Category Archives: True Capitalism

Monetary Theory, To Build up the Land, True Capitalism

Why What We Use as Money Matters Trailer released

Today we present the fresh release of the trailer for our recent book, Why What We Use as Money Matters, a reflection on current systems of finance and governance and how they may be throwing the earth wildly out of balance.

Could it be that it is not how, but what we use as money matters when searching for the root cause of Climate Change and other Global Problems?  These nine volumes are a thought provoking exploration of modern financial and political systems and their effects on both people and the land.

WWWUAMM BannerPick up your copy today and stay fresh!

 

ebooks, Economics, Empire, Freedom, Jesus, Monetary Theory, Peaceful Resistance, True Capitalism

Why What We Use as Money Matters, Our Economic and Philosophical Treatise, is Now Available

Our long awaited Treatise on Economy and Philosophy, Why What We Use as Money Matters, is now available in various digital formats at Smashwords.com and on Kindle at Amazon.com.  With any luck, we will have a print version available before we leave for the Southern Hemisphere.

Why What We Use as Money MattersWhat kind of book is this?  It is largely up to the reader to decide.  For us, it is the fruit of two years of wrestling with some of life’s deeper questions with regards to Economics, Politics, and Philosophy.  It has answered many of them and, in turn, has raised other issues, for in our exploration, as you will see, the current state of affairs is laid bare for all to examine, and our recommended courses of action may be unpalatable for many.

Nevertheless, there it is, altogether thick and challenging, yet refreshingly simple, the key to reversing the effects of climate change.Why What We Use as Money Matters

In a sense, it culminates the first phase of what we set out to do here at The Mint.  There will be more to come, but for the time being, we leave you to ponder the following brief excerpt:

“The natural world strives daily to achieve a perfect state of balance. Events and occurrences that, taken by themselves, appear chaotic and devoid of meaning are together part of a constant rebalancing of the earth’s delicate state. Each event is a splash of color across an oppressive gray sky that hints at a rainbow that will soon appear. “

 

Anarchy: Athiesm with Regards to Government, Empire, True Capitalism

The Primary Reason for the Superiority of Anarchy as a System

Dissent is information: Anarchy ensures system resilience
Dissent is information: Anarchy ensures system resilience

Here at The Mint, we have learned to embrace the anarchy in which we live as an ultimate given.  Anarchy is the primary state of being for all humans, whether we recognize it or not.  The sooner one realizes that they live in a state of Anarchy, the better able they will be to operate within it.

We also recognize that centralized control, when exercised without consent, is bad.  Fortunately, anarchic systems have a way of dealing with centralized control by forcing the disbandment of any form of control that is not obtained by assent.  Not by assent of the majority, as democratic thought would have us believe, but assent by each individual.  As such, if one is involuntarily subject to a form of centralized control, there is an easy escape for those who are not physically detained.  The escape hatch is in the mind, as all centralized control mechanisms can be escaped by changing one’s mind about the power it wields over them.

As both anarchy and its antithesis, centralized control, coexist to some extent all around us in various forms of ultimately voluntary capitalist and socialist systems which are constantly interacting with each other,  it is often difficult, if not impossible, to understand why Anarchy is superior to centralized control.

We recently came across a post on Zerohedge.com, Why Centralization Leads to Collapse, which articulates what we believe to be the primary reason the for the superiority of Anarchy:

Dissent is information

The author of the post, in a concise, well written fashion, recognizes that centralized control, which is an natural outgrowth of the desire for efficiency, leads to the rejection and ultimate termination of viewpoints that do not agree with the ideology or methods of the central authority.  Dissent is ignored, hindered, or terminated.

However, is terminating dissent, the centralized authority has removed perhaps the most important means by which a system can transmit information from the margins.

This information is important as well as the activities that dissenters carry out, for the diverse and seemingly contrary activities serve to make the entire system in which people live “anti-fragile.”  This means, for practical purposes, that an anarchic system is better prepared to deal with changes in data and the natural environment because it is constantly dealing with it by default, while a centralized system labors under the delusion that’s contingency plans are adequate to stave off any event that would threaten the supposedly superior system.

The rejection of dissent, then, ensures the collapse of the centralized system, while the toleration of the Anarchic system ensures its resilience.  It may be said that the chief virtue of Anarchy, then, is that it prevents centralized control by definition.

God recognized this and intervened famously on the Tower of Babel to ensure the earth which had rejected Him would remain resilient.  Mankind is dangerously close to constructing any number of similar towers today.

