{"id":41829,"date":"2017-03-11T05:15:13","date_gmt":"2017-03-11T13:15:13","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=41829"},"modified":"2022-01-22T12:54:37","modified_gmt":"2022-01-22T20:54:37","slug":"black-coffee-decisions-decisions","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id41829-black-coffee-decisions-decisions.html","title":{"rendered":"Black Coffee: Decisions, Decisions"},"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 …<\/p>\n

Life is a constant oscillation between the sharp horns of dilemmas.<\/em><\/p><\/blockquote>\n

— H.L. Mencken<\/strong><\/p>\n

The worst choice you can make, is no choice at all.<\/em><\/p><\/blockquote>\n

— Nicholas Stoller<\/strong><\/p>\n

Customers can have a car painted any color that they want, as long as it is black.<\/em><\/p><\/blockquote>\n

— Henry Ford<\/strong><\/p>\n

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

Credit:<\/strong><\/span> This week, President Trump maintained his pledge to restore Glass-Steagall<\/a>. That was one of America’s most important laws — a post-Depression mandate that prohibited banks from commingling their profits with customer deposits for speculative purposes. Unfortunately, it was repealed back in 1999 at Wall Street’s request — and Main Street has been paying for it ever since.<\/p>\n

Debit:<\/strong><\/span> Needless to say, bank stocks promptly responded to the Glass-Steagall restoration news by tumbling<\/a>. Hmm. Why do you think that<\/em> happened, you ask? Yeah … I wonder.<\/p>\n

Debit:<\/strong><\/span> Speaking of stocks, the market is looking eerily similar to the way it was in 1999<\/a>, just prior to the dot com crash. In 1999, the Fed was hiking rates, inflation was rising, and stocks were going parabolic. You know … just like today. Meh. I’m sure it’s just a mad coincidence.<\/p>\n

Debit:<\/strong><\/span> By the way, the soaring stock market belies the fact that desperate mall owners<\/a> are looking for tenants by recruiting any businesses they can find, including grocers, doctors’ offices — and high schools. Yikes. How would you like to be an alumni of “Galleria High”?<\/p>\n

Debit:<\/strong><\/span> Of course, as ZeroHedge observes<\/a>, those malls — most of which are now practically empty and sitting on prime real estate — are struggling thanks to “shifting consumption patterns, years of underinvestment by mall owners and a spate of retailer bankruptcies.” Yes, but I suspect the biggest culprit is the Internet. Thanks, Amazon!<\/p>\n

Debit:<\/strong><\/span> Then again, maybe there’s yet another<\/em> cause. For example, thanks to a floundering economy — the latest job figures<\/a> notwithstanding — most Americans are so broke that they have little discretionary income anymore, as evidenced by the fact that half of all Americans can’t afford to write a $500 check. Yes, half. No, really<\/a>.<\/p>\n

Credit:<\/strong><\/span> According to financial analyst Andy Hoffman, “(America’s) rapidly dying economy is forcing the Fed to make a Hobson’s Choice<\/a>: raise rates to maintain credibility, but destroy both the economy and America’s competitive position — or do nothing, and watch markets start to discount the hyperinflation that must inevitably arrive.” I think it’s obvious: the Fed will go with the first option … or the second.<\/p>\n

Credit:<\/strong><\/span> Hoffman also points out that the Fed’s decision to continue raising rates in the face of a struggling US economy<\/a> is an “insane, suicidal gambit” that will only hasten the onset of the next financial crisis. He’s right, you know.<\/p>\n

Credit:<\/strong><\/span> Meanwhile, Hugo Salinas Price points out that America has a catch-22<\/a> of its own: “The US cannot have it both ways — it can’t issue the world’s money, and<\/em> indulge in economic protectionism.” That’s because the latter will ultimately result in the US dollar losing its reserve currency status — and a lower standard of living for most Americans. At least temporarily.<\/p>\n

Debit:<\/strong><\/span> One thing is certain: Reality is officially in short supply now that a single bitcoin is worth more<\/a> than an ounce of gold. That’s right; an upstart abstract purely-ethereal cryptocurrency with no intrinsic value whatsoever is currently more valuable than real-life precious metals.<\/p>\n

Credit:<\/strong><\/span> Frankly, bitcoin being more valuable than gold<\/a> makes as much sense as a screen door on a submarine — or an ice machine for an eskimo. You choose.<\/p>\n

Credit:<\/strong><\/span> Finally … You know America’s day of reckoning isn’t too far off when even billion-dollar bond-king Bill Gross is admitting that the jig is up. In fact, in his most recent newsletter, he urged us to be more concerned about the return of<\/em> our money than the return on<\/em> our money because, “Our financial system is a truckload of nitroglycerin<\/a> on a bumpy road.” Uh huh. Hey, Bill … Welcome to the club.<\/p>\n

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

Here are a few facts on the US Navy’s newest and most technologically-advanced warship ever built, the USS Gerald Ford. It’s the first new carrier design since the Nimitz-class, which was commissioned in 1975:<\/p>\n

$12,900,000,000<\/strong><\/span><\/span> Cost to build the aircraft carrier, making it the most expensive warship ever.<\/p>\n

200,000<\/strong><\/span><\/span> Gallons of paint required to cover the ship; that’s enough to paint the White House 350 times.<\/p>\n

$4,000,000,000<\/strong><\/span><\/span> Amount the US Navy will save over the ship’s 50-year lifetime due to reduced maintenance requirements.<\/p>\n

90,000<\/strong><\/span><\/span> The final weight of the Ford in tons, equivalent to 400 Statues of Liberty.<\/p>\n

10,000,000<\/strong><\/span><\/span> Feet of installed electric cable, enough to reach the International Space Station 7.6 times.<\/p>\n

4,000,000<\/strong><\/span><\/span> Feet of fiber optic cable, enough to reach the International Space Station 3 times.<\/p>\n

4,000,000<\/strong><\/span><\/span> Pounds of weld metal used to build the ship.<\/p>\n

5000<\/strong><\/span><\/span> American shipbuilders involved in building the Ford.<\/p>\n

4500<\/strong><\/span><\/span> Sailors who will call the USS Gerald Ford home<\/p>\n

5200<\/strong><\/span><\/span> Sailors required to operate older Nimitz-class aircraft carriers.<\/p>\n

Source: ABC News<\/a><\/em><\/p>\n

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

How much money do you usually withdraw at an ATM?<\/p>\n