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 …
Truth waits to be found. It searches for no one.
– Suzy Kassem
Credits and Debits
Debit: Did you see this? A new study has found that exactly half of all Americans surveyed don’t think it’s realistic for the average American to expect to retire comfortably, while a significant share believe they may never retire, with 43% admitting they see themselves working until they die – or at least not long before they die…
h/t: @Alifarhat79
Credit: In other news, the Big Beautiful Bill recently passed by Congress raised the state and local tax deduction (SALT) from $10,000 to $40,000 for taxpayers next year. SALT includes state and local income taxes, as well as property taxes. This is expected to provide relief to homeowners who have been suffering from higher property taxes due to the almost relentless increase in housing prices since the pandemic.
Credit: On Wall Street, US stocks closed out a winning week as the Dow gained nearly 1% for the five trading sessions through Friday – its first win in three weeks – while the S&P 500 and Nasdaq had their best showings since early August with the former up 1.6% and the latter up 2%. Then there’s the mining sector – it has been quietly outperforming all of the major stock market indices this year…
Debit: Despite the rising stock market, the US economy is showing signs of teetering – especially when you dig into the data weeds. For example, macro analyst Daniel Oliver pointed out this week that “Google offers a tool that enables observing employee strife first hand: Google Trends reveal ‘a largely unfiltered sample of actual search requests made to Google.’ The samples below paint a bleak picture.” Indeed, they do. Here are six search terms on Google that prove the economy is definitely not getting better for many people:
Source: Myrmikan Research
Credit: Alas, the stability of global financial architecture rests on the long-term bonds of the US, Japan, and the eurozone. But now, long-term government bonds, once considered safe and yielding positive real returns, have lost considerable trust. As a result, anyone not legally obligated to hold these securities is dumping them for more-trusted safe havens such as precious metals. It’s a tried-and-true pattern that repeats itself throughout history whenever times get tough. Oh, and speaking of a lack of trust…
Credit: Meanwhile, Rabobank senior strategist Benjamin Picton observed this week that, “while front end yields sink on hopes of easier money from central banks, the story at the long end is a more complicated. Fixing bloated fiscal positions without clobbering the economy and simultaneously finding ways to finance spending priorities has become a policy paradox. Is it simply ‘too late’ to fix? Or can out-of-the-box economic thinking still find a solution?” Or perhaps AI can rush in and save the day? Hey… those are both good questions. Then again, so is this…
Credit: Don’t think that macro analyst David Jensen hasn’t noticed what has been going on with global debt markets. He notes that, “The largest debt bubble in history is now rapidly drawing to a close, but don’t believe that when it happens it was one big unhappy accident or unforeseeable. The economic sleight of hand to get to this point was carefully and intentionally crafted – and we have the receipts.” All of it, of course, perpetrated by the tricksters running the world’s central banks… and this guy:
Credit: By the way, Jensen also refers us to economist Antony Mueller, who points out that, “Austrian School economists have warned for more than a century that central banks attempting to generate economic growth (via) loose monetary policy only drive unsupported consumption, misallocation of capital, and boom-bust cycles, which inevitably lead to currency collapse.” Yep. The only question that remains is: Will the currency collapse come in a controlled manner via gold revaluation, or chaotically via hyperinflation? Yes, the picture is bleak and we wish there was a better way. Wait… come to think of it, there actually is:
Credit: Of course, as macro analyst Thomas Kolbe points out, “Highly leveraged, virtually unsecured fiat credit — without backing in gold — has turned the European financial system into a Ponzi-like structure, inevitably driving massive credit expansion. If the credit tap falters, the house of cards collapses.” Unfortunately, the situation is no different on this side of the pond because too many people want a “free” lunch. The trouble is, those meals aren’t truly free. Although this little fella would beg to differ…
Debit: By the way, Kolbe also warns that, moving forward, central banks’ “policy can be summarized simply: Ahead of the looming debt collapse, its task is to manipulate the entire yield curve downward to maintain the illusion of controlled public debt — and to prevent private investors from panicking.” Translation: yield curve control (YCC) is the last arrow in the quiver. Then its game over. In the meantime, those same central banks will continue to buy gold.
Credit: We’ll finish with a bit of wisdom from Mr. Jensen who reminds us that: “What we’re seeing isn’t a failure of the market economy, but the inevitable collapse of a structured fraud by our central banks and governments.” In the meantime, Mr. Jensen continues, “after decades of price manipulation, gold and silver remain, as always, ready to speak their truth. And they will speak.” Indeed they will. In fact, they already are – loud and clear. Got gold?
By the Numbers
A new study was released this week on best and worst places to retire. To help Americans plan for a comfortable retirement without breaking the bank, WalletHub compared more than 180 US cities across 45 key measures of affordability, quality of life, health care and availability of recreational activities. The data set ranges from the cost of living to retired taxpayer-friendliness to the state’s health infrastructure. Here are the ten best cities to retire to based on that data:
10 Casper, WY
9 Madison, WI
8 Cincinnati, OH
7 Fort Lauderdale, FL
6 Atlanta, GA
5 Tampa, FL
4 Miami, FL
3 Minneapolis, MN
2 Scottsdale, AZ
1 Orlando, FL
Source: WalletHub
The Question of the Week
Last Week’s Poll Result
What is the most you’ve ever won playing the lottery (or scratcher)?