BMW Charges Drivers $18 A Month For Heated Seat Subscription

BMW Charges Drivers $18 A Month For Heated Seat Subscription

Have you paid a subscription fee lately? Such as $10 a month to watch shows on Netflix or $15 a month for two-day or same-day shipping with Amazon Prime. Subscriptions are all around us and are now being embraced by the automotive industry. 

In select markets, BMW introduced the ConnectedDrive Store, a portal for existing owners can download various apps over the air to upgrade features on their vehicle, similar to how Tesla offers upgraded Autopilot subscriptions for a hefty monthly fee. 

However, BMW isn’t offering customers some advanced driving system that can autonomously navigate a vehicle around a parking lot with the touch of a button via a smartphone app or drive occupants around the metro area hands-free. The German automaker has begun to sell monthly subscriptions for “high beam assistant” and “front seat heating.”

BMW has embraced subscription monetization that will set drivers back $18 a month for heated seats or “unlimited” for $415. It’s similar to mobile gaming or video games — want a flashier player, better weapon, or a new map package — well, you have to pay for that. 

“Front Seat heating gets things nice and cosy in no time,” the ConnectedDrive store reads. “Activation after purchase is quick and easy.” 

The Verge noted, “BMW has slowly been putting features behind subscriptions since 2020, and heated seats subs are now available in BMW’s digital stores in countries including the UK, Germany, New Zealand, and South Africa. It doesn’t, however, seem to be an option in the US — yet.” 

“One of the most unusual items found in the BMW ConnectedDrive Store is called IconicSounds Sport. It essentially plays fake engine noises through the car’s speakers should you be willing to pay $138 to have the feature permanently,” automotive website Motor1 pointed out. 

The rise of in-car subscriptions is here, and drivers are furious because they’re paying for the hardware they can’t use — and there’s nothing revolutionary about heated seats, unlike Tesla’s upgraded Autopilot for $200 per month. 

Do NOT get the heated seat subscription, or anything similar to it,” one Redditor said on r/BMW. “

“The f**king hardware is in your car and you’ve already paid! And a f**king subscription on top of that is nonsense. Don’t get this, people, please,” they continued. 

Besides the proliferation of in-app car subscriptions, drivers will one day be bombarded with roadside ads on their infotainment displays. Ford’s new patent details this more in-depth (read: here). 

Tyler Durden
Thu, 07/14/2022 – 06:55

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California Border Patrol Finds 27 Pounds Of Meth In Booster Seat

California Border Patrol Finds 27 Pounds Of Meth In Booster Seat

Authored by Jill McLaughlin via The Epoch Times,

U.S. Customs and Border Patrol agents in Murrieta, California, arrested the driver of a car carrying 27 pounds of methamphetamine hidden in child booster seats, authorities announced June 17.

Border Patrol K9 team alert agents to children booster seats, and with further inspection agents found several packages of methamphetamine in Murrieta, Calif., on June 20, 2022. (Courtesy of U.S. Customs and Border Protection)

The suspect, a U.S. citizen, was driving on Interstate 15, north of a Border Patrol station, on June 15.

“Drug smugglers will use any means necessary to get their poison onto our streets. Nothing is sacred to them, not even family,” Aaron M. Heitke, Chief Patrol Agent at the San Diego Sector said in a release.

A man was driving with his wife and four of their children when agents stopped the car. A K9 team was dispatched and located the narcotics in three booster seats inside the car. Several packages were found containing methamphetamine, U.S. Border Patrol reported.

The estimated street value is $60,000, agents said.

Agents turned the driver over to the Inland Crackdown Allied Taskforce for prosecution. The vehicle was seized by Border Patrol. The four children and their mother were released.

Tyler Durden
Wed, 06/22/2022 – 23:25

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Hold On To Your Seat!

Hold On To Your Seat!

Authored by James Rickards via DailyReckoning.com,

The S&P is in bear market territory, which is defined as a decline of 20% or more from recent highs.

And it may fall even further. Since World War II, there have been 14 bear markets. The median loss during these bear markets has been 30%, and they lasted about a year (hat tip to Bespoke Investment Group).

The Kind of Drop We Haven’t Seen in Decades

And with the Fed ready to raise interest rates again in July (after hiking by 75bps this week following last week’s red-hot inflation data – CPI and UMich expectations), we could be soon witnessing an even bigger drop in the market – the kind that we haven’t seen in decades.

That’s not fear-mongering or hyperbole. It’s just a sober assessment of the situation.

