{"id":78387,"date":"2023-05-06T01:15:57","date_gmt":"2023-05-06T08:15:57","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=78387"},"modified":"2023-06-25T20:29:42","modified_gmt":"2023-06-26T03:29:42","slug":"black-coffee-6-may-2023","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id78387-black-coffee-6-may-2023.html","title":{"rendered":"Black Coffee: Upping the Ante"},"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’ve got another busy weekend ahead of me, so let’s get right to this week\u2019s commentary …<\/p>\n

The number of realists who are betting that both the ‘economy gets healthy soon’ and the federal government gets spending under control is a tiny group, indeed.<\/em><\/p><\/blockquote>\n

– Bob Beauprez<\/strong><\/p>\n

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You can’t taper a Ponzi scheme.<\/em><\/p><\/blockquote>\n

– Max Keiser<\/strong><\/p>\n

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

Debit:<\/strong><\/span> Did you see this? With a technical default fast approaching, insuring US Treasury notes against default now costs more than insuring Mexican debt. Based on April tax receipts, the latest estimates are that, unless the debt limit is raised by Congress, the federal government will default<\/a> on its obligations sometime in July. Or maybe June. If not sooner. Regardless, you can be certain that Congress will come to some sort of political decision before D-day gets here – even it is with only hours to spare. They always do.<\/p>\n

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Debit:<\/strong><\/span> Speaking of default, First Republic bank is now sleeping with the fishes<\/a>. And although this failure – the fifth major failure in last 60 days – was not unexpected, it’s still jarring. For the record, FRB is now the second largest US bank failure in history. Then again, the year is still relatively young.<\/p>\n

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(h\/t: mediacloud.theweek.com)<\/p><\/div>\n

Debit:<\/strong><\/span> By the way, for those of you counting at home, according to market analyst Charlie Bilello, between 2009 and 2022, there were – believe it or not – 511 bank failures in the US with total combined assets of $339 billion. Compare that to the total assets of last three US banks that failed: $548 billion<\/a>. But, hey \u2026 there’s nothing to see here, folks. Now move along.<\/p>\n

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(h\/t: Mike Maloney)<\/p><\/div>\n

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(h\/t: mediacloud.theweek.com)<\/p><\/div>\n

Credit:<\/strong><\/span> Frankly, it should be obvious to anyone paying attention to the state of the world’s finances that, after more than a decade, Western governments’ reliance on Modern Monetary Theory (MMT) – also known as the “Magic Money Tree” – has pretty much run its course<\/a>, which means the federal government’s money spigot will soon be shutting off. Permanently. And you know what that<\/strong><\/em> means. As for those who don’t know, well … here’s a preview of what it will look like:<\/p>\n