Category Archives: Education

Thomas Friedman’s Brief Theory of Everything

12/15/2014 Portland, Oregon – Pop in your mints…

At the closing session of the 2014 AFP National Conference, New York Times columnist and three time Pulitzer Prize winner Thomas Friedman gave a great discourse related to the biggest trends in the US and indeed the world today.  For those who are unfamiliar with Friedman’s work, suffice it to say that he is one of the more influential voices on the planet via his post at the New York Times.  As his discourse will reveal, he writes on foreign affairs, globalization, and environmental issues.

Thomas Friedman By Charles Haynes (Charles Haynes' flickr account) [CC BY-SA 2.0 (], via Wikimedia Commons
Thomas Friedman By Charles Haynes (Charles Haynes’ flickr account) [CC BY-SA 2.0 (], via Wikimedia Commons
Friedman is also a bestselling author, and many of his working hypotheses can be found in his 2005 International Best Seller, The World is Flat:  A Brief History of the Twenty-First Century.  In the book, Friedman lays out 10 “flatteners,” or things that he points to that are enabling the trend of leveling the global playing field.

On the afternoon of November 4th in Washington, D.C., Friedman shared a number of interesting insights with our audience of Finance leaders, among them is his own recognition of the effects that the forces he describes have on his own ability to influence American and global thought.  As he puts it {with a slight paraphrase to add context}, “Thirty years ago, James Reston, my predecessor would ask himself every morning, ‘I wonder what my seven competitors are going to write today?’  Today, I sit in my office and ask myself ‘I wonder what my 70 million competitors are going to write today?”

While we may not agree completely with Friedman’s ideologies at base, it cannot be denied that he is compelling to listen to.  His voice is inquisitive and familiar, and his depth of experience in the idea realm gives his opinions, whether one fully agrees with them or not, a strange authority of their own.  You can listen via the link below to one of the finest discourses we have ever had the pleasure of listening to:

Below are some of the most interesting points Friedman brings up, along with their corresponding time stamp on the above recording:

At 2:40:  Is the US’s OODA loop broken?  Friedman expresses concern about the US Government’s ability to Observe, Orient, Decide, and Act using a metaphor from the US Air Force.

At 4:25: – As Historians look back at our times, Friedman believes that they would identify as the most important things happening in the early 21st is that the three biggest forces on the planet, The Market, Moore’s Law, and Mother Nature, all went into hyper growth at the same time.

At 5:50: – The story of the Chessboard brought up in the book The Second Machine Age.  The Chessboard parable is cited as popular in Silicon Valley, and the morale is that, when you double something 63 times, you get 18 quintillion of whatever it is.  Friedman cites the Chessboard analogy a number of times in the discourse.  He believes that the world is in the “Second half of the Chessboard” in terms of the velocity of change with respect to The Market, Moore’s Law, and Mother Nature.

At 8:00: – The 2004 Thesis of The World Is Flat is that the convergence of four factors, the PC, the Internet, Workflow Software, and Search capabilities, that were melding together to form a platform that was allowing for large scale collaboration on a level never before experienced. {Editor’s Note: We closely observed this trend as an MBA student in Barcelona and it has continued to transform the way we live and work today, 10 years on. }

At 11:07 – In the past 10 years, with the advent of Facebook, Twitter, Skype, and the like, the world went from connected to hyper connected, and from interconnected to interdependent.  We are in the second half of the Chessboard with regards to globalization.

At 13:45 – Friedman begins to speak on the Environment, what happens when Mother Nature enters the second half of the Chessboard.  He cites the fact that the amount of carbon in the earth’s atmosphere is increasing 100 times faster today than it was at the end of the last ice age.  He also observes that the population of the earth has doubled in his lifetime, from 1959 to 1999, from 3 billion to 6 billion people.

At 21:00 – Friedman brings up the drought in Syria between 2006 and 2010, the most severe in modern history, as the cause of the revolution that rages there today.  One million Syrians, who had previously dedicated themselves to agriculture in the countryside, flocked to the cities, overwhelming the infrastructure.  Here, he also highlights the fact that Sao Paulo, Brazil, may become the first major city to run out of water due to a combination of a prolonged drought and the effects of deforestation of the wetlands and watersheds of its major water sources.

At 22:30 – What does it mean?  This is a great world to be a consumer, a maker (Entrepreneur), and a breaker (here Friedman cites ISIS’s use of social media as its command and control system).  It is a terrible world to be a leader (every leader is in a two way conversation).

At 30:10 – Average is over for countries as Mother Nature, The Market, and Moore’s Law enter the second half of the chessboard.  Developing countries are stressed, and weak countries are failing and entering disorder.

At 32:52 – This is perhaps Friedman’s most important insight Average is over for every worker.  Every worker must identify their unique value add.  “When I graduated from college, I had to find a job.  When you graduate from college, you will need to make your job.”  Every middle class job is being pulled up, out, and down.  The high wage, middle skill job, is over.  There are now only high wage, high skill jobs.

At 36:31 – Friedman speaks of the effects of Globalization on his own job.  Thanks to the internet, he now has 70 million competitors whereas his predecessor, James Reston, had 7.

At 39:30 – The three tiers of work, the first tier was non-routine, second tier was routine; the third tier was non-routine, local work, are being rattled to the core.  The second tier is being crushed, and the wages of the third tier non-routine depends upon the quality of the first tier non-routine.  Further, the first tier, non-routine must also be “creative” non-routine.

At 42:00 – You need more than the three R’s: Reading, Writing, and Arithmetic, you need the four c’s:  Creativity, Communication, Collaboration, and Critical Thinking, and the “M”:  Self-motivation.

At 44:07 – Now that the digital divide is gone, the good news ceilings and walls are gone; the bad news is that so are the floors.  For example, as an employer, Google doesn’t care what you know because it knows everything, but what you can do with it.

At 45:30 – Friedman’s five pieces of advice for his children, 1) Think like an immigrant, be a paranoid optimist, we are all new immigrants to the hyper connected world, 2) Think like an artisan, make what you make special, give it an extra effort, carve your initials into it, 3) Always be in beta, in Silicon Valley there is only one four letter word, Finished.  Always be in beta.  Literacy today is the ability to learn and relearn, 4) pq + cq > iq.  Perseverance/passion quotient + curiousity quotient is greater than a high intelligence quotient, 5) Think like an Entrepreneur:  Friedman paraphrases this as “Think like a pancake waitress,” do your best with those things under your control, and where you can, add value.

At 51:12 – Friedman fields a few questions from the audience and shares his thoughts on what needs to occur in the realm of politics.  The comments are timely as they come on the date of the 2014 US midterm elections.

This is one of the better discourses that we have been privileged to attend.  It is clear that Friedman is a deep thinker and has learned the art of expressing himself.  He is not especially clairvoyant, but he is deeply in touch with the times.  Evidence of his hypotheses is literally surging from every corner of the globe.

What will be your value add in the brave, new, flat, hyper connected world that is fast coming upon us?

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Key Indicators for December 15, 2014

Copper Price per Lb: $2.94
Oil Price per Barrel (WTI):  $55.99

Corn Price per Bushel:  $4.08
10 Yr US Treasury Bond:  2.12%
Bitcoin price in US:  $351.50
FED Target Rate:  0.12%
Gold Price Per Ounce:  $1,197

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  5.8%
Inflation Rate (CPI):  0.0%
Dow Jones Industrial Average:  17,218
M1 Monetary Base:  $2,966,700,000,000

M2 Monetary Base:  $11,635,400,000,000

What to do if You are Laid Off in Portland, Oregon Circa 2014

10/22/2014 Portland, Oregon – Pop in your mints…

Approximately one year ago, we had the good fortune of being laid off from our most recent employer of seven years.  We say good fortune as the first time this happened to us, after seven years at our first employer (on September 10, 2001, which is a story for another day) it marked the beginning of what continues to be the greatest adventure of our lives.

Staying in one place is comfortable, one knows what to expect, what to do, more or less what the rules are.  It is easy to see why many people get a job and then go on autopilot for 30 years.  However, staying in one place is also dangerous in that one runs the risk of stagnating to the point that they unwittingly join the ranks of the walking dead.

Humans desire to be comfortable, but it is only to the extent that they are uncomfortable that there is any hope for them.  Margie Warrell, writing at Forbes, sums up this sentiment well in her April 2013 article, Why Getting Comfortable with Discomfort is Crucial to Success.

If you have just been laid off, you are likely uncomfortable, which is good, because there is hope for you.  There will be time for that hope to blossom and trust us, it will.  However, if you have just been laid off from a long time employer, chances are that what you feel at the moment is intense discomfort laced with panic.  This is normal, and should drive you to take decisive action.

Flag of Portland Oregon
Laid off in Portlandia? Here’s what to do!