The Fed is deeply concerned about inflation, and it will continue to aggressively raise interest rates to try to tamp it down.

But neither the economy nor the stock market can take the kind of tightening required to really get a hold on inflation.

Since the end of World War II, the Fed has embarked on perhaps a dozen tightening cycles in which it raised interest rates.

All but one of these tightening cycles resulted in recession. That’s a nearly perfect record.

And there’s absolutely no reason to expect that this time will be any different, especially with the tremendous excesses within the financial system.

Which brings up the question, is the Federal Reserve broke?

How Can the Fed Be Broke?

When you bring up the topic of the Federal Reserve going broke, most individuals react by saying, “That’s impossible! The Fed can’t go broke. They can just print more money.”

That’s a typical reaction, but it displays a misunderstanding of what money is and how the Fed actually works. Yes, the Fed can print all the money it wants. But money is not an asset for the Fed; it’s a liability.

Take a $20 bill out of your purse or wallet and read it. On a banner across the top it says, “Federal Reserve Note.” A note is a form of debt; in other words, it’s a liability. That becomes clear when you look at the Fed’s balance sheet (it’s publicly available on the Fed’s website).

Assets consist mainly of securities: mostly U.S. Treasury bills and notes and mortgage-backed securities. Liabilities consist of cash, coins and reserves deposited by member banks at the Fed. The Fed’s net worth or capital is simply the net of the assets minus liabilities.

That equity account is a small sliver of capital relative to the total assets.

In other words, the Fed looks like a highly leveraged hedge fund. Printing money can be used to buy more securities, but all that does is leverage the balance sheet even more by piling more assets (securities) and liabilities (money and reserves) on top of the same sliver of capital.

But what if it’s worse than that? What if the assets are less than the liabilities so the Fed has a negative net worth?

Less Than Zero

A negative net worth is one definition of insolvency, which is a fancy name for broke. In the steady state, this would not happen. The Fed could just sit still; let assets mature at par value; and get paid the cash by the issuer, at which point the cash just disappears when the Fed receives it.

The Fed could gradually deleverage just by doing nothing. But what if the Fed balance sheet were marked to market like a real hedge fund? Or what if the Fed sold securities at a loss instead of just waiting for them to mature at par value?

The Fed’s accounting method does not mark to market, but any analyst can run the numbers anyway just by looking at asset maturities and using current market prices for those assets. If you do this, you find that higher interest rates have resulted in many securities in Fed’s portfolio being worth less than book value.

That’s bond math 101: higher rates = lower prices. Beyond that, the Fed does not want to wait to deleverage. It wants to reduce the balance sheet quickly. That means asset sales, especially the less liquid mortgage-backed securities.

That’s where real operating losses arise because an actual sale below par value results in a loss that must be charged against capital. So yes, the Fed is probably insolvent on a mark-to-market basis (a method it does not use).

A Fed Governor Admits the Fed Is Insolvent

If you evaluated the Fed on a mark-to-market basis the way you would with a hedge fund, its capital would be wiped out. It’s insolvent. I once had a conversation with a member of the Federal Open Market Committee who admitted this to me privately. I reached a conclusion on my own, but she confirmed it.

The conversation went like this: I said, “I think the Fed is insolvent.”

This governor first resisted and said, “No, we’re not.” But I pressed her a little bit harder and she said, “Well, maybe.”

And then I just looked at her and she said, “Well, we are, but it doesn’t matter.”

In other words, a governor of the Federal Reserve admitted to me, privately, that the Federal Reserve is insolvent but said it doesn’t matter because central banks don’t need capital.

Well, central banks do need capital.

She may be right in the short term that it doesn’t really matter. Most people don’t even know what the Federal Reserve is let alone the inside accounting issues I described here. But in the next panic, it just might matter.

Maybe Gold Is the Foundation of the Monetary System After All

The problem is each financial crisis is larger than the one that preceded it because the system itself is larger due to massive central bank interventions. It’s a matter of scale.

How can the Fed bail out big banks when the Fed itself is insolvent? The issue might not be a legal one so much as a matter of confidence.

Just in case, the Fed does have a hidden asset to offset all of those not-so-hidden losses. The Fed has a gold certificate on its books based on a quantity of gold valued at $42.22 per ounce.

If that gold were revalued to the current market price of $1,850 per ounce, another $500 billion would appear out of thin air. That could be added to Fed capital.

The Fed doesn’t like to talk about gold, but maybe the entire monetary system is based on gold after all.

One day we might just find out the hard way.

Tyler Durden
Fri, 06/17/2022 – 06:30

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