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.
Let’s get right to it …
Credits and Debits
Debit: Despite stagnant wage growth, RealtyTrac reports that US home prices hit all-time highs in at least 10 metropolitan areas this summer. Here we go again.
Debit: Not surprisingly, those sizzling home price gains have coincided with a resurgence of toxic liar loans. You know, the same ones that were a major factor in the last housing market crash nearly a decade ago. And in case you’re wondering: No, it’s not different this time.
Debit: By the way, don’t think you can avoid skyrocketing housing costs by renting — especially if you live in San Francisco. The Bay Area market is so ridiculous that you can rent a bunk bed in a house there for $1800 per month — as long as you are willing to share the place with 30 other tenants. Sounds reasonable.
Credit: As Zero Hedge points out, rents in San Francisco and New York City are so insanely high now that there are actually castles in France and Italy that can be rented for about the same price as average apartments in those cities. No, really.
Debit: The “good” news is New York state politicians just did their part to “help” people living in the Big Apple by further circumventing what’s left of the free market and approving a $15 minimum wage law for fast food workers. Forward!
Credit: Of course, New York’s latest mandate designed to alter economic reality will backfire too in the long run — just like all of the other government subsidies, rules and regulations that caused those skyrocketing rents in the first place.
Debit: The Dow ended the week on an up note but all is clearly not well, as declining liquidity is exposing all of the markets to increasingly violent volatility.
Debit: Unfortunately, wild and persistent market swings typically signify an impending meltdown. In fact, 9 of the Dow’s 20 biggest single day decreases — as well as 9 of its 20 biggest single-day increases — occurred during the last financial crisis in 2008.
Debit: Believe it or not, some economists are suggesting that the best way to improve our broken economy is to get rid of cash and make all transactions electronic. Heh. Sure. Apparently, they don’t mind giving up their privacy either.
Credit: Then again, liberty lovers shouldn’t panic just yet: There’s still a strong demand for paper money, as evidenced by the growing popularity in both the US and UK of artisanal cash — private currencies that feature images of everything from onions to 70s glam rocker David Bowie. (And, yes, it’s legal.)
Credit: Speaking of currencies, Russian President Vladimir Putin has drafted a bill that would eliminate the dollar from trade between countries of the former Soviet Union — lest you need more proof that the world is feverishly working to kill dollar hegemony. It’s coming folks.
Debit: The day the dollar finally falls off its perch is the day when everyone will finally discover that the buck is nothing more than a paper promise — an IOU backed by nothing more than confidence. That’s also the day Americans will see a dramatic reduction in their standard of living.
Debit: Some people are already aware of that fact, which may explain why a truck carrying real money — 16 metric tons of silver, to be exact — was stolen from the Port of Montreal last week. Hey, who says all criminals are dumb?
Credit: The good news is four suspects were apprehended a few days after the heist — although 70% of the silver is still missing. Call me crazy, but something tells me the authorities are going to have a hard time finding the rest of it.
By the Numbers
Yes, the dollar’s death throes are becoming more obvious with each passing day, but let’s get to the important news: Week 1 of the National Football League is finally here! Of course, that also means it’s pizza season — so here are a few stats on this fan-food favorite:
5,000,000,000 Number of pizzas sold worldwide each year.
60 Percentage of all pizzas that are sold in the US.
70,000 Pizzerias in the US.
65 Percentage of pizzerias in the US that are independent.
350 Slices of pizza eaten every second.
83 Percentage of pizzerias that offer delivery.
252,000,000 Pounds of pepperoni consumed on pizzas annually.
61 Percentage of Americans who prefer thin crust pizza.
46 The average number of pizza slices a person eats in a year.
Source: Statistic Brain
The Question of the Week
[poll id=”79″]
Last Week’s Poll Result
What’s your favorite food cooked on the grill?
- Hamburgers (31%)
- Ribs (22%)
- Steak (18%)
- Hot Dogs (10%)
- Chicken (9%)
- Veggies (5%)
- Shrimp (3%)
- Something else (1%)
- Fish (0%)
More than 700 people chimed in to answer last week’s question and, when it comes to barbecue time, nothing beats a grilled hamburger. Well … at least for 1 in 3 Len Penzo dot Com readers. Oh, and if you plan on grilling fish the next time you invite friends over for a barbecue, you may want to reconsider: “fish” received 0% of the vote. That’s only the second time a poll option received 0% since I started my Question of the Week polls more than three years ago.