What should that action be?  As a public service here at The Mint, we are offering a series of steps that were applicable to our situation in Portland, Oregon, circa 2014.  They may or may not be useful and/or accessible to you depending upon your situation, and are not to be taken as any manner of legal/financial/tax or any other sort of advice.

With that disclaimer out of the way, we hope to guide others and save them some time and confusion in navigating the system of public support available in the Willamette Valley.

One last caveat, the following list is comprised primarily of public resources.  At this moment in time, faced with losing a primary source of income, it is unlikely that one’s political ideology will stand in the way of taking advantage of the resources available to them.  If you find yourself struggling at all with this, be reminded that these public resources are absolutely necessary given the broken monetary system that we live in.  Indeed, the use of debt as money and the economic distortions it causes every day is likely the indirect cause of your present circumstance.  Acknowledging this fact should put to rest any hesitations about whether or not to apply for public assistance, not matter what your present circumstance.

  1. Unemployment Insurance: The first thing we recommend, unless you have a job that you will start within the next 5 days, is to file an unemployment claim against Oregon here: if you were working in Oregon and laid off (not fired with cause), you should have no problem qualifying.  The reason not to delay this step is that you have the right to claim the first day you are out of work and have to wait a week before you can claim a week of benefits.  They last for six months and are usually ~$500 per week on the high end as of this writing. Even if you were fired for cause, you may still qualify for unemployment insurance.  Oregon is generous in this sense and many employers are paying for it in the form of an employment tax anyway and will encourage you to take it.

Do not delay on this step!  Call the same day you are dismissed, otherwise you are literally leaving money on the table.

The next two steps may or may not apply to one’s specific circumstance as they are income qualified programs which take into consideration other income sources that a household may have.  If you and your household have no other income source, bear in mind that you are below many of the income thresholds as of the day you were laid off and are likely to qualify based on the current circumstance.  This is important, because certain programs, such as SNAP, last for six months before you have to recertify income.  At that point, you will be employed (we here at The Mint believe in you!), but in the meantime, you get a six month stipend

2.  SNAP (Food Stamps):  They usually will give these within a week as they are considered essential.  It is scaled on income and you qualify the minute your income drops below a certain level based on the number of people in your household.  Below is the website to apply through if applicable:

3.  OHP (Obamacare): If you qualify for SNAP, you are likely to qualify for OHP, Oregon’s version of Medicaid, which is basically free health insurance thanks to Obamacare.  The website is here:

In some cases, enrolling in SNAP will automatically qualify you for coverage, which is nice, because by this time, you may be getting sick of pulling together all of your personal data and submitting it to a government agency that will no doubt be hacked.This step is important as, once qualified, you will not have to pay COBRA or a private health insurance.  The coverage may not be great, and, depending upon how much you use your health insurance, it may be best to stick with the current provider, but if all you need is peace of mind on this front, it will save a chunk of change.

4.  Housing Assistance:  Depending upon your housing situation, there may be rent or mortgage assistance which you now, overnight, have become eligible for.  They can be a pain to apply and take a while to kick in (if they do at all), but may be worth it if they do.  Here is a list of resources in Oregon:

The above four steps are “defensive,” now for the job search, or “offensive” side, assuming you will be looking for a job, at least for the short term until your next movie deal comes through.

  1. Networking:  There are a number of networking opportunities that any job seeker or small business owner would be wise to attend from time to time. Attending these events will not only give you something to do other than surf the internet for jobs, it will inevitably encourage you to see you are not alone.  You may even be inspired.  One of the best in Portland is Portland Connect, you can request an invite here: They host a number of popular events and is a nice and efficient way to get to know some people who are there to mutually help each other.  The group drives home an oddity that we have found to be true in Portland, that it is a town where you must network face-to-face.  Portland Connect is a great place to do just that.
  2. Recruiters: If your profession is in such demand that it can support a recruiting industry, reach out to them, as they are literally in the business of finding you a job.  In Finance and Accounting, which happens to be our industry, we recommend Robert Half.  There are many others as that are industry specific.  Find them, call them, they will help.
  3. As for internet job searching: For the most part, applying online, while giving a strange sense of accomplishment, is akin to sending a message in a bottle. Chances are it will never get read and, if it does, the chances of it reaching the intended recipient at the right time may be slim.  It is always best to call someone at the company if possible to at least know you are not sending an “SOS to the world.”  Nevertheless, there are some sites which tend to be more responsive than others.  We seemed to have the most luck in terms of response from Craigslist posting, and Mac’s List: which is specifically targeted towards non-profits, our present area of expertise.  Idealist: also has good leads in terms of non-profits.   Generally speaking, we had little luck with large companies and wasted a lot of time on their sites applying, though it can be good practice.
  4. Friends and Family: Now is the time to reach out rather than retract.  Theoretically, your friends and family are another set of eyes and ears on the ground and generally be willing to assist you in your plight if it is within their means.  Reach out to the great brother and sisterhood of mankind, for we were made to help each other.  Indeed, disinterested service to others is the sure path to happiness.  Just remember to lend a hand when you are on the other side as well!

There are innumerable resources out there which may or may not apply to your situation.  We provide those listed above as a public service, for they were pearls of wisdom that we had to grasp for mostly in the dark, if it sheds the light on someone else’s way as they walk the path of unemployment, the time spent compiling it has been well worth it.

Above all, stay encouraged!  The US economy is going gangbusters and you have a place in it, it may require relocating, training, and generally becoming uncomfortable.

Get used to it, for you are now being asked to play a larger part of the long story of human progress. Embrace it.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Key Indicators for October 22, 2014

Copper Price per Lb: $3.02
Oil Price per Barrel (WTI):  $80.42

Corn Price per Bushel:  $3.53
10 Yr US Treasury Bond:  2.23%
Bitcoin price in US:  $383.00
FED Target Rate:  0.09%
Gold Price Per Ounce:  $1,241

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  5.9%
Inflation Rate (CPI):   0.1%
Dow Jones Industrial Average:  16,461
M1 Monetary Base:  $2,815,400,000,000

M2 Monetary Base:  $11,513,000,000,000

Entrevista con Mel Lagomasino de WE Family Offices

Hoy presentamos The Mint en Español con motivo de compartir una entrevista muy importante con Mel Lagomasino, una mujer que sabe algo de inversiones y la gestión de grandes patrimonios.

Ya puedes leer más acerca de los credenciales impresionantes de Mel Lagomasino en la página de sus servicios de Family Office:

WE Family Offices

En la entrevista que se puede ver en versión complete abajo, Mel abarca temas interesantes con franqueza. Entre ellos:

-Como preservar el dinero, como ganar el dinero, y como separar la vida personal de la vida empresarial de la familia.

-Lo que es un Mapping y por que es importante

-La diferencia entre ahorrar e invertir

Hay también unas frases y pautas claves compartidas, por ejemplo:

– Diversificar activos si uno quiere preservar el capital

-Los grandes patrimonios se ganan por la concentración, y se conservan por la diversificación.

-Es importante reflexionar en donde uno quiere llegar y cuando con su patrimonio y imponer una estrategia de inversión de acuerdo con este deseo.  Una vez impuesta, es aún más importante mantener la estrategia pese a los cambios temporales en el mercado.

-Que tengo?  Que es lo que me cuesta dinero? Que es lo que me gana dinero?

-Hay que separar lo acumulado por cubos e asignarlos un valor monetario.

-Empresa operativa = Crecer el capital

-Empresa patrimonial = Conservar el capital acumulado

Es importante la distinción  entre que tipo de empresa conviene porque hay que separar los intereses de los miembros de la familia quienes quieren seguir creciendo el capital de los a quienes no tienen interés en aportar al negocio.

-Hay que entender bien a los asuntos financieros y fiscales.

-Establecer la sucesión y comunicar/conversarlo.  La conexión entre el dinero y el amor está muy fuerte.

La entrevista termina con las reglas de oro de Mel Lagomasino:

-Ten un propósito

-No invierte en algo que no entiendes

-Entiende las emociones involucradas

-Maneja los costos que se pueden comer la rentabilidad

La entrevista reveladora, “Invertir: ¿Por Dónde Empezar?” se puede ver a continuación en YouTube.  Disfruta de la entrevista e intenta poner en práctica algunos de sus consejos. Sobre todo, irespectivo del tamaño de tu patrimonio, comienza a vivir e invertir bien!


Finance Smurf – A Post-2008 look at a Classic Graphic Novel

8/22/2014 Portland, Oregon – Pop in your mints…

In November of 1992 Pierre Culliford, a renowned author and illustrator published a graphic novel of tremendous gravity and startling economic insight.  The novel would be his last, as on December 24, 1992, Culliford suffered a heart attack at his home in Brussels and passed away the same day.

Culliford is known by his nickname, Peyo, and he was the creator of the Schtroumpfs, who are better known by their English name, the Smurfs.

Peyo’s final novel, Finance Smurf, at long last has an English translation which became available on July 1, 2014.

