This is somewhat of a predictably tragic outcome all things considered. I remember a previous conversation on these pages when GM moved massive investment into China to build their mid-size SUV brand, Encore.

Continuing the U.S. decline of the brand, the Wall Street Journal is reporting that approximately half of all Buick dealership in the U.S. have opted to take a buyout from GM, as opposed to spending millions in retooling, restructuring and retraining their staff to accommodate the EV influx.

Most of the EV’s shoved onto the dealer lots sit idle without customers to purchase them.

Wall Street Journal – General Motors (GM) has bought out about half of its 2,000 Buick dealers nationwide, based on their decision to not sell electric vehicles, according to a company spokesman Wednesday.

Dealers who are taking the buyout would give up the Buick franchise and no longer sell the brand, he said. The dealer can continue to sell other GM models, such as Chevrolet or GMC, that often account for a higher percentage of sales.

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Don’t pretend. The media are pitching this with full pretense.  Instead, look at the data carefully.  Tens of thousands of UAW members are on strike for better pay and benefits.   The installed occupant of the oval office makes a “historic” visit to the picket line.   About two dozen workers are there.  Think about it.

Look at the optics.  Do you think for one second that Team Obama would let their principal appear in such a smattering of support?  Not a chance.  This “crowd” might as well have had circles around their place to stand.  Joe Biden spent about an hour in Michigan before tripping back onto the plane and heading to meet Gavin Newsom in California.

Michigan – […] The move also appeared to be a clear counter to former President Donald Trump, who plans to visit Michigan on Wednesday instead of participating in the second Republican primary debate — the latest sign that both candidates have moved beyond the primary phase of the election and are focused on November 2024.

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There has been increasingly visible media promotion of various municipalities reinstituting mask recommendations to battle a new BA.2.86 covid variant.

Today, the New York City Dept of Health became the latest large metropolitan area to recommend the return to face masks; however, no government mandates yet.

[…] Staying up to date with COVID-19 vaccines, along with other proven prevention tools – like masking, testing, and staying home when sick – continue to be our best defense against COVID-19 and other respiratory viruses. (link)

[Source]

QUESTION: Are you starting to see increased emphasis on mask wearing in/around your local area?

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The Florida Department of Agriculture and Consumer Services (FDACS) released an urgent consumer notification that Citgo fuel services from the Port of Tampa accidentally mixed Diesel Fuel into gasoline tanker trucks that offloaded product at gas pumps in Tampa, Fort Myers, Cape Coral and other areas.  [FDACS Notice HERE]

Customers who purchased Citgo gas at the affected areas after August 26th are at risk.  Those fuel stations pumped diesel instead of unleaded gasoline.

[SOURCE]

(AP) – […] The Florida Department of Agriculture and Consumer Services said late Sunday that gasoline purchased after 10 a.m. Saturday at some Citgo-supplied stations had a strong likelihood of being contaminated with diesel fuel. Citgo identified 29 affected stations — sold at chains like 7-Eleven, BJ’s Wholesale and other convenience stores — in cities including Tampa, Fort Myers, Sarasota and more. 

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Several people have made queries about the current state of our national economic condition against the backdrop of disconnected data points that seemingly conflict. Here’s my review.

July and August are key months to gauge the prior six months of U.S consumer positioning.

Why?

Because all advance purchase orders for the U.S. holiday season are made in May, June and July for inventory builds and delivery schedules for September.  The decisions made by purchasing officers in late spring and early summer, reflect their predictive analysis for the holiday season.

Inventories are evaluated, critical financial discussions are held, and orders are placed for September arrival and distribution.  This predictive activity is what we see in the July and August data that flows from the global, multinational and shipping corporations who facilitate the transfer of the goods.  Check what is happening in distribution, and you can see what eventually creates the boxcar effect in the supply chain that ultimately leads to shuttered manufacturing.

Those who are involved in the business of shipping goods are signaling the flares around the state of the consumer economy and what will happen.  At the same time, the wording is almost hilarious in this era of great pretending.  Instead of saying ordinary words like “poor sales results for durable goods,” the parseltongue calls sales, “destocking.”  Example:  “CEO Vincent Clerc said he saw no sign that the destocking which has curbed global trade activity would end this year.”

Global shipping company Maersk is warning that shipping volume is low because warehouse inventories are high.  The goods are unsold.

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Before getting to the headline, I want to remind you what CTH outlined two years ago about these massive food price increases.

You might remember me saying that processed food prices will increase at a much greater rate than fresh or lesser processed foods.  Factually, even organic products (ie. produce) could/would end up less expensive (in relative terms) to the increase in price at your supermarket, as compared to the price increases for the more processed foods.

The reason is simple, processed food use more energy; energy prices are skyrocketing; the processing costs (packaging, transportation, freezing, sanitizing, storage, warehousing and distribution etc.), at each step of the processing cycle, in addition to higher labor costs, drive up the end result of the price.

In this energy driven inflationary environment, less processing and handling equals lower overall cost increases from field to fork.  More processing, handling, distribution equals higher overall costs.  This is simply a supply chain, truism.