Will we recognize the error in time?

ebooks, Economics, The Mint, True Capitalism

Natural Law and the Theory of Economic System Fluidity now available!

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4/26/2013 Portland, Oregon – Pop in your mints…

Natural Law and the Theory of Economic System Fluidity
Natural Law and the Theory of Economic System Fluidity

We are pleased to announce the release of our latest eBook offering, Natural Law and the Theory of Economic System Fluidity.

Natural Law and the Theory of Economic System Fluidity provides the theoretical basis for allowing the strengths of each economic system to peacefully work together to achieve this end and examines both the natural laws which govern economics as well as the moral basis for the existence of the nation state.

It is volume VI of the Why what we use as Money Matters series, and perhaps the most important, for it forms the philosophical core of our thesis.

We are pleased to offer it in PDF format for free here to our fellow taxpayers at The Mint, just click on the following link:

Mint Edition 04252013 – Natural Law and Economic System Fluidity

Additionally, it can be had for a mere $0.99 over at Amazon’s Kindle store and for free in a myriad of other eBook formats over and at Smashwords.com for the next month.  Be sure to use coupon code: WF75E at checkout to receive the discount.  The offer is good until May 25th, 2013.

Thanks again for reading and all the best!

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for April 26, 2013

Copper Price per Lb: $3.17
Oil Price per Barrel:  $93.00
Corn Price per Bushel:  $6.44
10 Yr US Treasury Bond:  1.66%
Mt Gox Bitcoin price in US:  $138.55
FED Target Rate:  0.13%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,462 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:  14,713
M1 Monetary Base:  $2,470,700,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base:  $10,667,300,000,000

ebooks, Economics, Freedom, The Mint, True Capitalism

Marx and Rand together in perfect harmony set for release!

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4/25/2013 Portland, Oregon – Pop in your mints…

As the financial world continues to turn in an ever inflated manner, we have been diligently working to complete the latest volume of the Why what we use as Money Matters series before the joyous distractions of summer in the Northwest call us away.

The following is an excerpt of Volume VI in the series, entitled Natural Law and the Theory of Economic System Fluidity, is perhaps the most important volume because it forms the ideological core of our economic treatise.

Enjoy and stay fresh!

Marx and Rand together in perfect harmony

It is increasingly important that mankind take adequate time to pause and reflect as to what ideology is being tacitly or actively pursued as a guide for his daily toils.  As the collective efforts of mankind reach an effectiveness that was unimaginable a generation ago, the throws of human action are having a profound impact not only on an increasingly interconnected global economy, but on the very earth which mankind has been entrusted with.

Natural Law and the Theory of Economic System Fluidity
Natural Law and the Theory of Economic System Fluidity

It is no longer a safe assumption that the natural world can perpetually work to correct the mistakes in favor of mankind.  A deep examination of our motives in light of the Golden Rule is desperately needed to ensure a prosperous future for many.  The key to material prosperity is allowing mankind to tacitly coordinate his varied productive efforts by promoting the ideals of true capitalism in large scale dealings, for it is the ideology which best allows mankind to respond to the incessant demands of natural law. Continue reading Marx and Rand together in perfect harmony set for release! →

ebooks, Economics, The Mint, True Capitalism

A Tale of Two Responses to Anarchy

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4/22/2013 Portland, Oregon – Pop in your mints…

The world keeps turning and has become quite unpredictable.  Check that, it has always been unpredictable, the realization of one’s inability to predict what will happen comes with age.

On one hand, money supply measures around the globe are going through the roof, as is indebtedness.  On the other had, the underlying economy, which had barely picked itself off of the canvas, appears to be up again, ready to be pile driven once again.  What is one to make of it?

The Bitcoin is once again racing ahead in USD terms, while Gold and Silver peel themselves off of the pavement after encountering a steamroller in their path (as an aside, it will be interesting just how much $1,350 gold and $23.50 silver can be delivered, our guess is, not much.)

Karl Marx
Will Karl Marx dance with Rand?

Our upcoming eBook, Natural Law and Economic System Fluidity – Marx and Rand together in perfect harmony, wrestles with unexplained economic phenomena such as the seeming impossibly of Capitalism and Socialism coexisting in harmony with one another, which are rapidly becoming important.

The following is a brief excerpt of our latest offering, scheduled to release late this month.  Enjoy!

