The planet-sized egos of rock & roll performers are legendary.
Few things symbolize this better than the outrageous requests they often make when on tour.
These requests are referred to as “riders”, and appear in the contract a tour venue receives in advance of the artist’s arrival. These contract riders specify the physical conditions that the singer/band requires to be in place before arriving to perform. Stage lighting settings, sound equipment, furnishings, etc — that kind of stuff.
And these rider requests can get pretty funky – often extremely so — when it comes to backstage perks the performers want.
For example: A wooden pond filled with koi carp (Eminem). A driver who will not speak or make eye contact (Katy Perry). 20 white kittens and 100 doves (Mariah Carey). Seven dwarves (Iggy Pop). 50,000 bees (Slayer). A sub-machine gun (Mötley Crüe). And, yes, even a great white shark (Hank III).
The practice of making these kind of outrageous demands stems from a rider Van Halen inserted into the contract for its 1982 world tour, which insisted on a bowl of M&Ms to be provided backstage, but with all of the brown M&Ms removed.
As this image below of the actual rider shows, the band was very explicit in its seriousness about this:
Once the media got whiff of this, it had a field day roasting the band’s narcissistic chutzpah. A new high-water mark of diva capriciousness had been established, which quickly became legend. A feat of prima donna pampering that subsequent performers have been trying to top ever since.
But as crazy as it sounds, Van Halen’s “no brown M&Ms” rider had nothing to do with caprice. There was a solid rationale behind it.
In fact, it was quite brilliant.
The Importance Of Effective Indicators
Van Halen’s 1982 world tour was a massive production, involving a tremendous amount of gear and technical complexity. The contract the band sent in advance to venues was so thick due to all the details within, it was referred to as the “Chinese Yellow Pages”.
Non-compliance with the requirements in the contract could have serious consequences that could ruin the show, or even jeopardize lives.
So when the band rolled up to its next venue, it needed a quick way to determine if the stage crew there had complied with all of the specifications within its contract.
And that’s why the “no brown M&Ms” rider was inserted. The band could simply hop off the bus and check the candy bowl. If they found brown M&Ms, they knew the contract hadn’t been carefully read. And then they’d immediately call for a full-line check of the entire set.
As lead singer David Lee Roth detailed in his autobiography:
Van Halen was the first band to take huge productions into tertiary, third-level markets. We’d pull up with nine eighteen-wheeler trucks, full of gear, where the standard was three trucks, max. And there were many, many technical errors — whether it was the girders couldn’t support the weight, or the flooring would sink in, or the doors weren’t big enough to move the gear through.
The contract rider read like a version of the Chinese Yellow Pages because there was so much equipment, and so many human beings to make it function. So just as a little test, in the technical aspect of the rider, it would say “Article 148: There will be fifteen amperage voltage sockets at twenty-foot spaces, evenly, providing nineteen amperes …” This kind of thing. And article number 126, in the middle of nowhere, was: “There will be no brown M&M’s in the backstage area, upon pain of forfeiture of the show, with full compensation.”
So, when I would walk backstage, if I saw a brown M&M in that bowl … well, line-check the entire production. Guaranteed you’re going to arrive at a technical error. They didn’t read the contract. Guaranteed you’d run into a problem. Sometimes it would threaten to just destroy the whole show. Something like, literally, life-threatening.
Genius.
Through its rider, the band had created a easy-to-monitor and trustworthy indicator. No brown M&Ms, and the show was likely set up to go smoothly. But if otherwise, don’t perform until the entire venue is scrutinized for other missed requirements.
The lesson to take from Van Halen’s wisdom is that having good indicators is key to achieving success.
This is also extremely true for the world of investing, where you are deploying capital based upon an expected future return. How do you determine when it’s a good time to enter into an investment? Once in it, how do you monitor the conditions supporting your rationale for holding it — are those changing? And if so, are they getting better or worse? When should you exit the position?
For all of these questions, the better the indicators you use, the more accurate and informed your decision-making will be. And the better your returns as an investor will be.
When The Indicators Are Giving A Signal, Pay Attention
Over the years, we’ve compiled a large number of indicators that we monitor closely on an ongoing basis here at PeakProsperity.com. They most definitely inform our economic outlook and forecasting.
