In late August, I was driving home from New York City when I came upon a throng of young adults who were coming back from an Electric Zoo concert on Randall's Island. Many were wearing swimming trunks, and were obviously ripped. They had had a blast... no doubt about it. The event underscored the current shift in the economy from Services to Experiences which is being driven by Millennials. Interestingly, the Experience Economy has been in the works for a long time.

The phenomenon didn't just pop up, it was mentioned in Alvin Toffler’s 1970  book, “Future Shock,” and then in a famous paper in 1998 that observed the direction consumers were moving toward. Think of those old westerns where everyone in town went to the general store for coffee beans and other staples. Fast forwarding to the future, we have packaged coffee to make our lives so much easier. We are also able to pick-up brewed coffee, which didn’t take too long to become the next big thing in the coffee world. And today, young adults buy their coffee from shops that have Wi-Fi and comfortable seating.

An Eventbrite-Harris poll on millennials and their spending preference known as the "Experience Economy" is a tell-tale sign:

78%	Prefer spending money on experiences over material things
82%	Have been to a live event in the past year
72%	Want to allocate more money to real-life experiences
70%	Admit to suffering from FOMO (Fear of missing out)

There are lots of ways to make money from this trend. Investors have to be leery of investments that are losing relevance in the Experience Economy (in which I will detail in a later piece). In the meantime, at least young adults are spending their own $1.3 trillion. When are we going to get a handle on the government spending our hard earned money?

GOP Blinks

Last week, the House passed a continuing resolution known as a CR that will keep the federal government operating until December 11^th… and you thought you were living paycheck to paycheck. The fact is the last time our government passed a real budget was in 1997. CR-time typically means drama, but the GOP is smelling victory in November, and wants no part of a government shutdown. So, Export- Import stays, and the President will get more money for war than he requested. I think it is a shame and a defeat for the American public. The Export-Import Bank is a massive engine of crony capitalism with millions going to green or so-called green projects, in addition to multi-billion corporations gaining access to taxpayer funds and backing.

Spending Levels	$1.012 Trillion	December 11, 2014
Export-Import	$27.3 Billion	June 30, 2015
Internet Tax Moratorium	N/A	December 11, 2014
Overseas Contingency Operations	$26.0 billion	December 11, 2014

Speaking of Green projects

On Sunday, the last official day of one of the coolest summers I can remember, about 300,000 protestors gathered in NYC to demand action on global warming. The event was led by Leonardo DiCaprio, who may not have enough star power to help this fading crusade.

Today, the official UN Summit will boost leaders from 125 countries, however, missing are leaders from the biggest creators of carbon emissions:

• India
• Russia
• China
• Germany
• Australia
• Canada

 Stephen Harper's absence is embarrassing, especially considering that he is in New York today. Perhaps, even more embarrassing is the fact that ice in the Antarctica is now 7.6 million square miles, a new all-time record.

Today’s Session

There are two big deals out this morning on foreign companies acquiring American businesses. This highlights that our poor tax policy isn’t just an issue for the US-based businesses that are looking to flee the most oppressive taxes in the world.

Sigma-Aldrich Being Acquired by Merck Germany in $17 Billion Deal

Total sales 2013 were $2.7 billion

• US $1,026,000,000
• International $1,678,000,000

Sigma Aldrich   2013 Sales
Research $1.4 billion	33	40	27
Applied $600 million	47	42	11
Commercial $700 million	55	32	13

Dresser - Rand Being Acquired by Siemens for $7.6 Billion

Total sales by geographic region in 2013:

• 31% North America
• 14% Latin America
• 26% Europe
• 12% Middle East
• 17% Asia

 This trend has been going on for years, but it seems to be picking up steam.

We live in a global economy and money moves around the world in a flash and just as Alibaba raised billions from American investors’, foreign investors are interested in America. The thing is, our tax policy makes it too easy for our companies to be taken over, and the foreign investors are going after our fastest growing businesses.

The market is worried about China’s manufacturing number… go figure.

Comments

I am NOT missing anything....not worried either. Karin on 9/22/2014 11:11:19 AM

to Charles have enjoyed watching you on Fox News I think you're very bright young man thats why I signed up for your site I'm just small town guy with a little bit of extra money looking to do some investing but I don't have the first clue about how to do it so if you get this maybe you can help me out or give me some helpful suggestionskeep up the good work and God bless you and your family. W Dome on 9/22/2014 11:26:51 AM

I don't trust the Fed. So much borrowing for so long can only mean a real shock when they stop buying our own bonds....Inflation always follows.. thomas Wayne on 9/22/2014 11:38:34 AM

Fearing we'd miss out on a major new ground-floor experience, my wife and I opted in to pay for seats to the new 49'ers LEVI STADIUM. The stadium license fee for just our seat that we share with my brother is $30K. (We passed on the 80K seats just 4 seats away from ours, but enough is enough.) The season tix cost this year is $3K per seat. But we we wanted to be in on the ground floor for this new state of the art stadium. Note this is money that is a real stretch for us -- but we did it nonetheless. However the real FOMO was us just "having to" see what the 49er RED ZONE RALLY pre-game party was like at $80 per person. It was lke "we'll never know what's behind the golden door unless we go once." Well the party was fun -- and the food and beverage delicious. I don't regret it, thogh I[m not sure how many more we'll attend. In summary I have a saying that you can always make up the money again -- but never the experience. Similarly, you always have the memory, but chances are you'll forget how much it cost. Ron G on 9/22/2014 1:55:19 PM

None, but I answered "yes" on the first three. Oh yes, I'm 80 so I haven't missed out on much. Dick Kantenberger on 9/22/2014 2:19:58 PM

FOMO is just another fad invented by bloggers desperate for something to buzz about. Back in my day, people went to live events all the time -- boxing matches, baseball, football and basketball games. I even went to a live poultry show in Madison Square 2 years in a row. Try doing that today! I'm more interested in what $250 billion IPO's like Alibaba can do to the market in one day. All that money had to come from somewhere, not all of it was just printed by the Fed. I think we've just had a mini-earthquake with lots of other stocks sold just to make room for BABA. Today, it began looking like a real top, but is it? Dennis Howard on 9/22/2014 4:39:10 PM

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