A Tale of Two Responses to Anarchy

In the current economic debate that rages between the productive virtues of what is referred to as Capitalism and the humanistic virtues of the Socialist ideal, it has become fashionable to assume that the virtues of one system, were its guiding principles put into action at once by all of the members of society, would eventually bring about the virtues promised by the other system in a peaceful manner.

This narrow, apologetic view taken by Capitalists and Socialists alike ignores the fact that the systems are wholly incompatible.  It also ignores the fact that mankind is in a constant struggle to bring order to surroundings that are inherently anarchic in nature.  The only laws that must be adhered to are natural laws, which are explored in section II of this volume.

For purists on either side of the ideological fence, compromise on any point is a slippery slope, and in the sense that the two systems are wholly incompatible, the view is technically correct.  However, most economists miss the fact that it is perfectly normal and beneficial for each system to operate side by side.  In fact, it is the only way in which mankind can reap the benefits of both systems at once.

All humans live and operate in both systems to some extent.  The Capitalistic system is best equipped to organize resources on a grand scale and provide material goods for the greatest number of people, the Socialist system is the system that offers refuge from the rigid and unrelenting demands of the Capitalistic system’s incessant response to anarchy and the demands of natural law.

This refuge is commonly referred to as the family, and it can be observed operating the world over in all shapes and sizes.

The inescapable fact that Capitalism and Socialism are at once incompatible and completely reliant upon one another is the basis for the Theory of Economic System Fluidity.

More to come as we hack and slash our way through the draft.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for April 22, 2013

Copper Price per Lb: $3.14
Oil Price per Barrel:  $89.36
Corn Price per Bushel:  $6.46
10 Yr US Treasury Bond:  1.70%
Mt Gox Bitcoin price in US:  $126.75
FED Target Rate:  0.15%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,424 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:  14,567
M1 Monetary Base:  $2,437,900,000,000 LOTS OF DOUGH ON THE STREET!
M2 Monetary Base:  $10,645,600,000,000

Climate Change, Economics, Empire, Freedom, Gold, Monetary Theory, Silver, The Mint, True Capitalism

Free Banking – The Ultimate Solution

11/2/2012 Portland, Oregon – Pop in your mints…

In our recent open letter to Evo Morales, we brought up three principles which must operate together in a society for the greatest amount of material good to come to the greatest possible amount of people.  While most assume that the principles, Liberty, Private Property, and Equality before the law, can only operate via the apparatus of government, we argue that the exact opposite is the case.  By necessity, the operations of government, an ultimate sovereign, would necessarily hinder the operation of these essential principles.

The reasoning is this:  These principles are so important that they must be learned and respected by every member of society.  At the same time, they are so basic to human nature that they are most effectively learned by simply living amongst one’s fellow human beings.  As such, the more a person is exposed to the anarchic environment in which we all ultimately live, the more quickly they will master these essentials.

Free Banking - The key to Liberty
Free Banking – The key to Liberty

The apparatus of Government can only retard the most effective teacher:  Hands on experience.

The recognition of the vacuum of power called Anarchy, which all systems great and small operate under, is extremely important when trying to understand the world as we know it.  However, it is not the focus of today’s Mint.

Today’s Mint is focused on Free banking.  Within our three great principles, Free banking generally fits under the principle of Liberty.  However, as banking and currency circulation, circa 2012 is perhaps the least free area of enterprise, it deserves special consideration as we examine what true freedom consists of.

Important as it is, the concept of Free banking may seem foreign to you, fellow taxpayer, as it is to nearly every other person, great and small, on our beloved earth.

However, the concept of Free Banking is perhaps the most important thing that men today can dedicate themselves to, for it is the lack of Freedom when it comes to currency and credit which has lead to stripping of the earth’s resources and the resulting environmental problems which a number of developing nations suffer from in a disproportionate manner.

Specifically, the suppression of Free Banking has caused the activities of man to create what is an unsustainable imbalance with the demands of the earth’s natural systems.

So what is Free banking?  As the name may suggest to many in the developed world, it is not a lack of monthly charges on a bank account, rather, it is the freedom for banks to compete as issuers of credit and safe keepers of currency in any form.

The Free Lakota Bank - Free Banking in action
The Free Lakota Bank – Free Banking in action

The current slave banking system’s fatal flaw is that it is obligated to issue credit and accept deposits in currencies which are nothing more than debt issued by a Central Bank.  This constraint causes the currency created by the Central Bank to be the basis of all of man’s activities out of a necessity to pay a tax to the government in said currency.

To compound this fatal flaw, the issuing Central Banks actively manipulate the interest rates, which affect the price of the flawed currency and credit, making the value of both the credit and savings of everyone completely subject to the whims of the Central Bank.

If the currency which everyone was working for had been created legitimately by the labor of another man and its price, via the interest rate mechanism, allowed to respond to real supply and demand signals, a natural balance would be struck between credit and savings in society.  This balance would express itself as conservation and eventual increase of the earth’s resources.

However, the currency which everyone is working for is nothing more than a piece of data created by a computer and printed onto a piece of paper and, via the active suppression of the interest rate mechanism, is not allowed to be properly discounted.  As such, all of the labors of man are set towards destroying the earth, turning it into more pieces of paper, and depositing them into a bank in order to close out the credit account created by the computer.

We observed the zeal with which Evo Morales and other revolutionary leaders have implemented reforms by closing down a majority of the ministries of the government almost immediately upon gaining the power to do so.  It is a swift move in which they attempt to consolidate their power.  However, as one studies these cases, they will see that often there was one notable exception that was allowed to continue operating:  The Central Bank.

The Central Bank is often seen as a sacred cow, even by those who vehemently opposite it, on the grounds that the currency and interest rates are too important to day to day life to be to the incapable hands of the people, which is what the concept of Free banking is all about.

However, it is for this very reason, the indispensible role of currency and credit in society, that currency and interest rates CANNOT be left in the hands of any one entity, no matter how much clairvoyance is attributed to them.

No one would argue that grains and fuel are important to everyday life in nearly all the earth.  However, even hard core Marxists would be hard pressed to admit that all peoples would be better off were only one entity given the ability to produce and set the price for either.  As such, it has been proven over and over again that the expansion of the ability to produce such indispensible items not only provides them in sufficient quantities to satisfy demand, it will do so at a price that is more or less tolerable for all (this argument, of course, is null if the price is controlled by a single entity).

While free market proponents are quick to recognize the benefits of the freedom to produce grains, fuels, and healthcare, for example, they become hardcore Marxists when it comes to currency and credit.  What those who fall into this trap fail to realize is that all of the virtues of free markets are worthless if the most basic economic common denominators of currency and credit are not allowed to operate in as nature intended.

Free banking would allow free markets to solve all the problem of scarcity in currency and credit in the most efficient way possible.  Why, then, is Free banking seen as the ultimate boogeyman by those in authority?  It is for one reason and one reason only:

Control of currency and credit represents the ultimate authority in the material world.

While free market reforms can go a long way towards liberating the peoples of the world, the task and to close down the Central Bank and allow both the banks and the people to choose in what currency they will issue credit and maintain their savings.  Far from leading to anarchic chaos, the basic need for exchange and the issuance of credit amongst humans would cause all of society who wished to trade with one another to arrive at a tacit decision as to what is best suited to serve as currency.

While in most cases, this tacit decision has arrived on Gold and Silver, the British and American empires, the most recent examples of empire, grew so wealthy that lesser metals, such as copper, were thrust into use as currency.

As a practical matter, it must be admitted that closing down the Central Bank would be a shock.  For this reason, we look to solutions such as those seen in the actions of Canupa Gluha Mani, the Ithanchan of the Free Lakota Bank, as a path to free banking and the ultimate freedom of the peoples of the world.

The Lakota people declared their freedom from the sovereignty from the Government of the United States government in 2007.  As an important part of this process, they knew that it would be necessary to establish their own monetary system.  Further, they recognized that to simply choose another currency would again make them slaves to the creators of that currency.

To solve this problem, they opened the Free Lakota Bank and adopted what is known as the American Open Currency Standard, which is attempt to return to a balanced system of metallic weights and measures to use as currency which is recognized and traded internationally.

While this may seem now like an impossible step to take, the Peoples of the earth must enjoy free banking if they are to enjoy Liberty, Private Property, and Equality before the law in any meaningful way.  For the lack of options in currencies in favor of the Central Bank’s monopoly on the issue of credit will keep the Peoples of the earth and their governments in the bonds of financial slavery until the Freedom of Banking is restored.