We’ll dedicate an upcoming report to laying out the sources and metrics we place the greatest weighting on. But several that we’re watching closely right now come from two market analysts that we highly respect.
The first set comes from Lance Roberts, chief strategist/economist for Clarity Financial. Lance is renowned for his excellent charts and ability to highlight key changes in data trends. Below are several indicators he’s recently featured, suggesting weariness in the US financial markets and growing likelihood of economic recession.
First, the S&P 500 is showing signs of topping out, having broken below the trading range of its latest 8-month bullish trend, and its MACD momentum indicator displaying two recent sell signals:
Lance warns that such signals suggest that further price gains will be “volatile and limited” unless the S&P returns into its bullish channel. If it indeed does not and drops below the key resistance level of 2390, he sees a swift price correction of 12% as a real possibility.
But he then combines this near-term technical analysis with more far-sighted data to make the point that the financial markets are not just overbought, but dangerously overvalued at this point. Similar to John Hussman (another producer of market indicators we value highly), Lance shows that, because today’s prices are the result of pulling so much of tomorrow’s valuation into today (e.g., via the suppression of interest rates and overexuberant speculation), we are living at a rare time in history where the average market return for the next 20 years may well be negative:
And he recently caught our attention by surfacing this chart of the change in annual Real Value Added to the US economy, a metric that hadn’t been on our radar beforehand. This has been a reliable indicator of recession in the US for nearly 70 years, and is now signaling that we’ve likely already entered one:
Couple Lance’s indicators with those of our other expert, Grant Williams, portfolio advisor at Vulpes Investment Management and co-founder of Real Vision TV. Grant and the team at Real Vision recently issued their latest Killer Charts series, which adds validation and additional weight to Lance’s warnings.
First off, Grant and his team see similar technical signs of “exhaustion” in the S&P 500 and predict lower prices ahead:
Note that they don’t just expect the S&P to correct slightly and then continuing powering higher. Other indicators they track, like the equities-vs-commodities ratio, strongly suggests a bubble peak for the S&P. From here they predict a secular bear trend for stocks (possibly paired with a new bull trend in commodities):
And like Lance, Grant sees signs that the US economy is poised to slow further…
.. and is likely, as Lance also concludes, tipping into recession:
When smart analysts independently find the same patterns in the data, it’s time to take notice.
The charts above are only a few of the indicators Lance and Grant monitor that are now sending strong cautionary warnings about the near-term prospects for the financial markets and the underlying economy. What other key metrics should we also be tracing closely right now?
To dig much deeper into this, Lance and Grant will be presenting their latest indicators, analysis and forecasts at the Dangerous Markets webinar on September 13th — where they will take ample questions live from the audience. For more information on the webinar, click here.
Join the discussion
13 Comments
Fri, Sep 01, 2017 - 4:36pm
BBC and Bloomberg know it, but no mention on Peak Prosperity
Both BBC and Bloomberg mentioned that the hurricane disaster was linked to the fact that the atmosphere now has 7% more moisture than in the past, since we are 1 deg C up. Strangely, the "cutting edge" Martenson site does not mention it, and Martenson himself gets interviewed on the hurricane and does not even mention gl0bal w/rming (I even have to munge the words so as not to trigger your spam filters).
Something stinks in the state of Denmark.
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Fri, Sep 01, 2017 - 5:46pm
Be careful with your style of criticism
GerrySM --
I'd advise a different approach here when submitting critical feedback. Noting that you're a relatively new member here at PeakProsperity.com, I'm offering this in the spirit of increasing your odds for success in getting Chris and/or me to respond in the future.
Chris and I are much more likely to engage with a cooly-presented direct question. "What role, if any, do you think climate change played in contributing to Harvey's potency?" is a fine example.
A good question. One we'd do our best to give a thoughtful answer to.
But we don't respond well to rants, attacks, or petulance -- or all three, as I interpret to be the case with your comment. Whatever the topic, we have no interest in allowing ourselves to be pushed into reacting to every person's pet cause that we may or may not have addressed in our work.
But a curious, respectfully-presented question or debate? We love those. Critical feedback is absolutely fine, as long as our site's posting guidelines are respected.
