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 kick this baby off, shall we?
There are strange flowers of reason to match each error of the senses. Admirable gardens of absurd beliefs, forebodings, obsessions and frenzies.
— Louis Aragon
Credits and Debits
Debit: Mortgage rates have been soaring since the election — so it’s no surprise that mortgage applications have tumbled since then. As rates rise, affordability is becomes a major issue — and the proof is in the pudding: pending home sales last month saw their biggest drop since last May. Uh oh.
Credit: In other news, last week Forbes called on President Trump to transition America’s currency to a gold-backed dollar. Don’t laugh … it could happen, although I won’t hold my breath. There are too many big spenders in Washington D.C. who would never allow that to happen. At least not willingly.
Credit: Then again, who needs a gold-backed dollar when stocks are on fire? How hot is the market? This hot: Last Monday the Dow closed on an all-time high for the 12th consecutive day. Yes, 12. Even though the Dow has been around since 1882, it has never had a longer streak of record closes. No, not ever. Hooray! I think.
Debit: Despite the soaring US stock market, would you believe there are a lot of Silicon Valley tech workers with six-figure salaries who are openly complaining that they’re only “scraping by“? Sadly, there are. Sheesh. Suck it up, buttercups.
Debit: Those “financially strapped” tech workers who think they have it bad should be thankful they’re not a teenager. After all, it’s going to be a bit harder for teens to find an entry level job now that Wendy’s is planning to install 1000 self serve kiosks. I’m sure those Utopian government mandates for $15 per hour fry cooks had absolutely nothing to do with that.
Debit: By the way, if unemployed teenagers think they have it bad, then they should try walking in the shoes of any retired New York state Teamster. That’s because their pension officially ran out of money in February. Oops. They’re not alone; one expert is warning that a “tsunami” of failed pension funds will soon be washing across all of America.
Debit: That tsunami couldn’t be coming at a worse time. The Pension Benefit Guarantee Corporation, a government agency created to, well … “guarantee” corporate pensions, is on the verge of bankruptcy too.
Debit: Of course, all of those failing pension funds will only add to the food stamp rolls that already support 1 in 7 Americans — a number that is truly remarkable when you consider that the US is supposedly eight years into an “economic recovery.” Or not.
Credit: On the other hand, considering that more than 9000 Maine residents dropped off the state’s food stamp program since the state began enforcing work and volunteer requirements, I think it’s safe to say there are more than a few people currently using food stamps who really don’t need them. Just sayin’.
Credit: Meanwhile, as CNN reports, “Massive government overspending, a crashing currency, mismanagement and corruption have sparked extremely high inflation in Venezuela that’s expected to rise 1660% this year and 2880% in 2018.” Caracas is also down to its last $10 billion. Uh huh. That should be gone by early next year. Hopefully, Venezuela’s socialist government won’t be far behind. Forward!
Debit: Finally … Did you see this? Last week, a $20 debt led to chaos at a cookie stand outside a Florida Walmart when a man and his teenage friend attacked the family of a Girl Scout they said owed them the money. No, really. Now you know why I never shop at Walmart.
By the Numbers
This past week New Orleans celebrated Mardi Gras. Here are some of the numbers behind Fat Tuesday:
1830 Year that Mardi Gras was first celebrated in the US. However, it was in Mobile, Alabama — not New Orleans.
3 States with counties that have declared Mardi Gras an official holiday. (Louisiana, Alabama, Florida)
3 Number of official Mardi Gras colors: Purple for justice, gold for power and green for faith.
3 The number of major Mardi Gras parades in New Orleans. (Endymion, Orpheus, and Bacchus)
0 Number of Mardi Gras float riders in New Orleans who are allowed to ride unmasked.
$5.72 This year’s average price for a Mardi Gras mask.
$35 The average price of a Mardi Gras King Cake.
$150 Average price to attend “Super Krewe” Balls in New Orleans, the largest Mardi Gras parties open to the public.
$500 Amount spent by the average Mardi Gras float rider on beads, cups and other souvenirs.
Source: WFMZ
Last Week’s Poll Results
Did you watch the Academy Awards this year?
