Welcome to another exciting edition of Black Coffee, your unusual weekly digest of what’s going on in the world of money and personal finance.
Well… another busy week is behind us. So with that in mind, let’s get this party started!
When a government devalues the currency to defraud its creditors, the procedure is politely called “inflation.”
–George Bernard Shaw
Credits and debits
Credit: Have you seen this? Artificial intelligence (AI) is increasingly shaping daily financial decisions, and that growing dependence can be risky. Yet 82% of Americans say so they rely on AI when it comes to financial information and guidance, and 64% say their financial health has improved since using AI. We suspect this helped a bit too…
Debit: Unfortunately, it will take more than AI to prevent the middle class from coming under pressure. Whether it’s housing, healthcare, childcare, fuel, food or taxes, the costs of modern living have exploded. The US currently sets the official poverty line for a family of four at $32,150. However, they no longer reflect reality because the benchmarks they use date from the 1960s. As a result, measuring the cost of living in terms of gold instead of US dollars (USD) shows. terribly different story. How different? Well…according to precious metals analyst Mike Maloney, the current price of gold in USD implies a real poverty line of $140,000 per year. No, really.
Credit: On the other hand, Wall Street is doing fine, even though the major US stock indices are down slightly this week, thank you. The markets were relatively unaffected due to growing uncertainty about the next Fed chairman, or due to persistent geopolitical tensions. In fact, the Dow Jones, S&P and Nasdaq all ended the week down about 1%. Yet all three indices are still near their all-time highs. As for the timid investors who decided to do so Finally dipped a toe in the water and took a chance on cryptocurrencies for the first time last year, well…
Debit: In other news, credit card lending has become more lucrative than ever, with JPMorgan saying last year that the net return on its more than $200 billion in card loans was 9.7% last year. With that in mind, the current government is proposing a proposal a limit of 10% on credit card charges. The good news is that bipartisan legislation was introduced in Congress last year that would do just that for a five-year term. Needless to say, card issuers weren’t impressed, which means you shouldn’t expect rates to be capped anytime soon.
Credit: On the other hand, not everyone likes the idea of a cap on credit card interest rates. Why? Well… according to WalletHub CEO Odysseas Papadimitriou: “Limiting credit card interest rates to 10% is a terrible idea. Yes, people who currently have credit card debt will get some short-term relief, but this move will inevitably lock up millions of people whose credit histories don’t deserve 10%. April no more access to credit at all.” The good news is that THAT will force people to save more. That being said…
Debit: On this note, nearly 3 in 5 millennials say the average U.S. home now sells for $410,800. plan to spend less than $400,000 for their home purchase. Yet 44% of millennials – including half of all first-time buyers – would be willing to spend more than half of their monthly income on housing to afford a home. Yes. Good luck with that. Especially now that the US has announced its commitment to lowering mortgage rates, which will only serve to artificially support the housing market.
Credit: To no one’s surprise, mortgage rates immediately increase dropped to below 6% for the first time in three years, after credit giants Fannie Mae and Freddie Mac were ordered to buy $200 billion of mortgage-backed securities. And while Fed officials insist this will increase housing affordability, the reality is that the only way to make housing more affordable in the long run is to crash the housing market with double-digit interest rates. Hey, never say never…
Credit: For those who don’t understand the irony behind higher interest rates making housing more affordable, consider this example: Everything else is equalthe monthly payment for a $400,000 mortgage with a 30-year term at 6% is $2,398, while the same payment for a $250,000 mortgage at 10% is almost €200 lower – and a mortgage of €200,000 at 10% is only €1755. As an added bonus, when/if interest rates eventually drop again, these payments can drop even further in the future by refinancing the mortgage. That said, this is apparently only a problem for us regular people – or for them participation…
Gary Larson – The Other Side
Credit: Despite first-time homebuyers struggling to enter the market and the middle class coming under pressure, the value of the stock portfolios of all American households rose by $5.5 trillion in the second quarter of 2025, while the value of real estate assets increased by $300 billion. Over the same period, the net worth of households and nonprofits rose from $176 trillion to $182 trillion. But don’t be fooled. Rather than a sign of a healthy economy, this dichotomy is yet another sign of the USD’s declining purchasing power – all thanks to the US government’s insatiable appetite for debt…
Credit: It is no coincidence that the USD’s share of global reserves fell to roughly 40%, while gold’s share rose to 30%. That means gold is now bigger in central bank reserves than the euro, yen and pound combined. As the macro analyst known as “no1” on his Substack account notes, “This is not diversification. This is a flight converted into a neutral – non-devaluation asset – asset. And since 2023, things have been accelerating.” And now you know why the USD price of gold rose 65% last year. Oh… and silver 145%. Yes. And if you don’t believe us, just ask this guy…
By the numbers
A new study has identified the states with the highest number of Powerball lottery jackpot winners per capita. On the other hand, “luck” is actually a reflection of resident involvement, creating the illusion that certain states are luckier than others – for example, Rhode Island, which ranks third, has the highest lottery spending per capita in the country. With that in mind, here are the “luckiest” and “unhappiest” states under 45 participating in the Powerball lottery.
1 Delaware (Jackpot winners per million inhabitants: 9.5)
2 New Hampshire (8.5)
3 Rhode Island (8.0)
4 Indiana (5.9)
5 Missouri (5.4)
41 Texas (0.6)
42 Colorado (0.5)
t-43 Wyoming (no)
t-43 North Dakota (no)
t-43 Mississippi (no)
Source: US Census; Powerball; WINZ.IO
The question of the week
The result of last week’s survey
What are we having for dinner tonight?
Chicken 33%
Beef 24%
Pork 11%
Pasta 9%
More than 1,900 Len Penzo dot Com readers answered last week’s survey question and it turns out that more than 2 in 5 respondents ate something other than chicken or beef on the day they took this survey.
If You If you have a question that you would like to see here, please send it to me Len@LenPenzo.com and be sure to include “Question of the Week” in the subject line.
Useless News: Groovin’
An old man was visiting his local Starbucks when he suddenly felt the urge to fill up on gas.
The place was packed, but luckily the music was very loud on this particular day – so he decided to hide his farts by timing them in rhythmic pulses to the beat of the music.
After a few minutes, he thought his plan was working perfectly – and then he noticed everyone was staring at him.
Then he remembered he was listening to his iPod.
(h/t: Dave)
Squirrel Cam
If squirrels had an OnlyFans account…
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More useless news
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