{"id":60187,"date":"2020-03-28T02:15:27","date_gmt":"2020-03-28T09:15:27","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=60187"},"modified":"2024-06-19T17:46:06","modified_gmt":"2024-06-20T00:46:06","slug":"black-coffee-28-mar-2020","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id60187-black-coffee-28-mar-2020.html","title":{"rendered":"Black Coffee: Watching a Monetary System In Its Death Throes"},"content":{"rendered":"

\"\"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

Don’t be fooled by this week’s market rebound — the monetary system is flat-lining and the Fed and Congress will not be able to revive it. The only question now is how long the US government and its increasingly impotent central bank remain in denial. Their refusal to acknowledge reality could go on for many many months — so don’t be surprised if they foolishly decide to look the other way until hyperinflation rears its ugly head.<\/p>\n

Gold is an objective value, an equivalent of wealth produced. Paper is a mortgage on wealth that does not exist, backed by a gun aimed at those who are expected to produce it. Paper is a check drawn by legal looters, upon an account which is not theirs, upon the virtue of the victims. Watch for the day when it bounces, marked, ‘Account Overdrawn.’<\/em><\/p><\/blockquote>\n

– <\/strong>Ayn Rand, Atlas Shrugged <\/em><\/strong><\/p>\n

All paper money eventually returns to its intrinsic value: nothing.<\/em><\/p><\/blockquote>\n

— Voltaire<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? Economists for Credit Suisse are saying that because there’s no blueprint<\/a> for the economic shock we’re now experiencing, future economic data won’t just be bad — it’ll be unrecognizable<\/strong><\/em>. They say “anomalies will be ubiquitous and old statistical economic relationships between market and macro data won’t always hold.” Then again, most economists couldn’t agree even when the data was<\/strong><\/em> highly correlated.<\/p>\n

Credit:<\/strong><\/span> Market analyst Dave Kranzler notes that whenever the most reckless hedge funds have the rug pulled out from them<\/a> as they did during the market crash of 1987, and the Long Term Capital Management Crisis<\/a> in 1997, then “the biggest charlatans of modern money management<\/a> start crying for the Fed and the government to bail them out.” Funny how that works. It’s part and parcel of a fraudulent system that’s in its death throes.<\/p>\n

Debit:<\/strong><\/span> Unfortunately, the Fed’s decision to continually step in and reward that kind of reckless financial behavior has finally backfired. In case you haven’t noticed, those daily $1 trillion repo operations are, as Zero Hedge notes, “nothing more than the Fed preemptively bailing out<\/a> all those over-levered hedge funds that would have otherwise imploded.” Oh … speaking of reckless behavior that backfired:<\/p>\n