- No (90%)
- Yes (6%)
- Only the red carpet interviews. (4%)
More than 1300 Len Penzo dot Com readers responded to last week’s question and 9 in 10 said they didn’t bother watching this year’s Academy Awards. If most of them are like me, however, I bet a good percentage of them saw clips of the debacle at the end of the show where the Oscar for Best Picture was originally given to a nominee that didn’t actually win it. Heh. I love it.
The Question of the Week
[poll id="153"]
Insider Notes: Financial Tyranny and the War on Gold
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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
From Mothusi Ncube:
You were named a financial beneficiary of Princess Jana Aisha Abdulaziz Al Saud. Contact her at: princessalsaud2422@____.com for more details.
Really? “Princess Al Saud 2422“?
I’m Len Penzo and I approved this message.
Photo Credit: brendan-c
In addition to the ridiculous minimum wage, is the new attempt by state legislatures to balance their bloated budgets on the backs of soda drinkers. Under the guise of making people healthy by taxing drinks with sugar, they are implementing such a high tax on each ounce of soda that many people are just not buying it any more. Which, of course, has caused many bottling plants (at least in PA) to lay off workers and delivery drivers. So now the state gets to pay them unemployment and welfare benefits instead of the former employees paying taxes.. Genius!
These soda taxes are just another law sold as a solution to “protect” the so-called stupid public from ourselves. In reality, it is simply another revenue stream for the government, which they use to expand its power over the citizenry. I never cease to be amazed at the amount of punishment some voters are willing to inflict upon themselves. Of course, I see and deal with it here in the People’s Socialist Utopian Paradise of California all the time.
I try to stay away from Wal-Mart too but I still find myself going there sometimes because they do have good deals I can’t pass up.
Have a great weekend Len!
You too, Sara!
If the agency that backs the pensions fails then you know it is only a matter of time before the taxpayers get stuck holding the bill. What a mess.
The failing pension fund system is actually a symptom of a much bigger problem, Oscar: the imploding US dollar.
When I was a kid, minimum wage jobs were mostly held by teenagers. Fast food workers, paper boys, grocery store baggers, retail sales clerks were all positions that teenagers took as a right of passage to break in to the workforce. They were never intended to be jobs that could support a family.
Exactly, ND. Minimum wage jobs were originally meant to be entry-level positions that one used as a stepping stone to more important higher paying jobs. Again, that has changed and the primary reason why is that the purchasing power of the US dollar has been badly eroded over time.
All of these issues will continue to persist until we get a new monetary system. Unfortunately, 99% of the public doesn’t understand this.
While this is true, fact is a lot of these jobs are operating at hours that would make having a teenager (let’s say 15-18) unable to be there (breakfast at 6am = being there at 5am; most schools start around 7-8am for example during the school year). Many of these jobs aren’t allowed by law to have minors work more than so many hours per day, let alone per week.
But also, wasn’t “minimum wage” set (when it was created) to be the bare minimum that would be necessary for a person to live/function?
Personally where I work (I’m in retail) for every 1 teenager that shows up on time, does their job, doesn’t screw around, we have 3-4 that go missing, call off 30 minutes before, etc. I’d rather have an older worker (25+) cause they treat it as a job. However the teenagers can be hired for cheaper, so what can you do?
I understand your frustration, Taddy … If I was the manager, the consistently irresponsible teens would be fired. That’s the beauty of minimum wage positions: there should always a large pool of applicants available to handle the turnover!
Unfortunately/fortunately Len, it’s the kind of place where unless you steal from them or no call/no show for a week (or two), your job is pretty much safe unless there’s 10 inches of paperwork detailing written ups.
C’est la vie.
It is impossible to price anything in gold as things stand today. Everything is misspriced by vast amounts in both directions. From PE ratios at the high end to the value of labor at the other end. The arguments over minimum wage wouldn’t be happening if this wasn’t so.
Again, this all goes back to our broken monetary system, Andy. True price discovery will not return for almost anything until the system is allowed to reset.
Len, I present a conundrum. If true price discovery will not return until the monetary system is allowed to reset, how am I to value a Len Penzo Insider Membership? Do I pull the trigger today with the current sham of a monetary system in place, or do I wait it out until we have a massive reset whereby I can feel good about the price/value ratio?
Let me help you out, Scott; there’s no conundrum. After the reset, the Insider Membership will be a thing of the past.