Seen through the lens of post 2008 skepticism with regards to the financial system that continues to hold the world in shackles, the novel seems especially timely, and the marketing copy on the back cover, which reads:

“99% of the Smurfs have left the Smurfs Village!  No one but the Finance Smurf wants to occupy the Smurfs Village!”

appears to be nothing more than an attempt to carry on the rallying cry of the Occupy Wall Street movement of 2011.  However, as one opens the cover and peers into the world of Peyo’s Smurfs, it is clear that the author intended to call into question everything the reader thought they understood about money, and in large part, he succeeded.

Occupy Wall Street Poster
“Wall-Street-1” by Licensed under Fair use of copyrighted material in the context of Occupy Wall Street via Wikipedia –

While the Smurfs are, well, the Smurfs, and as such will invariably be forever adorable and highly entertaining in the eyes of most of humanity, here at The Mint we will look past the novel’s obvious merits of providing page after page of blue colored cuteness and highlight our observations of the merits of the economic arguments and questions that it raises as well as the metaphors employed via the roles played by long-standing characters in the following review.  Enjoy!

Finance Smurf

The novel Finance Smurf is set in Smurfs Village.  It begins with the incapacitation of Papa Smurf, the Smurf who keeps Smurf Village safe and orderly, who is laid up by a laboratory accident.  In this sense, Papa Smurf may be seen as a metaphor for a benevolent dictator or embodiment of a divine being for the Smurfs.  This is important, as it is the absence of the ongoing intervention of Papa Smurf in daily life that gives room for the mischief in the novel to occur (Smurf fans will quickly recognize this plot device employed by Peyo).

It then falls to Finance Smurf to seek an antidote, which takes him to the world of humans.  It is there that he learns the concept of money and becomes fascinated by it.  It is interesting that he does not appear to immediately recognize the creation of money as a means to enrich himself.

Indeed a hallmark of the Smurfs is the communist (or socialist) structure of their life in the Village.  Here at The Mint, we do not find this odd, as we have explored in-depth here at The Mint the fact that socialism is the norm in self-supporting economic systems the size of Smurfs’ Village who have a Papa Smurf, so to speak, as a universally respected authority figure.  What drives people to Capitalism is the need to tacitly make economic decisions in the absence of a universally respected authority figure, hence Peyo’s need to sideline Papa Smurf at the outset for the narrative to play out.

Finance Smurf returns to Smurfs’ Village with the antidote, as well as a burning desire to introduce money and the human system of trade to the Smurfs.  First, he reasons that he needs gold coins with Papa Smurfs likeness on them to use as monetary units.  He goes to Painter Smurf for the artistic rendering, Sculptor Smurf for the mold for the coins, Miner Smurf for the gold (Miner Smurf, ironically, has a pile of gold sitting there which he has no use for, as he is diligently extracting flint with his pick axe). Handy Smurf then melts the gold and makes the coins using the mold.

Here we interject another observation.  The day-to-day activities of the Smurfs are dependent upon their profession (or lack thereof).  In the absence of money the Smurfs simply do what they do.  There are rarely specific value judgments made with regards to what the Smurfs do, though all of their actions appear to be motivated by the needs of their fellow Smurfs and throwing the occasional party.  This system, while idyllic, assumes that everyone wants to maintain the status quo.  The maintenance of the status quo is at once the pillar of strength and the Achilles heel of Socialism.

It is clear that for Painter Smurf, Sculptor Smurf, and Handy Smurf, the requests of Finance Smurf are outside of the status quo.  However, being good Smurfs, they go along with it and hope for the best.

With the coins made, Finance Smurf calls a meeting of all Smurfs, introduces the concept of money, and hands out an equal share of the coins to each Smurf.  The Smurfs initially do not know how to operate in the new system, so Finance Smurf helps them by doing some back of the napkin costing analysis of their activities.  It is worth noting here that this activity is also the hallmark of Socialist systems, the central planning of prices.

As the Smurfs begin to trade, the predictable begins to happen.  The productive elements of society, Farmer Smurf, Handy Smurf, Baker Smurf, and so on, soon have more coins than they know what to do with.  They take them to Finance Smurf, who is now acting as the bank, to be invested.  On the other side, artists such as Harmony Smurf and Poet Smurf find themselves short of money and then mortgage their houses to Finance Smurf.  Lazy Smurf is hardest hit.

If it was not obvious to readers to this point, Finance Smurf begins to embody Central Banks and Wall Street.  At one point, Baker Smurf calls out Finance Smurf for lending at 10% but only giving him a 6% return.  In a nod to the foreclosure crisis, Finance Smurf becomes owner of all of the real estate in Smurfs’ Village.  There is a reference to privatization of public works, as when the bridge goes out, the Smurfs look to Finance Smurf to pay for the replacement, which he does in exchange for the right to collect a toll.  Even corruption is broached as there is some price-fixing for lumber on the bridge project orchestrated by Finance Smurf.

In short, Finance Smurf comes to embody everything that everybody hates about today’s financial system.  The rest of the Smurfs, fed up with the swift disaster that the Money system introduced by Finance Smurf has brought upon them, leave to build another village.  In this action, they take the only logical step in the face of monetary tyranny.  It is a wonder that more of us do not venture out and do the same today.

In terms of economic lessons to be taken from Finance Smurfs, there is little more to be gleaned.

The remaining Social/Political lessons are taught via the intervention of Gargamel, the Smurfs’ arch nemesis.  Gargamel counterfeits coins, echoing a form of economic sabotage employed by nations at war, and lures the Smurfs to them, relying on their newfound greed to be their downfall.  Fortunately, Papa Smurf returns and wisely guides the Smurfs away from the trap.

In another odd twist, Papa Smurf, once he becomes aware of the new Money system that has been introduced during his time of incapacitation, does not act to stop it, instead, he bumbles along with it as many a powerful emeritus would do, until the Smurfs ultimately leave to build another village, safely away from the scourge of money.


As an adult reading Finance Smurf in the post 2008 socio-economic landscape, one gets an eerie sense that Peyo was on to something back in 1992, and cleverly communicated it to the world.  While the ongoing economic analogies presented in the novel are quite clear, Peyo proves stunningly accurate in his depiction of Finance Smurf inventing money and introducing it to the populace, along with a monopoly on usury, for in this way Central Banks unwittingly enslave the world by promulgating the debt based money supply.

The Peyo’s final triumph is his clairvoyant depiction of the Smurfs’ unanimous decision to simply leave the village that was their happy home before it became the illegitimate property of Finance Smurf, and build another village just a stone’s throw away, yet with one marked difference; the absence of money and its creator.

True to form, the Smurfs reconcile with Finance Smurf who repents of his ways.  For Smurfdom, and indeed our world, was never meant to live under the tyranny of perpetual debts.  The Smurfs in Smurfs’ Village, who had a small-scale debt problem which quickly got out of hand, simply left and went elsewhere.  Jewish law called for a Jubilee, recognizing both the necessity of money and finance for large-scale commerce and the necessity of liberation from the snares that they created amongst what would otherwise be a brotherhood of man.  What, then, is the solution for an entire world living under the scourge of a 100-year-old debt based monetary system?

Following the Smurfs may not be a bad idea after all.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Key Indicators for August 22, 2014

Copper Price per Lb: $3.20
Oil Price per Barrel (WTI):  $93.50

Corn Price per Bushel:  $3.65
10 Yr US Treasury Bond:  2.40%
Bitcoin price in US:  $518.00
FED Target Rate:  0.09%
Gold Price Per Ounce:  $1,280

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  6.2%
Inflation Rate (CPI):   0.1%
Dow Jones Industrial Average:  17,001
M1 Monetary Base:  $2,694,800,000,000

M2 Monetary Base:  $11,393,400,000,000

Fine Wine Investing – The London International Vintners Exchange

11/04/2013 Portland, Oregon – Pop in your mints…

For those of you who thought we had forgotten to complete our mini-series on Fine Wine Investing, we admit that we nearly did.  Between the excitement of Halloween and painstakingly formatting the print version of our Economic and Philosophical Treatise, a proper completion of the Fine Wine series nearly escaped the steel trap of our mind, until today!

Throughout this series, we have dabbled into a world that, for a time, appeared to be the playground of those with a penchant for refinement or those with enough money to appear refined.  After all, mustn’t one have an intimate knowledge of the Bordeaux region and at least have heard of Robert Parker;s nose before daring to invest in Fine Wines, an asset class which not only carries principal risk, but the risk of direct consumption?

Today, thanks to the world’s leading electronic exchange for fine wines, the Liv-ex, price discovery is now within grasp of the commoner.

The London International Vintners Exchange, or Liv-ex, is like COMEX for Fine Wine.  Since is was established in 1999, it has performed an important public service, as do all exchanges, it allows the commoner a peek into the most recently discovered price points for certain vintages, which can greatly aid them as they begin their adventure in Fine Wine Investing.

