Black Coffee: Somebody Call Oprah — I’ve Got a Confession to Make.

It’s time to sit back, relax and enjoy a little joe

Welcome to another rousing edition of Black Coffee, your off-beat weekly round-up of what’s been going on in the world of money and personal finance. Here’s what caught my attention over the past week…

Oprah called last week asking me for an interview. Of course, I refused. So she settled for Lance Armstrong instead.

That being said, I want to make one thing perfectly clear: Despite what many of you out there may think, I’ve never used any performance-enhancing drugs while writing these Black Coffee posts.

And I’m sure all my critics out there will happily back me up on that.

Okay … onward and upward.

Blogs I’ve Been Following This Week

MonevatorCould You Outsource Your Job to China? The Investor opines on the recent case of “Bob,” the financially savvy corporate computer programmer who, unbeknownst to his employer, outsourced his six-figure-salary job to China for pennies on the dollar so he could use his time on the clock for more important things — like watching cat videos on YouTube. I know. Talk about snatching defeat from the jaws of victory.

Control Your CashHow Do You Guys Do It? Then again, there’s always Plan B. Says Greg:  “We’ve managed to position ourselves so that we don’t have to work. And believe us, we don’t.” How does he manage to live the good life without exerting a lot of effort? Well, I won’t give the answer away, but rest assured it involves less paperwork and subterfuge than Bob’s idea.

Canadian Budget BinderA Personal Story: Chores and Money Lessons Growing Up. In this guest post by Glen from Monster Piggy Bank, he explains how he learned at an early age that there’s no such thing as a free lunch. Psst. Don’t tell that to Bob and Greg.

Live Well on LessWhen Should You Buy a House? According to Matt, on average, since 1920 home prices in the UK have appreciated at an annual rate of 8%. If true, that’s an absolutely insane pace that would seem to defy financial gravity. Then again, what do I know? (No need to answer that, folks. It’s a rhetorical question.)

The Way-Back Machine: Past Posts Of Mine You May Have Missed

From October 2009:

The 7 Deadly Sins of Personal Finance – Did you know your personal finances are subject to the very same seven deadly sins that many believe afflict the human soul? It’s true.

Credits and Debits

Credit: Wall St. celebrated on Friday as the Dow and S&P both closed at their highest levels in five years. The markets are on an upswing that has seen all three major averages, including NASDAQ, turn in three consecutive weekly gains.

Debit: Meanwhile, here on Main St. the outlook ain’t quite as rosy. Higher payroll taxes that took effect in January are at least partly to blame for consumer sentiment falling to its lowest point since December 2011.

Debit: Then again, considering that long-term unemployment hasn’t been this bad since World War II, it’s no wonder consumers are having trouble remaining upbeat. The average unemployed worker now needs 40 weeks to find a new job.

Debit: Did you see this? The US continues to aggressively recruit welfare recipients — whether they’re legal citizens or not. The push to increase the rolls is so aggressive, it’s estimated that federal welfare costs will rise 80% over the next ten years, putting taxpayers on the hook for $11 trillion.

Debit: Hey, it’s only money, right? Which is why you shouldn’t get too upset after I tell you that us taxpayers have been picking up the tab for, among other things, our multi-millionaire ex-presidents’ hefty cable and satellite television bills. Yep. It’s good to be king.

Debit: Of course, the spending party will continue as long as Ben Bernanke’s Federal Reserve continues to debase our currency and willingly bankroll our government’s uncontrolled deficits.

Debit: However, the soiree will eventually come to an end because, with each passing day, foreigners are becoming more reluctant to finance our debt. And who can blame them when the US shows absolutely no desire whatsoever to protect the value of its currency?

Credit: Our creditors — at least the ones who are paying attention — are finally realizing that they’d be much better off spending their money on tangible assets now, rather than risk being paid back down the road with our increasingly worthless dollars.

Credit: So when will the party end? When hyperinflation finally rears its ugly head and it takes a giant bag of cash to buy a few six-packs of beer, that’s when. Of course, that’ll never happen here in the US, no matter how much fiat money the Fed creates out of thin air. Right?

Debit: Big-government nanny states like California that, not surprisingly, are unable to control their spending, don’t have the luxury of printing away their massive debt — which is why the Not-So-Golden State taxes its citizens to death.

