Black Diamond NOW

Why E-Commerce Is The Future Now

We've seen lots of statistics regarding the drop in retail sales during the Great Recession.  On-line sales also took a hit but pretty small really and look at the recovery - bigger and better than ever.  Why?

A lot of reasons but my recent trip to Fry's Electronics yesterday really hit home.  Our stereo receiver seems to have croaked with just one stereo channel now working.  A little complicated because we have speakers in two different rooms but a real bummer just being able to listen to only one speaker in each room.  After 20 plus years with our current Denon receiver, the time has come to face the abuse of our past.  For today try the Black Keys El Camino album turned up to top decibles if you want to test your system and "rock out" a bit - just as a test of course, but I guarantee you won't be able to sit down.

So, in search of a solution, we first stopped at Costco.  Limited selection, low price but figure it out ourselves.  Then on to Fry's in Renton to talk to a real person at a brick and mortar retailer.  And no more Best Buy for me.  Bad experiences.  Other than learning that I am pretty dumb regarding electronics I heard little of value at Fry's other than I needed to do my own research. So why pay the overhead cost for brick and mortar retail if you can't get something of value more than you can get on line?  Guess where we won't be investing any of our resources in the near future.  On line it is for us now.

One more observation - just think how much easier it is for seniors and others not so mobile to order online compared to having to manage the logistics to get to and from a mall.  By comparison, a computer can be a lot easier way to navigate for our increasingly tech savy shoppers and UPS/FedEX deliver to our door step.

And don't forget, if you buy on-line, you directly benefit our city's sales tax revenue.  A rapidly changing world indeed that we live in today.

Employment Trends - Some Interesting Data

Following is a profile of employment by size of firm and industry segment in our state, excluding the public sector.  What does the future hold for our community and what steps can we be taking to help shape it?  Building a local employment base is key to our future.

The following chart shows national data trends but I would expect that relative trends here pretty well mirror what we see below.

Puget Sound Fresh

Puget Sound Fresh is an interesting source of information for what's fresh, local and in season year round here in the Puget Sound region.  Find a farmer, farmers market, harvest schedule, recipes and events.  And believe it or not, some farmers markets remain open year round and with fresh local produce even this time of year.  Check it out.

Local Economic Outlook - The Latest

On Tuesday, our Emergency Medical Services (EMS) task force was briefed regarding the latest economic outlook for King County.  I found it very revealing, particularly since the focus is local.  On the whole, they were able to point to some good news and some not so good news. 

The good news:

• There is some growth here in the county
• King County seems to be doing better than the nation as a whole
• Retail sales are up 4% to 6% overall (+11% in Black Diamond)
• Employment is up 1.5% to 2% year over year with over 18,000 jobs added in the county during this period
• Local firms seem to be doing well, particularly Boeing and Microsoft
• The affordability index for new home purchases is at the highest level in the last 20+ years.

The not so good news:

• The housing market remains very weak despite much improved affordability
• Retail sales (and sales tax revenues) remain well below pre-recession levels
• There are many risks to our local economy still out there that are beyond our control including, commodity prices (energy), European Union, Congress disfunction, etc.  We are not an island.

One of the biggest surprises to me was that incomes in the county have returned to pre-recession levels, but not retail spending as shown below:

Wow - retail sales are not currently expected to return to pre-recession levels until 2024.  How about assessed values for real estate?

For homeowners, this would appear to be good news for our 2012 tax bills.  Assessed values always lag by a year so 2012 assessments will be based on 2011 values. 

Among the most shocking of the data presented was the New Construction Forecast for King County.   This data shows just how big the bubble was here when over $8 billion of construction activity occurred in 2009, now expected to be less than $1.8 billion in 2012 - that's a collapse.  The new norm - if we get back to $4 to $5 billion per year we might be fortunate.

Seeing this data, it's a little easier for me to understand the magnitude of the "adjustment" our state and local governments are having to undergo.  It also brings home the lesson loud and clear - don't spend it all during the good times.  Save, save, save!

Is There Hope For The Housing Market?

Our outlook for the future always seems to be the most pessimistic when we are at the bottom of a business cycle.  Given where housing markets now are with recent record low prices, a continued forclosure overhang and all time low housing starts in 2011, it's hard for us to see how things might get any better.  But, could it be that housing markets might actually begin to grow in the reasonably near future?  Following are a couple of charts posted by Mathew Yglesias at Slate magazine.  They show that population is growing significantly faster than housing starts, which historically would lead to significant pent up demand and hence growth.  The longer this pent up demand goes unfulfilled, the stronger a recovery there typically might be.

In essence, rather than occupy new homes or apartments, people are doubling up, moving in with relatives etc.  Is this the "new normal" or can we expect to see significant growth in housing markets in the years ahead?  I certainly have no crystal ball but an intriguing question.

Why Do We Like Pets So Much?

I continue to be intrigued by our society's affinity for having pets, be they dogs, cats, birds, horses, rabbits or even snakes. Why do we have so many pets?  If one were to quantify the economic value of the "pet industry", I think that we might be staggered by what an economic powerhouse this industry really is.  Have you been to a vet lately?  So, being the ever curious, I decided to do some research.  Thanks to the internet, I consulted three "experts" - first a psychologist, second, scientists from the California Institute of Technology and third, none other than Oprah herself.  What did I learn?

1. The Psychologist - In an article published last year in Psychology Today, we learn than the simple answer is that pets make us happy.  "If there is a purer, less complicated joy than that of making an animal happy, I have yet to experience it. And there's something deeply fulfilling about knowing that, even in a complicated and often unkind world, you've managed to create a pocket of perfect security and bliss for at least one small creature."
2. The Research Scientists - CalTech scientists have difficulty dealing with esoteric concepts such as "happiness" and instead focus on how our brain functions in the presence of pets. They actually measured activity levels in different segments of the brain in the presence of animals.  Surprisingly, there was little difference between a cuddly cat and dangerous pit viper.  "Our study shows that neurons in the human amygdala respond preferentially to pictures of animals, meaning that we saw the most amount of activity in cells when the patients looked at cats or snakes versus buildings or people".  Their conclusion - we are hardwired to love pets.
3. Oprah - For the definitive answer, I was sure that Oprah could set us straight. The right pet emboldens us. "People who think of themselves as socially inept often choose dogs who are very socially assured. I've heard from so many people who say, 'I was always painfully shy, but my whole life has changed because of the confidence I feel with my dog by my side.'" Forget the "crazy cat lady" stereotype. Try "compassionate cat guy" instead. "The male cat owners I've worked with are incredibly empathetic, sweet, intuitive, tender people." The Prophet Muhammad may have been the earliest Cat Guy: "His cat fell asleep on his sleeve, and when he had to move, he cut the cloth rather than wake the cat—he couldn't bear to disturb it. Any cat lover can relate."
   Stop wagging the dog… "Do you love your animal, or do you love loving your animal? If you treat your dog like a dress-up doll, chances are that its needs aren't being met, because you're projecting a fantasy. There are times when I just have to tell my clients, 'Put the dog on the floor!'"…and let the love in. "In all of our relationships, we need not only to give affection but to see that affection reflected back to us—we want to know that the other being enjoys it. So a dog wagging his tail or a purring cat closes the relationship loop for us in a very profound, nurturing way."

There you have it.  For whatever the reason, we do love our pets and pets represent a very large economic industry segment.  Have fun with your pet(s) and be sure to shop local at Horizon Pet Supply and don't forget to also get a pet license from the City - it's in your best interests and does serve to help us fund essential animal control services.

