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 this week …
Credits and Debits
Credit: Let’s get this week’s news from the People’s Socialist Paradise of VenezuelaTM out of the way early, shall we? The Utopian politicians there who promised the wide-eyed proles that government would make life better by giving them everything they need, can’t even provide electricity now. Forward!
Debit: As usual, socialism has succeeded in making everyone equal — equally miserable. Well … except for the Venezuelan politicians and their family members who are still running the show. Besides, daily four-hour rolling blackouts are a small price to pay for La Revolucion!
Debit: On a related note, the recently-deceased former artist known as Prince once had a backing band called The Revolution. I wonder what he’d say if he knew the government is going to end up with more than half of his $500-million estate, redistributing his hard-earned wealth as it sees fit. I do know this: the pols in St. Paul and Washington are gonna party like it’s 1999!
Debit: In case you haven’t noticed, some data suggests the economy may be on its deathbed too. In the US, year-over-year orders for core durable goods — stuff like washing machines, consumer electronics and other big-ticket items — fell for the 14th consecutive month. One. Four. How can that be if the US isn’t in a recession? Anyone? Bueller?
Credit: On second thought … strike that last question. I don’t want to be publicly ridiculed as one of those cuckoo “booming economy deniers.” No, siree. After all, I’m sure the true state of the economy is “settled science.” Just like global warming climate change. Oh wait …
Credit: Frankly, I’m still waiting for somebody to explain this to me: If the US economy is so rosy, why are interest rates still hopelessly stuck at the zero-bound? (Actually, I know the answer. I’m just looking for a good laugh.)
Debit: The fact of the matter is the world economy cannot get better until the current ailing dollar-based international monetary system finally kicks the bucket. In the meantime, the world’s central banks will continue monetizing debt and propping up the markets at all costs to keep it from collapsing. Well … until they can’t.
Debit: How phony are the markets today? One example: The Bank of Japan is now a Top 10 owner in 90% of all Japanese stocks. That’s not how capitalism is supposed to work, folks. What do you think would happen to stock prices if the BoJ ever decided to exit their position?
Credit: Billionaire business magnate Carl Icahn is warning that the markets are overpriced and will soon face a day of reckoning. Of course they’re overpriced, Carl — they’ve been artificially juiced on all of that central bank funny money that’s been printed since 2009. Just ask the BoJ.
Debit: Then again, maybe the BoJ should consider buying a few Apple shares. After Apple posted its first quarterly revenue decline in 13 years, its stock plunged more than 8% last Tuesday — and it has lost almost 18% in the last two weeks.
Debit: Meanwhile, after a run of more than 75 years, Exxon Mobil saw its credit rating downgraded to less than AAA. That leaves just two AAA-rated companies in the “booming” US economy: Microsoft, and Johnson & Johnson, which makes, among other things, Tylenol.
Credit: By the way, it’s no coincidence that Microsoft and Johnson & Johnson go together like peanut butter and chocolate … as anyone who’s ever been forced to use Microsoft software well knows.
By the Numbers
Before Financial Literary Month comes to a close, here’s a look at some performance figures of the most — and least — financially savvy states:
287% Hawaii’s percentage of per capita debt related to median household income. That’s the worst in the nation.
4.3% The foreclosure rate in New Jersey. No state is worse.
23% Percentage of Hawaiians and Nevadans who spend more than they earn each year. Among all 50 states, that’s the bottom of the pack.
53% Percentage of Arizona households with a rainy day fund — that’s best in the US.
1.5% North Dakota’s auto loan delinquency rate. No other state can beat that figure.
1 Minnesota’s rank among the most financially savvy states. (Worst state: Missouri)
Source: WalletHub
Last Week’s Poll Results
If you found a $100 bill on a retail store floor, what would you do?
- Keep it (48%)
- Turn it in (27%)
- I’m not sure (25%)
More than 1000 people responded to last week’s provocative question and it turns out that almost half of the respondents say they would keep a $100 bill if they found it on a retail store floor; you can include me in that group. Why? Because, in this hypothetical situation, it was loose and a relatively small sum. On the other hand, if that $100 bill was in a wallet, or five $20 bills in a money clip, I would turn those in. I would also turn in a larger sum of loose cash. That being said, one in four Len Penzo dot Com readers would turn that $100 in, regardless of the circumstances — and they are clearly better people than I am.
The Question of the Week
[poll id="111"]
Insider Notes: The Dollar and a Lesson on Value vs. Price
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Other Useless News
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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 post on how to find a pest control company that won’t rip you off, Jeff Madison left this comment:
My wife and I have a terrible ant problem in our home, so maybe we should find someone who is licensed.
You should if you want me to invite you to my next picnic.
I’m Len Penzo and I approved this message.
Photo Credit: brendan-
Good stuff as usual.
Just one comment on Pre-nups. I think they should simply be made “mandatory” as part of the marriage process.
It would remove the stigma of having the awkward discussion before the date, and protect both sides after. It would greatly reduce litigation costs and the healing time after divorce. More money in your pockets for any shared kids.
If you have something to lose even if you think “this is a sure thing” protect yourself. It’s that simple.