{"id":48643,"date":"2018-05-05T04:15:56","date_gmt":"2018-05-05T11:15:56","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=48643"},"modified":"2023-05-12T10:30:43","modified_gmt":"2023-05-12T17:30:43","slug":"5-may-2018","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id48643-5-may-2018.html","title":{"rendered":"Cafe Negro: Cinco de Mayo Edicion Especial"},"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

And away we go …<\/p>\n

“In time of peace there can, at all events, be no justification for the creation of a permanent debt by the Federal Government. Its limited range of constitutional duties may certainly under such circumstances be performed without such a resort.”<\/em><\/p><\/blockquote>\n

— John Adams<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? A new poll found that 46% of Americans favor government jobs for all. No, really<\/a>. Never mind how something like this can ever be paid for. Oh, that’s right … I forgot: “Money” can be created by simply printing as many pieces of green paper with dead presidents on them as needed, without regard to real economic output.<\/p>\n

Debit:<\/strong><\/span> Folks, with 46% of the population this ignorant about basic economics and willing to embrace the “free lunch” mindset, I think it is safe to say that the end of the current American Empire can’t be too far away. The Washington Post estimates that if such a program were implemented today, it would cost upwards of $2 trillion<\/a>. Annually. Forward!<\/p>\n

Debit:<\/strong><\/span> At the rate the US is now racking up debt, why worry about adding another $2 trillion per year into the debit column? On Monday the US Treasury announced that it borrowed $488 billion last quarter<\/em>. That’s the single biggest quarterly debt sale<\/a> since the US borrowed $569 billion during the final quarter of 2008. Of course, that was done to stave off a meltdown of the global financial system.<\/p>\n

Debit:<\/strong><\/span> Then again, as Zero Hedge notes, when it comes to the Treasury’s latest single-quarter half-trillion dollar credit card binge, the difference is this time “there was no crisis<\/a>; not even a recession.” Think about that.<\/p>\n

Debit:<\/strong><\/span> Unfortunately, the central banks have been pulling back the reins on America’s credit limit by slowing their purchases of US Treasuries. As the WSJ notes, “The behavior of these bidders is crucial<\/a> for the US to fund itself, at a time when the budget deficit is forecast to surpass $1 trillion by 2020 and remain above that level for the foreseeable future.” Does anybody else see a problem here? Okay … then how about here:<\/p>\n