Credit: One Californian who ran into tough times became so fed up that he recently paid his $14,000 property tax bill with a wheelbarrow full of coins and small bills — courtesy of donations from friends and relatives who were eager to help him out.

Debit: Hey, somebody’s got to pay for California’s $99 billion union welfare program: a bullet train connecting Merced and Fresno. I know. As others have astutely observed, the bullet train will go nowhere — but at least it’ll go nowhere fast.

Debit: Okay, okay. To be fair, the bullet train will eventually connect Los Angeles with San Francisco — but that won’t be until 2033. Assuming the project stays on schedule. Never mind that it only takes an hour to fly between those two cities now.

Debit: Finally … A Chicago man who bought a lottery scratcher ticket and won $1 million ingested a fatal dose of cyanide the day after the state issued him a check for his winnings. Uh huh. I’m sure it’s just an unfortunate coincidence.

The Question of the Week

Sorry, there are no polls available at the moment.

By the Numbers – Contest Time: Win a $20 Starbucks Gift Card!

Yep, it’s contest time again! Below is a list of the Top 10 grossing movies from 2008. I’ve got a $20 Starbucks gift card for the person who can correctly guess the highest grossing film from that Top 10 list that I’ve NEVER seen.

Please place your answer in my blog’s comment section; I’ll only accept one answer per email address. If multiple folks pick the correct answer, then I’ll select the winner by a random draw among everybody who got it right.

And if nobody enters, I’ll use the card myself.

The contest closes on Friday, January 25th at 5 pm, Pacific Standard Time. Good luck!

1. The Dark Knight (US box office gross: $533 million)

2. Iron Man ($318M)

3. Indiana Jones and the Kingdom of the Crystal Skull ($317M)

4. Hancock ($228M)

5. WALL-E ($224M)

6. Kung Fu Panda ($215M)

7. Twilight ($193M)

8. Madagascar: Escape 2 Africa ($180M)

9. Quantum of Solace ($168M)

10. Dr. Seuss’ Horton Hears a Who ($155M)

Source: Box Office Mojo

Other Useless News

Here are the top — and bottom — 5 Canadian provinces and territories in terms of the average number of pages viewed per visit here at Len Penzo dot Com over the past 30 days:

1. Prince Edward Island (4.11 pages/visit)
2. Manitoba (2.17)
3. Northwest Territories & Nunavut (2.00)
4. British Columbia (1.71)
5. Quebec (1.65)

8.  Newfoundland (1.46)
9. Nova Scotia (1.42)
10.  Saskatchewan (1.33)
11. Yukon Territory (1.20)
12. New Brunswick (1.09)

Whether you happen to enjoy what you’re reading (like my friends on Prince Edward Island, eh) — or not (you hosers in New Brunswick) — please don’t forget to:

1. Click on that “Like” button in the sidebar to your right and become a fan of Len Penzo dot Com on Facebook!

2. Make sure you follow me on Twitter! And last, but not least…

3. Don’t forget to subscribe to my RSS feed too! Thank you. :-)

Letters, I Get Letters

Every week I feature the most interesting question or comment — assuming I get one, that is. And folks who are lucky enough to have the only question in the mailbag get their letter highlighted here whether it’s interesting or not!

Candy had this question for me:

“Will you ever do any more movie reviews with the Honeybee?”

Thanks for asking, Candy, but I doubt it. I alienate enough readers with these Black Coffee articles.

I’m Len Penzo and I approved this message.


  1. 2


    I’m going with… 3. Indiana Jones and the Kingdom of the Crystal Skull ($317M)!

    In terms of the tipping thing. For pretty bad service I’ll leave 10% most times and 15% if it wasn’t completely the server’s fault. For absolutely horrible service they get nothing. I was a server once and got nothing for good service at times, so nothing for bad service is at least deserved.

  2. 7

    Steve says

    This is a question that will require some pondering over time. I am asking you, because I perceive similar financial view characteristics.

    It will seem “a joke” initially, but it is becoming more serious to me, as I have pondered it many months now.

    What if the United States Treasury defaults with or without the Federal Reserve’s permission, on the debt of the US gov’t?

    I know, I know; first reaction no one else will buy our debt. I don’t buy that argument. Whose debt is China and Japan going to buy before they buy US debt, Greece?