Understanding the Liv-ex is crucial to today’s serious Fine Wine Investor.  The following are excerpts from a recent report on the market.  Enjoy!

THE LIV-EX and the Financial Markets

Liv-Ex, London International Vintners Exchange, is the world’s one and only leading electronic exchange for fine wines, based in London, UK. Founded in 1999, Liv-Ex provides a marketplace and online platform for wine merchants, traders and brokers to trade wines freely and easily, just as it is done by equity stockbrokers.

Liv-Ex FEW Compared to other methods of fine wine procurement, such as auction houses, the main difference is that not everyone can trade on the Liv-Ex wine platform; only registered wine professionals/experts who have a proven track record in the industry are able to place bids (buy) and offers (sell) on the platform.

Only investment grade and blue-chip fine wines are traded on the Liv-Ex platform. Moreover, unlike auctions, no antique or collectible items are traded. Therefore, the majority of trades carried out on Liv-Ex are for French wines, usually from the highest rated vintages, mainly the more recent ones.

The Liv-Ex online wine platform also publishes its own price indices based on the amount of transactions made and has developed further into becoming the leading information source for fine wines; current prices, price fluctuations, historical stock data and the fine wine market in general.

Like any exchange, the Liv-ex has also produced a series of indices, which allow the casual observer to gauge the performance of the overall market for fine wines at a glance.  It is these indices that give us the  means to compare the Fine Wine Market’s performance with that of other major asset classes.  The results may surprise you.

The following are the Liv-Ex Fine Wine Indices:

• Liv-Ex Fine Wine 50 Index

• Liv-Ex Fine Wine 100 Index

• Liv-Ex Fine Claret Chip Index

• Liv-Ex Fine Wine Investables Index

• Liv-Ex Fine Wine 500 Index

The Liv-Ex 100 Index is the fine wine industry’s leading benchmark index and even listed on Bloomberg. It includes and represents the price movement of the 100 most sought after wines, for which there is a strong secondary market and is calculated on a monthly basis.

By looking at the trading history of the fine wine market in the last decade, one may notice FWI demonstrated excellent track record which is appealing to absolute return investors.

According to the Liv-ex, FWI has consistently delivered positive absolute return over every.  Next 5-year holding period since 2000. Figure 1 below also highlights that the average 5-year foreword performance since 2000 is as high as 111%!

While the returns on the Liv-ex 50 are compelling, they become even more compelling when considered within the context of other asset classes.  The report continues:

It is also worth to note that while comparing FWI with global equities, FWI generated significant outperformance to global equities over any 5-year investment horizon since 2000, with hit rate as high as 98%, as shown in figure 2 below.

FWI provides diversification benefits to global equities portfolio. Besides outperforming global equities, FWI also gives diversification benefits as the correlation of FWI to global equities is only 0.19.

Whilst the above suggest FWI is attractive, recent trend has been less encouraging. Not only has the correction of the FWI market started to drag down the recent returns and out performance, but the diversification benefits also seem to have been diminished.

 Like any market, the Fine Wine Market must be enjoyed in moderation, as out performance tends to attract attention which generally leads to…underperformance.

It is worth noting that the Fine Wine Market, while unique, has behaved similarly to that of Crude Oil over the past 10 years, as pointed out by this excerpt from a 2011 post in the Sizemore Letter:

From 1990 to 2010, the correlation between fine wine and crude oil returns was a staggering 90 percent!

What is the takeaway from all of this?  While Fine Wines now have an established exchange, corresponding price index, and are a nice way to diversify from equities, they may offer returns similar to other commodities.

In the end, returns are returns, and from a pure numbers standpoint, the higher the returns, the better.  From a semantic standpoint, it is much more fashionable to talk about one’s Fine Wine investments than crude oil in many social settings.  Given this criteria, the answer is clear:

Fine Wine trumps Texas Tea.

This concludes our brief yet informative jaunt into the world of Fine Wines.  Again, if you are interested in hearing more about Fine Wine investing, please email us at the address below.

After one last goblet, The Mint must carry on, for the Bitcoin has nearly doubled in price, and there is much to explore in the fine autumn that is upon us.

Stay tuned and Trust Jesus!

Stay Fresh!

David Mint


Key Indicators for November 4, 2013

Copper Price per Lb: $3.24
Oil Price per Barrel:  $94.62
Corn Price per Bushel:  $4.26
10 Yr US Treasury Bond:  2.60%
Mt Gox Bitcoin price in US:  $237.00
Gold Price Per Ounce:  $1,315
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.2%
Inflation Rate (CPI):  0.2%
Dow Jones Industrial Average:  15,639
M1 Monetary Base:  $2,515,000,000,000
M2 Monetary Base:  $10,867,000,000,000

Fine Wine Investing – Everything You Need to Know about Bordeaux

10/1/2013 Portland, Oregon – Pop in your mints….

Appellations, Banks, Gravel, and Clay all work together in the Southwestern region of France which has become legendary for its wine production:  Bordeaux

While the word Bordeaux may ring a bell, many of us would be hard pressed to hone in on specifics when it comes to selecting a fine wine investment from this or any other region for that matter.

Until now.

The following is a synopsis of the Bordeaux region and the fine wines that it produces.  Think of it as the Hitch Hiker’s Guide to the Galaxy of fine wines which fall under this prestigious umbrella.


Red Bordeaux (or “Claret” as the British have always known it) can be the epitome of fine wine. The best wines exhibit a wonderful complexity of aromas and flavours, great elegance and refinement and an ability to age gracefully – some for a hundred years.

Like all of France, quality wine production in Bordeaux is governed by a set of regulations known as “Appellation Contrôlée”, often abbreviated to “AC”. An AC covers a certain geographical district and governs production of wine within the district. The whole of the Bordeaux region is covered by a couple of catch-all, generic ACs: AC Bordeaux and AC Bordeaux Supérieur (the latter is higher in alcohol, but not necessarily better). An enormous quantity of inexpensive, “everyday” wine is made under these ACs. Though this is not the “great” Claret that all the fuss is about, it can provide very attractive, reliable drinking.

There are also many smaller, named areas, each entitled to its own AC: AC Fronsac, or AC Pomerol for example. These more specific ACs are usually superior to generic Bordeaux and have stricter regulations.

To the west of the river Gironde, the vineyards of the Médoc and Graves are based on gravelly soil and are planted mainly with Cabernet Sauvignon vines. To the east lie Pomerol and St-Emilion, two smaller areas of predominantly clay soil, planted with a higher proportion of Merlot. Hence we have “left bank” and “right bank” wines.

The wines from each area can have quite a different character because of the different soils and predominant grape variety. This also means that one is usually more successful than the other in any given year.

Bordeaux Grapes no matter where they are from, almost all red Bordeaux is blended wine: made from two or more grapes. Red wine grape varieties allowed in Bordeaux, in order of importance, are:

  • Cabernet Sauvignon,
  • Merlot
  • Cabernet Franc
  • Malbec
  • Petit Verdot

Bordeaux also produces considerable quantities of white wine. Grape varieties permitted are:

  • Sémillon
  • Sauvignon Blanc
  • Muscadelle.
Bordeaux Wine Regions
Map of Bordeaux Wine Regions created by Domenico-de-ga

Classic Bordeaux Regions – 

The Médoc

The Médoc is home to most of the great, classic Clarets. You will find wines labelled AC Médoc that are usually one step above basic Bordeaux, but the very best wines of the Médoc come from even more tightly defined ACs within the Médoc. The best of these individual ACs include:

  • AC Margaux,
  • AC St-Julien,
  • AC Pauillac
  • AC St-Estèphe.

This region is dominated by large wine-making estates, known as châteaux. Whilst many of these do indeed have a château as their HQ, others have nothing more than the vineyards and a collection of ordinary working buildings. Unlike many producers from other parts of the world, each château tends to produce only one “grand vin” which carries its name. Some of them also make a white wine, and many make a second wine, from vats not considered good enough for the “grand vin”.

Each of the top ACs of the Médoc has its own character:

  • Margaux is home to the most perfumed, elegant and “feminine” wines
  • Pauillac three 1ers Crus. Classic, powerful yet elegant wines
  • St-Julien the epitome of Claret: savoury, well-balanced and refined
  • St-Estèphe wines are structured, tannic, long-lasting, “masculine” wines.

In 1855 Médoc wines were classified. From the many thousands of wines produced in the area, just sixty were thought worthy of classification. These sixty were sorted into five ranks or, in French, “Crus” (meaning “growths”), i.e. “Premier Cru” (first growth), “Deuxième Cru” (second growth) and so on.

There are only five top ranking, Premier Cru wines:

  • Château Lafite-Rothschild
  • Château Latour
  • Château Margaux
  • Château Haut-Brion (actually in Graves)
  • Château Mouton-Rothschild.

