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.
I’ve got another busy weekend ahead of me, so let’s get right to this week’s commentary …
An honest man is one who knows that he can’t consume more than he has produced.
— Ayn Rand
Credits and Debits
Debit: Did you see this? Approximately 4 of every 5 employees now use artificial intelligence (AI) tools at work. However, a fresh analysis of 164,000 workers across 1111 employers covering more than 440 million hours of work activity found that AI isn’t leading to lighter workloads – instead, it’s increasing their pace and complexity. In fact, the study found 94% of AI users spent more time on email, chat apps and business-management activities while, ironically, the amount of time workers spent on deep concentration activities needed for analysis, strategy or complex problem solving fell 9%. In other words: Solving perplexing tasks like this…
Debit: In other news, Honda Motor corporation announced that it’s fiscal year – which ends on 31 March – will finish almost $16 billion in the red. That will be Honda’s first annual loss since it began since its shares were first listed on the Tokyo Stock Exchange in 1957. As for the reason: Honda’s strategic manufacturing shift towards electrification has failed to translate to any appreciable sales. Then again, never say never…
Debit: On a related note, while most Americans have noticed the rising cost of gasoline, jet fuel prices have been flying under the radar – but that may be changing with global average jet fuel price rising 58% from the week before. The current price of jet fuel is now 80% higher than the average cost of jet fuel in 2025. As a result, we should expect higher airfares in the coming days and weeks as well. Oh… and on a related note…
Credit: Stop us if you’ve heard this before: According to macro analyst Jesse Columbo, according to “the cyclically adjusted price-to-earnings (CAPE) ratio, the US stock market is currently more overvalued than it was in 1929, just before the historic crash that led to the Great Depression. In addition, it is approaching levels last seen during the Dot-com bubble of the late 1990s.” And, apparently, it’s not just stock that are over-valued – at least according to some indicators.
h/t: Jesse Columbo substack
Debit: By the way, Columbo also discussed another indicator, the stock market capitalization-to-GDP ratio, where he points out that “Warren Buffett once called this his favorite indicator. He also warned that when this ratio rises above 200, investors are ‘playing with fire.'” Uh huh. Today, the ratio is at an all-time high of 216; the historic average is 87. And now you know why Mr. Buffett currently holds the majority of his position in cash, rather than the stock market. Just remember that US dollars (USD) aren’t money; they’re debt. An IOU. In fact, you can think of USDs as a zero-duration US Treasury (UST) bond that pays 0% interest.
h/t: Jesse Columbo substack
Gary Larson – The Far Side
Credit: Meanwhile, macro analyst Daniel Oliver warned this week that, “the private credit market is sliding towards a full collapse: first Blue Owl, BlackRock, Blackstone. And now Cliffwater and Morgan Stanley are facing a credit run; and if private credit is worthless, so is private equity. The Fed will print money, but it can’t bail out these credit monstrosities: Everyone needs a house and a car, so the USDs printed in previous panics went to the locus of those crises. But nobody needs Class C office space anymore, so the printing will (only) exacerbate inflation. And war… will require even more debt.” Uh huh. Behold, Exhibits A B and C:
Source: Myrmikan Research
Credit: Not surprisingly, there is a global shift underway from a fiat-based monetary order based on debt-backed currencies. For many decades, USTs have been the world’s go-to safe haven – the asset you held when there were no other satisfying options. However, their status is rapidly eroding now in favor of commodities – and eventually an honest monetary system based on real money. Hey… we can all drink to the that!
Credit: By the way, for those think they’ve already missed the big move in precious metals, consider silver. Mr. Columbo notes that the silver-to-Dow ratio is up 255% so far, which “pales in comparison” to the average 1409% increase of the previous two secular silver bull markets from 1971-1980 and 2001-2011. So, by that measure, he says the current secular silver bull market is only 18% of the way there. It’s certainly a reasonable conclusion. And if you think that’s crazy, what do you call the time that Texas Rangers’ third baseman Brock Holt volunteered to work as an emergency pitcher?
