Off we go …
Credits and Debits
Credit: As financial analyst Dave Kranzler pointed out this week, “What’s been billed as ‘economic growth’ since 2008 is nothing more than debt-fueled inflation in the form of ‘nominal’ economic growth.” He’s right, you know.
Debit: It may seem preposterous, but those capital-consuming negative interest rates being imposed by an increasing number of central banks are a desperate last-ditch effort to keep the global economy from falling into the abyss. Yes, negative rates may buy a little time … No, they won’t fix things.
Credit: In fact, capital consumption is akin to burning the furniture to heat your home. It might work for awhile, but eventually you’re forced to burn the walls, floorboards and the rest of the house. No, that’s not my analogy: it’s from economist Ludwig von Mises … Yes, he’s brilliant.
Credit: In other news, US employment was better than expected last month, as the Bureau of Labor reported more than 215,000 new jobs were created in March. Even better: the labor participation rate finally ticked up after years of steady declines. Yes, up …No, really. Hooray!
Debit: Now for the reality check: As MarketWatch reports, a closer look at the data indicates that most of those jobs are due to a shift in hiring toward lower-paying part-time jobs with fewer hours. No, I didn’t make that up … Yes, I’m being a party-pooper. Again.
Debit: Even worse, there are now 29,000 fewer manufacturing jobs today than there were in the previous month. The “good” news is those lost high-paying jobs were almost completely offset by the creation of 25,000 new waiter and bartender positions. Forward!
Debit: Despite the rising labor participation rate, 23% of Americans between the ages of 25 and 54 are currently unemployed. Wow. Yes, that’s their prime working years … No, that’s not good.
Debit: Yes, considering that 62% of all Americans have less than $1000 in savings, it’s understandable if you wonder how all of those unemployed workers are getting by. On second thought … No, it’s not. (Psst. Three letters for you: EBT.)
Credit: Meanwhile, home prices in Portland, Seattle and San Francisco have officially passed their highs from the 2007 housing market bubble. I know. Then again, if real wages — which have been depressed for decades — don’t make a huge and miraculous comeback, those new highs won’t be around for very long.
Debit: Prices in “Frisco” are so ridiculous that the median rent for a one-bedroom apartment there is $3670. Yes, that’s per month … No, I didn’t add an extra zero.
Credit: Of course, if you’re willing to live in an 8-foot long by 3.5-foot wide box, you can actually make a go of it in San Fran for only $400 per month. Don’t get too excited though: it’s just 4.5 feet tall. Yes, that’s kind of cramped … No, that ain’t so bad — if you’re a midget.
Last Week’s Poll Results
Were your parents good financial role models?
- Yes (40%)
- No (32%)
- Yes … and no (28%)
More than 900 Len Penzo dot Com readers responded to last week’s question and 2 in 5 said their parents were good financial role models, thank you very much. On the other hand, one-third believed their folks set a poor example for the kids. The good news is, when it comes to money management, we’re all given the opportunity to learn from our parents — regardless of whether or not they’re paragons of financial responsibility.
The Question of the Week
Insider Notes: Why Service Industry, Banking, and Government Jobs Don’t Create Wealth
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By the Numbers
Charting the automation risk of potential US jobs. The following numbers represent the estimated percentage of human jobs that can be eventually replaced via automation:
74% Percentage of America’s 3 million fast food workers whose jobs are currently at risk from automated kiosks and robots.
72% Percentage of commercial pilot activities that will eventually fly away.
69% Percentage of heavy truck driving jobs that will hit the road.
47% Percentage of pharmacists who will be replaced by robo-pill-dispensers.
29% Percentage of doctors whose jobs will be performed by mechanical medicos.
22% Percentage of all janitors who will eventually be trashed by robotic cleaning crews.
7% Percentage of current manual labor jobs that can be automated.
Other Useless News
Programming note: Unlike most blogs, I’m always open for the weekend here at Len Penzo dot Com. There’s a fresh new article waiting for you every Saturday afternoon. At least there should be. If not, somebody call 9-1-1.
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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 article explaining why waterbeds are for suckers, Etep wrote in to dispute my claim that they’re overrated as a platform for sex:
What are you talking about? They’re great! Push once and coast for two!
Right. I bet you’re a riot on the dance floor.
I’m Len Penzo and I approved this message.
Photo Credit: brendan-c