{"id":67810,"date":"2021-07-24T02:15:48","date_gmt":"2021-07-24T09:15:48","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=67810"},"modified":"2025-01-01T10:37:38","modified_gmt":"2025-01-01T18:37:38","slug":"black-coffee-24-july-2021","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id67810-black-coffee-24-july-2021.html","title":{"rendered":"Black Coffee: Low Rates and High Prices"},"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

I hope everybody had a wonderful week. And with that, let’s get right to this week’s commentary, shall we?<\/p>\n

Over the years, a number of very smart people have learned the hard way that a long string of impressive numbers multiplied by a single zero always equals zero.<\/em><\/p><\/blockquote>\n

— Warren Buffett<\/strong><\/p>\n

It’s not the mountain we conquer, but ourselves.<\/em><\/p><\/blockquote>\n

— Edmund Hillary<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? According to a recent survey, more than 4 out of 5 American voters believe that retirement security is a problem<\/a>. Another 9 out of 10 say that Social Security alone is not enough to financially prop up retirees during their golden years. Now here’s the kicker: Both results are regardless of party affiliation. Finally. Something everybody<\/strong><\/em> can agree on. Okay … almost everybody. I think.<\/p>\n

\"\"<\/p>\n

Credit:<\/strong><\/span> In other news, David Stockman pointed out this week what the financial media knows, but won’t say out loud: “After decades of unhinged money-pumping, the Fed has driven real interest rates so low that there are no more bond investors<\/a> — just traders and suckers.” Yeah. That definitely sums it up.<\/p>\n

\"\"<\/p>\n

Debit:<\/strong><\/span> By the way, Stockman goes on to point out that, last year, business debt soared<\/a> by 50% more than 2007, which until 2020 was the previous biggest borrowing year of all time. He also notes that the Fed’s financial repression policy has caused the business leverage ratio to become unhinged at 111%. That’s double what it was in the 1970s and more than three times what it was after World War II. Then again, with moral hazard firmly entrenched in our society now, I guess that shouldn’t be too<\/em><\/strong> surprising …<\/p>\n