Free banking, by its very nature, does not obligate a people to adopt a currency standard, as the native Lakota people have.  While the most likely outcome of the liberation of the currency and credit markets is for all involved to quickly settle on a new currency standard, it is necessary to guarantee that all Peoples the right to choose which currency they want to hold and to bank in.  This is the only way that man can live in harmony with one another and with the natural world.  This freedom is the spirit of the principle of Free Banking.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 2, 2012

Copper Price per Lb: $3.48
Oil Price per Barrel:  $84.86
Corn Price per Bushel:  $7.39
10 Yr US Treasury Bond:  1.73%
FED Target Rate:  0.17%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,677 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.9%
Inflation Rate (CPI):  0.6%
Dow Jones Industrial Average:  13,093
M1 Monetary Base:  $2,394,100,000,000
M2 Monetary Base:  $10,168,900,000,000

Economics, Jesus, Spain, Sports, The Mint, True Capitalism

Spain downs Portugal 4-2 on penalties, Euro 2012 prediction intact, Faith and Courage in the face of hegemony and collapse

6/27/2012 Portland, Oregon – Pop in your mints…

We are emotionally drained here after Spain’s victory over neighboring Portugal in the Euro 2012 semifinal which took place in the Ukraine.  From what we could tell, soveriegn credit quality was not mentioned nor did it have an impact on the match.  As such, the correlation between a country’s sovereign credit quality and Euro cup performance is still being tested.

Spain downs Portugal! Euro 2012 prediction intact

If Germany downs Italy tomorrow, the hypothesis will hold, at least as far as the semifinals are concerned.  We are predicting that Spain will disprove the hypothesis in the final and take the cup home.

Yet the Euro 2012, as are the Olympic games, which commence in just one tender month, are large scale distractions from the disease that ails the world and is threatening to rip it apart.  Yes, fellow taxpayer, the insane “debt is currency” monetary experiment of the past 40 to 100 years is beginning to disintegrate.

Someday the historians will write about our times and lament:  “They used debt as money, and corn as fuel,” or something to that effect.

While modern life is full of such contradictions, there are few with the potential to wreak such havok as the one where debt is forced into the role as money, which is akin to water being forced into service as oil.

But what is so bad about debt based currency?  Doesn’t the ability to create money at will buffer everyone from suffering another depression?

On the contrary, the fickle nature of electronically created debts masquerading as money is economic suicide.  This demands an explanation that we will not unduely withhold, for it about to burst out of us.

Capitalism is man’s only productive reaction to his Anarchic surroundings.  It is inevitable that man would choose an increasingly free and capitalistic society as he gains a deeper understanding of natural law and his rightly understood self interests.

The expansion of the capitalistic system relies upon the division of labor in which men (we include women as we use the term “men” to define all of mankind) increasingly abandon self reliance and begin to trust their fellow men to provide them with life’s essentials.

This process is good, for it inspires and encourages widespread effeciencies in all spheres as man’s natural tendency to economize is rewarded as his actions align with what we refer to as the demands of anarchy and the natural economic law of supply and demand.

While this process is good, it is dependant upon capitalistic principles to operate in all spheres without exception.  Any part of the system which succombs to hegemony (what we refer to as ‘Might makes right“) by one party causes all of those who mistakenly rely upon that part of the system to become vulnerable to its collapse.

The hegemonic parts of the system are prone to collapse because their existence is no longer owed to willing participation, but the use of force.

At the risk of oversimplifying a complicated issue, the more an organization encourages willing participation, the more it must adapt to the wants and needs of its clients.  The process of adaptation makes the organization extremely strong and stable.  It becomes a rock.

A hegemonic system, where organizations rely upon force to maintain thier positions, has already failed, for the organizations cease to adapt in a vain attempt to force others to adapt to them.  The organizations in turn become weak and prone to collapse.

The largest hegemonic system operating today is the world’s monetary system, and it is on the verge of collapse.  This debt based monetary system is especially dangerous because it has the effect of stimulating economic interdependence in much the same way that a healthy capitalistic system would while at the same time rendering useless or destroying the capital upon which a healthy capitalistic system relies upon to operate.

While the more perceptive members of society see it coming, the inevitable collapse causes the interdepence on which all rely to suddenly cease to operate.  The result is chaos and suffering for the unprepared.

While there are many ways to prepare for this, there is only one way to start.  It requires large amounts of humility, faith, and courage.

For now is the time to walk humbly with God and others.  It is time to step, on the right with faith, which is provided by God, and the left with courage, which comes from within.

Faith…courage…faith…courage…faith…courage as we work together to pick up the pieces of the failed experiment to build something new, something reliable, something that will last.

For walking humbly in faith and courage is to live in the Kingdom of God.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for June 27, 2012

Copper Price per Lb: $3.36
Oil Price per Barrel:  $80.42

Corn Price per Bushel:  $6.42
10 Yr US Treasury Bond:  1.62%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,585 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  8.2%
Inflation Rate (CPI):  -0.3%
Dow Jones Industrial Average:  12,627

M1 Monetary Base:  $2,192,300,000,000
M2 Monetary Base:  $9,933,900,000,000

Events, True Capitalism

Jamie Dimon makes a courtesy appearance before the home team

Today, Jamie Dimon, CEO of JPMorgan, made his courtesy appearance before the home team, the Senate Banking, Housing, and Urban Affairs Committee earlier today.

It was, for the most part, a constructive exercise.  Mr. Dimon had been called to explain something alarming, a $2 billion loss due to hedges gone awry in what is essentially the banks internal treasury operations.  Alarming as it may be, the losses fell entirely on the backs of JPMorgan’s shareholders.

It was a stark contrast to the lambasting that Jon Corzine, former bureaucrat and MF Global chief, recieved by committees from both the House and Senate after his firm “lost” $1.6 billion of client funds.  As JPMorgan was the counterparty to the transfer of a portion of those funds, it was only natural that a few questions with regards to the infamous event would find their way to Mr. Dimon today.

Generally, Mr. Dimon gave an impressive show in front of the home team crowd.  As the largest bank on the planet and a Treasury Primary Dealer, JPMorgan may be one of the largest direct and indirect purchasers of US Bond issues.  For the most part, the Senators were kind to their biggest customer.  You can see the entire testimony here.

Some observations from The Mint:

  • Mr. Dimon knows what he is doing.
  • There is a reason that JPM is the banker and/or key liquidity provider of many smaller banks and sovereign nations.
  • It was brought up that loans are the riskiest investments that a bank makes, and JPMorgan is no exception.
  • The term “hedging” is widely misunderstood.  Most take it to mean a trade made to eliminate risk, when in practice hedging has the effect of diversifying a portfolio of investments, often using leverage to do so.
  • Mr. Dimon’s brief response about the need for fewer regulations which are enforced rather that a myriad of regulators which lack expertise and authority was a brilliant appeal to common sense which mostly fell on deaf ears.
  • The US fiscal cliff will not wait until December 31, 2012 to produce derogatory effects for the economy.  Individuals and businesses will begin to take actions to protect themselves long before the deadline approaches.
  • One of the Senators observed that the US Treasury ran a loss of $4 billion per day, twice the amount that Mr. Dimon’s firm had lost on its renegade trades.
  • Most of the Senators, while well intentioned, are absolutely clueless about the inner workings of a modern banking entity.  Which begs the question, what qualifies them to regulate one?
  • JPMorgan is not to big to fail, rather, it is too big to save were it to fail.
  • One cannot apply the hedging and investment strategies of the world’s largest bank to the entire banking industry.
  • JPMorgan is in a league of its own, and thus is required to take risks on the scale that is difficult to fathom.
  • Mr. Dimon places little faith in financial models, which at best are a reflection of the immediate past and generally useless for future decision making.
  • New regulation costs as a result of the legislation inspired by the financial crisis for JPMorgan were estimated to be upwards of $1 billion.
  • It is not below the Senate to play the “US Taxpayer is on the hook” card when speaking with a banker, incorrectly implying that the US Taxpayer somehow thought that TARP and everything after was necessary and stands ready to take similar actions should another large bank get into trouble.

Much of the testimony was peppered with the common theme from the Senators which can be summed up in the phrase “how should we regulate you?”

While Mr. Dimon took the opportunity to point out that the so called Volcker rule was a bad idea, which is what has dominated headlines about today’s hearing, He did point out that JPMorgan’s survival was not dependant upon TARP and other bailouts, as has been suggested.

The message?  Don’t regulate us and don’t save us.

In the end, isn’t that what true capitalism is all about?

 

Anarchy: Athiesm with Regards to Government, Economics, Freedom, Spain, The Mint, True Capitalism

Spain, Inc., the latest proof of Anarchy in action, an Impromptu Manifesto

6/11/2012 Portland, Oregon – Pop in your mints…

When we attended graduate school in Spain, we were the first North American student in our course.  It was late 2003 and the Eurozone was full of optimism.  This optimism lead some of the professors to use a portion of their class time taunt the US model as failed and the European model as the obvious way forward.

