{"id":41141,"date":"2017-01-28T05:15:09","date_gmt":"2017-01-28T13:15:09","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=41141"},"modified":"2024-12-27T13:24:40","modified_gmt":"2024-12-27T21:24:40","slug":"black-coffee-green-confetti-red-tape-and-blue-taxpayers","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id41141-black-coffee-green-confetti-red-tape-and-blue-taxpayers.html","title":{"rendered":"Black Coffee: Red Tape, Green Confetti and Blue Taxpayers"},"content":{"rendered":"

\"\"<\/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

Okay, let’s get right to it this week …<\/p>\n

Whoever is for higher taxes, feel free to pay higher taxes.<\/em><\/p><\/blockquote>\n

— Adam Carolla<\/strong><\/p>\n

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

Credit:<\/strong><\/span> The Dow crossed the 20,000 mark<\/a> for the first time ever on Wednesday; the S&P also hit another all-time high on the same day. For those who are paying attention, the Dow is up 207% since its March 2009 low. Hooray!<\/p>\n

Debit:<\/strong><\/span> Looking at the Dow you’d never know that US GDP was just 1.6% in 2016<\/a> — that’s the lowest print this decade. By the way, the US hasn’t had a year with at least 3% GDP since 2005 and the last 4% year was in 2000 — despite adding $15 trillion to the National Debt since then. This downward spiral will continue until our failing debt-based monetary system is replaced — or implodes beforehand.<\/p>\n

Debit:<\/strong><\/span> Of course, stock investors around the world can thank central banks for the eight-year bull market — and 80% of the world’s central banks say they plan to continue<\/a> buying stocks. Frankly, they have no choice; in an odd way, it has become a necessary component for keeping their Ponzi scheme going and maintaining faith in their failing fiat currencies.<\/p>\n

Credit:<\/strong><\/span> Then again, as the Wall Street Journal points out, “Central banks care relatively little<\/a> about whether such investments make profits or losses because they can always print more of their currency. So risk is less important.” Sadly, the only thing that matters to these bankers is keeping the gravy train rolling by maintaining their monetary illusion for as long as possible.<\/p>\n

Credit:<\/strong><\/span> It may be true for the central bankers that risk is “less important” in the short run but, as financial analyst Bill Holter notes, while central banks can buy equities with their government-sanctioned green confetti that’s created out of thin air, the strategy has a fatal flaw<\/a>: it eventually leads to currency destruction.<\/p>\n

Credit:<\/strong><\/span> Driving home the absurdity of central bank stock-buying, Holter asks a logical question: “How does anything without (intrinsic) value ‘support’ the price of what is most important to everyday life and thus the real economy?” (Spoiler alert: It can’t! At least not forever.)<\/p>\n

Debit:<\/strong><\/span> Yes, yes … I hear you: the US dollar is still king. Well … it is for now. But, as Simon Black points out, comparing prices of McDonald’s Big Mac around the globe clearly demonstrates why the buck is also currently overvalued against almost every currency<\/a> in the world.<\/p>\n

Credit:<\/strong><\/span> Eventually, a new system will have to be put in place — and many people are betting on a new gold-backed dollar<\/a>. Well … assuming the US still has all of the gold it says it does.<\/p>\n

Credit:<\/strong><\/span> If the US ever does<\/em> return to a gold-backed currency, cuckoo exchanges like this between those who actually understand that a monetary system based upon real money is in the people’s best interest — and the central bankers who insist on maintaining the current scabrous and sinister debt-based Ponzi scheme<\/a> they’ve imposed on Americans since 1913 — will finally become a thing of the past:<\/p>\n