{"id":40380,"date":"2016-12-17T05:15:59","date_gmt":"2016-12-17T13:15:59","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=40380"},"modified":"2016-12-20T06:07:50","modified_gmt":"2016-12-20T14:07:50","slug":"black-coffee-if-it-pleases-the-court","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id40380-black-coffee-if-it-pleases-the-court.html","title":{"rendered":"Black Coffee: If It Pleases the Court …"},"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

Let’s get right to it today …<\/p>\n

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

Debit:<\/strong><\/span> Venezuelans lined-up outside banks this week to deposit backpacks full of cash after their socialist government followed India’s lead and laid down the law by giving everyone three days to turn in their 100-bolivar notes<\/a>— worth less than $0.03 — before they became null and void.<\/p>\n

Debit:<\/strong><\/span> One Venezuelan objected<\/a> to the decree, saying, “I’ve been saving for so long, withdrawing money every week — and for what? Nothing!” Uh huh. That’s what happens when you put all of your faith into fiat money, amigo — not to mention the capricious politicians who can steal it from you with a mere edict.<\/p>\n

Debit:<\/strong><\/span> You know the war on cash is getting out of hand when even Australia<\/a> is now openly thinking about getting rid of their $100 note. I think it’s fair to say, beyond a reasonable doubt, that the officials in Oz have gone troppo too.<\/p>\n

Debit:<\/strong><\/span> Of course, central banks need to move the world toward a cashless society because its the only way to maintain negative interest rates over the long term — and prolong the life of their failing fiat currencies<\/a> a little while longer.<\/p>\n

Credit:<\/strong><\/span> It’s a matter of record that the US dollar is both a fiat currency and the backbone of the debt-based international monetary system. Yes, the system is mathematically unsustainable and on its last legs — but for now economic reality is in abeyance, as the dollar’s resulting exorbitant privilege continues to provide Americans with an artificially-high standard of living.<\/p>\n

Debit:<\/strong><\/span> The US is in trouble, folks — and the evidence is everywhere. Exhibit A is a fiscally-cavalier public, exemplified by voters in Montebello, California, who overwhelmingly approved a $300 million school bond<\/del><\/span> tax — even though district administrators failed to identify<\/a><\/span> a spending plan for the funds prior to the vote. Hey, why not? After all, only property owners have to pay the tab!<\/p>\n

Debit:<\/strong><\/span> Then there’s Exhibit B: America’s $20 trillion national debt. In fact, during the past two months alone, the US bled another $181 billion in red ink — despite raking in $213 billion in income taxes<\/a>. If you include unfunded liabilities such as Medicare and Social Security, we’re $104 trillion in the hole. I know … the Fed can always print more!<\/p>\n

Debit:<\/strong><\/span> This week the Dallas city council provided Exhibit C, when they offered police officers a 27% pay increase<\/a> over the next three years. Wow. Can you imagine if the private sector offered annual raises like that?<\/p>\n

Credit:<\/strong><\/span> Yes, these are the very same public servants in Dallas whose gold-plated pension fund will soon go bankrupt unless it gets a $1.1 billion infusion<\/a> from city taxpayers; that’s Exhibit D. It used to be that government existed to serve the people — clearly, that concept was turned on its head sometime ago.<\/p>\n

Debit:<\/strong><\/span> Frankly, it’s hard to justify salary increases like that for municipal employees, especially in the face of Exhibit E, behold: between 1980 and 2014 income for the bottom half of Americans rose just 1%. It wasn’t always that way. Between 1946 and 1980 — when the American dream<\/a> was still alive — real wages for that group actually doubled<\/em>.<\/p>\n

Debit:<\/strong><\/span> Exhibit F is the disappearance of generally accepted accounting principles (GAAP) and financial transparency<\/a>. According to FactSet, more than 90% of S&P 500 companies are guilty of reporting non-GAAP adjusted earnings figures each quarter. It’s also no coincidence that 80% of the time those adjusted numbers make corporations look financially better. Think: lipstick for pigs.<\/p>\n

Credit:<\/strong><\/span> Indeed, financial analyst Dave Kranzler makes the case by noting that, “If GAAP accounting standards from 1999 were applied to current earnings, both the Dow and S&P 500 would be at record valuation levels<\/a>.” Imagine that. Caveat emptor.<\/p>\n

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

In North Dakota, 42 people collect government assistance for every 100 people who work outside the government and pay taxes. That is the lowest ratio of any state. Here are the number of dependents for every 100 private sector workers in the six states that currently have more<\/em> people on the dole than private-sector taxpayers to support them:<\/p>\n

148<\/strong><\/span><\/span> New Mexico<\/p>\n

116<\/strong><\/span><\/span> West Virginia<\/p>\n

114<\/strong><\/span><\/span> California<\/p>\n

111<\/strong><\/span><\/span> Mississippi<\/p>\n

108<\/strong><\/span><\/span> New York<\/p>\n

103<\/strong><\/span><\/span> Arkansas<\/p>\n

Source: Forbes<\/a><\/em><\/p>\n

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

[poll id=”142″]<\/p>\n

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

How many bathrooms does your current home have?<\/p>\n