and 2023 – to assume that this will result in weak onshore metals demand. Beijing’s emphasis on rapid growth in the metals intensive green economy, as an offset to property declines, continues to act as a policy put for green metals demand. After last year’s strong trends, evidence year-to-date is again supportive with aluminium and copper apparent demand rising 17% and 12% y/y respectively. Moreover, the potential for a ‘cash for clunkers’ initiative could provide meaningful right tail risk to that healthy demand base case. Yet there are also clear metal losers in this divergent policy setting, with ongoing pressure on property related steel demand generating recent sharp iron ore downside.

Meanwhile, Snowdon believes that the driver behind Goldman's long-running bullish view on copper - a global supply shock - continues:

Copper’s supply shock progresses. The metal with most significant upside potential is copper, in our view. The supply shock which began with aggressive concentrate destocking and then sharp mine supply downgrades last year, has now advanced to an increasing bind on metal production, as reflected in this week's China smelter supply rationing signal. With continued positive momentum in China's copper demand, a healthy refined import trend should generate a substantial ex-China refined deficit this year. With LME stocks having halved from Q4 peak, China’s imminent seasonal demand inflection should accelerate a path into extreme tightness by H2. Structural supply underinvestment, best reflected in peak mine supply we expect next year, implies that demand destruction will need to be the persistent solver on scarcity, an effect requiring substantially higher pricing than current, in our view. In this context, we maintain our view that the copper price will surge into next year (GSe 2025 $15,000/t average), expecting copper to rise to $10,000/t by year-end and then $12,000/t by end of Q1-25’

Another reason why Goldman is doubling down on its bullish copper outlook: gold.

The sharp rally in gold price since the beginning of March has ended the period of consolidation that had been present since late December. Whilst the initial catalyst for the break higher came from a (gold) supportive turn in US data and real rates, the move has been significantly amplified by short term systematic buying, which suggests less sticky upside. In this context, we expect gold to consolidate for now, with our economists near term view on rates and the dollar suggesting limited near-term catalysts for further upside momentum. Yet, a substantive retracement lower will also likely be limited by resilience in physical buying channels. Nonetheless, in the midterm we continue to hold a constructive view on gold underpinned by persistent strength in EM demand as well as eventual Fed easing, which should crucially reactivate the largely for now dormant ETF buying channel. In this context, we increase our average gold price forecast for 2024 from $2,090/toz to $2,180/toz, targeting a move to $2,300/toz by year-end.

Much more in the full Goldman note available to pro subs.

Tyler Durden Fri, 03/15/2024 - 14:25

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