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. Alaska (3.10 pages/visit)
2. New Mexico (3.08)
3. Iowa (2.11)
4. Idaho (2.09)
5. Rhode Island (2.08)
46. Delaware (1.58)
47. Nebraska (1.57)
48. Colorado (1.54)
49. Mississippi (1.53)
50. Wisconsin (1.40)
Whether you happen to enjoy what you’re reading (like my friends in Alaska) — or not (ahem, Wisconsin, for the second month in a row) — 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!
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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 the results of my latest brown bag sandwich price survey, Francis had this to say after reading that eggs at my local grocery store were selling for $4.92 per dozen last month:
Where the heck do you shop for eggs?
Um … Would you believe New Yolk City?
I’m Len Penzo and I approved this message.
Photo Credit: brendan-c
Len, apologies for the second month in a row for my state’s reluctance to page views. But you have to understand, the Packers have started again. Most Wisconsinites can know only talk about how they are an “NFL Owner” and that the Bears suck…That takes up a lot of time that they just can’t spend reading personal finance. Otherwise they may learn that their “NFL Ownership” is a waste of time 🙂
It’s okay, Thias. If Wisconsin does it again next month, they’ll match the only state that has three consecutive months at the bottom of the list: Vermont. Not surprisingly, considering my blog’s personal responsibility theme, it is Ben & Jerry’s home state — the same state that elected a socialist, Bernie Sanders, to the US Senate — that has also been at the bottom of the list more times than any other state.
Len,
I shouldn’t be, but I was astonished to see the Crimex now had 207 contracts for every ounce of gold in inventory! How can this continue to go on without some criminal investigation?! Oh well, I think we are within weeks of a major market crash that might perhaps propel us towards finally getting the reset this global economy needs so much. Maybe I’m dreaming and they can continue the smoke and mirrors for decades to come. I’ll just keep stacking a little at a time in perpetration for that moment!
Stack on!
Jared
I’m not astonished, Jared. There will be no criminal investigation because the authorities are in on this: they need to suppress the price of gold and, especially, silver in order to keep appearances that the dollar is a viable currency. Remember, precious metals are a thermometer that indicate the health of a currency. The authorities have broken the thermometer — but that can’t make the patient’s fever (that is increasing by the day) go away. And that “fever” (dollar debasement) is eventually going to kill the patient (the US dollar).
By the way, the COMEX is now at 228 contracts for every ounce of gold in inventory. People who can’t see that our society is completely corrupt now need to wake up. This whole thing needs to come down soon, so we can begin the painful, but necessary, task of starting over and rebuilding a real economy.
Just how do you think this reset will be be set up. Will our money be worth less, or worthless?
The first question is anybody’s guess, Granny. The second question depends on the first.
If they try a currency devaluation, then the dollar would be worth less, while the purchasing power of gold and silver would be, at worst, unaffected — although I believe it will actually increase somewhat due to decades of artificial price suppression.
If they wait too long and hyperinflation (i.e., a rapid loss of confidence in the currency) strikes, then the dollar will implode and they will need to issue a new currency (hopefully, one backed by gold and silver). In this case the purchasing power of the dollar will quickly evaporate and eventually become worthless (i.e., people will be lucky if the balances in their savings and 401k accounts will be able to buy a cup of coffee), while precious metals will maintain or increase their purchasing power.
In both cases, lenders will take it in the shorts, as they end up being paid back in dollars that are less valuable. On the other hand, borrowers will be able to retire their loans much more easily (as long as their loans are valued in the devalued currency), because the cash they are paying back the loans with are less valuable.
As for how would the US devalue the dollar … my guess is they would reset gold to a much higher price in dollar terms than it is today; and silver would quickly follow. From there, we would have to see if they let the free market price of gold (and silver) take over — or they try to hold the price at the newly established higher-level, either overtly via a hard peg or covertly via further manipulation.
Living in Silicon Valley, only sightly less crazy than San Francisco, it makes me laugh to think of renting a castle for me and 25 of my friends for the same account it would cost for a tiny apartment in the city.
Bubble? Naw. Move along, nothing to see here…
Yep, although not as bad as SF or NYC, it is relatively nuts here in SoCal too now, Jack. This is shades of 2006, 2007 all over again. But this is what happens when a currency is not anchored to precious metals.
I would have thought there were more pizza places in the US. I guess I need to figure out what they are considering a pizza shop. In my town alone there are 5 and we have a population of less than 5,000 people!
And as for the average number of slices, I guess I’m a fatty because I’m well above that mark. In fact, I might even be in the 1% haha!
I think that number is pretty close for me. I figure I eat about 4 slices per month — of course, they are BIG slices, so maybe I should double that number. ha ha