{"id":80376,"date":"2023-09-30T01:15:24","date_gmt":"2023-09-30T08:15:24","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=80376"},"modified":"2023-10-04T11:21:56","modified_gmt":"2023-10-04T18:21:56","slug":"black-coffee-30-sep-2023","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id80376-black-coffee-30-sep-2023.html","title":{"rendered":"Black Coffee: The Good Ol’ Days"},"content":{"rendered":"

\"hurricane-flags\"<\/a>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

Another busy week is crossed off the list. So without further ado, let’s get right to the commentary …<\/p>\n

The way prices are rising, the good old days are last week.<\/em><\/p><\/blockquote>\n

– Les Dawson<\/strong><\/p>\n

We’re devaluing the US dollar so rapidly that you can’t even bribe … senators with cash today. You need gold bars to get the job done, just so the bribes hold value.<\/em><\/p><\/blockquote>\n

– Matt Gaetz<\/strong><\/p>\n

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

Credit:<\/strong><\/span> Did you see this? It’s estimated that the Social Security cost-of-living adjustment (COLA) for 2024 will be 3.2%<\/a>. The adjustment, which takes effect in January, will result in an average $57 increase, raising benefit checks to $1790 for the average recipient. Even so, many people are grumbling that the 3.2% COLA is far lower than last year’s 8.7% hike, which was the highest increase in 40 years. That being said, the estimated 2024 COLA would still<\/strong><\/em> be higher than the 2.6% average over the past 20 years. So I guess you can’t please everyone … although there are<\/strong><\/em> exceptions:<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

Debit:<\/strong><\/span> In other news, I think it is safe to say that most Americans today would be shocked if you told them that the pinnacle of US power occurred way back in 1944. Back then, the US was not only the premier military power of World War II, it also held 22,000 tons of gold – most of it in Fort Knox<\/a> – while the American industrial base was responsible for producing 70% (!) of the world’s manufactured goods. But those days are gone. Now get off of my lawn!<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

Debit:<\/strong><\/span> More than 50 years after America decoupled the US dollar (USD) from gold, the fiat monetary system’s chickens are finally coming home to roost as a majority of the world is getting serious about finding an alternative currency that can’t be inflated away so easily. As a result, the BRICS economic block now includes four of the world’s six largest oil producers and is bigger than the G7<\/a>. Most importantly, the 11 BRICS nations have pledged to bypass the USD for trade, thereby initiating an economic power shift and dealing a huge blow to the dollar’s 80-year run as the premier global reserve currency. And speaking of power shifts:<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

Credit:<\/strong><\/span> Unfortunately, the impacts of losing the the premier global reserve currency will sharply reduce the purchasing power of the US dollar (USD) – as well as middle- and lower-class American living standards. Then again, as macro analyst Peter Hanseler points out, “When the US was at the peak of its might and forced Bretton Woods on the rest of the world, it still took 12 years until the USD overtook the British pound in international trade in 1956. Some trends may be irreversible – but they take time<\/a>.” Then again, knowing that the Fed is in charge of protecting the USD, maybe this time is different …<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

Debit:<\/strong><\/span> Meanwhile, the average American consumer now requires more than $6500 of debt<\/a> per year to fill the gap between the inflation-adjusted cost of living and the spread between their income and savings. Or to put it another way: A significant proportion of Americans who refuse to take on additional debt have seen their living standard decline, while those who are merely trying to maintain their current standard if living are essentially burning the furniture to heat the house. What does it all mean? Well … here’s one<\/strong><\/em> way to put it:<\/p>\n