{"id":42389,"date":"2017-04-15T05:15:33","date_gmt":"2017-04-15T12:15:33","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=42389"},"modified":"2017-04-18T06:55:26","modified_gmt":"2017-04-18T13:55:26","slug":"black-coffee-lucy-in-the-sky-with-diamonds","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id42389-black-coffee-lucy-in-the-sky-with-diamonds.html","title":{"rendered":"Black Coffee: Lucy in the Sky with Diamonds"},"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

Let’s dive right in this week …<\/p>\n

The best mind-altering drug is the truth.<\/em><\/p><\/blockquote>\n

— Lily Tomlin<\/strong><\/p>\n

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

Debit:<\/strong><\/span> By now I’m sure everyone has seen the video of the United Airlines passenger who refused to be bumped<\/a> from an overbooked flight and had to be forcibly removed. Just remember, the paper gold (and silver) ETF markets “overbook” their customers too; their “bump day” is coming — and there will be no compensation. Well … at least compensation that’s worth anything.<\/p>\n

Debit:<\/strong><\/span> In other news, I see the IRS collected record amounts of both individual income and payroll taxes during the last six months. Yep. The tax collector sent more than $1.2 trillion to the federal government — and yet the US Treasury still ran a $527 billion deficit<\/a> over the same period. Think about that the next time a politician claims we need higher taxes.<\/p>\n

Debit:<\/strong><\/span> If you think that’s<\/em> crazy, last year Ford, America’s second largest automaker, sold 6.7 million vehicles. Compare that to Tesla: they delivered fewer than 80,000 cars in 2016 — and many of those were heavily subsidized. So can somebody please explain how Ford’s market value is currently $2.7 billion less<\/em> than Tesla<\/a>?<\/p>\n

Credit:<\/strong><\/span> Then again, stock analyst Piper Jaffray thinks Tesla stock is a screaming deal. As an understandably dumbfounded Dave Kranzler points out, Jaffray says his analysis makes perfect sense — but only as long as investors accept something he calls, “creative valuation methodology<\/a>.” Heh. I’m no expert in that type of analysis, but I strongly suspect any old chicken bones will do.<\/p>\n

Credit:<\/strong><\/span> Says Kranzler: “‘Creative valuation methodology’ sounds like something used (by) stock analysts who have taken LSD.” Yes, Dave … and it seems to be much more prevalent during stock market bubbles<\/a>.<\/p>\n

Debit:<\/strong><\/span> Maybe the Fed should have loaded up on Tesla stock instead of all of those toxic mortgage backed securities<\/a> they bought during the last financial crisis. Unfortunately, they didn’t. As a result, the Fed is now technically on the edge of insolvency<\/a>.<\/p>\n

Credit:<\/strong><\/span> Speaking of insolvent central banks, a proposed law in Zimbabwe would compel the nation’s banks to accept cattle, television sets, refrigerators and other household appliances as collateral. No, really<\/a>. Am I the only one wondering if that includes electric can openers?<\/p>\n

Credit:<\/strong><\/span> Yes, I know. Technically, the Fed can never be insolvent because they own a printing press. However, as Robert Murphy of Mises.org points out, “If the Fed should become insolvent from an accounting standpoint, more of the public would begin to realize just how nihilistic<\/a> our fiat-currency system really is.” One can only hope.<\/p>\n

Debit:<\/strong><\/span> On the other hand, pension funds can<\/em> become insolvent. In fact, gold-plated public pensions in Chicago, Dallas and several other locations around the country are in serious trouble; Chicago’s could implode in as little as four years<\/a> if the stock market tanks. Uh oh.<\/p>\n

Credit:<\/strong><\/span> Fortunately, for you government workers in Chicago, Dallas and elsewhere who are worried that you’ll no longer be able to retire at age 50 and pull a six-figure taxpayer-supplied pension for 35 years or more, there’s still hope: I hear that LSD markedly improves your pensions’ longterm outlook.<\/p>\n

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

[poll id=\"159\"]<\/code><\/p>\n

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

How much cash do you currently have in your wallet?<\/p>\n