{"id":36623,"date":"2016-04-02T00:15:35","date_gmt":"2016-04-02T07:15:35","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=36623"},"modified":"2023-06-25T20:13:06","modified_gmt":"2023-06-26T03:13:06","slug":"black-coffee-the-yes-and-no-edition","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id36623-black-coffee-the-yes-and-no-edition.html","title":{"rendered":"Black Coffee: The ‘Yes … and No’ Edition"},"content":{"rendered":"

\"\"<\/a>It’s time to sit back, relax and enjoy a little joe<\/em> …<\/p>\n

Off we go …<\/p>\n

Credits and Debits<\/strong><\/p>\n

Credit:<\/strong><\/span> 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<\/a> in the form of ‘nominal’ economic growth.” He’s right, you know.<\/p>\n

Debit:<\/strong><\/span> 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<\/a>. Yes, negative rates may buy a little time … No, they won’t fix things.<\/p>\n

Credit:<\/strong><\/span> In fact, capital consumption is akin to burning the furniture to heat your home<\/a>. 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.<\/p>\n

Credit:<\/strong><\/span> 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<\/a> in March. Even better: the labor participation rate finally ticked up after years of steady declines. Yes, up …<\/em>No, really. Hooray!<\/p>\n

Debit:<\/strong><\/span> 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<\/a> with fewer hours. No, I didn’t make that up … Yes, I’m being a party-pooper. Again.<\/p>\n

Debit:<\/strong><\/span> Even worse, there are now 29,000 fewer manufacturing jobs<\/a> 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!<\/p>\n

Debit:<\/strong><\/span> Despite the rising labor participation rate, 23% of Americans<\/a> between the ages of 25 and 54 are currently unemployed. Wow. Yes, that’s their prime working years … No, that’s not good.<\/p>\n

Debit:<\/strong><\/span> Yes, considering that 62% of all Americans have less than $1000 in savings<\/a>, 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<\/a>.)<\/p>\n

Credit:<\/strong><\/span> Meanwhile, home prices in Portland, Seattle and San Francisco have officially passed their highs<\/a> from the 2007 housing market bubble. I know. Then again, if real wages — which have been depressed for decades<\/a> — don’t make a huge and miraculous comeback, those new highs won’t be around for very long.<\/p>\n

Debit:<\/strong><\/span> Prices in “Frisco” are so ridiculous that the median rent for a one-bedroom apartment there is $3670<\/a>. Yes, that’s per month … No, I didn’t add an extra zero.<\/p>\n

Credit:<\/strong><\/span> 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<\/a>. Yes, that’s kind of cramped … No, that ain’t so bad — if you’re a midget.<\/p>\n

Last Week’s Poll Results<\/strong><\/p>\n

Were your parents good financial role models?<\/p>\n