Credit: As metals analyst David Jensen notes, “For 40 years, the global asset bubble that has been blown with central bank loose monetary policy has been predicated on low interest rates that are in turn dependent on suppressed gold and silver prices being fixed on highly leveraged exchanges globally. Increasing shortage of silver and gold globally over the past few years has pointed to the end of this digital metal price fixing system and much higher gold and silver prices.” Maybe so, but the corrupt metal exchanges aren’t going down without a fight…
Credit: So where is this runaway train going? Well… although markets are currently adjusting to an emerging monetary regime where central banks are now forced to continually print fiat currency to keep the global monetary system afloat, Mr. Jensen reminds us that conjuring USDs out of thin air “won’t suffice when precious metal is demanded but not available. Higher interest rates spell decline for the $270 trillion global bond and stock market asset bubble blown by central banks. Real estate too. And sharply higher rates spell sharp decline and an accelerating run into monetary safe havens silver and gold.”
Credit: Since 2022 – when America weaponized the USD for the first time by freezing Russia’s UST reserves – central banks have been buying gold at an unprecedented pace. Why gold? Because the yellow metal can’t be frozen, sanctioned, or printed at will – that is, it has no counterparty risk. As a result, gold now has a constant demand source that effectively absorbs selling pressure. It’s why gold hovering around $5000 isn’t a bubble. It’s also a sign of gold’s ascending monetary role in a world that no longer trusts the Fed to protect the purchasing power of the USD. And neither should you.
h/t: Zero Hedge
By the Numbers
Ever wonder what the most popular items sold every week on Amazon are? Well… here are the ten home products with the most sales last week (affiliate links):
10 Olany 20″ x 30″ bathroom rug
9 Utopia Bedding bed sheet set
8 Stanley 30 oz. Quencher H2.0 tumbler
7 Barossa Design plastic shower curtain liner
6 Amazon Basics velvet space saving clothes hangers
5 Upsimples 11″ x 14″ picture frame
4 Terro ant killer bait stations
3 Bedlore waterproof mattress protector
2 Owala FreeSip insulated stainless steel water bottle
1 CGK Unlimited comfy breathable & cooling bed sheets
Source: Amazon
The Question of the Week
Last Week’s Poll Results
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Within the last month 68%
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Within the last six months 15%
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Within the last year 9%
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More than a year ago 8%
More than 2500 Len Penzo dot Com readers responded to last week’s question and it turns out that 1 in 6 of you haven’t made a payment with a paper check in more than six months. I remember the days when I would go through checks in my check books in almost no time flat. Oh, how the times – and the way we pay are bills – continue to evolve!
If you have a question you’d like me to ask the readers here, send it to me at Len@LenPenzo.com and be sure to put “Question of the Week” in the subject line.
Useless News: Therapy Session
Ever since I was a child, I’ve always had a fear of someone under my bed at night. So I went to a psychiatrist and told him: “I’ve got problems. Every time I go to bed I think there’s somebody under it. I’m scared. I think I’m going crazy.”
“Just put yourself in my hands for one year,” said the psychiatrist. “Come talk to me three times a week and we should be able to get rid of those fears.”
“How much do you charge?”
“Three hundred dollars per visit,” replied the psychiatrist.
“I’ll sleep on it,” I said.
Six months later the psychiatrist met me on the street.
“Why didn’t you come to see me about those fears you were having?” he asked.
“Well … $300 a visit, three times a week for a year, is $46,800. A bartender cured me for $10. I was so happy to have saved all that money that I bought a new pickup truck.”
“Is that so?” the psychiatrist replied. Then, with a bit of an attitude, he said, “And how, may I ask, did that bartender cure you?”
“He told me to cut the legs off the bed. Ain’t nobody under there now.”
Moral of the story: It always pays to get a second opinion.
(h/t: Cowpoke)
Squirrel Cam
This little critter was ready for its close-up…
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More 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
This week GC disputed my claim that whirlpool tubs are for suckers:
I’m not sure what you people are talking about. Sure, you have to clean it a lot but, wow, you have to keep it clean anyway.
Thank you. I rest my case.
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Photo Credit: public domain
Question of the Week