As proof of European supremacy, our Finance professor often made a point of mentioning to us that the yields on the Spanish 10yr bond were almost the equivalent to the yields on the US 10yr bond.

What a difference nine years and 500 basis points make.

Circa 2012, Spain dominates the financial headlines as the latest casualty of the European debt crisis.  Apparently Spain now is in need of a bailout.  The bailout strategy which will be employed by Spain, Inc. is a hybrid of the prior bailouts accepted by their counterparts, Greece, Inc. and Ireland, Inc.

Greece, Inc. required a bailout because its government was broke.  Ireland, Inc. was slightly more ingenious in that it made a good faith effort to backstop its banks, only to find that it was now the entity which required a backstop.  Spain, Inc, theoretically learning from both experiences, forced its banks to accept the backstop directly so that the Spanish government could save face and be spared the humiliation of the Irish scenario.

Unfortunately, the markets have seen through the charade and are now putting pressure on all bonds, bank or sovereign, which hail from the Iberian Peninsula.

What a difference nine years and 500 basis points make!

Spain’s strategy has failed before it was even implemented for lack of collateral and credibility, both of which are in desperately short supply amongst the EU leadership.

How did once proud Europe end up in this situation?  They decided to force a debt based currency integration by integrating only the currency part of the equation and leaving the debt and fiscal matters to chance.

As if choosing to use a debt based currency weren’t bad enough, choosing only to implement the currency is like handing the nations foolish enough to engage in such a gamble the revolver in a game of Russian roulette where the revolver is fully loaded.

Now, the revolver is being passed and it is Spain’s turn.  Once Spain slumps to the floor, it is Italy’s turn, the Belgium, France, etc. until the European Currency Union, doomed from its outset, breathes its last.

At some point in the process, possibly as Spain pulls the trigger, USA, Inc. will be forced to step in with the “ultimate” backstop, the final hope of the failed, insane “debt is money” currency regime.  As the US throws its sovereign credit rating in front of the runaway freight train of Europe’s soveriegns, it will quickly find itself in the very situation that it is trying to save the European Sovereigns from.

For in this debt crisis, the unwritten rule of quality holds.  When one adds wine to sewage, one gets sewage.  When one adds sewage to wine, one gets sewage.  The sovereign vats have long since been polluted.  It might make sense to check one’s portfolio and remove as much sewage as possible.

Beyond that, we will present two unsolicited yet practical bits of advice.  First, US Bonds will ultimately slide as USA, Inc. wades across the pond to aid Europe.  The Euro currency will rally as the run on European banks by the citizens and the wholesale dumping of any bond denominated in the currency begins.  Quite simply, demand for the Euro will exceed supply in the short term.

Plan accordingly.

We submit to you that the Spain, Inc. debacle is further evidence of one of The Mint’s central themes, that Anarchy is man’s reality, it is an ultimate given, it simply is, and all understanding of the current political and social structures is greatly facilitated by one’s acceptance of this fact.

In fact, one’s ability to act and react to the unfolding changes in the current political and social structures depends upon accepting and embracing Anarchy as the basis for reality and learning to operate in the Truly Capitalistic system which organically emerges as men learn anew that mutual trust and cooperation are in their rightly understood self interests, and that he who is to lead must truly become the servant of all.

To truly embrace this fact, we must understand the nature of mankind.  Man, left to his own devices, is completely devoid of the ability to do the right thing.  He doesn’t have it in him.  He is lazy, self-serving, and completely evil.  He needs God and his fellow man to be able to do anything productive, altruistic, or what may be considered remotely good.  A full defense of this statement is a subject for another day (although the evidence is all around us), we mention it here only to underscore the necessity of a framework which presupposes this fact within which mankind can use this weakness to avoid both self and mutual destruction.

The only reliable framework which has emerged out of natural Anarchy which not only addresses the problem of human nature, but also turn man’s weaknesses into strengths is what we call True Capitalism.  Ironically, by allowing market forces to work with as little hindrance as possible, mankind can insulate itself from descending into chaos and catastrophe.

In fact, to fight the workings of True Capitalism is, by default, to submit oneself to chaos and misery.  Yet every nation on the planet is devoted to some degree in the fight against True capitalism.  Why?  Because the nation state sells itself as the most perfect expression of man’s good intentions, which we presuppose do not exist.  In other words, the dream of the nation state is built on a false pretense that is usually attributed to socialism: That man is inherently good and wants to do good to others.