All classed growth wines command very high prices, many of these, particularly the Premiers Crus, are bought by investors all across the world. To this day the classification remains more-or-less unchanged and many of the original classified châteaux are still producing some of the world’s greatest wines. Of course strong arguments could be made for promotions and relegations within the classification. A group of wines known as the “super seconds” are generally acknowledged to be Premiers Crus in all but name, and a few of the original châteaux have either gone or have lost their reputation. However, apart from some obvious anomalies, it is remarkable how the bulk of the classification holds up, even after 150 years.

The Médoc Crus Bourgeois

Just below these classed growth superstars of Bordeaux are a host of wines known as the “Crus Bourgeois”. Many fine wines can be found within this classification – some are worthy of classed growth status, yet are available at a fraction of the price. I have found properties such as Chasse-Spleen, Meyney, Coufran and d’Angludet to be consistently good. However, in 2006 a court case found that the classification of the Crus Bourgeois was illegal, and pending a restructuring which means wines will have to be independently assessed for inclusion each vintage, the whole classification was temporarily suspended.


Graves lies to the south of the city of Bordeaux. This region produces both red and dry white wines on the very gravelly soils after which the region is named. The red wines tend to express a soft, earthy quality. Like the Médoc this region was also classified, but not until 1959. Only a couple of dozen châteaux are entitled to the words “Grand Cru” on their label. The best vineyard sites of the Graves are clustered in the North of the region. That is where almost all the Grands Crus are situated. In 1987, this area was given a brand new AC of its very own: Pessac-Léognan. Wines bearing these words on their label should be of higher quality than most Graves. The undoubted super-star of the area is Château Haut-Brion. As noted earlier, this property was actually declared a Premier Cru in the 1855 classification of the Médoc due to its exceptional quality. Uniquely, it is allowed to have both classifications on its label: Médoc Premier Cru and Graves Grand Cru. Its sister property, La Mission Haut-Brion, is also capable of the highest quality.


Although the area is quite large, the properties here tend to be much smaller and less grand, and the wines (exclusively red) are very different. The soil is clay and limestone rather than gravel, and the dominant grape variety is not Cabernet Sauvignon, but the softer Merlot and Cabernet Franc. The wines tend to be approachable at a younger age and to have a warm-blooded fruitiness. It is an area that requires a little bit of caution because of its classification system. St-Emilion wines are divided into 5 classifications. In ascending order, these are:

  • St-Emilion
  • St-Emilion Grand Cru
  • St-Emilion Grand Cru Classé
  • St-Emilion Premier Grand Cru Classé “B”
  • St-Emilion Premier Grand Cru Classé “A”.


Pomerol is by far the smallest of the great regions. It has 2 basic constituents that determine the character of its wines: the soil is thick, heavy clay and one grape variety dominates: Merlot. Pomerol wines are extremely soft, seductive and full of spice and vivid fruit. The production tends to be tiny in the area, so the wines are generally expensive. Indeed, Pomerol is home to some of the world’s most expensive wines such as Châteaux Pétrus and Le Pin, the latter producing little more than 500 cases each year. You will rarely see these wines in shops as they are snapped up years in advance of production. Look for more reasonably priced wines such as Petit-Village, Le Bon Pasteur and Clos René. The wines of Pomerol have never been classified.

Sauternes and Barsac

The Bordeaux area also produces world class white wines, though invariably in tiny quantities. The most famous of these are the sweet wines of Sauternes and Barsac, including the almost legendary Château d’Yquem. These luscious wines (also classified in 1855) are created by a particular and unpredictable fungus, called botrytis. Botrytis rots the grapes, leaving them high in sugar and glycerine which leads to their eventual silky, honeyed sweetness. The best dry white wines come from the Graves area. Though often of tremendous quality, these tend to be scarce and the famous names are very expensive.

The minor regions

From the inexpensive, soft, fruity and delicious wines of the Premières Côtes de Blaye in the north of the Bordeaux region, to the moderately-priced structured, tannic and impressive clarets of Fronsac or Lalande de Pomerol, the “lesser” red wines of Bordeaux are not to be despised. Whilst the finesse and breeding of the top classed growths might be missing, the red wines of the region are generally very reliable and well made.

The dry whites of the region, from areas like Entre-Deux-Mers or simple AC Bordeaux can produce refreshing, zippy, occasionally slightly tart wines for drinking young. Areas around Sauternes, like Sainte-Croix-du-Mont or Loupiac which lie just across the Gironde, also produce sweet, sometimes botrytis affected wines that can be very good and are moderately priced. Rosé is also produced in the Bordeaux region, often from the Cabernet Sauvignon. It can be delicious stuff with bright, supple fruit and refreshing acidity.

Indeed, the Bordeaux Region and its Appellations are the epicenter of Fine Wine investment.  A basic understanding of the region and the wines that are produced there, which we hope you have gained by reading the above information, is absolutely crucial for anyone who wishes to dabble in fine wine for investment purposes.

If you or any of your clients would like more information on fine wine investments, simply email us at: with the word “WINE” in the subject line.

More to come on the Fine Wine Market.

Stay Fresh!

Investing in Fine Wines has Never been Easier

Fine wines have always commanded a premium on restaurant menus, but have you ever stopped to consider the other side of the trade on a romantic dining experience?

Tempranillo Photo credit: Mick Stephenson
Tempranillo Photo credit: Mick Stephenson

Fine Wine Investing

Today we begin a short series on investing in Fine Wine.  Fine Wines as an investment opportunity may sound like something that well heeled folks with large estates and walk in wine cellars are equipped to dabble in.  However, as with many things the rich do, they tend to do it because there is money in it.

The market for Fine Wines is remarkably stable and refreshingly uncorrelated with other asset classes, which is why the rich, apart from bragging rights, have no qualms about storing a portion of their nest egg in corked glass bottles.

Today, the stability and out sized price gains in the Fine Wine market are available to almost anyone willing to invest.  The best part is, you don’t even need to build a wine cellar or worry about your retirement account spilling in an unfortunate accident or being accidentally enjoyed at a candlelight dinner at home.  You can now invest in Fine Wines as you would any other asset class, via the internet.

You still own the wine, naturally, you just don’t need to deal with the hassle of transport and storage.  All you need is a minimum investment of 5,000 British pounds and a bit of information.

If you would like more information on this investment opportunity, which is available through one of our partners, simply email us at: with the word “WINE” in the subject line.

For the moment, we present the following information as a brief overview of the market of Fine Wines.  While it should go without saying, we present the following information as a general overview and cannot and will not comment upon whether or not Fine Wines are appropriate for each individual’s investment situation, this is a decision that must be made by the individual.  However, if you or someone you know determines that Fine Wine investing is agreeable to their taste, we will gladly facilitate the transaction.



From its origins as an exotic drink, wine has become a long standing commodity, with a lineage that dates back to the Greek empire and beginning of trade in 1600 BC. The ancient Greeks carried wine throughout the Mediterranean coast, with Europe leading the way in consumption, production and movement. A major transformation occurred when Napoleon III requested a classification of best Bordeaux wines in France in the year 1855. Following this, wines were classified on a recognised price-based ranking, leading to the grading of the world’s finest wines.


The traditional notion that wine investment is about buying two cases of young wine so that, after a period of maturation, you drink one case and sell the other to finance both may have a certain romantic appeal.

As an investment philosophy, though, it is heavily discounted by today’s serious investor. Investment is all about risk and good investment choices are made when the exposure to risk is clearly understood.

Fine wines has been one of the strongest areas for investment in recent years What may surprise many is that an investment in fine wine has consistently been a low risk investment opportunity compared to oil, the FTSE 100 and even gold. Combined with strong absolute performance and low correlation to other assets, that has led wine to find a home in many serious investment portfolios.

Those interested in accessing the fine wine market have more options available to them than ever before with a range of tax-efficient structures available. The timing looks opportune too: prices came off significantly in 2011, leaving the possibility of a substantial upturn in the medium term, and inflationary fears are enhancing the attractiveness of physical assets.

There is very little correlation between financial markets and fine wine prices. For example, whilst many stocks, shares and markets crashed during the financial crisis of 2008, most wines continued to significantly appreciate in value. Whilst wine prices are not always free of volatility, the market tends to be far more resilient than many traditional investments that investors go for. The reasoning behind this is actually very simple. Fine wine is a completely tangible asset, a luxury product in which supply is always exceeded by demand. As a particular vintage wine is consumed, more of that wine cannot be produced, so the wine appreciates in value.

Fine wines frequently outperform share indices, for example between May 2010 and May 2011, whilst the FTSE 100 appreciated by 15.6%, the fine wine index increased by a considerably higher 21.1%. The Live-Ex 100 Fine Wine Index is the industry’s main performance benchmark, and represents the price movement of the 100 most sought-after fine wines. The price index is calculated on a monthly basis, with the vast majority being Bordeaux wines. Over the last 25 years the very best wines have appreciated by 15-25% per annum, a staggering return on investment very difficult to find anywhere else without very high risks.


It is the underlying supply and demand characteristics of wine which make it attractive as an investment proposition. On the supply side, Bordeaux (considered by many to produce the only investment grade wine) is a finite geographical area in France with an essentially fixed number of wine producers (châteaux). The initial supply of wine is therefore finite, and over time can only fall as bottles of the wine are consumed.

Meanwhile demand tends to rise, for two reasons. First, the quality of the wine improves over time as it matures, making it more attractive to drink. Second, global demand continues to rise as new markets for the wine open up. In the last 25 years alone we have seen Japan, Russia, Korea and China ‘discover’ fine wine and consume it in large quantities, with countries such as India and South America yet to come ‘on stream.’

Intrigued?  More to come on this interesting and exciting opportunity.

Stay Fresh!

A Wealth of Marketing Knowledge

9/24/2013 Portland, Oregon – Pop in your mints…

Are you interested in successfully marketing a product or service?  Today we take a small deviation from monetary matters to provide our faithful readers with some advice on marketing.  The articles linked below are must reads for anyone positioning a product or trying to close a sale circa 2013.

The first article, by Peep Laja, founder of Markitekt, is on nine things to keep in mind when working to influence purchasing decisions.  Taken together, they will dispel any number of myths that you may be currently laboring under:

9 Things to Know About Influencing Purchasing Decisions

While influencing purchasing decisions is paramount, it is equally important to close the sale once one senses that the decision has been made.  But how can you close the sale when you are not present at that crucial moment?  Your packaging must do it for you!

Packaging:  The Last 10 Seconds of Marketing

Finally, an article that is near and dear to our hearts here at The Mint.  While advertising on Social Networks is necessary to get the ever shrinking attention span of consumers directed at your offering, what appears on Social Networks alone is hardly perceived as authoritative.

Independent blog reviews, on the other hand, give an air of authenticity to what is being said.  After all, reaching out to a well known blogger and having them review your offering takes a bit more time and effort than simply posting on Facebook:

Blogs Outrank Social Networks for Consumer Influence:  New Research

And there you have it, three articles that we hope will challenge and enrich your marketing experience as well as helping to focus your limited time and resources on things that matter to consumers.

Happy selling, Stay tuned, and Trust Jesus!

Stay Fresh!

David Mint

Key Indicators for September 24, 2013

Copper Price per Lb: $3.22
Oil Price per Barrel: $102.86
Corn Price per Bushel: $4.53 
10 Yr US Treasury Bond: 2.68%
Mt Gox Bitcoin price in US: $133.28
Gold Price Per Ounce: $1,311 
MINT Perceived Target Rate*: 0.25%
Unemployment Rate: 7.3%
Inflation Rate (CPI): 0.1%
Dow Jones Industrial Average: 15,395
M1 Monetary Base: $2,469,100,000,000 
M2 Monetary Base: $10,783,000,000,000

Why it is Never a Good Idea to Talk to the Police

Today we came across some information that may literally be a question of life or death.  It is regarding the much vilified Fifth Amendment, better known for its Miranda translation, “The right to remain silent.”

We came across this crucial bit of information via the following article published at

The jest of the article is that, rather than being a hiding place for criminals, the Fifth Amendment, the right to not incriminate oneself, serves an extremely important function in today’s culture where persons are all too often presumed guilty until proven innocent.  The best advice, when approached by a police officer, is to draw on the fifth amendment first and then ask questions later, with an attorney present.

The logic is that, the police, even under the best of circumstances, may unintentionally twist one’s words in a way that implicates them in a crime that one did not commit.  In the worst of cases, the Police use anything one says to frame them.

The article draws on information from the following lecture given by a law school professor and former criminal defense attorney, which deals extensively with this very issue:

With the incredible pressure and awkward situations in which those who are entrusted to serve and protect us are placed in daily, invoking the Fifth Amendment may also be the best way to get them out of a difficult situation.

Paradoxical as it may seem, the next time one is approached by the Police, the best course of action is to simply state, “I invoke my right to remain silent.  If you wish to speak with me, I will do so only with my attorney preset.”  When they ask why, simply state “Because, anything I say can and will be used to incriminate me.”

As society has made the Subtle Change from Principles to Rules, simply being alive and breathing may cause one to break any number of rules, both written and unwritten, no matter how much one tries to do the right thing.

The Police are there to enforce the rules, and we praise them for it, unfortunately the rules themselves all too often serve to pervert justice rather than serve it.  For innocents simply trying to live their life peacefully, the Fifth Amendment may be the best and only source of protection against random prosecutions.

Malala Yousafzai addresses the UN as a 16 year old peacemaker

Malala Yousafzai, the Pakistani girl who survived a vicious attack by Taliban gunmen as she and her friends attempted to exercise their right to go to school, was given the opportunity of a lifetime yesterday as she addressed a youth delegation at the United Nations’ general assembly room on her 16th birthday.  Her address to the UN, which can be seen below in its entirety, will go down as one of the greatest in recent memory.

Many in the West will no doubt be stricken by the fact that there are places in the world where girls are not allowed to attend school even when the facilities exist.  We were stricken for a different reason:  Malala is not only one who has stood up for educational rights, she is a 16 year old peacemaker.

In the speech she cites Gandhi, Martin Luther King, and others as her inspiration to pursue peaceful methods of protest.  In doing so, she has become a living example of two truths:

That violence is a symptom of cowardice, and that the peacemakers shall be called the children of God.

Angel Investing and Entrepreneurship: Adam and Eve in the Garden

4/29/2013 Portland, Oregon – Pop in your mints…

Here at The Mint, we have a soft spot for both Entrepreneurs and Angel Investors, for they are to a business what Adam and Eve are to the Genesis narrative.  They are not the creators themselves, but they are the ones who work together in the creation of a business so that it might to flourish.

Our friends over at have put together a great video series called Minute MBA.  In a recent video, which can be seen here (or by pasting the following link in your browser:, they eloquently, in both pictures and words, walk us through the startup funding process from idea, to seed capital, through to an IPO in under three minutes.

They also stress the importance of timing the solicitation of the appropriate flavor of capital at the right stage in the company’s life cycle.  It is an extremely import detail which cannot be overstated.

How To Fund A Startup
Click to view “How To Fund A Startup” via

While there is much written about ideas, business plan development, and the life-cycle of a startup, which is naturally where a majority of the action takes place, there is often less attention devoted to the preparation of the garden plot upon which the seed capital will be planted into.

We call this garden plot the entity structure.  While many entrepreneurs wait until the Angel Investor appears on the scene to prepare the garden plot, there are some things that can and should be done by the entrepreneur at or near the conception of their venture to ensure that any seed capital they manage to attract is not needlessly scattered to the wind.

{Editor’s Note:  At this point a blanket disclaimer is in order, at this point, we are neither an attorney, CPA, tax, or other type of registered professional.  Even if we were, the following is in no way intended to address any one specific situation.  Any decision regarding entity structure should be taken after consulting an attorney and/or CPA who understands the laws of the land where the enterprise is to be founded and operate (should they not be one in the same) as well as the specifics of the owner(s)’ situation and goals.}

The following are three types of potential entity structures that may be employed to form a receptacle that can receive seed or, in some cases, even angel stage capital depending upon the requirements of the potential investor(s).

Think of it as the entrepreneur building their own garden box into which they will pour the rich soil of their time, effort, creativity, and ingenuity.  A garden box that is prepared to receive seeds that will be watered by the blood, sweat, and tears of the entrepreneur in hopes they will blossom to the point where the angels will take notice, muster their resources, and work their own creative magic.

When the angel gets involved, they may see that the garden box is well-tended and bearing fruit.  Depending upon the circumstances, they may seed their capital into the existing garden box, make substantial additions to it, or ask the entrepreneur to take their idea out of the garden box altogether and purchase them a field large enough to accommodate the flood of IPO funding.

We now digress to that lonely place where the entrepreneur sits alone in their yard, trying to decide what type of garden box to build.  The following is a menu of basic garden box designs from which to choose with the careful guidance of a qualified professional with intimate knowledge of the actors and the circumstances:

Step 1 – Buy an investment vehicle – The entrepreneur should establish a simple entity such as an S-Corporation or LLC to serve as their personal vehicle in which they can drive their idea(s) around in to visit potential investors.  This step will help establish a shield between the entrepreneur’s personal assets and their new venture.  It will also give the entrepreneur a tool through which they can manage their tax liability if necessary.

Perhaps more importantly, establishing the first entity gives the entrepreneur a bit of practice, both at corporate governance as well as letting go.  As parents of college freshmen (and Suzy Bogguss) will tell you, it’s never easy letting go.  The saying goes sevenfold for an entrepreneur and their idea.  However, letting go, to some extent, is the ultimate, often unstated goal of soliciting angel types of investment.  It is best to take the first, painful step in the privacy of one’s own home to avoid any unwanted emotional breakdowns as they sign away a portion of the rights to their baby entity in return for the cash needed for it to grow and thrive.

This is a deep, nearly metaphysical, aspect of the interplay between entrepreneur and angel investor, and we must leave it there for the moment and get on to the designs.

Design 1 – The Simple Promissory Note:  While most entrepreneurs and investors alike tend to think of seed capital as purely equity, we believe that in terms of ease of set up (meaning fewer legal and accounting fees) and understanding, creating a promissory note directly payable to the seed fund investor and the vehicle entity that is wholly owned by the entrepreneur for the amount to be invested offers a simple, if not elegant way for the parties to marry their money and idea on a trial basis.

From the entrepreneur’s standpoint, the ideal promissory note would provide for the use of the investor’s funds for a mutually agreed upon amount of time, during which interest may accrue at an agreed upon rate, but no payments on the note are due until the entity is projected to be able to have the free cash flow available to make good on the obligation.

The investor may be afforded some protection by perfecting a security interest against a portion of the entrepreneur’s other assets which would act as collateral.  We refer to this type of clause as a negative outcome exit.

However, as the reason for the decision to invest in the first place is presumably because the investor believes that the venture will succeed and grow, it would make even more sense to include a positive outcome exit.  In the case of the simple promissory note structure, the positive exit would include the right for the investor to convert the note into an equity stake of a previously agreed upon percentage of an entity that is again, previously agreed upon to be formed as a next stage investment vehicle for the new venture.

The promissory note strategy is a form of baby IPO that allows for the intimate gestation of the venture while it is at its most vulnerable by two parties who have a vested interest in seeing it grow and develop.

This strategy does not, however, offer the tax advantages usually associated with the investor’s ability to write off any losses that the venture may incur in its early years that the strategies mentioned below in Design 2 and 3 offers.  Then again, if a portion of an investment return is attributed to losses incurred in the early years, it may delay or even discourage the wise and judicious development of the venture by lulling the entrepreneur and investor alike into a false sense of security as the piling up of losses may be explained as beneficial with regards to tax liability.

Design 2 – The S-Corporation: An S-Corporation, while a bit antiquated, is still a favorite entity structure for closely held ventures.  S-Corporations are subject to state administrative rules related to corporations and may be formed with a fixed number of shares that can be sold to a limited number of investors.

Along with the S-Corporation come the joys (read responsibilities) of corporate governance.  There is more ongoing paperwork involved and therefore more attorney and CPA fees.  However, the S-Corporation is a much sturdier garden box than the simple promissory note.  It serves to isolate the venture and give it form; it also allows all parties to “enjoy” the tax benefits of the early years where the venture bleeds money.

Another advantage of the S-Corporation structure is that it can later be converted into a C-Corporation, which is the field upon which the great flood of the IPO can be released.

Design 3 – The Limited Partnership:  This option generally allows for the greatest amount of entrepreneurial flexibility to operate with the greatest number of potential investors.  Depending upon the requirements of the Limited Partners (LPs) and the myriad of exit strategies available, the agreements can be quite complex and again, there can be a great deal of legal and accounting fees incurred during the setup and operation of the LP.

The basic structure involves a General Partner, which in this case would be the entrepreneur’s vehicle established in Step 1 above, and one or several Limited Partners.  The General Partner is responsible for the day-to-day operations and has full responsibility for the debts of the partnership (for this reason, it is best that the General Partner, in practice, be an S-Corporation or LLC which itself will limit the entrepreneur’s liability).  New forms of Limited Partnerships, such as the LLP and LLLP are now being recognized which serve to further insulate the General Partner from unlimited liability.

The Limited Partners are only liable up to their invested amounts and are shielded in the same way a corporate shareholder is shielded in the event the LP should go bankrupt.  However, the Limited Partners cannot participate in the day-to-day operations of the Partnership, which for most Angel investors is just fine.

The Limited Partnership allows all parties to enjoy the tax “benefits” of the losses that the venture incurs early on.

Another advantage of the Limited Partnership is that one General Partner can be involved with many Limited Partnerships, which is ideal for the entrepreneur who has multiple ideas that may appeal individually to differing groups of investors who may not want to be in the same risk pool together.  These risk pools can be established by creating different Limited Partnership.

Under the Limited Partnership model, the General Partner will generally charge a percentage of revenues as a management fee and an additional percentage or fixed amount as an investors’ service fee to the partnership in exchange for dealing with 100% of the headaches.  These fees may be cash flow contingent and may vary depending upon the extent that the General and Limited Partners are sharing the profits or losses of the venture.

The Issue of investor accreditation and other rules, laws, and regulations:

In the case of Design 1, it may not always be possible to solicit funds using this vehicle depending upon local laws and regulations regarding who may or may not enter into a promissory note.  In a perfect world, this would not be a barrier, however, we do not live in a perfect world.

Further, in Designs 2 and 3 (and in some cases, Design 1 as well), there exists the Federal requirement that all investors be “accredited,” meaning that they have a net worth of over $1MM or have an income of at least $200K for two of the past three years ($300K if married) and the expectation of generating this level of income during the current year.  There are some other ways to qualify which can be seen here but the $1MM threshold is the most common.

In summary, Design 1, the promissory note, is simplistic in that no new entity that needs to be formed.  However, it does not offer much in the way of income tax advantages or flexibility.  It is best suited for a specific project or purpose with an eye towards the larger garden boxes that will later be built.  Designs 2 and 3 both have the complication of entity formation and governance.  The ultimate advantage of options 2 and 3 are enhanced liability protection, greater operating flexibility, and the ability to control income tax considerations to a greater degree.

Again, these are just a few of any number of possible designs, and an attorney and or CPA that is close to the specific situation that is being addressed is in the best position to be able to advise which specific design to tailor so that both entrepreneur and angel investor, Adam and Eve, as it were, will be properly clothed.

If you are an Adam in search of an Eve, or vice versa, or an Adam and Eve who have just found each other and are in desperate need of a Virtual CFO to get things to the next level and beyond, we would love to help!  Simply contact us at the email address below to enquire about our customized, tailor made CFO services here at The Mint.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint


Key Indicators for April 29 2013

Copper Price per Lb: $3.21
Oil Price per Barrel:  $94.43
Corn Price per Bushel:  $6.84
10 Yr US Treasury Bond:  1.67%
Mt Gox Bitcoin price in US:  $143.50
Gold Price Per Ounce:  $1,474 THE GOLD RUSH IS STILL ON!
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.6%
Inflation Rate (CPI):  -0.2%
Dow Jones Industrial Average:  14,819
M1 Monetary Base:  $2,470,700,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base:  $10,667,300,000,000

Of Money and Metals: The Operation of a Free Money Supply Explained

We’ve been at it again!  Be the first to download our newest e-book,  now available on Smashwords and Amazon’s Kindle:

Of Money and Metals: The Operation of a Free Money Supply Explained

Of Money and Metals: The Operation of a Free Money Supply Explained is Volume II in the “Why what we use as Money Matters” series. Of Money and Metals presents the fallacies of the current day practice of circulating debt in the place of money and explains the urgent need for and the operation of a free money supply. This volume also explores the phenomenon of Bitcoins and digital currencies.

It is available to our dear readers for free until January 31, 2013 at, just enter coupon code: MA65L

Thank you for your support!

Of Money and Metals by David MInt


They can’t take us all! The Weyer Hall Stampede of 1993, a failure of democracy

10/15/2012 – Portland, Oregon – Pop in your mints…

In today’s Mint, we offer, for your enjoyment, an event which transpired during our time of service on the democratically elected dorm council as secretary at Weyer Hall, circa 1993.  While the narrative touches upon many themes that will no doubt evoke strong emotions, we humbly offer it as an example of the shortcomings of governance by democratically elected bodies.

It is recounted here, with certain liberties, in loving memory of Ma Tinder, long time dorm Mother at Weyer Hall.  Enjoy!

The Stampede.

During our short, but eventful time as a student at Hastings College, we resided in Weyer Hall, an all male dormitory which housed 70 residents.  While we assume that the College Administration had ultimate responsibility for campus governance, each dormitory was governed by a small group of democratically elected peers who sat on what was known as the dorm council.

During the Fall semester of our sophomore year, it fell to us to serve on the council as Dorm Secretary.  We say fell, because we did not exert much effort in our campaign, nor did we crush an inferior opponent in a moderated debate.  For all we know, we may have raised our hand at the wrong time, an innocent mistake which caused our name to land on the ballot.

Nonetheless, we were determined to serve our fellow residents to the best of our abilities.  As Secretary, our responsibilities included taking notes of the decisions of the dorm council, which invariably included the details of certain disciplinary actions taken against those who did not follow the rules and were foolish enough to get caught, publicly recognizing noteworthy accomplishments of the residents, if any, and informing them of upcoming events.

Our diligent dispatches reached the desk of the College President as well as the backs of every bathroom stall in the dorm, where they were most likely to be read.  For a time we created toned down, official version of the dispatches for the President.  However, our inner laziness finally demanded that we produce just one dispatch, complete with all of the juicy tidbits and unsolicited commentary fit to print.

The President seemed to love it.

The dorm council meetings were held in the quarters of the Dorm Mother, affectionately known as Ma Tinder.  Ma Tinder’s quarters were located at the center of the first floor of the three story structure.  She resided there, along with her dachshund “Peanut” as a source of calm in what was otherwise a cross between “Revenge of the Nerds” and “Animal House.”

The dorm council’s business, which it faithfully discharged at its monthly meetings, was to decide trivial matters, such as the design of the dorm t-shirt (which is fodder for another day), as well as to enforce the rules of the dorm.  Violations of the law of the dorm included residents found to have invited a female to the premises without signing them in at the desk, excessive noise, possession of alcohol and other illegal substances, and in one infamous case, the unlawful operation of a charcoal grill…indoors.

Weyer Hall
The tranquility of Weyer Hall was about to be transformed
Photo Courtesy of

The dorm council, as with any governing body, was divided into unspoken but acknowledged factions.  Those who were there to enforce the rules, and those who were there to ensure that the rules, if enforced, were loosely interpreted and administered with clemency.

You can imagine which camp the younger Mint fell into.

So it happened that on a Sunday afternoon, as winter descended upon Central Nebraska, the dorm council assembled in Ma Tinder’s quarters during mandatory “quiet time,” as was the custom.  As we were discussing matters of relatively trivial importance, a pounding noise, distant at first, then increasingly loud and frequent, arose from somewhere in the interior of the building until it passed, as would a locomotive, directly above Ma Tinder’s isle of tranquility.

It was the Stampede.

Those members of the council who were firmly in the rules enforcement camp immediately sprang to their feet in pursuit of the perpetrators of what was obviously a direct affront to the authority of the council.  To flagrantly violate “quiet time” by running in boxers and boots, as heavily as one could, through the hallway directly above the meeting place of the council was not simply a minor violation of the rules, it was mutiny.

Those of us who found ourselves in the “loose interpretation/clemency” camp slowly arose, fighting off a chuckle, and give the appearance of chase as doors all over Weyer Hall immediately shut as the Stampede ended just as suddenly as it had begun.

For not only did we see the Stampede as an artful form of both coordinated self expression and protest, we had helped instigate it.

In the end, while the entire dorm was given a stern warning to respect the the rules, there were no individual indictments.  Like history makers throughout the ages, the Weyer Stampeders had proved their point,

“You can’t take us all!”

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint


Key Indicators for October 15, 2012

Copper Price per Lb: $3.70
Oil Price per Barrel:  $91.82
Corn Price per Bushel:  $7.33
10 Yr US Treasury Bond:  1.66%
Gold Price Per Ounce:  $1,737 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.8%
Inflation Rate (CPI):  0.6%
Dow Jones Industrial Average:  13,424
M1 Monetary Base:  $2,449,400,000,000
M2 Monetary Base:  $10,157,100,000,000

Bursting The College Bubble – A Lesson in Diminishing Marginal Returns

10/5/2012 Portland, Oregon – Pop in your mints…

Today we came across one of the most insightful pieces on education that we have read in quite a while.  Perhaps we are biased because it we written by a member of our comparatively small generation, or perhaps it is something more.  Virginia Heffernan, the national correspondent for Yahoo! News posted an article today entitled:

How to burst the college bubble:  Stop pretending your alma mater matters

With what appears to be the benefit of hindsight and a sober look at her own educational experience, she eloquently voices a viewpoint which, almost out of necessity, is quickly moving from the fringe to mainstream thought.  A traditional college education, circa 2012, not only fails to offer a competitive advantage in the workforce to those who can set aside four to six otherwise productive years and the untold thousands spent during that time period, it places undue financial and social pressure on both parents and their children from the time of admission to graduation day.

The College Education: A ticket to a rewarding career or four years of indoctrination followed by a trip to debtors prison? There must be a better way.
Photo of Harvard Yard in 2009 by chensiyuan

This undue stress is generally attributable to the fact that parents and students alike who find themselves in the middle of a financial commitment which equates to more than a few years worth of wages are collectively questioning the wisdom of throwing money at an investment whose return has turned unacceptably negative in recent years.

The reason for this, as most current economics students may struggle to tell you, is that the college education, like any other economic good, is succumbing to the workings of to the law of diminishing marginal returns.  This law is one of the beautiful, immutable natural laws which states that economic activity, if carried on long enough, will reach a point where each additional dollar of capital invested will render a lower return on investment than the previous dollars invested.

This phenomenon is attributable to changes in the underlying supply and demand dynamics which take place as the natural tendency to chase outsized returns drives more people to engage in high margin activities, which increases the supply of that activity’s output.  This supply, as it satiates demand, then serves to lower the price of the product until the producers with higher cost structures are driven out of business while producers with lower-cost structures continue producing profitably at lower price points.

The application of the Law of diminishing marginal returns when applied to College degrees in the US

For a period of time, beginning in the 1940’s in the US, it was relatively rare for an individual to obtain a four-year college degree.  In economic parlance, there was a scarcity of college educated individuals relative to demand.  Those individuals who did obtain a degree received a higher return on their investment in education in the form of higher wages for the rest of their working lives.

{Editor’s Note:  We recognize that this analysis ignores the dynamics in the US economy during that time period leading to the demand for college educated individuals in the workforce.  For purposes of this example, we submit it as a given to avoid further divergence from our theme.}

As time went on, more and more individuals saw the wisdom in investing in a college education, colleges and universities increased their capacity and course offerings to satisfy this demand.  As the workforce continued to demand college educated individuals, this created a virtuous feedback loop in the higher education industry.

This virtuous feedback loop became so normal, as did rising stock prices in the 80’s and rising home values in the 00’s, that seeking to attend a four-year college has become the goal for a great majority of teens.

Circa 2009, the supply of college educated individuals began to overwhelm the demand for their services.  At this point, the marginal return on investment for attending a four-year college for many has decreased to the point where it no longer has a positive net present value, the financial criteria most often used by rational individuals when determining whether or not to undertake an action.

Against this dismal backdrop for education entered a phenomenon which is poised to deliver the knockout blow, the widespread adoption of the internet.

While the net productivity gains realized by the advent of the Internet are seen in many spheres, the Internet is maturing to the point that it is now fundamentally changing the structure of education.

Our mother wisely told us, during those difficult years we spent at the University in the 90’s, that the only thing college will teach you is how to access the information you need when you need it. 

The advice has served us well, as has Google.

Unlike Heffernan, we do not feel that our college degree is obsolete.  In our epoch, it was necessary to attend a four-year school to learn the disciplines of accounting, finance, and treasury which support us today.

However, the internet has fundamentally changed not the disciplines, but the delivery methods of said education.  Now, an individual desiring to learn a discipline such as accounting or economics no longer needs to pack their bags to party with others for four years while fitting in class between video games and other shenanigans.

That individual can peruse The Mint, for example, form the comfort of their living room.  Then, after leaving the site. thoroughly confused (for which we wish to be held harmless, mind you), they can access any one of thousands of free online tutorials and videos created by capable individuals who will provide an education on a specific subject on demand in a fraction of the time that it takes to obtain a degree.

Gary North has written recently on the YouTube educational phenomenon as well.  If one has something to teach the world, it is a small task to obtain a microphone, video camera (think webcam or smart phone), and a YouTube account.  Simply teach the class once to a camera, post it, and your done, saving countless hours needlessly spent drooling on yourself as you sleep through class in a lecture hall.  This is how a majority of education will be served over the next millennia. 

The internet is fundamentally changing the education industry in the same way it has changed communication, and many of our alma maters will soon resemble the US Postal Service, which has struggled in vain to maintain its current state and sinecure structure as the world it grew up in has changed forever.

This analysis does not even address the fact that many four-year colleges have struggled to keep up with the ability to teach the skills demanded by the modern workforce.  The net result of this change in delivery methods and competative disadvantage will be the loss of a number of sinecures in the hallowed halls of Liberal Arts colleges across the land.

While the liberal arts and art itself will always find ways to flourish, paying to be forced to read literature that one is not interested is quickly becoming a luxury that college students cannot afford.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint


Key Indicators for October 5, 2012

Copper Price per Lb: $3.75
Oil Price per Barrel:  $89.90
Corn Price per Bushel:  $7.48  
10 Yr US Treasury Bond:  1.73%
Gold Price Per Ounce:  $1,781 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.8%
Inflation Rate (CPI):  0.6%
Dow Jones Industrial Average:  13,610  
M1 Monetary Base:  $2,355,800,000,000
M2 Monetary Base:  $10,070,300,000,000