The cost to make a penny has gone up 76% since 2021.
“President Trump said Sunday that he had asked the U.S. Treasury Department to stop minting new pennies, part of an effort to cut down on what he called wasteful government spending…It cost 3.7 cents to make one in 2024. That is up from 3.07 cents in 2023, 2.7 cents in 2022 and 2.1 cents in 2021. It costs so much more to make a penny than its value that the U.S. Mint reported losing some $85.3 million last year on the nearly 3.2 billion pennies it produced.”
"Pennies from Heaven" was written by Johnny Burke and Arthur Johnston for a 1936 movie by the same name.
"I hated Wall Street. It was so empty. People just didn't really give a shit about anything but money."
“Retail investor sentiment has reached its highest level on record by JPMorgan global quantitative and derivatives strategist Emma Wu’s lights, surpassing the meme stonk mania of 2021, while Alexander Altmann, global head of equities tactical strategies at Barclays, reports that individual exposure to the stock market stands near its highest since 1997.”
“Relative return risk is the only reason to buy something you don’t feel you should own. The pressure to not underperform is so powerful that it leads to behavioral absurdities. For instance, it is common for analysts and portfolio managers who are negative on a sector to underweight it. It would be a very aggressive and courageous posture, in a diversified strategy, to be so negative on IT as to be 75% underweighted.
Nevertheless, that is equivalent to telling one’s clients: “Because of the very great risk in technology, we’ve invested 10% of your portfolio in those stocks.””
“Jared Kushner, Donald Trump’s former White House adviser and his son-in-law, praised the “very valuable” potential of Gaza’s “waterfront property,” suggesting that Israel should remove civilians while it “cleans up” the area. “Gaza’s waterfront property, it could be very valuable…””
“…your worst sin is that you have destroyed and betrayed yourself for nothing.”
Carried Interest
“Donald Trump has made hay of the carried interest1 issue, claiming in 2016 that the “hedge fund guys are getting away with murder” and pledging to end the tax break.”
“In March 2024, President Joseph Biden released his Fiscal 2025 tax budget where he again called for an end to the carried interest loophole. This got airplay for a few days and then disappeared.”
CBDC’s are Tyranny
“The key difference with the CBDC is that the central bank will have absolute control on the rules and regulations that will determine the use of that expression of central bank liability. And also, we will have the technology to enforce that.”
Agustín Carstens, General Manager, Bank of International Settlements
From the Biden/Harris Administration, May 2024:
“…nearly all advanced economies and many developing countries are now governed by independent central banks whose governing bodies decide monetary policy without political input, approval, or fear of reprisal.”
Good news (for now)…
"As the penny is laid to rest, the dollar has taken its place, having lost roughly 99% of its purchasing power since the inception of the Federal Reserve, whose primary mandate was a stable currency."
Below the fold: inflation expectations, charts Greg Weldon made me look up, an academic paper, Melody Wright on the CFPB, private equity scoundrels, Dogecoin, gold, Cisco’s market cap, $29T of Fed fun coupons during the “GFC,”2 Al Green, bad sovereign wealth ideas, options action, investing in UFO’s, a scary article on Jim Jones, Dan Mitrione and USAID, a fascinating interview with DNC defector Lindy Li, and various other stuff.
I’ve already started on my next post. So many shiny things, so little time.
“This graph shows the Dodge Momentum Index since 2002. The index was at 225.7 in January, up from 213.6 the previous month. According to Dodge, this index leads "construction spending for nonresidential buildings by a full year". This index suggests a slowdown in early 2025, but a pickup in mid-2025.””
Downtown San Diego’s largest apartment complex has sold for $309 million.
“The 718-unit Park 12 complex, which completed construction in 2019, is next to Petco Park and gets a showcase every San Diego Padres home game as it towers over the eastern half of the ballpark.
South Carolina developer Greystar said in 2019 that the project cost around $400 million to construct, making this week’s sale a bargain for San Diego-based MG Properties.
Greystar did not respond to a request for comment. Local analysts were unclear why the company would sell, seemingly, at a discount.”
United States Michigan 5-Year Inflation Expectations
Look at the 10-year chart of this:
And now since 1979:
Paradigm shift?
“To return to a 65% debt/GDP level in 10 years, the government would have to create price inflation almost 10% a year above the rate of economic output.”
Food for thought.