If You Like Curry, Have I Got The Place For You - And Pizza Too

I'm a big fan of currys - the hotter and spicier the better.  Now you can get great curry right here in Black Diamond.  We lost power again yesterday so we were looking for a new take-out experience in town.  On a tip from the Wheelers, I went of all places to Italian Fresh Pizza located at the intersection of Lawson and SR 169 (right across the street and kitty corner from the Cenex).   Italian Fresh Pizza opened in town about 18 months ago with a full menu of affordably priced pizza that I am told is quite good.  About six months ago, the family who owns the restaurant and who are originally from Pakistan, decided to begin offering some of their own family's special chicken curry.  Wow, was this great.  And the Naan bread that accompany's each order is a wonderful additional treat.  We got one order of medium hot chicken curry and one of hot and they were both delicious.  Definately gets my five star rating.  Preparation takes about 20 minutes so give them a call to order take-out at 360-886-5298 or 360-886-5111.  They also offer delivery and catering - and be sure to try their pizza too.   Let's support our local businesses.

Osgard & Allen - A Must See Friday January 27th at Baker Street Books

What a treat for our community.  Not only are they talented but they are LOCAL as well.  Hope to see you there. 

Lest There Be Doubt - The Importance Of Getting A Quality Education

Who are the biggest winners and the biggest losers through our recent recession?  Clearly, the greater the level of education the greater the employment opportunities and growth have become.  In times of more full employment, employers are more willing to invest in the training needed for new employees, but less so when times are tight for all.  So the message - get as much education and re-education as you can.  It's the gift that keeps on giving.

The downside, however, is the climbing cost of education today.  Students leaving college with student loan liabilities in the triple digits face a daunting new challenge - how to pay for it.  One more example of the haves and have nots in our country today.  And keep in mind, that declaring bankruptcy will not wipe-out student loan debt obligations.  Any wonder that you see the young 20's crowd leading the Occupy movement?

Black Diamond Sales Tax Receipts Surge 11% in 2011

Still a small number but 11% growth is certainly a positive trend.

31 Days Of Adventure In Our Community - My January 2012 Challenge To All

The web is all astir offering numerous 31 day challenges entering January and the New Year.  Using the above graphic as a boundary map to help define our broader community, I offer the following 31 day January 2012 challenge (opportunity).  Whoever takes advantage of the most of these opportunities in January will receive a $25 gift certificate to the restaurant or other establishment of your choice in Black Diamond.

Hiking Trails for Natural Beauty & Exercise

• Jellum & Cinnabar Mining Hub (for more info beyond this link, search this blog for "Cinnabar")
• Hanging Gardens
• The Cathedral
• Icy Creek (for more info beyond this link, search this blog for Icy Creek)
• Ravensdale Creek (the "slatted bridge" loop)
• Ravensdale Lake (the lake and creek east of SR 160)
• Frog Lake
• Franklin Heritage Area (also, follow the link to the Black Diamond Historical Society who sponsors two tours each spring, typically one in February and one in March - credit to those who go on either of these in 2012)

Area Parks To Visit & Enjoy

• Lake Sawyer Regional Park
• Nolte State Park
• Kanaskat Palmer State Park (winter camping and Yurts here)
• Flaming Geyser State Park
• Lake 12 King County Lake Access

Entertainment & Culinary Delights

• Friday night Dinner & Jazz at Black Diamond Pizza & Deli and Baker Street Books (live jazz most Friday or Saturday nights and no cover).  Baker Street Books is directly across the street from Michael's place 
• Breakfast, brunch or dinner at the Black Diamond Bakery
• Awesome Italian at Mama Passarelli's
• Awesome BBQ at Rooters Famous BBQ

Enjoy & Contribute To The Future Of Our Community

• Visit & become a member of the Black Diamond Historical Society
• Volunteer and/or contribute to the Black Diamond Community Center (gas vouchers for the needy are particularly in demand)

