Category Archives: Spain

Catalunya Employs Classic Democracy as Oregon Taxes Weed

11/9/2014 Portland, Oregon – Pop in your mints…

For those among our readership who do not follow Spanish Politics, Catalunya, the region of Spain most easily recognized by its leading city, Barcelona, held a vote on two matters of the utmost importance to the Catalans. The questions were posed in the following manner:

1) Do you want Catalunya to be a State?

2) Do you want that State be Independent?

The vote today in Catalunya, of which 80.72% voted “yea” on both questions, was not sanctioned or recognized by the Spanish government in Madrid, other than to say it was nothing more than propaganda.

According to The Guardian, roughly 2 million of the 5.4 million persons who were eligible to vote cast a ballot today, a roughly 37% turnout, which means that today, roughly 32.3% of those living in Catalunya took the time to submit a symbolic ballot in favor of their Independence from Spain. For a quick comparison of this figure, 68.9% of eligible voters cast a ballot in Spain’s last General Election in November of 2011.

L'Estelada Blava
L’Estelada Blava

While voter turnout today in Catalunya may not seem impressive on the surface, it takes on more meaning when one considers that, as it was unsanctioned by the Spanish Government, over 40,000 volunteers took it upon themselves to receive and count the ballots.

The Catalans have employed what we call Classic, or Grass-roots, Democracy in an effort to allow their citizens to determine in a civilized manner the most basic of questions with regards to self governance: Shall we, as a region, be Independent?

Admittedly, Catalunya is in a unique position to do so. Most regions, for which Independence is more a romantic idea than a practical one (the most recent example being Scotland’s referendum to break ties with the UK), have much to lose and little to gain by declaring Independence. Catalunya, on the other hand, is essentially self-sufficient and for them, remaining part of Spain has little upside.

For a time, the argument could be made that Spain provided Catalunya access to markets that it otherwise could not have sold into. Today, this is a non-issue, as the EU trade agreements would continue to cover an Independent Catalan State.

The Spanish Government has a big problem. While Spanish officials are swiftly and publicly denouncing the Catalans for holding what, in their mind, had already been declared an “illegal” vote, the Catalans have cleverly and very publicly made a mockery of what passes today as “Democracy” in the Sovereign States of the world who embrace this model of governance.

For what is Democracy if not the people’s right to self determination? Yet modern democracy for most boils down to questions of which hand picked candidate will occupy an embedded power structures, and whether or not to increase the existing tax and regulatory burdens imposed by this power structure.

With today’s actions, the Catalans struck at the heart of the existing system. Our guess is that one day, they and many other regions in similar situations will enjoy sovereign status as peers to their former oppressors in the EU.

Throwing off the EU’s chains, however, would be a matter settled by arms, as the French, American, and every other successful revolution against the clutches of Empire have shown. It is not the nature of Empire to negotiate or put to vote matters of self-determination.

Oregon Taxes Weed

In our local elections, our fellow Oregonians chose to decriminalize marijuana. Joining them were the people of Washington, DC, making a total of four jurisdictions in the US that have changed the innocuous plant from a huge drain on tax revenue to a potential source of revenue with the stroke of a pen.

Weed: It got your parents kicked out of school, now it can pay for yours.

Which way did The Mint vote on the issue? We didn’t. You can read our reasons for abstaining from voting on State and Federal Matters in the links below:

Ballot Burning, Our Breaking Point, and Why the Next Gold Rush Just Began (notice the reference to Catalunya’s Independence preparations)

Three Reasons Why We’ve Stopped Voting, The Trail of Tears

The Silent Majority, Why No One Will Win the 2012 Presidential Election

As the Catalans have seen in the case of the Spanish, government, once it exceeds a certain size, ceases to serve the people who created it and becomes at best parasitic and at worst, antagonistic and violent as it increasingly resorts to the use of force in an effort to advance a failed system.

Can Catalunya peacefully remove the yoke?

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Key Indicators for November 9, 2014

Copper Price per Lb: $3.07
Oil Price per Barrel (WTI):  $79.02

Corn Price per Bushel:  $3.67
10 Yr US Treasury Bond:  2.31%
Bitcoin price in US: $361.80
FED Target Rate:  0.09%
Gold Price Per Ounce:  $1,179

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  5.8%
Inflation Rate (CPI):  0.1%
Dow Jones Industrial Average:  17,574
M1 Monetary Base:  $2,939,700,000,000

M2 Monetary Base:  $11,485,000,000,000

Why the IMF has no clue how to deal with the Spaniards and Italians

10/15/2013 Portland, Oregon – Pop in your mints…

As the world continues to bite its collective nails while it waits for the US Government to decide whether to punt the ball down the road another stretch or capitulate on its debt in what we have dubbed “The Ultimate Stimulus Measure,” the IMF is busy scolding the US Government and proposing hack solutions which completely miss the point.

Just try to tax usThe world that the IMF operates in exists only in theory, it is like the perfectly closed system where energy is a constant which is the the basis of many physics theories.  On one hand, the assumption of a closed system is the only way to test a hypothesis.  On the other, to assume that the closed system is a given in real world situations is folly in the physics profession.

While the physics professor recognizes the limitations of his theory in practice and makes the requisite adjustments, these limitations are all too often lost on the IMF and others in the economics profession.  The situation of the latter is dangerous, as for some bizarre reason their theories influence wide-ranging policy decisions which affect the lives of billions based on its closed system fantasy.

Such is the case with the recommendations made in its October 2013 World Economic and Financial Survey which is eerily titled “Taxing Times.”

Taxing Times IMF 10-2013

In the report, the IMF makes two data driven observations:  That the national debt load in certain Euro zone countries is excessive and that there is a certain level of net family wealth in these countries.

Fair enough, however, what happens next is disturbing, for it reveals both the closed system fallacy as well as the arrogance of those at the IMF.  The IMF takes the above two data points and arrives at the following conclusion:

A one time, 10% tax on net family wealth in certain heavily indebted countries would make the national debt loads once again “manageable.”

If you have yet to laugh, cry, or hurl at what we have just described, you may stop reading as you are unlikely to get what follows and reading it will be a waste of time you can otherwise spend watching CNBC or the teletubbies.  Please carry on.

If you are still with us, allow us to heap it on by adding that the IMF believes that this one time family wealth tax would help as it would simply reduce the national debt, specifically in Italy and Spain, who, true to form, have managed to avoid full-scale bailouts suffered by the Irish, Greeks, Portuguese, and Cypriots to this point and gamed the ECB into issuing bonds on their behalf.

This last point should give you, fellow taxpayer, all the information you need to understand why, as ludicrous as a family wealth tax sounds, it becomes even more ludicrous when one thinks that it can be imposed on Spaniard and Italians, who are hands down the world champions in tax avoidance.

The governments of Italy and Spain have managed to have the ECB foot the bill for their respective bailouts to this point.  However, the only reason they need a bailout in the first place is because their citizens are experts in tax avoidance (it is a genetic adaptation acquired during Roman times which has grown stronger and more agile over time, that is all you need to know.)

Now, the IMF, in its infinite wisdom, glances at the problem and a dim light bulb goes on!  If you just tax 10% of each family’s wealth, you can reduce the national debt to an acceptable level!  “Voila,” says Lagarde!  “C’est comment son fait!”

“The genius of the tax,” she continues “is that it is one time only, so it won’t have any effect on investment or savings preferences!  Its perfect, I tell you, perfect!!!!”

This is why she’s paid 300,000 pounds a year, of course, to put two and two together.  At this moment, Christina Lagarde has now transformed into Cruella DeVille, the villainess of Disney fame (a transformation that requires only a slight wardrobe adjustment and a little imagination.)

As word of the IMF’s latest ploy spreads, the few Spaniards who have not opened a Bitcoin wallet called up their grandchildren and asked them to do it for them.

(Wondering what a Bitcoin is?  Check out our reasonably priced e book on the subject here)

By the time any sort of 10% one time wealth tax hits the Spanish and Italian Peoples, there won’t be a peseta or lira, er, Euro to be found from the Pyrenees and Alps to the Mediterranean coast, where avoiding the looting hands of emperors has been a national pastime for over 2000 years.

Stay tuned and Trust Jesus!

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for October 15, 2013

Copper Price per Lb: $3.28
Oil Price per Barrel:  $101.38
Corn Price per Bushel:  $4.37
10 Yr US Treasury Bond:  2.70%
Mt Gox Bitcoin price in US:  $152.89
FED Target Rate:  0.09%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,277
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.3%
Inflation Rate (CPI):  0.1%
Dow Jones Industrial Average:  15,236
M1 Monetary Base:  $2,689,400,000,000
M2 Monetary Base:  $10,790,700,000,000

Columbus dons Barça gear at Nike’s request

image

Sergio Garcia climbs a tree to hit one-handed second shot

Nice shot Sergio:

I’m Latin, I can’t Keep Calm! Adios Euros

3/21/2013 Portland, Oregon – Pop in your mints…

On Monday, we shared with you our friend Tom’s first hand experience and general impressions with the Spain’s currency conversion from pesetas to the Euro.

Adios Pesetas: A look back at adoption of the Euro in Spain

The conversion to the Euro, for most practical purposes was a long, drawn out process which took two years to implement, starting with the final exchange rate peg to the Euro and culminating with the coin and bill conversion which Tom so eloquently described.

Adios Euros!
Adios Euros!

Today, thanks to the prospect of forced bail ins, the term for a levy or tax (depending upon your preferred term for asset confiscation) such as the one proposed in Cyprus which would bail out the government and/or banks, there is a run on banks throughout Iberia.

The reason is that the preference for the bail in solutions are now popping out of central banker’s mouths like pop corn.  Even Ben Bernanke, slave master of the US currency, has uttered that it would be a possibility.

However, this is the twenty-first century, and bank runs aren’t what they used to be.  For one thing, banks now have instant access to all of the digital currency they could possibly want.  It is a simple ledger entry for the bank to replace the customer’s deposit with a Central Bank liability.

However, there is still the matter of cold, hard currency.  As the Spaniards begin to withdraw currency en masse, the bank branches are bound to run out of Euros.  Thanks to technology, holding Euros, either in physical or digital form, is no longer an absolute necessity and, at this point, it is extremely undesirable.

According to a report at Zerohedge.com, Spaniards are getting a crash course on Bitcoin adoption:  Spain Bitcoin run has started

As the monetary authorities are just now beginning to understand the practical implications o

Bienvenido real money!
Bienvenido real money!

f forced bail ins, the peoples of the world are not content to stand pat while their leaders sqauble over how much to confiscate from whom.  Thanks to digital solutions like the Bitcoin, Spaniards and people the world over are making a run on banks from the comfort of their own homes on their smart phones.  The Euro, which took two years to implement, may be largely replaced in commerce in a matter of weeks.

Even so, the Bitcoin has its limits, as wealth held digitally has a flight risk of its own.  Silver and other hard currencies do not have this problem, and the first stages of the next leg up in Silver and Gold is commencing in lockstep with the Bitcoin app downloads in Iberia.  Either way, it is a unanimous democratic process whose end result will be the Euro being voted off the continent.

While the monetary authorities prepare their familiar mantra, “Keep Calm and Carry on,” the response in Iberia is ringing back “I’m Latin, I can’t Keep Calm!”

Neither should you.  Here at The Mint, we have taken the step of accepting Bitcoins in exchange for silver coins to deal with this contingency.  We ship worldwide and guarantee your satisfaction.  If you are interested, please email us at the address below for a quote as we have yet to fully automate this process.

Adios Euros!  Bienvenido real money.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for March 21, 2013

Copper Price per Lb: $3.47
Oil Price per Barrel: $93.15
Corn Price per Bushel: $7.32
10 Yr US Treasury Bond: 1.94%
FED Target Rate: 0.15% ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce: $1,614 THE GOLD RUSH IS STILL ON!
MINT Perceived Target Rate*: 0.25%
Unemployment Rate: 7.7%
Inflation Rate (CPI): 0.7%
Dow Jones Industrial Average: 14,512
M1 Monetary Base: $2,466,100,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base: $10,499,300,000,000

Adios Pesetas: A look back at adoption of the Euro in Spain

3/18/2013 Portland, Oregon – Pop in your mints…

The following is an essay written by a dear friend of ours, Tom Baker, in February of 2002.  Tom and his wife have lived in the region of Catalunya for a number of years.  His observations regarding the currency transition which was about to take place in Spain from pesetas to the full adoption of the Euro may prove timely if and when a similar event takes place in your locale.  Enjoy!

Adios pesetas

A major milestone has come to Europe with the introduction of the common currency known as euros.  Actually the Economic Union of 12 countries (Trivia question–can you name the 12 countries? answer below) has been on the euro standard for the last 2 years, with exchange rates fixed permanently between the currencies of the member countries.  Everyone was really using euros, but they just looked different in each country.

Now in the last month, the last major hurdle has been addressed with the withdrawal of all local currencies from circulation, and their replacement with euro coins and bills.  Think of the problems involved in changing the currency of 12 countries (approximately the size of the US) with 12 different monetary systems simultaneously.

Prices for goods have been posted in both pesetas and euros in the larger stores for the last year to accustom people to thinking in euros.  It isn’t easy-we have gotten used to valuing items in pesetas, and even though the euro is close to a dollar in value, that hasn’t helped much.  So it must be worse for those that have lived with pesetas all their lives.

Spanish FlagThe schedule is for 2 months of dual circulation, with only euros after that.  Now for some details of the tactics used.  Most cash registers are electronic and have been reprogrammed to handle both currencies.  Banks had kits of euro coins available in December for their customers so people could start getting used to the feel and appearance, but they could not be used until Jan 1.

The big change-over day (Jan 1) was of course very quiet, the major change being that most cash machines only dispensed euro bills.  Then the tactic to force the change-over was that customers could pay in either currency, but always received their change in euros.  So all the stores were sucking pesetas out of circulation.

It was a bit chaotic in the first week, with small merchants having to do the conversions on calculators.  Lots of mistakes were made, lots of people were confused, but the pesetas were disappearing briskly.  A few operations had problems with machines that accept coins, especially the toll roads.  So they decided to shut down the automatic coin machines until the conversion period is over, giving them time to convert them to euros.  If you want to pay cash, you have to give it to a human operator, otherwise use a credit card for automatic payment.EU-flag

The use of credit cards in general was encouraged to reduce the demand for change initially.  There were some shortages of coins, especially when the big traditional sales kicked in on Jan 8.  Now after a month of usage, the euros are seeming more natural and the prices are starting to make sense.  Pesetas have disappeared-all transactions are in euros now.

[A cartoon that I saw showed a bank robber at the counter, and the cashier asked if the transaction would be in pesetas or euros].

In our house, and I’m sure in most others, there was a sweep to collect all the pesetas and get them spent.  Then you find another coat pocket with a handful of coins, plus an envelope with French francs, another with Italian lira, etc.  There are cans with slots in all the banks for those last few stray pesetas to help children around the world.  We’re going to haul our francs to France for one last meal there before the pumpkin-hour.  The lira we sent with friends that are visiting Italy.

If you are holding on to European currency, send it to me immediately :-).  No, just kidding, but you do need to change it.  Bills you should be able to change at major banks until March 1 when all local currencies will disappear; after that you will have to change the money at the state bank in the country of the currency.  They predict that at least a third of the currencies will never be turned in.  That is pure gravy for the governments.

A side effect of the change-over is its effect on black money.  Spain and other areas of Europe have a sizeable underground economy, with all transactions in cash, not reported to the government for tax purposes.  Now some people are stuck with bundles of currency that will soon be unusable.  So the sales of luxury items skyrocketed in December, especially expensive cars.

Also there seemed to be a lot of money being poured into new construction, and housing prices have risen dramatically in the last year.  We will see if they subside in the coming year.  The government has promised to look into suspicious purchases of luxury items.  There were reports of Germans hauling carloads of marks into Switzerland.

On your next trip to Europe, you will find things much easier, with only one currency to carry unless you visit England, Switzerland, Denmark, Sweden, or Norway.  I wonder how much this will affect tourism into these countries?

The last thought is the number of colloquial sayings that will disappear from the language.  “No vale ni un peseta” = “It’s not worth even a peseta”.  The common words used for money were duros (5 pesetas, or like a nickel), and pelas (1 peseta).  These will disappear.

Euro coins:

1, 2, 5 Cents, Centims, Centimos-Copper colored
10, 20, 50  Cents-Gold colored
1, 2 Euros-Gold outer band, silver inner section

The “front” side of each coin is unique to each country, while the “back” side is common to all.

Euro Bills: 5, 10, 20, 50, 100, 200, 500

Euro countries:  Spain, Portugal, Ireland, France, Germany, Austria, Italy, Greece, Holland, Luxemburg, Belgium, Finland

We wish to thank Tom for allowing us to share his essay with you, our fellow taxpayers.  It is both an interesting, first hand look at a significant event in the history of world currencies as well as an instructive guide as to how one may prepare and what to expect should the monetary authorities in your locale choose to swap their existing national currencies for some flavor of supranational currency, such as the Euro.

At the time the Euro was adopted, it appeared to have a number of benefits for the adherents despite the minor inconveniences and sometimes painful price adjustments (we are told that the typical café, which before the Euro went for 100 pelas (see above) was immediately repriced up to a round 1 Euro (roughly 162 pesetas), an instant 62% increase) that were experienced in its adoption.

Now, some eleven years later, five of the countries on the above list have experienced significant economic distress, while others teeter on the fine line between growth and solvency.

It is important to note, however, that the countries that are now in distress experienced substantial economic booms related to the Euro adoption.  Their governments were allowed to borrow at rates which were aided by the strength of their European neighbor’s finances and, as Tom pointed out, the Central Banks made a windfall profit on the quasi confiscation of nearly 1/3 of the currency in circulation.

Was it worth it?  In terms of currency history, 11 years is a bit too soon to make a call, but either way, we have a feeling that a similar sort of currency “consolidation” awaits many in the not too distant future.  It will not be some sort of conspiracy, as many believe, but simply an attempt by the desperate governments of the world to shore up their ailing finances.

It will ultimately fail, but that time may be farther off than it seems.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for March 18, 2013

Copper Price per Lb: $3.51
Oil Price per Barrel:  $93.21
Corn Price per Bushel:  $7.16
10 Yr US Treasury Bond:  2.01%
FED Target Rate:  0.14%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,596 THE GOLD RUSH IS STILL ON!
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.7%
Inflation Rate (CPI):  0.7%
Dow Jones Industrial Average:  14,496
M1 Monetary Base:  $2,466,100,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base:  $10,499,300,000,000

86! The incomparable Lionel Messi breaks the scoring record

Watch the master at work netting 86 big ones.  Amazing: