Black Coffee: Sometimes, He Who Sells First Sells Best

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.

And away we go …

Credits and Debits

Credit: If you’re looking to invest in the stock market, you may want to consider a single Class A share of Warren Buffett’s Berkshire Hathaway multinational conglomerate; it crossed the $200,000 mark on Thursday. No, that’s not a typo. It’s $200,000 per share.

Credit: For what it’s worth, Berkshire Hathaway owns a host of companies including GEICO Insurance, Burlington Northern Santa Fe, and Helzberg Diamonds. I don’t see an obvious connection there either, but obviously Mr. Buffett knows what he’s doing.

Credit: On the other hand, Buffett’s megacorp also owns Dairy Queen and Fruit of the Loom. I’m sure the lactose-intolerant among us would argue there is some serious business synergy going on there.

Debit: Yes, Berkshire’s Class A stock is for wealthy people. For the rest of us, there’s Walmart; their shares ended the week at a more affordable price of $73.90, down almost 6% this year on dwindling sales. In fact, Walmart’s same store sales have declined for five consecutive quarters. Ouch.

Debit: Did you know that 18% of all food stamps were redeemed at Walmart stores across the nation last year? It’s true; $13.5 billion worth to be exact — that’s roughly 3% of Walmart’s $469 billion total revenue in 2013.

Debit: Here’s another reason to disbelieve anyone who says we’re in the middle of an economic recovery: A $2.4 billion casino in Atlantic City that filed for bankruptcy is closing its doors next month. As a result, 3100 people will soon be unemployed. Sad.

Debit: Maybe they can get a cushy government job at the US Patent Office. The Washington Times reports that workers there were paid more than $5 million between 2009 and 2013 — including $500,000 in performance bonuses — to walk their dogs, watch TV and do chores at home. No, really.

Credit: If that isn’t a prime example of a government that’s grown far too large for its own good, what is? Even so, that evidence still won’t keep Big Government cheerleaders from clamoring for higher taxes on “the rich.” I know.

Debit: Speaking of jobs, from CNBC: “Since 2000, all of the net increase in the number of working-age (16 to 65) people holding a job in Tennessee has gone to immigrants (legal and illegal). Even though the native-born accounted for 60% of the growth in the state’s total working-age population.” Unbelievable.

Debit: Putting your home on the market? If so, consider this: the supply of buyers may be drying up. Mortgage applications have been declining for the past nine months; they’re now at a 14-year low — despite falling interest rates. Remember: In a topping market, he who sells first sells best.

Debit: Meanwhile, in yet another sign that the dollar’s reign as the world’s reserve currency is on its last legs — Russian President Vladimir Putin said this week that he’s thinking about bypassing the dollar by selling oil and gas directly for rubles.

Debit: Why should we care about Mr. Putin’s threats? Because, as Bill Holter explains: “It means the purchasing power of the dollar is being threatened. It means that once the dollar does devalue sharply and quickly, your labor will be paid less in real terms. It means everything you have saved over the years will be worth less in real terms.”

Debit: As Holder also notes, the bad news doesn’t stop there: “(As) the dollar becomes (less) sought-after, it will then take MORE dollars to complete trade for anything and everything from high tech widgets to bananas.” And you think Walmart is having trouble selling goods now?

Debit: It’s easy to see why the world is quickly tiring of the US dollar. Especially in light of reports that the US government’s fiscal gap increased by $11 trillion last year alone. It’s now a staggering $222 trillion. There is no way that this can ever be paid off — at least not without destroying the dollar first via massive money printing.

Credit: If enough people eventually figure out that the dollars they’re holding are essentially worthless, then a devastating — not to mention previously-inconceivable — run on the dollar will begin. After all, when fundamentals turn sour, “he who sells first sells best” isn’t limited to over-priced housing. It applies to over-valued currencies too.

By the Numbers

History shows that no world reserve currency lasts forever.

1530 Year the real de a ocho — better known as the Spanish dollar, or piece of eight — became the world’s reserve currency.

1640 Year the Netherlands guilder dethroned the real de a ocho to become the next world reserve currency.

95 Number of years that France owned the world reserve currency, after wrestling it from the Netherlands in 1720.

1815 Year the British pound sterling became the world’s reserve currency.

94 Average reign, in years, of the world’s reserve currencies since 1450.

94 Number of years the US dollar has been the world’s reserve currency.

Source: Economic Reason

The Question of the Week

[poll id="21"]

Last Week’s Poll Result

On average, how many robo- or telemarketing calls do you receive each week?

• 1 or 2 (30%)
• 5 or more (29%)
• 0 (22%)
• 3 or 4 (19%)

More than 200 people answered this week’s survey question — and judging from the responses, it is apparent that more than 3 in 4 of you get hit by a rogue telemarketing call at least once per week. I’m happy to say that since we’ve been using the free service offered by nomorobo.com, it has stopped those annoying calls dead in their tracks! Oh, and as for the 22% who report getting zero calls per week, well … all I can say is: congratulations!

Other Useless News

Here are the top — and bottom — five 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. Alberta (1.93 pages/visit)
2. Prince Edward Island (1.87)
3. Alberta (1.81)
4. Ontario (1.72)
5. Manitoba (1.62)

9. Newfoundland (1.44)
10.Nova Scotia (1.42)
11. Yukon Territory (1.25)
12. Northwest Territories (1.25)
13. Nunavut (1.00)

Whether you happen to enjoy what you’re reading (like those crazy canucks in Alberta, eh) — or not (you hosers living on the frozen Nunavut tundra) — 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 via email 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! You can reach me at: Len@LenPenzo.com

After reading my post on why waterbeds are for suckers, HH had this to say regarding my claim that waterbed sex is overrated:

If you don’t like the motion, there are other places in the house.

So … That’s what it’s like to live in a home without any kids!

I’m Len Penzo and I approved this message.

Photo Credit: brendan-c