For The Adventurous

• Paddleboard around Lake Sawyer ( you can borrow our paddle board)
• Kayak to where Ravensdale Creek and Frog Lake/Rock Creek dump into Lake Sawyer (we would be happy to lend you our two kayaks)
• Enjoy the Lake Sawyer Community Club Polar Bear swim New Years Day (a certified goose-bump event)
• Participate in one of the Yarrow Bay MPD special citizen committees (attend the Water Quality committee formation meeting on Wed. January 4 at 6:30 pm at the Black Diamond Elementary school or attend the Green Valley Road commitee formation meeting on Tues. January 10 at 6:30 pm at the Black Diamond Elementary school)
• Go skateboarding with local kids or just stop by the skateboard park downtown next to the elementary school.  Extra credit if you actually give it a try
• Bicycle, jog or walk any of the cross country trails on or around Ravensdale Creek between Lake Sawyer and SR 169 (credit goes to each outing)
• Bird watch at Frog Lake
• Try fishing in Lake Sawyer - catching a fish is worth extra credit
• Run, jog, walk around Lake Sawyer
• Enjoy a lazy explorative day at the Black Diamond Public Library

And last but not least, attend a City Council meeting (Jan. 5 and Jan. 19 beginning at 7 pm), attend a City Council Open Community Forum (Jan. 12 beginning at 6:30 pm at the Black Diamond Community Center) or just give any of your Councilmembers a call to share what is on your mind.

 

A Nation Of Class Warriors?

Interesting chart based on a recent Pew Research poll and courtesy of Slate Magazine and Matthew Yglesias.  There doesn't appear to be a lot of trust in our financial institutions even among Republicans at the national level.  What parallels can you think of at the state and local level?  Please don't answer.

"Cow Power" Comes To The Enumclaw Plateau

Dairies have long faced the challenge of handling their biggest milk making by-product - MANURE.  Traditional methods are not pretty as can be seen in the graphic that follows:

Now, 3 dairy farms in Enumclaw are teaming up with a Skagit county based company called Farm Power Northwest to construct an anaerobic digester to process this waste.  The new company will be called Rainier Biogas.  The $4 million project includes a 1-million gallon digester vessel and is expected to generate enough electricity to power 600 homes.  In addition, the elimination of manure lagoon methane emissions combined with clean electricity will reduce net greenhouse gas emissions by an estimated 9,000 tons of CO2 per year - the equivalent of removing 2,200 cars from our roads.

Anaerobic digesters rely on naturally occuring micro-organisms to break down or digest the waste, producing waste gas that can then be harnessed to produce electricity.  This technology has been around for many years, but what has changed is that it is now much more affordable to use for smaller scale projects.  King County has committed $492,000 to the project with funding provided by Federal grants.  The project is expected to be up and running in 2012.  Appears to be a great step forward for sustainable agriculture right in our backyard.

For those interested, following are two more graphics, first of the new process flow and then of the digester process.

 

Reflections On Becoming A Techno Retard

I've always considered myself to be ahead of the curve in adopting new technology, but increasingly I find myself scrambling to keep up.  The above picture is of the Apple II plus of which I was one of the early adopters.  Introduced in June 1979, well after I was out of graduate school where we still had to use punch cards to run our BASIC computer programs on mainframes, we jumped in early and bought this wonderful machine which was the latest and greatest at the time.  With 48 K of ram expandable to 64 K, there was not a lot of computing power here.  Doing a financial spreadsheet for home budgeting was about all we could do, except for playing Tetrus.

Today, we are just deluged with all of the new electronic tools.  When our children and grandchildren come to visit we see laptops, iPads, smart phones, iPods and Kindle spread around the house.  Wii Dance is great fun on the big screen and Nintendo DS units are in every bedroom.  Want to watch a movie - just go to Netflix running through our home wi-fi connection and Wii.  Judy's home desk top computer is pretty lonely these days.  Wow - what a change in such a short period of time.

