{"id":37504,"date":"2016-05-28T05:15:19","date_gmt":"2016-05-28T12:15:19","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=37504"},"modified":"2023-01-07T11:39:53","modified_gmt":"2023-01-07T19:39:53","slug":"black-coffee-the-memorial-day-edition","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id37504-black-coffee-the-memorial-day-edition.html","title":{"rendered":"Black Coffee: The Memorial Day Edition"},"content":{"rendered":"

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

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.<\/p>\n

I want to thank all of you who called 9-1-1 to report my absence last week. It turns out that I just had too big of a workload from my day job — you know, the one that actually puts the food on my table — and by the time I got home last Friday night, I was just too pooped to write. Then Saturday morning rolled around and I had a few more hours of work to do, so I just decided to skip last week altogether.<\/p>\n

Anyway … I hope everyone is enjoying their Memorial Day weekend. And please be sure to take a moment to remember our soldiers, sailors, airmen and marines who made the ultimate sacrifice in defense of our nation.<\/p>\n

Off we go …<\/p>\n

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

Debit:<\/strong><\/span> How can anyone say the economy is doing just fine when one in five adults<\/a> between 18 and 34 still live at home with their parents? And in Southern California and Miami it’s one in three<\/em>. Yet more proof the economy died in 2008 and has been kept alive only with trillions in Central Bank currency printing.<\/p>\n

Debit:<\/strong><\/span> Of course, the banks have noticed that Millennials can’t afford to buy homes, which is why they’re now offering home loans to borrowers with poor credit<\/a> for a token down payment of just 3% — that can be provided by anybody<\/em>. You know … they pulled a similar stunt right before the last housing bubble burst too.<\/p>\n

Debit:<\/strong><\/span> I know what you’re thinking, but you can relax. The good news is Wells Fargo is partnering with Fannie Mae<\/a>, so even though some<\/del> most of those new loans will probably<\/del> end up in default, they’re guaranteed by the federal government. On second thought, it’s only good news if you don’t<\/em> pay taxes. I think.<\/p>\n

Debit:<\/strong><\/span> Meanwhile, I see Deutsche Bank is offering their Belgian clients who are willing to lock their cash up for 90 days an interest rate of 5.0%<\/a>. Yes, the decimal point is in the correct spot. Three words for you: insolvent bank ahead.<\/p>\n

Debit:<\/strong><\/span> You think I’m kidding? Washington Mutual tried offering above-market interest rates<\/a> right before it went under in late 2008. The big difference is, unlike WaMu, Deutsche Bank is one of the largest banks in the world. If it goes under, the collateral damage could be catastrophic.<\/p>\n

Credit:<\/strong><\/span> Speaking of bureaucracies with imploding balance sheets, Obamacare continues its descent into the depths of healthcare-coverage hell as three states will only be offering one health insurance company<\/a> on their exchanges this year — and next year there may be several states with no insurers at all. Imagine that. Forward!<\/p>\n

Credit:<\/strong><\/span> Needless to say, the twisted Utopian economics behind Obamacare’s slow-motion train wreck is just a small-scale example of why socialism always eventually breaks down on a more widespread basis, as it’s now doing<\/a> in the People’s Socialist Paradise of VenezuelaTM<\/span><\/sup>.<\/p>\n

Debit:<\/strong><\/span> When pie-in-the-sky economically-illiterate nanny-state politicians insist on imposing price controls and subsidizing everything from rice and gasoline to telecommunications service and healthcare, the inevitable result will be crippling shortages<\/a> that can rip the fabric of a civil society<\/a>.<\/p>\n

Debit:<\/strong><\/span> Even so, the promise of “free stuff” from the government is a siren song for those who prefer dependence over self-reliance. Too bad it always leads to economic collapse, where toilet paper is a luxury<\/a>, and people stand in interminable lines all day long for scarce goods — although they often have no idea what they’re waiting to buy.<\/p>\n

Debit:<\/strong><\/span> With that in mind, it should be no surprise to anyone that barter is now the order of the day<\/a> in the People’s Socialist Paradise of VenezuelaTM<\/span><\/sup> despite its economic inefficiency. Then again, desperate times call for desperate measures. Oh, and a return to free markets.<\/p>\n

Debit:<\/strong><\/span> More pie-in-the-sky promises: Another gravy train that’ll soon be running off the rails are all of those ridiculous government pensions<\/a> that have many city and state employees retiring in their 50s with six-figure stipends — some upwards of $250,000 annually. No, really<\/a>.<\/p>\n

Credit:<\/strong><\/span> Take Chicago’s pension fund, for instance: it’s so badly underfunded there are only 32 cents<\/a> for every dollar owed to retirees. (Psst. And if you think that’s bad, just wait until the bull market in stocks finally runs out of steam.)<\/p>\n

Debit:<\/strong><\/span> Hey … Do you think Chicago politicians will order their already over-taxed citizenry to cough up even more cash so government retirees can continue to receive 100% of their unrealistic benefits? Yeah … I guess that is<\/em> a stupid question<\/a>.<\/p>\n

Debit:<\/strong><\/span> By the way, Illinois’ biggest government-employee union is demanding $3 billion in additional salary and benefits for its workers, even though government union salaries increased more than 40%<\/a> from 2005 to 2014. At the same time, median private-sector wages in Illinois remained flat. I know. This isn’t unique to Illinois<\/a>, mind you; it’s a similar story all across America<\/a>.<\/p>\n

Debit:<\/strong><\/span> Twas a time when the government existed to serve the people. The trouble is, today we exist to serve the government<\/a> — and we have only ourselves to blame.<\/p>\n

Credit:<\/strong><\/span> Rest assured, there’s a light at the end of the tunnel; what can’t be sustained won’t. And although it’ll be painful, the coming economic reset<\/a> will mercifully deliver us from this financial — and social — rabbit hole we currently find ourselves in, where black is white, down is up, bad is good, and good is bad. The sooner the better.<\/p>\n

By the Numbers<\/strong><\/p>\n

Some facts on the Memorial Day holiday:<\/p>\n

1873<\/strong><\/span><\/span> Year the first state officially recognized Memorial Day. (New York)<\/p>\n

25<\/strong><\/span><\/span> American cities that claim to be the birthplace of Memorial Day.<\/p>\n

260,000<\/strong><\/span><\/span> Graves at Arlington National Cemetery that are adorned with US flags for the holiday.<\/p>\n

1,300,000<\/strong><\/span><\/span> Members of US armed forces who have lost their lives in conflict.<\/p>\n

39<\/strong><\/span><\/span> Percentage of Americans who plan to travel over the Memorial Day weekend.<\/p>\n

55%<\/strong><\/span><\/span> Average increase in the cost of a Memorial Day hotel room this year compared to 2015.<\/p>\n

62<\/strong><\/span><\/span> Percentage of Americans who will barbecue this weekend.<\/p>\n

818<\/strong><\/span><\/span> Hot dogs consumed every second<\/em> between Memorial Day and Labor Day.<\/p>\n

Source: WCTI 12<\/a><\/em><\/p>\n

The Question of the Week<\/strong><\/p>\n

[poll id=\"114\"]<\/code><\/p>\n

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

How long could you willingly go without a smartphone?<\/p>\n