Oh, and provided the criticism is well-founded. For instance, your primary complaint is that there's been "no mention" on this site of the role that higher temperatures in the Gulf played in Harvey's prodigious force.
That is not accurate.
Here are Chris' words, taken from the transcript of this week's Off The Cuff discussion with Charles Hugh Smith:
We can tolerate you overlooking this clear evidence in your haste to comment. You're not a paying subscriber, so you don't have access to the OTC transcript. Of course, had you simply asked us our position on the matter, we would have clarified it for you.
But your tone, sir, we won't tolerate.
Please take the direction above under advisement in your future comments. Else you highly likely won't get a response from us, and will likely see any similar comments which are in violation of our posting guidelines removed by our site moderators.
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Fri, Sep 01, 2017 - 7:15pm
THE EARTH IS THE SUN
Aloha! I went to my first Van Halen gig at the Golden West Ballroom in Norwalk, CA back in 1974. They weren't famous then! No M&Ms either!
Was interesting how climate seems to be more about human industrial cycles than sun cycles. All my life I thought the sun had something to do with the surface warmth of Earth and the daily weather. I surmised this when I noticed as a child that the ground temperature at night time was generally cooler than the day time!
What do children know?
When I see large global banks and global politicians pushing a one sided agenda I get wary! Doesn't matter if it is derivatives or global warming or now climate change! You can plug the word "change" into anything to make it seem logical. Like "human change"! Like "financial change"! In the end change virtually means nothing! Obama used it a lot! Hope and Change! And he got elected!
Here see ...
Humans always have more grandiosity and genius in political think, but when it comes to nature we're pretty useless and unimportant and in actuality not so grand. Harvey proves that! So did the Northridge earthquake! Technology to infinity changes nothing about the human condition. We are always full of ourselves and egotists until the next disaster!
I am north of Houston and had to evacuate my mother. Lots of truly brave and heroic events every day without any government regulations or politicians directing us. I saw the same in Hawaii when I was in Hurricane Iselle and I saw the same in Hurricane Alicia as well and the Loma Prieta earthquake which I was in. Not much global warming controversy then! But banks and politicians didn't think up carbon credits until later! Who owns who?
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Sat, Sep 02, 2017 - 5:52am
Love the forward PE chart Adam...
Nothing like a good, "you are here" map to wake folks up. The situation is actually worse than it looks, because, like most metrics, the integrity of, "P/E" has morphed over the years, with more and more non-GAAP accounting tricks coming into play, and the massive, cheap money-fueled stock buyback programs making earnings look better on a per share basis. Dave Kranzler is a capable forensic accountant and has documented many instances over the last few years.. here are some recent examples;
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Sat, Sep 02, 2017 - 8:28am
Be Careful What You Wish For
Jim,
That is a good example of why people need to be careful to choose indicators that aren't easily manipulated. The more the measures can be manipulated, the less useful the measures become. Take the M&M indicator. Do Roadies ever talk to each other? Won't stories about that prima donna group get passed down the line. Once everyone knows the band's obsession against brown M&Ms, that indicator becomes worth less and less until it becomes worthless.
In the medical field, doctors noted a high correlation between high cholesterol and heart related issues. Since cholesterol was easy to measure, it became an indicator that had some utility. Enter the pharmaceutical industry. Since folks are focused on the indicator's level rather than the underlying health driving the indicator, they've developed drugs to lower cholesterol. There is no need to change a gluttonous diet or start to actually exercise. Just take this pill and all that worry goes away. Who cares that there are side effects. There are pills for those conditions as well.
When I was working, my bosses usually had their preferred metric indicator that was easily discerned. We learned that rewards go to those who improve the boss' measure. It really didn't matter whether the indicator improved the project or the organization. The "smart" engineers focused on improving the measure. Lots of costly decisions were made in this pursuit.
The bottom line is that indicators are just that - indicators. Be careful when choosing a simplistic measure and only trust it as far as it can be thrown.