Listening to Greg Weldon always leads me look stuff up. For example, the Personal Savings Rate:
The only times since 1959 we've been this low (3.8%) is in the runup to the DotCom bomb, the runup to the 2008 coup, and now, post-Covid.
Since the data began in 1959, the median and the average savings rate has been 8.4%, although the demarcation line when we went from above 8.4% to below 8.4% is the early 1990’s, perhaps partly related to the start of the Fed’s low and no interest rate policies. The savings rate never went below 4% until 1999.
I was sent this paper stating that the savings rate drop is due to health care expenditures, claiming "a 1 percentage point increase in health expenditure produces a decline in the saving rate of between 0.73 and 0.89 percentage points."
I’m not an economist, so I’m not sure what the wrong answer is.
Credit Card Delinquencies
Back to Q4 2011 levels, for what that’s worth.
Then again, if you exclude the 100 biggest banks…
Random Steel Imports Graphic
Melody Wright on the CFPB
“I never once saw the CFPB make an organization better or stick up for the consumer in a way that could truly protect them. Instead, I saw a bureaucratic operation that spent most of its time on the administration’s pet projects. Meanwhile the debt-to-income requirements that supported prudent lending were removed from regulations while the CFPB justified its existence and unsuspecting borrowers signed up for FHA loans they could not afford - again.”
Private Equity Strikes Again
All Quiksilver, Billabong and Volcom stores to close amid Chapter 11 bankruptcy
“Costa Mesa-based Liberated Brands said in a bankruptcy filing this week it would shut down 124 locations…Liberated said it faced “a lethal combination of significantly lower revenue than anticipated during a period of increased operating expenses and integration costs.”
“Liberated Brands” is owned by Authentic Brands Group.
“Authentic Brands Group (Authentic), a global brand owner, marketing and entertainment platform, today announced a $500M primary follow-on investment from its current investor General Atlantic, a leading global growth equity firm….Authentic’s other significant shareholders include BlackRock, CVC Capital Partners, Simon Property Group, HPS Investment Partners, Leonard Green & Partners and Brookfield.”
I can't believe we likely will have a Dogecoin ETF.
"Money" now is literally a joke. (Graphic via EricBalchunas and JSeyff)
Great timing, WSJ! September 20, 2022
Here’s gold since the WSJ headline, “Gold loses status as haven”:
Also from Alyosha: “Everything I see in gold’s technical development and what I gather from the tangle of views on what is happening now, tells me gold has little or no FOMO activity or narratives. It’s one of the most unfrothiest bull move I have ever seen…Total holdings of gold ETFs are down 900 tons since their COVID ATH. Another un-fomo datum to dwell on…The most common comment I hear from friends in the business is, “The phones aren’t ringing.””
China Frees Possible $27 Billion From Insurers to Buy Gold
“Ten insurance firms — including PICC Property & Casualty Co. and China Life Insurance Co., two of China’s biggest — will be able to invest as much as 1% of their assets in bullion, in a program that became effective last Friday. That would translate into a potential 200 billion yuan ($27.4 billion) of funds”
March 17, 2000
That's how much at least one analyst believes Cisco Systems Inc. will be worth in a few years--and you'd be hard pressed to find anyone to disagree…
Thirty-seven investment banks recommend either a "buy" or a "strong buy." None recommend a "sell" or even a "hold." On any given day the volume of Cisco shares traded is the equivalent of every man, woman and child living in California--having hit 33 million as recently as March 9.
George Kelly, an analyst with Morgan Stanley Dean Witter in New York who took Cisco public a decade ago, is one of the Cisco bulls. Cisco's stock is trading at roughly 120 times Mr. Kelly's earnings' estimate of $1.13 per share.
The multiple, or price-to-earnings ratio, is a number that places a value on a stock. It is a ratio of the price of the stock to the profit of a company expressed per shares outstanding.
"A low P/E usually signals investors are uncomfortable," Mr. Kelly said.
As a reference, in 2000 Cisco's multiple of 120 compares to Microsoft Corp.'s multiple of 55 and Intel Corp.'s multiple of 42. Yet their values are below Cisco.”
25 years later Cisco’s market cap is around $250 billion.
