{"id":70643,"date":"2022-01-15T02:15:04","date_gmt":"2022-01-15T10:15:04","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=70643"},"modified":"2022-01-18T06:08:57","modified_gmt":"2022-01-18T14:08:57","slug":"black-coffee-15-jan-2022","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id70643-black-coffee-15-jan-2022.html","title":{"rendered":"Black Coffee: Iron Fist, Glass Jaw"},"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 terrific week. With the hardest part of it over, let’s get right to this week’s commentary …<\/p>\n

It ain’t about how hard you can hit. It’s about how hard you can get hit and keep moving forward.<\/em><\/p><\/blockquote>\n

— Anonymous<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? Rising crude oil prices are bad enough, but now the cost of cooking oil is beginning to soar too, with canola prices are at record highs<\/a> with global stockpiles at a four-year low. Last week Paris canola oil futures surged nearly 6% – that was the largest intraday gain since 2009. The price increase was a bit more subdued on this side of the pond, as canola futures climbed a relatively paltry 1.5%. If only the price increases for other prices were so tame, relatively speaking.<\/p>\n

\"\"<\/a><\/p>\n

Debit:<\/strong><\/span> Of course, nobody who has been paying attention is surprised at rising prices anymore. In fact, the Bureau of Labor Statistics’ (BLS) December Consumer Price Index (CPI) showed prices rose at 7.0% year-over-year<\/a> (YoY) — that marks the fastest YoY increase since 1982. Although when one considers how manipulated the CPI figures are, you can bet the actual<\/strong><\/em> inflation rate is probably double that number. If not more …<\/p>\n

\"\"<\/a><\/p>\n

Credit:<\/strong><\/span> In other news, this week macroeconomist Jim Rickards complained that, “It’s difficult to tell if the supply chain is being intentionally sabotaged or whether it’s just collapsing under its own weight; possibly both. For 30 years, the goal of supply chain management has been efficiency, inventory and latency. That’s fine in the short run, but it results in a system that’s brittle<\/a> and has no tolerance for even small disruptions.” Translation: Just-in-time delivery is a wonderful innovation that keeps prices low as long as there are absolutely zero<\/strong><\/em> hiccups. Otherwise, it’s a disaster. That being said …<\/p>\n

\"\"<\/a><\/p>\n

Credit:<\/strong><\/span> Meanwhile, investment advisor Lance Roberts points out that “share buybacks hit a record<\/a> last year as companies rushed to improve bottom-line EPS reports. More than 40% of the S&P 500’s total return since 2011 came from share buybacks.” But wait … it gets better. Roberts goes on to say that, “Over the last few years they’ve accounted for nearly 100% of the net buying in the market. So, if buybacks accounted for a large portion of the net purchases in the equity market, what happens if those buybacks reverse?” Hey … it’s a good question. Let’s go to the tape:<\/p>\n