Black Coffee: Sleight of Hand

Spread the love

It’s time to sit back, relax and enjoy a little joe …

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.

I hope everybody had an enjoyable week. Without further ado, let’s get right to this week’s commentary …

Sneaky and underhanded, the Fed has been sucking the life blood out of the United States since 1913. Like a black widow spider, it weaves a web of corruption and deceit. Unknown to its prey, the Fed’s bite is poisonous, deep, long-lasting and brings financial upheaval and misery to Americans.

– Jim McCarthy

Credits and Debits

Credit: Did you see this? There’s a personal finance trend known as “No Buy 2025” where individuals commit to avoiding non-essential purchases that is all the rage in some circles. According to Yahoo!Finance, the challenge is designed to ” help people reset their spending habits, get clarity on their financial priorities, boost their savings without having to make huge sacrifices.” Then again, available discretionary spending has been gradually declining for a long, long time now …

Credit: While the no-buy challenge helps you break longstanding habits, like reaching for your phone to shop when you’re bored, it’s primary benefit is to help people reach larger financial goals, from paying off debt to buying a home. Unfortunately, for nervous realtors, it appears that consumers can’t save fast enough …

Debit: On a somewhat related note, May’s tariff-fear surge of 8.3% in US factory orders was the second biggest monthly jump in 69 years. So it’s not surprising that the May front-running led to factory orders in June tumbling 4.8% – that follow-on decline is the biggest month-over-month drop since the pandemic. The good news is that, somehow, the stock market is still flirting – yet again – with more all-time highs …

Debit: Meanwhile, the latest jobs report that was released last Friday not only showed weaker-than-expected hiring – it also revealed some jaw-dropping downward revisions to previous data. As a result, many macro analysts are concerned that the labor market is losing steam faster than previously thought. For those not counting at home, the US economy added just 73,000 jobs in July – that’s far below the 104,000 expected by economists. But even more startling is that the May and June figures collectively erased an additional 258,000 jobs, marking the largest two-month downward revision since May 2020. Ouch.

Debit: Even more disturbing, of the jobs that were created last month, the government sector was still responsible for 1 in every 9 new openings, despite the longer-term year-over-year loss of those jobs. Those jobs actually represent a net drain on the economy. In other words: Those jobs act as a black hole used to consume taxpayer money without providing any increase in living standards. And speaking of powerful black holes…

Credit: In other news, economist Thomas DiLorenzo pointed out this week that, “A consumer basket of goods selling for $100 in 1790 cost only slightly more, at $108, than its equivalent in 1913 – which was the year of the Fed’s founding. But thereafter the price soared, reaching $2422 by 2008. (So) the Fed has … not only failed, but has made the economy far more unstable and with more price inflation than there was before (it) existed.” Imagine that.

h/t: TF Metals Report

Debit: On a related note, DiLorenzo provides some interesting trivia regarding Fed mismanagement. He notes that, “the Fed is spending $2.5 billion on its headquarters building in Washington, DC – not for a new building, but for renovations of their already palatial headquarters. To put this into perspective, the cost of building Trump Tower (in the early 1980s), adjusted for inflation, was about $921 million.” And In the meantime, the Fed will continue to rely on a key tactic from the same playbook that the politicians in DC routinely use to keep taxpayers in the dark …

Debit: Of course, the declining value of the US dollar (USD) is directly related to the US National debt spiraling out of control. The punchline is that there’s nothing the Fed can do about it – which is why the world’s fiat currencies continue to hemorrhage purchasing power. At the same time, central banks are reducing their purchases of US Treasury (UST) bonds while aggressively buying and hoarding gold. This should also be a clue to investors that the long-held belief that USTs are a ‘safe haven’ asset is, at best, an illusion. At worst, it’s a complete fabrication. The lesson here: Sometimes things aren’t always what they seem …

Credit: It’s no coincidence that, as macro analyst Jesse Columbo points out, since the pandemic, central banks have significantly ramped up their gold purchases by a dramatic increase of roughly double the annual average in the preceding decade. Huh. It’s almost as if the authorities whose primary business is based on the value of the currency they distribute are worried about the continuing viability of their fiat monetary system.

Credit: The uncontrolled debt spiral is why gold is now clearly on the path to restoring its previous role as the backbone of a new monetary system that could replace failing fiat currencies – as indicated by its furious price gains that were ignited on March 2024. The good news is that the US Congress has decided to get serious about its reckless spending and the resulting debasement of the US dollar (USD) by setting a new $41.1 trillion debt ceiling. So there’s that.

Credit: For those who are still trying to figure out what, exactly, is going on, the bottom line is that the world’s migration toward gold means the yellow metal should no longer be considered just wealth insurance – it’s also poised to be the foundation of global money. That’s because gold is honest money in a dishonest system.

By the Numbers

A recent study calculated the average cost of a wedding in each state and matched it with its citizens’ average disposable daily income. Here are the ten states with the longest path to a fully-funded wedding, based on how many days people have to work in each state to fully cover the cost of their nuptials:

442 Massachusetts

457 New Hampshire

465 Maine

468 Delaware

484 Louisiana

486 South Carolina

578 New Jersey

579 Rhode Island

617 Vermont

879 Hawaii

Source: JJ’s House

The Question of the Week

Last Week’s Poll Result

Are you financially better off than your parents?

More than 1700 Len Penzo dot Com readers answered last week’s question and it turns out that 3 in 5 of you are better off than your parents. Let’s hope many of you are millennials or Gen Z – although based on last week’s responses, that’s almost certainly not the case.

This week’s question was courtesy of reader Frank. If you have a question you’d like to ask the readers here, send it to me at Len@LenPenzo.com and be sure to put “Question of the Week” in the subject line.

Useless News: Car Trouble

(h/t: Oscar)

Squirrel Cam

This red squirrel was ready for its close-up (followed by a Superman audition)…

Buy me a coffee? Thank you so much!

For the best reading experience, I present all of my fresh Black Coffee posts without ads. If you enjoyed this week’s column, buy me a coffee! (Dunkin’ Donuts; not Starbucks.) Thank you so much!

More Useless News

Here are the top — and bottom — five states in terms of the average number of pages viewed per visit here at Len Penzo dot Com over the past 30 days:

1. Kansas (5.00 pages/visit) (!!!!!)
2. West Virginia (4.00) (!!!!)
3. Connecticut (3.13) (!!!)
4. Kentucky (3.00) (!!)
5. Virginia (2.42)

46. Montana (1.48)
47. Iowa (1.45)
48. Colorado (1.43)
49. Arkansas (1.25)
50. Delaware (0.00) (!)

Whether you happen to enjoy what you’re reading (like my friends in Kansas) — or not (ahem, Delaware …) — please don’t forget to:

1. Subscribe to my weekly Len Penzo dot Com Newsletter!

2. Make sure you follow me on follow me on X.

3. You can also friend me on Facebook too!

And last, but not least …

4. Please support this website by checking out my sponsors’ ads!

Thank you!!!! 😊

Letters, I Get Letters

Every week I feature the most interesting question or comment — assuming I get one, that is. And folks who are lucky enough to have the only question in the mailbag get their letter highlighted here whether it’s interesting or not! You can reach out to me at: Len@LenPenzo.com

After reading about the 10 worst things I ever bought, Buy & Hold Long wrote in to tell me this: