{"id":75730,"date":"2022-11-19T00:15:52","date_gmt":"2022-11-19T08:15:52","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=75730"},"modified":"2023-05-12T11:33:02","modified_gmt":"2023-05-12T18:33:02","slug":"black-coffee-19-nov-2022","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id75730-black-coffee-19-nov-2022.html","title":{"rendered":"Black Coffee: Wake-Up Call"},"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

Well … another busy week is behind us. So with that in mind, let’s get this party started …<\/p>\n

The serpent, the king, the tiger, the stinging wasp, the small child, the dog owned by other people, and the fool: These seven ought not to be awakened from sleep.<\/em><\/p><\/blockquote>\n

— Chanakya<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? The word on the street is that the financial wunderkind who became the disgraced founder of the now-bankrupt FTX cryptocurrency exchange, Sam “the Sham” Bankman-Fried – otherwise known as “SBF” – managed to raise more than $1.4 billion dollars<\/strong><\/em> from various investors. But all those investments have gone up in smoke<\/a>, as they are now worth nothing<\/strong><\/em>. Zero. Zilch. Zippo. Nada.<\/p>\n

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Debit:<\/strong><\/span> Not surprisingly, the collateral damage is growing with each passing day – as evidenced by Genesis Trading’s announcement that it was suspending crypto redemptions<\/a>. As asset manager, Michael W. Green, opined this week, “The industry, as it exists today, is built on a foundation of memes and lies<\/a>. The objective has always been to drive panicked buying of a speculative asset, as the FTX saga demonstrates yet again. There are real issues with the global financial system, and the misinformation spread by the crypto industry has delayed reform. But that’s okay. Because Sam says he’s really sorry.”<\/p>\n

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Credit:<\/strong><\/span> Everybody should take the time to read market analyst Daniel Oliver’s brilliant – and very thorough – explanation of how the entire FTX debacle<\/a>\u00a0unfolded. In it, he points out that “all those users who thought they had escaped the fiat-based fractional banking system were in the exact same system – except that the crypto system was run by young criminals and based on assets vastly more volatile than US dollars.” Or to put it even more<\/strong><\/em> succinctly:<\/p>\n