From 2011: $29,000,000,000,000:A Detailed Look at the Fed’s Bailout of the Financial System
“There have been a number of estimates of the total amount of funding provided by the Federal Reserve to bail out the financial system, ranging from the Fed’s own claim of only $1.2 trillion to Bloomberg’s estimate of $7.7 trillion (just for the biggest banks) and the Government Accountability Office’s tally of $16 trillion. As part of the Ford Foundation project that I am directing, “A Research and Policy Dialogue Project on Improving Governance of the Government Safety Net in Financial Crisis,” Nicola Matthews and James Felkerson have undertaken a detailed examination of the raw data pried from the Fed by lawsuit and congressional order. Felkerson’s new working paper, issued by the Levy Institute, is the first in a series that will report their results. The headline summary is that the Fed committed more than $29 trillion in the form of loans and asset purchases to prop up the global financial system. Beneficiaries included member banks, investment banks and the rest of the shadow banking system, industrial firms, foreign banks and central banks, and even individuals such as the “Real Housewives of Wall Street” identified by Rolling Stone’s Matt Taibbi…
The extraordinary scope and magnitude of the financial crisis of 2007–09 induced an extraordinary response by the Fed in the fulfillment of its lender-of-last-resort function. The purpose of this research is to provide a descriptive account of that response. Once we know what the Fed did, we can begin to assess its approach to the crisis, as we will do during the second stage of this project. This will help us to formulate policy should we face another crisis—a possibility that seems increasingly likely. A more detailed discussion of this topic can be found ” here:
“The Global Financial Crisis of 2007-2009…exposed the lengths to which central banks worldwide—the Fed being perhaps the best example—would act to save the existing financial order, helping to preserve especially the largest and most powerful institutions.”
‘Sovereign Wealth’ for Politicians
All the reasons Trump’s government investment fund is a very bad idea.
“Now here’s an idea: Leverage federal assets to create a new investment fund for the political class to invest in whatever it pleases, including private companies. What could possibly go wrong?
The answer is plenty, which is why President Trump’s proposal Monday to create a new sovereign wealth fund deserves to die in Congress. His executive order included scant details. But it said the fund would “promote fiscal sustainability,” “establish economic security for future generations, and promote United States economic and strategic leadership internationally.” More likely, it would take resources from the private economy, fund political boondoggles, and mess with the business decisions of private companies…
Other countries that have wealth funds, such as Norway, finance them with revenue from oil or resource sales. The U.S. earns revenue from spectrum sales and royalties from leases. But the politicians spend it.
Such funds typically enrich a country’s rulers and their friends far more than citizens. Foreign leaders use the funds to finance businesses and projects of political allies. Corruption is a constant temptation. Malaysia’s version, 1MDB, channeled billions of dollars to support the lifestyles of a Prime Minister and his cronies…
…with ownership comes political control. A sovereign wealth fund would give Mr. Trump and future Presidents more leverage to bully businesses. Witness how public pension funds use their investments to coerce companies to adopt their climate and cultural agenda. The French government’s stake in Renault has made it harder to cut jobs and close factories so the auto marker could become more competitive…
Government doesn’t create wealth, and a sovereign wealth fund would merely be one more way for the government to commandeer private wealth for political purposes. It will destroy more wealth than it creates.”
Just as when Yellen suggested the Fed buy stocks and bonds, this is an awful idea. A massive politically-controlled fund would certainly be used to punish/reward private companies. Doesn't matter if you love Trump - you may loathe the next President.
Options Made Easy
“Tuttle Capital has filed to invest in “reverse-engineered alien technology” with the Tuttle Capital UFO Disclosure AI Powered exchange traded fund, which is one of eight new products the manager has registered with the Securities and Exchange Commission, regulatory filings show.
With the ticker UFOD, the actively managed UFO Disclosure AI Powered ETF will invest at least 80 per cent of its net assets in a basket of companies that Tuttle Capital “believes have potential exposure to advanced or ‘reverse-engineered’ alien technology, spurred by disclosures about UFOs and alleged advanced technologies”, the registration statement reads.
Those companies will include aerospace groups and defence contractors that may have research and development programmes “rumoured to work with classified technology, potentially leading to groundbreaking advancements”, the filing says.”
The Secret Life of Jim Jones: A Parapolitical Fugue
Thought-provoking article I stumbled across, by Jim Hougan:
“In 1947, 15-years-old and still a resident of Lynn, Jones began preaching in a “sidewalk ministry” on the wrong side of the tracks in Richmond, Indiana — sixteen miles from his home. Why he traveled to Richmond to deliver his message, and why he picked a working-class black neighborhood in which to do it, is uncertain.