Into this issue comes McDonald’s Corp.  Last I heard, approximately 85% of McDonald’s business was franchise.  The franchise has to purchase the product (food) from the main company.  Supply side cost increases in the food are transferred from the company to the franchisee via higher product costs.  The restaurant is then forced to raise prices to accommodate their increased costs.  A portion of the revenue from sales then flows back to the main company.

It is important to note here, there is a natural disconnect in supply side price increases within the franchise model.  The parent company must, must, negotiate the best possible contract terms with the suppliers because the increases in costs are passed directly to the franchise.  The parent company doesn’t immediately feel any problem until the revenue from the franchise drops due to the forced raising of retail prices and diminished sales.  There is a lag.

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UPDATE: I’m sticking this to the top of the page for a little while, because there is excellent feedback in the comments section.  Awesome job with some granular detail. 

The National Transportation Safety Board (NTSB) released the preliminary findings from its investigation of the East Palestine, Ohio, train derailment. (video below)

There were three locomotives and 149 rail cars. Before the train derailed Feb. 3, the crew received a warning telling them to immediately slow and stop the train to conduct an inspection.  It was during the deceleration that a railcar carrying plastic pellets had a wheel bearing failure, according to NTSB Chair Jennifer Homendy.  [Bullet Point Video, WATCH]

Thirty-eight cars derailed and fire damaged an additional 12 cars.  Five tanker cars carry 115,580 gallons of vinyl chloride were part of the group that derailed.  Vinyl Chloride is a flammable and toxic gas used to make PVC pipe.  The initial fire was the result of the hot axle and the plastic pellets in the railcar.  According to Mrs. Homendy, there was no evidence the three-person train crew did anything wrong. She said the NTSB, so far, hasn’t identified any operational issues with the defect detectors or railroad tracks.

Full Press Conference Video Below:

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When Ohio Senator JD Vance was briefing the press earlier today, he was asked about East Palestine residents being required to sign indemnity waivers, releasing Norfolk Southern Railway from legal liability, as a requirement of having their water/air tests conducted on their property.

Senator Vance said he talked to a resident about it, then reviewed the contract and confirmed the indemnity demand.  Vance then immediately called Norfolk Southern Railroad officials and asked them about it.  According to Vance, the response from Norfolk Southern Railway was that the liability waiver was accidentally presented.  WATCH (@24:54 Prompted):

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Does anyone really believe the contingency waivers were “accidentally” presented to the residents?

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At approximately 8:55pm on February 3rd a major train derailment happened near the border between Ohio and Pennsylvania. In an Ohio town called East Palestine, a Norfolk Southern train pulling 150 cars derailed. 20 of those cars were carrying hazardous materials, including a liquified substance called “Vinyl Chloride.”

A massive explosion and fire resulted from the derailment and the nature of the cargo. In an effort to mitigate the problem, responding emergency authorities dug a trench and allowed the chemicals to burn off into the atmosphere. However, vinyl chloride turns into hydrochloric acid when it mixes with water vapor. The resulting chemical toxins can travel with wind, forming toxic clouds.

Several people in the downwind region from the initial explosion have reported health issues. Additionally, animals and fish have been reported to have been killed in the zone where the chemical cloud traveled.

There is now increasing concern about longer term impacts from the release of the chemicals including vinyl chloride.

Norfolk Southern and the EPA released the full list of chemicals that were being transported, they include:

♦Vinyl chloride: a colorless gas that is used to make polyvinyl chloride (PVC) plastics and is highly flammable and decomposes to make toxic fumes. According to the National Library of Medicine, it is also carcinogenic and can cause other health issues.

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Did you know that during hurricanes asphalt roofing shingles act like flying blades?  More on that momentarily….

Today Florida Governor Ron DeSantis was in the Punta Rassa area of South Fort Myers to celebrate a remarkable accomplishment.  The Sanibel bridges and causeway are open to civilian traffic. {Direct Rumble Link}

The massive, albeit temporary, repairs to the three spans and spoil islands have been completed three weeks after Hurricane Ian wiped them out.  A genuinely remarkable feat of engineering and git’ r done roughneck effort.  Truly an incredible accomplishment.  To check out the scale of it see PICTURES HERE.

TALLAHASSEE, Fla. — Today, Governor Ron DeSantis announced that emergency repairs to the Sanibel Causeway have been completed in 15 days, more than a week ahead of schedule. As of this morning, access to Sanibel Island has been restored for residents, reconnecting Sanibel Island to the mainland. WATCH:

“The work that has been done to restore vehicle access to Sanibel Island has been historic,” said Governor Ron DeSantis. “Cutting through bureaucratic red tape and delivering on our promise to get Sanibel Island up and running has been a top priority. By restoring access over the causeway, repair crews, first responders, emergency vehicles, business owners and residents will be better able to expedite recovery from this storm.”

“I am grateful for our dedicated team members who quite literally built a road in the Gulf in 15 days,” said FDOT Secretary Jared W. Perdue, P.E. “While the bridges were largely undamaged by the storm, portions of the causeway which connect bridge structures together were washed away by Hurricane Ian, leaving the bridges unconnected to the mainland or the island.

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