Tuesday, August 23, 2011

A Wheelbarrow of Food to Buy Cash

August 22, 2011
Bangor woman records couple dumping water in food stamp scam

The Bangor couple, a 23-year-old man and a 17-year-old female who turned 18 on Sunday, told the investigating officer that they had purchased two cases of water with funding provided by the Supplemental Nutrition Assistance Program, formerly known as the Food Stamp Program.

“They openly said they were dumping water” for the value of the returnables, Sgt. Paul Edwards said Monday. “They said they didn’t think there was anything wrong with that.”

The bottled water cost around $6 and the duo got $2.40 back in cash from the redeemed bottles.


The couple managed to convert $12 of food into $4.80 in cold hard cash.

It would seem that hyperinflation has been postponed yet again. Cash apparently still has some value. Go figure.

16 comments:

Mr Slippery said...

What a SNAPpy title! I see what you did there with.

The reason they are doing that is because they can't by alcohol or smokes with SNAP. Is that a problem with them or the program? Incentives may have something to with this at least two levels up the flowchart.

Stagflationary Mark said...

Mr Slippery,

There's a lot of things they can't buy with SNAP. Indeed.

I suspect you are right about the alcohol or smokes (that was my first thought too), but it could just be that they need rent money, gasoline, or a variety of other things we often take for granted.

Stagflationary Mark said...

In any event, the frugal person within me thinks there is a cash flow problem if people are willing to convert $12 in food to $4.80 in cash.

tj and the bear said...

Mark,

Several thoughts (catching up):

1) I also prefer "ripping the bandaid off".
2) When the DOW & gold cross I'll already be out.
3) You're 2027 date for RE bottoming is probably right, per Armstrong and numerous demographic studies.
4) Markets-wise I'm pretty much into the idea we're passed the EW Grand SuperCycle top; it's all down hill from here.

How about that gold slapdown today? They didn't let it go as far as I thought they might. Interesting...

Stagflationary Mark said...

tj and the bear,

How about that gold slapdown today? They didn't let it go as far as I thought they might.

I had very similar thoughts about today's 30-year TIPS slapdown.

I do not believe that the bull market in equities has resumed in all its grandeur. I'd be tickled if we could get the S&P 500 back to 1200 again though. December of 1998 brings back such fond memories!

Okay, maybe not. I was going through a divorce and my place of employment was a sinking ship. But hey, at least I had the stock market to provide long-term comfort, lol. ;)

Mr Slippery said...

How about that gold slapdown today? They didn't let it go as far as I thought they might. Interesting...

It ain't over til it's over. I still expect a margin hike or two, op-ex is Thursday, and maybe Ben can sow some gold hate on Friday. The all clear will be early next week at whatever levels we are at then.

Stagflationary Mark said...

Mr Slippery,

I still expect a margin hike or two...

Gold as an investment

Bullish investors may choose to leverage their position by borrowing money against their existing assets and then purchasing gold on account with the loaned funds.

Everything I have done since 2004 has been done with the intent to distance myself from leverage.

October 27, 2010
Eerie Quote Flashback

Risk abounds no matter what we do.

Mr Slippery said...

AWWOOOOGA!

Margin hike from China.

Gold can be levered as much as anything futures trades, including stocks. But, it can't be levered as much as houses! No bank is going to loan someone without a job $500k to buy gold. That is good for everyone :)

BTW, typing on my new Alienware laptop that was paid for with gold profits on 1.25 oz. Smokin'

Watchtower said...

"...Alienware..."

Sweet!

(Oops, off topic, sorry Mark, but that is one nice laptop, suitable for...gaming!)

Stagflationary Mark said...

Mr Slippery,

No bank is going to loan someone without a job $500k to buy gold.

Not knowingly.

Those who used cash advances on credit cards to fund gold futures speculation would have done EXTREMELY well over the past decade though. No job required.

Stagflationary Mark said...

Watchtower (& Mr Slippery),

Well, since Alienware didn't get caught in Blogger's excellent SPAM detection system, it can't very well be SPAM now can it?

Hahaha! ;)

Stagflationary Mark said...

Check out this leveraged fund for thrill seekers! (It lost 13% today.)

The investment seeks to replicate, net of expenses, twice the daily return of the Gold Bull/S&P500 Bear index. The fund is is designed for investors who believe that gold will increase in value relative to the large-cap U.S. equity market segment, in one day or less, by primarily establishing a leveraged long position in Gold futures and a leveraged short position in the E-mini S&P 500 Stock Price index futures.

If I was in charge of the advertising campaign this would be my slogan.

Because the world needs more doubled leverage!

Mr Slippery said...

Those who used cash advances on credit cards to fund gold futures speculation would have done EXTREMELY well over the past decade though. No job required.

Wow, I hope no one actually tried that. Loan shark rates on cash advances.

Stagflationary Mark said...

Mr Slippery,

Wow, I hope no one actually tried that. Loan shark rates on cash advances.

Care to give me even odds that someone in this country of 300+ million didn't try it?

Before you answer...

March 24, 2003
Why Visa Is Dropping Online Gambling

Players wager billions of dollars online each year. Almost all bets are funded, at least initially, by credit cards.

Leave the Credit Cards Home

To get a $500 cash advance the charge was $21.99. That is 4.4 % paid to the casino up front. Most credit card companies charge you 3% for a cash advance, which will come to $15.66 (3% of $521.99.

You are already down $37.65 or 7.5% before you even sit down to play.

Charles Kiting said...

This dumping goes on all the time in Chicago, except instead of just getting the deposit cash back, they sell the water at intersections or on the subway for a buck a bottle.

WV: pounit. Perhaps southern dialect for "pouring it".

Stagflationary Mark said...

Charles Kiting,

It would seem that Chicago still has that entrepreneur spirit!