    The money the Fed used to buy the debt, is already floating in the economy, if were “inflationary” as we have been told it would/should be, it would be by now. I do not buy the it would be “inflationary” argument.

    What does the Federal Reserve need a healthy balance sheet? What credit agency do they report to? Write-off the debt.

    They sure as hell are not holding it for the interest revenue stream.

    Further after we write this $85 billion, print the money to by some more and repeat until there are signs of inflation. This mindless accumulation of debt has got to be addressed.

    Would appreciate your insight.

    Big Ed in Amarillo, Tx

    • 8

      Len Penzo says

      “Whose debt is China and Japan going to buy before they buy US debt, Greece?”

      Who says any country has to buy our debt? After all, they can always use their dollars to buy tangible assets like oil, gold, and other commodities. And many are. There are fewer and fewer takers at Treasury auctions now — and so the Fed has to buy the bonds to take up the slack.

      There can be no argument that monetary inflation is out of control. The question is: When will it manifest itself in terms of price inflation?

      Right now, the Fed can print money until the cows come home because the US dollar is the world’s lone reserve currency — which increases demand for our currency. But that is slowly changing. For the past few years, Brazil, Russia, India, China and South Africa (the BRICS) have been conducting trade between themselves without the US dollar, weakening the buck’s hold as the world’s reserve currency.

      The lynchpin currently propping up the US Dollar is that all oil transactions are also made exclusively in US dollars, which enables us to continue running these massive deficits while maintaining relatively controlled price inflation. (I say “relatively controlled” because those who have been paying attention realize that prices have actually risen more than the government is letting on via its price indices.) There is huge opposition to this set-up, imposed by Henry Kissinger and the Saudi royal family soon after Richard Nixon fully decoupled the US dollar from gold. But that is quickly changing. The only thing keeping that very unpopular agreement in check has been our ability to impose our military dominance over the Middle East. It is only a matter of time before we are faced with a challenge there that we will refuse to take on — and that will end the age of the “petrodollar” and our ability to spend way beyond our means. It will also crash the economy here.

      Now … where is the price inflation? If you believe the government inflation figures as measured by the CPI, there is almost zero inflation. That is clearly hogwash — my grocery bills continue to climb at alarming rates. You can also see price inflation in, for example, the price of oil. It’s currently running at $111 per barrel (Brent Crude) — despite the current world economic malaise, that’s the same price oil was fetching back when the economy was really booming, before the economy crashed. Soy beans is another popular example. The new price floor today — which was established after all the new money printing started in 2009 — is the old price ceiling that was previously in effect for over three decades.

      Even so, although prices have been clearly rising for some time now, they haven’t risen as much as I would have expected to date based upon the current humongous expansion of our money supply. Here’s the rub: monetary inflation rarely runs in lock step with price inflation. As such, it is impossible to predict when its insidious effects will finally manifest on a major scale.

      But that doesn’t change the fact that extraordinary increases in the money supply eventually lead to massive price inflation over time. It always has. History has proven that fact time and again. No matter what kind of logic and financial machinations some economists will conjure up to try and prove that “this time it’s different.”

      (And here’s the scary thing … I think the Fed realizes the jig is up. They know there is a massive bond bubble that is going to pop, and that they are going to eventually lose control of the financial and currency markets. I believe they’re now simply trying to hold off the coming crash as long as possible.)

  3. 9

    Juanita says

    Hmmm. You have kids, so you probably watched the animated films. The superhero movies: all same genre, so you probably like those. (I know I do, despite my husbands protests and loud snoring in the theatre. Who sleeps through Batman?) I’m truly sorry if you saw that Indiana Jones movie. I’m guessing Twilight. I’ve only seen some of them because I have a 15 year old daughter. I wanted to wear a disguise in the theatre. Ugh. My apologies if the Honeybee made you go.

    • 10

      Len Penzo says

      I’ll admit, Juanita … I didn’t see the Twilight movie. (I’d rather get a root canal.) The big question is: Are there any higher-ranked movies on the list that I didn’t see??? :-)

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    “Despite what many of you out there may think, I’ve never used any performance-enhancing drugs while writing these Black Coffee posts.” – You sure that coffee isn’t leaded? (And I don’t mean the caffeine/no-caffeine joke)

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