{"id":38270,"date":"2016-07-16T05:15:05","date_gmt":"2016-07-16T12:15:05","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=38270"},"modified":"2016-07-19T06:02:58","modified_gmt":"2016-07-19T13:02:58","slug":"black-coffee-dont-stop-believing-all-is-well-or-else","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id38270-black-coffee-dont-stop-believing-all-is-well-or-else.html","title":{"rendered":"Black Coffee: Don’t Stop Believing All Is Well — Or Else"},"content":{"rendered":"

\"\"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 trust that many of you are familiar with the story of Peter Pan, in which it says, ‘the moment you doubt whether you can fly, you cease forever to be able to do it.’ What we need is positive attitude and conviction.<\/em><\/p><\/blockquote>\n

— Bank of Japan Governor Haruhiko Kuroda (June 3, 2015)<\/p>\n

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

Debit:<\/strong><\/span> Golf’s British Open just ended but, the week prior to that, the UK was hosting the spectacle that is Wimbledon tennis where Serena Williams was crowed the women’s singles champion. Unfortunately for her, the grand prize was $380,000 less<\/a> after the post-Brexit plunge in the pound sterling. Ouch. Somehow, though, I think she’ll survive.<\/p>\n

Debit:<\/strong><\/span> Speaking of falling earnings, I see that the Seattle employment level has fallen<\/a> after their economically-clueless councilmen imposed upon the city’s businesses a forced-march towards a $15 minimum wage for unskilled labor. Imagine that.<\/p>\n

Credit:<\/strong><\/span> This cartoon is a couple of years old now, but it’s message is still on-point:<\/p>\n

\"minimum<\/a><\/p>\n

Debit:<\/strong><\/span> You know what else is funny? (Or not.) A social justice group in Maine that is seeking a $12 per hour base wage posted jobs paying … wait for it … $10 an hour<\/a>. They’re insisting that it was a mistake. Heh. Sure<\/em> it was. I think the only “mistake” was that they got caught.<\/p>\n

Credit:<\/strong><\/span> Meanwhile, despite the lack of good high-paying manufacturing jobs in America and stagnant wages, US stock market indices are at all-time highs<\/a>. Is it just me, or does somebody on Main Street need to ask the folks on Wall Street for an explanation<\/a>?<\/p>\n

Credit:<\/strong><\/span> After all, as financial analyst Andy Hoffman notes, the soaring US markets make zero sense<\/a> when one realizes that, “Institutions have withdrawn capital from equity funds for 17 weeks running amidst horrific economic and geopolitical developments — let alone, plunging corporate earnings.” I know, Andy. I know.<\/p>\n

Debit:<\/strong><\/span> One thing is certain: there’s a growing number of “helicopter money” trial balloons now being sent up by the Fed. Obviously, the stock market approves — and why not? “Helicopter money” is simply a colloquial term for outright Weimar-style debt monetization<\/a>. In other words: Get your wheelbarrows ready!<\/p>\n

Credit:<\/strong><\/span> Then again, why shouldn’t<\/em> stocks soar? Back in 2007, after its central bank rolled out the helicopter money in earnest, Zimbabwe had the best performing stock index in the entire world — but only in nominal<\/em> terms<\/a>:<\/p>\n

\"Zimbabwe<\/a><\/p>\n

Credit:<\/strong><\/span> Of course, all of this talk about helicopter money<\/a> begs the question: If stock markets are already at all-time highs then why do we need it?<\/p>\n

Credit:<\/strong><\/span> Yes, the question was rhetorical, but I’ll be rude and answer it anyway: It’s because the international monetary system is on its death bed. The helicopter money is simply palliative care until the US dollar crosses to the other side<\/a>.<\/p>\n

Debit:<\/strong><\/span> Needless to say, we’re in this mess because of the scourge of central banking<\/a>, and its misguided belief that a handful of ivory tower finance apparatchiks can do a better job at determining the price of money — also known as interest rates — than the free market. At least that’s what Tinker Bell told them.<\/p>\n

Debit:<\/strong><\/span> If you’re curious about what waits for all of us at the end of the road if those in power refuse to return the world to a monetary system tied to honest money<\/a>, then look no further than the People’s Socialist ParadiseTM<\/sup> of Venezuela, where the standard of living continues to plumb new depths<\/a> with each passing day.<\/p>\n

Credit:<\/strong><\/span> In Venezuela, rising consumption, steady employment, guaranteed pensions and socialized healthcare are, as the Associated Press notes, “running aground<\/a> on the unwelcome reality that promises made decades ago can no longer be kept.” The AP is too kind. Most people would say the ship actually sank<\/em> years ago.<\/p>\n

Debit:<\/strong><\/span> The stark reality, however, is that the US is in the very same economic boat, but that won’t become apparent until the US dollar finally — and most assuredly — loses its reserve status. Only then will most Americans realize that the lifestyle they too ordered<\/a> is suddenly out of stock.<\/p>\n

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

As I mentioned in the intro, the British Open — the oldest major in golf — played this week at Scotland’s Royal Troon Golf Club. Here are a few facts:<\/p>\n

1860<\/strong><\/span><\/span> The year that the inaugural British Open was held.<\/p>\n

$1.67 million<\/strong><\/span><\/span> The payout to this year’s Champion Golfer of the Year.<\/p>\n

29<\/strong><\/span><\/span> Number of Americans who have won the Open Championship.<\/p>\n

22<\/strong><\/span><\/span> Number of British Open winners produced by Scotland.<\/p>\n

14<\/strong><\/span><\/span> Number of British Open winners from England.<\/p>\n

14<\/strong><\/span><\/span> Number of courses that have hosted the 145 editions of the British Open.<\/p>\n

6<\/strong><\/span><\/span> Number of times Harry Vardon won the British Open. (Yes, that’s a record.)<\/p>\n

71<\/strong><\/span><\/span> The age of Gene Sarazen during the 1973 British Open, when he made a hole-in-one at Royal Troon’s par-3 8th hole, known as the Postage Stamp.<\/p>\n

6<\/strong><\/span><\/span> The number of shots the fourth-ranked golfer in the world, Rory McIlroy, took to extricate his ball from an infamous Postage Stamp bunker during a practice round last Tuesday. Take a look:<\/p>\n

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