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.
It’s still August but, here in Southern California, there has actually been a hint of fall in the early-morning air over the past couple of days. Strange. Okay, away we go …
“Oh dark, dark, dark, amid the blaze of noon. Irrecoverably dark; total eclipse, without all hope of day.”
— John Milton
“When you bring the darkness to the table, it doesn’t rule you or hurt other people; but when we keep it secret, it’s dangerous.”
— Natalie Goldberg
Credits and Debits
Debit: I see billionaires Richard Branson and Elon Musk continue calling for the Utopian fantasy known as government-provided universal basic income. You shouldn’t be surprised. As mentioned here last week, Musk has been receiving his own steroid-induced version of guaranteed government income for years in the form of taxpayer subsidies. Just sayin’.
Credit: Meanwhile, Jim Rickards astutely points out that we’re living in a time that’s looking more and more like a replay of the 1930s: First there was the currency war, which began in 2010, and now the trade wars are starting. Unfortunately, after that comes the shooting war.
Credit: Frankly, the currency wars are hotter than ever. Earlier this week, Russia’s Deputy Foreign Minister, Sergei Ryabkov, said his country is reducing its reliance on US payment systems and the dollar as a settling currency because, “The US is using its dominating role in the monetary and financial system to impose pressure on foreign businesses, including Russian companies.” Imagine that.
Credit: The Russians and Chinese have been working to move away from the US dollar for awhile now — but as the ongoing currency war escalates, intentions by foreign nations to break the dollar’s grip on world commerce are becoming more transparent. Regardless, it’s another nail in the coffin for the current dollar-based international
monetary system Ponzi scheme. And most Americans’ standard of living.
Debit: Did you see this? This week the Financial Times revealed that, in 1914, “The UK decided that news of a failed war bond sale would have been disastrous to the public. So the BoE bought the outstanding securities in the name of its chief cashier, and listed them on its balance sheet as ‘other securities.'” The moral of the story? Governments and central banks lie. And they’ve been doing it for more than a century.
Debit: You think a total solar eclipse is rare? Check this out: On Thursday the Dow actually fell more than 1%. To be exact, 1.2%. No, really. Okay, okay … a down day in the stock market isn’t that rare — but it was the Dow’s biggest single-day drop since May 17th.
Credit: Then again, with the number of so-called Hindenburg omens continuing to climb — and nearing an all-time high, to boot — perhaps the stock market will actually begin seeing more down days in the near future. Then again, maybe these omens are only, um, full of hot air. Ahem. Yeah, that was lame. Moving on …
Debit: In other news, Social Security’s Board of Trustees warned Congress that their fund is running out of money. In fact, it’s going to need a cash infusion that’s 60 times larger than the 2008 emergency bank bailout. How big is that? Well … $46 trillion. In other words, more than twice the National Debt, and almost three times the value of the entire US economy. That’s also bad news for the buck.
Debit: Speaking of bail outs, Dallas police officers continue to retire at a rapid rate; you can blame their failing pension fund for the exodus. While you’re at it, you can also castigate the politicians who agreed to handout those fiscally unsustainable gold-plated pensions in the first place.
Debit: Imploding government pensions aren’t unique to Dallas — you can find them from sea to shining sea. It’s especially bad in Illinois, where 25% of the state budget will soon be required to pay for government retirees’ pensions. I suspect even the most cock-eyed optimist politicians in Springfield are beginning to realize that this isn’t going to end well.
Debit: Believe it or not, thanks to years of underperforming investment returns, government pension funds across America are now underfunded by $7 trillion — despite an eight-year bull market in stocks. That’s quite a trick. Maybe the funds will become solvent once the market finally reverses course and starts delivering negative returns. Or not.
Credit: Too bad Social Security and government pension funds have shorter shelf lives than the 106-year old fruitcake found in Antarctica this week. Yes, apparently it’s still edible. Of course, you know what that means: somebody will almost certainly be getting it as a Christmas present this year.
By the Numbers
There’s been a lot of talk about the upcoming solar eclipse on August 21, but here are some numbers about it you may not know:
0 The number of hotel rooms on Hotel.com available the night before the eclipse in Nashville, Tennessee. (Nashville is one of the larger cities in the path of totality.)
14 Number of states for this eclipse that lie in the path of totality from coast to coast.
160 Number of seconds totality will last in Carbondale, Illinois. (That’s the longest period of totality for this eclipse.)
1918 The last year the United States had a continent-wide total solar eclipse.
1979 The last year a total solar eclipse occurred in any of the lower 48 states.
$2500 Price for the last three available hotel rooms on the night before the eclipse in Casper, Wyoming. (All at the Sterling Hotel and Extended Stay.)
Last Week’s Poll Result
What is the average gasoline mileage of your primary car?
- 16 to 25 mpg (51%)
- 26 to 35 mpg (41%)
- 36 mpg or more (5%)
- 15 mpg or less (3%)
More than 1100 people answered this week’s survey question and it turns out that almost half of all Len Penzo dot Com readers drive a car that gets at least 26 miles per gallon. I figured that number would be a bit higher. How about you?
The Question of the Week
I see that the good folks over at Zumper included me in their list of Top 25 Personal Finance bloggers. Very cool! Thanks, guys!
Other Useless News
Here are the top — and bottom — five Canadian provinces and territories in terms of the average number of pages viewed per visit here at Len Penzo dot Com over the past 30 days:
1. Saskatchewan (1.58 pages/visit)
2. Alberta (1.55)
3. New Brunswick (1.50)
4. Quebec (1.36)
5. Manitoba (1.34)
9. Nova Scotia (1.29)
10. Prince Edward Island (1.25)
11. Yukon Territory (1.13)
12. Northwest Territories (1.00)
13. Nunavut (0.00)
Whether you happen to enjoy what you’re reading (like those crazy canucks in Saskatchewan, eh) — or not (ahem, you hosers living on the frozen Nunavut tundra) — please don’t forget to:
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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 me at: Len@LenPenzo.com
After reading my article explaining why a 30-year mortgage is better than a 15, Debbie Christian left a few pragmatic thoughts of her own that included something a lot of people seem to overlook:
I figure old age is no time to run out of money.
I hear ya, Debbie. Perhaps that’s why most folks today run out of money while they’re still young.
I’m Len Penzo and I approved this message.
Photo Credit: (coffee) brendan-c