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.
Let’s get right to it this week …
Credits and Debits
Credit: Don’t look now, but Texas legislators are considering a bill that would legalize marijuana. Yes, that Texas.
Credit: Hey, did you see this? According to the latest government statistics, employers added 233,000 new jobs last month, bringing the US unemployment rate down to 5.4%. Hooray!
Debit: Unfortunately, as Zero Hedge points out, the quality of all these new jobs is dubious at best: The reported jobs increase was due entirely to part-time positions — that’s because there was a net loss of 252,000 full-time jobs in April.
Debit: If that wasn’t bad enough, the number of working Americans in their prime career-building years — folks between 25 and 54 — declined again in April. Incredibly, despite the “recovery” — and an increasing population — there are 4 million fewer people aged 25-54 working today than in 2007.
Debit: I guess that big bump in part-jobs goes a long way toward explaining why last month there was, sadly, only one manufacturing job created for every 26 waitresses and bartenders that were hired. Did I just hear “last call” for the US economy?
Debit: On a related note, for every manufacturing job in Baltimore, there are six government jobs. Yes, six. In a productive economy, those numbers would be reversed. In fact, 21% of all jobs in Baltimore belong to government bureaucrats.
Credit: One thing is certain: If there were more manufacturing jobs in America — and far fewer government paper pushers — the US wouldn’t have had its worst trade deficit since 2009 last month. Our wallets would be fatter too.
Debit: You know the US government is far too big when it’s expected to finish 2015 with yet another budget deficit, despite taking in record tax revenue this year. The IRS picked taxpayers’ pockets for $472 billion … in April alone.
Debit: Meanwhile, Greece, which straddles three seas — the Mediterranean Sea, the Aegean Sea, and the Sea of Red Ink — is imposing a surcharge for all cash withdrawals as a last-ditch measure to prevent citizens from making a run on the country’s banks.
Credit: Of course, although denial is widespread, the rest of the world is in the same financial boat as Greece — which they’ll discover soon enough. It’s probably why Russia recently joined China in aggressively increasing its gold hoard.
Debit:Can you guess which country currently has the most overpriced housing market in the world? Go ahead; I’ll wait while you think about it. If you said, Canada, well … give yourself a gold star.
Credit: Then again, if the People’s Democratic Republic of San Francisco was a country it would give Canada a run for its money. A 291-square foot “apartment” there just sold for $415,000 — after a bidding war increased the price by 40%. Suckers!
Credit: Market froth isn’t limited to housing. Despite April’s dubious employment data, the Dow had one of its best days of the year, as it surged 1.5% on Friday. As for the S&P 500, less than 10% of its 500 companies finished in the red. I know.
Credit: I’m not the only one who thinks there’s more than a little irrational exuberance in the markets. For her part, Janet Yellen recently admitted that she thought stock valuations were dangerously high too. No, really.
Debit: And finally … This week former Treasury Secretary Tim Geithner said that another financial crisis was going to happen again at some point. He also said it wouldn’t be anything like the last one in 2008. He’s right. It’s going to be worse. Please … prepare accordingly.
By the Numbers
Here’s a little postscript on potential impacts to the Lone Star State if the pot legalization effort there eventually succeeds:
2,000,000 Pounds of marijuana seized by the US Border Patrol in Texas during the last fiscal year.
1327 Prisoners incarcerated in Texas last year for criminal possession or distribution of marijuana.
$60 Amount that Lone Star State sheriff offices spend per day for each prisoner.
$230,000,000 Estimated taxpayer savings over next five years if marijuana is legalized (due to reduced incarceration and enforcement costs).
$7,400,000 Estimated fine and court revenue counties in the Lone Star State would lose annually if marijuana is legalized.
$76,000,000 Tax revenue collected by Colorado for recreational and medicinal marijuana in 2014.
0 Tax revenue Texas would collect if marijuana is legalized there. The current bill under consideration doesn’t call for any fees or taxes to sell weed.
The Question of the Week
Last Week’s Poll Result
How many keys are on your key ring?
- 3 or 4 (32%)
- 5 or 6 (21%)
- 1 or 2 (18%)
- 7 or 8 (17%)
- 9 or 10 (7%)
- 11 or more (5%)
More than 600 people chimed in to answer last week’s question and all I’ve got to say is this: Although I can’t imagine why anybody would need to carry 11 or more keys around on a day-to-day basis, apparently 1 of every 20 Len Penzo dot Com readers do so. That’s got to be really comfortable.
(By the way, the maker of my polling plug-in updated his software this week. It appears as if that has fixed the frozen voting button issue that many people have had for the past several months.)
Other Useless News
Here are the top — and bottom — five states in terms of the average number of pages viewed per visit here at Len Penzo dot Com over the past 30 days:
1. New Mexico (2.24 pages/visit)
2. North Dakota (2.03)
3. Utah (2.00)
4. Alaska (1.94)
5. Pennsylvania (1.91)
46. Nebraska (1.44)
47. Kansas (1.40)
48. California (1.39)
49. Vermont (1.27)
50. Wyoming (1.26)
Whether you happen to enjoy what you’re reading (like all of my friends in New Mexico) — or not (ahem, Wyoming) — 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!
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And last, but not least …
4. Consider becoming a Len Penzo dot Com Insider! 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 out to me at: Len@LenPenzo.com
After reading my suggestion regarding the smartest way to eliminate credit card debt, Walt shared a long list of his own personal finance tips and observations, including this one:
The evil cable company has lost its grip on me.
Me too, Walt! Unfortunately, I’m now in the clutches of the satellite company.
I’m Len Penzo and I approved this message.