Grover
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Sat, Sep 02, 2017 - 2:25pm
"enter the pharmaceutical industry"
...exit a lot of things
Ps. There's great scene from Spinal Tap (possibly my favorite film) where the genius Christopher Guest takes the M&M concept to a new level (possibly 11)
click on black screen
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Sun, Sep 03, 2017 - 2:43am
Was interesting how climate
Was interesting how climate seems to be more about human industrial cycles than sun cycles. All my life I thought the sun had something to do with the surface warmth of Earth and the daily weather. I surmised this when I noticed as a child that the ground temperature at night time was generally cooler than the day time!
What do children know?
When I see large global banks and global politicians pushing a one sided agenda I get wary! Doesn't matter if it is derivatives or global warming or now climate change! You can plug the word "change" into anything to make it seem logical. Like "human change"! Like "financial change"! In the end change virtually means nothing! Obama used it a lot! Hope and Change! And he got elected!
You have a very good point!
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Sun, Sep 03, 2017 - 8:47am
Re: BBC And Bloomberg Know It, But No Mention On Peak Prosperity
Both BBC and Bloomberg mentioned that the hurricane disaster was linked to the fact that the atmosphere now has 7% more moisture than in the past, since we are 1 deg C up. Strangely, the "cutting edge" Martenson site does not mention it, and Martenson himself gets interviewed on the hurricane and does not even mention gl0bal w/rming (I even have to munge the words so as not to trigger your spam filters).
Something stinks in the state of Denmark.
US policies caused overbuilding in a flood plane. Idiocy repeated over and over. I am beginning to think this is intentional to consolidate power. And it is now called Climate Change because original assumptions have proved invalid.
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Sun, Sep 03, 2017 - 7:16pm
At The Edge of Extinction, Only Love Remains
To quote prof. McPherson.
Who percieves what and what do we want to name it. We could just call it the natural outputs of Human Civilization Over-shoot. Let's just call it crop failure or famine. As large mammals we ought to be quite concerned about that predicament. We need to eat a lot. Solar record, Geologic record or human record. It won't matter.
As has been noted. A civilized conversation is always more interesting. What do you want and what are you doing to get it? And by all means try some due diligence and research before hand.
I've mentioned here before that I would love to see PP tackle race in America since slave labor is how this economy came to be. But I also realize what a challenge that would be for this audience and probably not helpful here. So I don't go off on my soap box. There is some mention here and there but my guess is we're mostly well educated, middle to upper-middle and wealthy white folks here and have the privalege of ignoring it. Unless "they" start messing with symbols. [sic] At least y'all write like white people. LOL
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Tue, Sep 05, 2017 - 5:55am
(No subject)
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Tue, Sep 05, 2017 - 5:56am
(No subject)
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Tue, Sep 05, 2017 - 5:59am
haha
The economy came to be due to capitalistic economic policies and a resource saturated nation. Slavery, that was happening all over the world so it wasn't a competitive advantage. Listing it as such shows ignorance and perpetuates division.
You're racial views and emotional rant tell everyone exactly what they need to know about you....hateful, divisionist, and extremely ignorant.
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Tue, Sep 05, 2017 - 11:00am
wanderson, newsbuoy
Some rather wide-ranging thoughts:
No J wanderson, or JW anderson; Mr. Newsbuoy is not ignorant or hateful.
Newsbuoy, you're right: we've we've hit Peak Oil and Peak almost-everything and the hard times have started for many, for others the hard times are coming soon. But let me hasten to add, that "soon" is a relative term. When all of us were 1st exposed - intellectually, I mean - to the exponential function and it's "results" (environmental devastation and economic troubles) that already have more than a foothold already... I'm saying that when you're first exposed to these concepts you tend to think the human species will fall off a cliff immediately. But instead of a quick trainwreck what has begun is a slow-motion trainwreck. A lot of us have had years to prepare.
Historical questions like "what role did slavery play in the antebellum US?" have been researched. So if we're going to discuss them here do your research and tell us where you learned about it. The question is probably more nuanced than we have time for at Peak Prosperity (or maybe it is, like other historical things, subject to opinion as posts in this thread might suggest), we at PP aren't specifically a history site so maybe there's no point in pushing it further.
Some groups of people have it statistically harder than others. I suppose that is considered a justification for identity politics in the US. But I don't think we want identity politics on this site because if we focus on fairness from one group to another then we start to lose sight of things like barrels of oil per capita or doing what you can with what you have.
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