{"id":89760,"date":"2025-11-29T01:00:48","date_gmt":"2025-11-29T09:00:48","guid":{"rendered":"https:\/\/lenpenzo.com\/blog\/?p=89760"},"modified":"2025-12-03T08:53:58","modified_gmt":"2025-12-03T16:53:58","slug":"black-coffee-29-nov-2025","status":"publish","type":"post","link":"https:\/\/lenpenzo.com\/blog\/id89760-black-coffee-29-nov-2025.html","title":{"rendered":"Black Coffee: The King Is Dead, Long Live the King"},"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

The gold standard did not collapse \u2013 governments abolished it in order to pave the way for inflation. The whole grim apparatus of oppression and coercion had to be put into action in order to destroy it. Solemn pledges were broken, retroactive laws were promulgated, provisions of constitutions and bills of rights were openly defied. And hosts of servile writers praised what the governments had done, and hailed the dawn of the fiat-money millennium.<\/em><\/p><\/blockquote>\n

\u2014 Ludwig von Mises<\/strong><\/p>\n

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

Credit:<\/strong><\/span> Did you see this? Although US rental prices climbed faster than paychecks in the aftermath of the pandemic, renters have reclaimed some ground this year because, in much of the country, rents are falling<\/a>. As of the end of October, the median monthly rent on units with up to two bedrooms have fallen 1.7% year-over-year to $1696. That’s also down 3.6% from their 2022 peak. Now for the bad news: That still doesn’t mean that rents are affordable for many Americans. If you\u2019re looking for that, then you\u2019ll need to live in China\u2026<\/p>\n

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Debit:<\/strong><\/span> Rents may be falling, but people are still being cautious with their money. A new survey has found that many consumers are looking to shell out 4% less this holiday season<\/a> than last year, citing higher costs of living and more fear of the economy. That is the first time since 2021 that shoppers have indicated that they plan to spend less than previous years. Consumers making less than $50,000 a year are expected to spend 12% less than last year, while shoppers making more than $200,000 a year say they\u2019ll cut their spending by 18%. And while the latter seems counterintuitive, there may<\/strong><\/em> be a good reason for that…<\/p>\n

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Credit:<\/strong><\/span> In other news, just 1 in 5 Baby Boomers expect to leave an inheritance, with the rest planning to spend their wealth<\/a> during their lifetimes instead. Factors contributing to this trend include the desire to enjoy their money, high costs of living, inflation, and significant expenses related to healthcare and long-term care in retirement. The punchline? This contrasts with many younger generations who expect to receive an inheritance… of some kind.<\/p>\n

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Debit:<\/strong><\/span> Frankly, who can blame any parent for not planning on leaving an inheritance to their kids when a cheeseburger at McDonald\u2019s is now more than three times as expensive as it was in 2019 and a medium serving of French fries are more than $4? Or that a Big Mac that used to cost $2.25 in 2000<\/a> is more than $6 today in most of America, including Massachusetts where they sell on average for $6.75. And to think there was a time when McDonalds used to issue $5 holiday gift books with five $1 coupons in them. When we were kids, those holiday books were good for several trips to the Golden Arches. Clearly, not anymore.<\/p>\n

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McDonald’s circa 1975<\/p><\/div>\n

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Debit:<\/strong><\/span> It turns out that finances aren\u2019t doing so well on the other side of the pond either, where a German federal official reported this week that, \u201cAlmost every German city is now on the verge of bankruptcy<\/a>.\u201d He went on to point out that the largest state in Germany has only 10 out of 396 cities and municipalities that can present a balanced budget. He then added that those alarming figures aren\u2019t unique to that particular state and can be applied to the \u201centire country.\u201d Sounds like Germany is finally running out of other people\u2019s money. That’s just one reason why silver closed more than 5% higher to finish at a new all-time high ($56) on Friday.<\/p>\n

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Credit:<\/strong><\/span> Of course, the US is heading in the same direction as Germany, albeit at a slower pace thanks to a seemingly endless supply of other nations willing to buy its debt. However, as macro analyst Sunil Reddy points out, “For decades, the Fed could always buy unlimited quantities of US Treasuries, forcing yields lower and prices higher. But that privilege depended on two conditions that no longer exist<\/strong><\/em>: 1) Inflation anchored near 2%; and 2) The dollar\u2019s unchallenged role as the global (reserve) currency \u2013 and both anchors are now gone<\/a>.\u201d True. And that’s bad news for most Americans. But honesty is always the best policy. Just ask these guys…<\/p>\n

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Credit:<\/strong><\/span> In response to the US fumbling away its exorbitant monetary privilege, several years ago China launched the BRICS-linked Cross-Border Interbank Payments System (CIPS) as an alternative for global trade settlement. The CIPS has now expanded across 185 countries<\/a>, allowing international payments in Chinese yuan without using the US dollar (USD). If true, the USD\u2019s role as the global king of currencies could finally be on its death bed. Or not…<\/p>\n