But while we can keep up by buying the latest and greatest hardware, being "functionally" skilled is a whole nother issue and it seems that I keep falling further and further behind.  Anyone else out there feeling this same angst?  Fortunately, we have our grandchildren to help us keep learning.  And if you want to get in touch with me, don't txt.

What are your tips for keeping up?

And true confession - I still really enjoy reading a hardback book from Bob at Baker Street Books here in Black Diamond.  This is truly one of our community's treasures and increasingly a great entertainment hub with live jazz most every Friday or Saturday evening.  Am almost through the tome Peter The Great by Robert Massie that Bob got for me - great russian history and a great read.

One more tip.  If you buy any of this new technology and it's not available in town, do it on line. In that way, the City of Black Diamond will recieve the sales tax that would otherwise go to the brick and mortar outlet's home city.

2011 Retail Sales Trends By City

The above data shows in town retail sales trends by City so far in 2011.  Interestingly, our neighbor Covington tops the list.  Other neighbors such as Auburn and Kent do not appear to be so fortunate. 

We in Black Diamond didn't make the list because the total of in town retail sales is a small number.  Overall, however, when both in town and internet sales are included, we are doing ok with year to-date total retail sales growing in the 6 to 7% range - with city sales tax receipts growing accordingly.  But, sales tax receipts still represent a relatively small part of City general budget revenues.  We do need more retail/commercial development in our City.

Local Business Focus - Horizon Pet Supply

If you are looking for all natural food for your pet or maybe a special gift or treat for your pet this Christmas, you should consider dropping by Horizon Pet Supply located right here in Black Diamond at Diamond Square.  I am certainly no officiando of pet food or pet supply stores, since we currently have no pets, but I was pleased to find that we have a retail outlet right here in our community focused on healthy diets for pets.  Their theme is "Only the good stuff, with good old fashioned customer service" and they are local.  Definately worth giving them a try.

Cenex - Support A Local Business While Helping A Family In Need

Councilmember elect Tammie Boxx-Deady and I had the opportunity to meet with Cheryl Hanson, director of the Black Diamond Community Center, this past week.  Cutbacks in federal FEMA funding are having a big adverse impact on many of our local Food Banks.  We understand that Maple Valley's Food Bank funding has now been reduced by 40% entering the new year.  Fortunately, our Black Diamond Community Center Food Bank has not historically relied on federal funding so we are in a bit better position.  But what do you think might be the most in demand item that our in-need community requests?  As it turns out, gasoline vouchers top the list. Our community's food bank typically has plenty of soup and even some wonderful winter coats and jackets right now, but gas vouchers are consistently at or near the top.

Here is where our local Cenex station is now helping out.  If you buy a $20 voucher (that you can either donate or use yourself at a later time), you receive an immediate 10 cent per gallon discount at the pump for your current fill-up.  Sounds pretty good to me.  A great opportunity to support our local businesses, support our Black Diamond Community Center and at the same time save yourself some money in the process.  Thanks, Cenex.  It's a great deal.

Are New Health Care Clinics Good Or Bad For Our Community?

Ok, after a self imposed short hiatus, I am feeling the need to for more charts, graphs and data.  But bear with me on this one - these data raise some very interesting questions.  One of my favorite bloggers, Matthew Yglasias, has recently moved to Slate which I have also followed for many years now.  What the data seem to be saying is that the more services that are available to us and the closer these services are, the greater consumers of medical services we will be.  But - is there a correlation between being greater consumers of medical services and outcomes?  This is the real fundamental question and the jury remains out. 

Perhaps the biggest trend these days is to locate emergency medical services in suburban areas.  St. Elizabeth's hospital in Enumclaw recently opened a world class facility right in our back yard.  Believe me, I've seen their new facility and it's great.  Now we have Multi-Care in Covington also expanding facilities and will soon open their new 24 hr. emergency medicine services wing.  Currently, urgent care is only available during regualr business hours.  And somehow, many of us still find ourselves paying taxes to support Valley Medical Center, which is also trying to add new emergency services in our area.  With Multi-Care and St. Elizabeth's, why should we be required to pay taxes to support Valley??  Perhaps one of these days I'll have time enough to take on this cause for our community - but not now.

Why are all of these new emergency medical services being offered here?  Because they pay off.  But do they really result in better outcomes?  That's the big question and the data doesn't yet support the premise that the more available these services become locally, the better the outcomes.  We do know, however, that costs go up the more we "consume" of these services and the more local these services are, the more consumption of services there will be.  Since both our daughter and son-in-law are emergency medicine physicians in northern California, this issue leads to some interesting conversations. 

Who says that free market economics are not driving the medical establishment - unless you are a tax subsidized Valley Medical Center that we just don't need?

The Financial Markets' Casino

What ever happened to investing based on the fundamentals?  We do still have Warren Buffet and a few others of his ilk, but increasingly our financial markets seem to be dominated by the gamblers.  I was at the gym yesterday punishing my body in the battle of flab versus muscle tone and what did they have on the big screen - CNBC reporting on the markets.

The screen was literally alive with numbers, colors and movement that would make any gamer out there proud.  I'm not a TV watcher so I observed the scene for a little while and racked my brain - where have I seen this before?  Ah yes, Las Vegas and the casinos, that's where.  In so many ways, a casino seems to be the perfect metaphor for our financial markets of today.  All of the emphasis seems to on the very short term.  What's happening today.  The only trend charts that you see are daily trade related and maybe span a week at the longest. Breaking news is all of the "pops and drops" - those stocks going up or down the most for the day.  They even have a "halftime report" during the middle of the trading day, as if this is momentous news of great importance.  And then, if you want, you can continue watching at the end of trading and tune into "Mob Money", "Fast Money", "Mad Money" and even "Bonus Buck Answers".   Now if this isn't the closest thing that you'll find to Las Vegas and the casinos, I don't know what is.

Part of my reaction is specific to CNBC and their coverage but I think that it's also very illustrative of the mentality that seems to pervade our markets today.  Those that win this lottery are those whose "bets" on daily and weekly market movements beat other traders' or investors' bets.  If you think the market or particular stocks are going to go down, you place a "bet" - otherwise known as short selling.  This isn't investing, it pure short term wagering.  So, our 401K's can get creamed, but who walks away with money in their pocket. And we see extreme volatility as a result given the herd mentality.  Somehow, I just can't see the "value added" brought to our economy as a result of this speculation.

It will be interesting to see where the Occupy Wall Street movement goes.  There is no question that more and more people are angry.  I will admit to being a child of the 60's and all of the civil rights and anti-war demonstrations and riots.  With economic inequality continuing to increase, are we headed there again?

By the way, still looking for my hippie van.

 

Weekly Trend Charts Of Interest

No surprises here re the trend in Health Insurance Deductibles.  Be sure to let me know if any of your deductibles decreased.

When will home values stabilize?  Still so much forclosure overhang out there - in the millions of homes.  No more home equity credit card for the foreseable future.

There may actually be some good news in the chart above.  Apartments and multi-family housing are all the rage right now in the development community.  Population continues to grow and people must live somewhere, even when evicted from there homes.  When doubling up, there are only so many people that you can put into a bedroom.  So - eventually, one might reasonbly expect new home construction to eventually come back, whether it be in 5 years or 8 years or 10 years, and the cycle will swing back.  And like past cycles, you will likely see a glut in apartments and multi-family housing within the next 5 to 7 years.  Affordability, however, seems to me to be the wild card and this is where homebuilders and land developers may well have to face a whole new reality, even with increased demand for their product.  Mortgage rates just can't get materially lower.  With needing 20% down and limited increases in take home pay for the bottom 95% of us, particularly given health care cost trends, where will the money come from to pay the higher prices from the past?