What is certain, however, is that, while in Richmond, Jones established a relationship with a man named Dan Mitrione. Like the child evangelist, Mitrione would one day become internationally notorious and, like Jones, his violent death in South America would generate headlines around the world. As Jones told his followers in Guyana,
“There was one guy that I knew growing up in Richmond, a cruel, cruel person, even as a kid, a vicious racist—Dan Mitrione.“
Myrtle Kennedy has confirmed that the two men knew one another, saying that they were friends.
That Jones knew Mitrione is strange coincidence, but not entirely surprising. A Navy veteran who’d joined the Richmond Police Department in 1945, Mitrione worked his way up through the ranks as a patrolman, a juvenile officer and, finally, chief of police. It is unlikely that he would have overlooked the strange white-boy from Lynn preaching on the sidewalk to blacks in front of a working-class bar on the industrial side of town.
What is surprising about Jones’s statement, however, is his description of Mitrione as a “vicious racist.” There is nothing anywhere else to suggest that Mitrione held any particular views on the subject of race. Communism, certainly — but race, no.
Which is to say that either Jones was wrong about the Richmond cop, or else he knew something about Dan Mitrione that other people did not.
If Mitrione were to play no further part in Jones’s story, there would be little reason to speculate any further about their relationship. But, as we’ll see, Jones and Mitrione cross each other’s paths repeatedly, and in the most unlikely places. Neither family friends nor playmates (Mitrione was eleven years older than Jones), their relationship must have been based upon something. But what?
…Whether Mitrione was an undercover CIA officer in South America is disputed. The Soviets say he was. Officially, however, Mitrione was an AID officer attached to the Office of Public Safety (OPS). But OPS was very much a nest of spies: in the Dominican Republic during the mid-1960s, for example, six out of twenty positions were CIA covers. Moreover, Mitrione’s partner at the time of his 1970 kidnapping in Uruguay was a public safety officer named Lee Echols — whose previous assignment had been as a CIA officer in the Dominican Republic.
Whether or not Mitrione was an undercover CIA officer, it is a fact that the CIA’s Office of Security opened a file on Jones, and conducted a name-check on him, coincident with Mitrione’s departure for Rio. Why it did so is a mystery: the Agency won’t say…
CIA records indicate that Jones’s file remained open for 10 years. It was finally closed, without explanation, in the wake of Dan Mitrione’s assassination by Tupamaro guerrillas in Uruguay.
Which is to say that the lifespan of Jones’s file at the CIA coincided precisely with the dates of Dan Mitrione’s rather suspect tenure at the State Department. What I am suggesting, then, is that Richmond Police Chief Dan Mitrione was recruited into the CIA, under State Department cover, in May, 1960; that a CIA file was opened on Jones because Mitrione intended to use him as an agent; and that Jones’s file was closed and purged, ten years later, as a direct and logical result of Mitrione’s assassination in 1970…
Given Jones’s sociopathic personality (not to mention his rightwing sermons in Guyana and the implications of his CIA file), it is very likely that Jones was working for Mitrione rather than against him.”
Many more detail in the article.
Dan Mitrione and USAID
Here’s the Amazon blurb for the book, Hidden Terrors: The truth about U.S. police operations in Latin America:
“A “devastating” exposé of the United States’ Latin American policy and the infamous career and assassination of agent Dan Mitrione (Kirkus Reviews).
In 1960, former Richmond, Indiana, police chief Dan Mitrione moved to Brazil to begin a new career with the United States Agency for International Development. During his ten years with the USAID, Mitrione trained and oversaw foreign police forces in extreme counterinsurgency tactics—including torture—aimed at stomping out communism across South America. Though he was only a foot soldier in a larger secret campaign, he became a symbol of America’s brutal interventionism when he was kidnapped and executed by Tupamaro rebels in Montevideo, Uruguay.
In Hidden Terrors, former New York Times Saigon bureau chief A. J. Langguth chronicles with chilling detail Mitrione’s work for the USAID on the ground in South America and Washington, DC, where he shared his expertise. Along the way, Langguth provides an authoritative overview of America’s efforts to destabilize communist movements and prop up military dictators in South America, presenting a “powerful indictment of what the United States helped to bring about in this hemisphere” (The New York Times). Even today, the tactics Mitrione helped develop continue to influence operations in Guantanamo Bay, Cuba, and black sites around the globe.”
From the book, “Killing Hope,” by William Blum:
“Dan Mitrione did not introduce the practice of torturing political prisoners to Uruguay. It had been perpetrated by the police at times from at least the early 1960s. However, in a surprising interview given to a leading Brazilian newspaper in 1970, the former Uruguayan Chief of Police Intelligence, Alejandro Otero, declared that US advisers, and in particular Mitrione, had instituted torture as a more routine measure; to the means of inflicting pain, they had added scientific refinement; and to that a psychology to create despair, such as playing a tape in the next room of women and children screaming and telling the prisoner that it was his family being tortured.
"The violent methods which were beginning to be employed," said Otero, "caused an escalation in Tupamaro activity. Before then their attitude showed that they would use violence only as a last resort."“
Mitrione was with USAID for 10 years.
"…the Tupamaros found three identification cards in his pocket. One was from the Department of State, Agency for International Development..."
On August 10, 1970, Jim Jones' friend Dan Mitrione "was was found on the back seat of a stolen 1948 Buick convertible. He had been bound and gagged and shot twice in the head."
Costa-Gavras 1972 film, "État de siège" was based on this incident.
“The precise pain, in the precise place, in the precise amount, for the desired effect."
'The words of Dan Mitrione, the head of the Office of Public Safety (OPS) mission in Montevideo. Officially, OPS was a division of the Agency for International Development...'
Former DNC bigwig Lindy Li comments on Kamala Harris' ambitions, and the California fires as a political "gamechanger." (The CA Lt. Governor mentioned is Eleni Kounalakis).
On illegal immigration:
Lindy Li on why the DNC stuck with the obviously mentally incompetent Joe Biden for so long.
Noted: "Tulsi by that time had gone off the reservation. To her credit, she left knowing that the entire thing was rotten."
"People are now blasting Elon for not being elected, but you know who else wasn't elected? The senior advisers who were running our country for the past four years while our president was just not present."
- Lindy Li
Ryan: "Why is the party more important than the country?"
Li: "Because it's a religion for them. They don't have a religion, so it's become their religion."
Ryan: "Just in the 10-minute break that we took, guess what? Mitch McConnell fell down the stairs again. This is a huge problem."
Li: "The United States gerontocracy."
Ryan: "How do people keep voting this shit in?"
Li: "Name ID and money. It's the power of money."
“Everyone was playing their part in an Emperor has new clothes situation, because in their mind the alternative was so dire, and that is Trump. If have you seen “The Wire,” you know that phrase - “You come at the King, you better not miss”? If you try to push Biden aside and you fail that attempt the only person who benefits is Trump, so that was their logic.” - Li
An interesting comment:
Ryan: “Why were they so fearful of Trump? Does it have to do with protecting themselves? You know, we have the Epstein stuff that's hopefully going to come out…”
Li: “They think that Trump is on that list.”
“They pretend to hate Trump, but it's just a gag. It's a show, it's a charade. You saw Obama yucking it up with him at Jimmy Carter's funeral? Democrats pretend to hate Trump but at the end of the day, they crave him. They're obsessed with him. They need him for their fundraising machine. They need him as their raison d'être.
Without Trump, they would have no rudder - they would be even worse off than they are. Trump is their lodestar. It's their reason for existence, so they're not trying to protect themselves. They have no other reason to exist at this point, because their party is basically in shambles.”
“The entire [Biden] family enterprise was influence peddling. Everyone was in on it essentially, except Ashley.”
Who was running the Presidency for the last 4 years?
A Short History of Money
“If anything has been demonstrated by modern experience in these matters, it is that, once wide coercive powers are given to governmental agencies for particular purposes, such powers cannot be effectively controlled by democratic assemblies. If the latter do not themselves determine the means to be employed, the decisions of their agents will be more or less arbitrary.”
F.A. Hayek, The Constitution of Liberty
“General partners of private equity, venture capital, and real estate funds often receive compensation in the form of carried interest that is structured to be taxed at a favorable long-term capital gains rate (eg, 20 percent), despite not contributing significant initial capital.“
aka Great Depression 2
Just wow. We are in the soup now. And thank you.
I recall when Sen Sinema changed her vote in exchange for maintaining the carried interest loophole. I thought WTF, she's been paid off given that Wall Street is so close to Arizona. She is another sell out to Wall Street money for her personal avarice and greed over any illusion of fairness much less patriotism. I think she is now working with Coinbase to line her pockets and undermine the country.