Given their presuppositions, is it clear that the nation state and a truly capitalistic society are, in fact, the antithesis of one another.  Where a nation state regulates by edict,  truly capitalistic society regulates by example.  Where a nation state is rigid, where  truly capitalistic society is pliable.  Hence, where  truly capitalistic society will bend but not break, the nation state is repeatedly smashed to pieces when faced with change.

For the more a nation state tries to force men to do good, the more mankind’s character flaws will overtake these good intentions until the nation state becomes an expression of mankind’s evil nature.

The truly capitalistic society allows each mans evil nature to be corrected by allowing him to experience the consequences of his inherently poor behavior, paradoxically and naturally improving the behavior and norms of all.

Moving to a less philosophical level, how can we be sure that Anarchy is the basis of man’s current existence?  The evidence can be found in that the institutions which supposedly offer the best option to Anarchy, the nation states if the world, are beginning to succumb to the punishments they have built up in their losing fight against natural law.

Greece, Ireland, Portugal, Italy, and now Spain, Inc. are now succumbing to the inevitable.  The member of club med which turns from the failure of the Euro currency to go it alone and embrace the much feared “Anarchy,” as it were, paradoxically stands to be richly rewarded by the flocks of tourists who can suddenly afford a European vacation without the Euro.

We conclude with a brief manifesto for your perusal and enjoyment.  What does the future hold?

Out of Anarchy, a Truly Capitalistic System will ORGANICALLY emerge, and with it a new dawn for humanity, built on mutual interest and almost endless capital formation which will engender a spontaneous and dynamic social order, a society without borders that would enjoy freedom and prosperity that we cannot even imagine under current conditions.

Believe.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for June 11, 2012

Copper Price per Lb: $3.35
Oil Price per Barrel:  $81.49

Corn Price per Bushel:  $5.92
10 Yr US Treasury Bond:  1.60%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,596 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  8.2%
Inflation Rate (CPI):  0.0%
Dow Jones Industrial Average:  12,411

M1 Monetary Base:  $2,306,000,000,000
M2 Monetary Base:  $9,790,100,000,000

Economics, Freedom, Politics, True Capitalism

You Might be a Socialist if…

3/5/2012 Portland, Oregon – Pop in your mints…

Nearly 20 years ago, Jeff Foxworthy topped the comedy charts when he released his now famous album “You Might be a Redneck if…”  While we have no illusions that today’s musings will attain the fame that Mr. Foxworthy’s have, today’s Mint is an entirely accidental homage to Mr. Foxworthy in which we present a series of one-liners which we hope will provide an invaluable service to the American public.

Namely, we aim to provide the public with comical assistance in helping one properly identify whether or not they are a Socialist.  It is a handy, self convicting exercise which is meant to help all of us to identify and perhaps deal with our latent Socialist tendencies.

In other words, you may laugh heartily, knowing that the laughter, like the accumulated loss of capital in a Socialist society, is at the expense of the proletariat.  Enjoy:

You might be a Socialist if… (with apologies to Mr. Foxworthy):

You default to the government when asked who should solve a social problem

You get a measure of self righteous gratification when passing through a body scanner

You believe in economic equality

You have attempted to define economic equality

You make special exceptions for yourself when defining your concept of economic equality

You still believe in economic equality after attempting to define it

You are a member of a labor union

You wish you were a member of a labor union

You wish you were an unemployed member of a labor union

You believe that tariffs save jobs

You believe that limitations on immigration save jobs

You believe that taxes create jobs

You believe that regulations create jobs

You vote for tax increases

You vote for a representative government which asserts authority over those who are not permitted to vote

You are entirely comfortable living in a world where the “end justifies the means”

You regularly give unsolicited advice to strangers

You get angry when such advice is ignored

You use a central bank issued currency as a savings instrument

You have attempted to describe the economic benefit of homogenized interest rates

You prefer a higher national GDP to a higher personal income

You believe that certain projects are so big that only the government is qualified to do them

You can say “government efficiency” with a straight face

You have ever defended TARP on the grounds that a nebulous “greater disaster” was averted

You’ve referred to “Cash for Clunkers” as good for the environment

You’ve referred to “Cash for Clunkers” as good for the economy

You’ve referred to war as good for the economy

You’ve referred to a natural disaster as good for the economy

You believe that there is a universally fair price for certain goods or services

You believe that said universally fair price should be a dictated by the government

You would feel guilty paying less than said universally fair price

You think you are saving money because an expense is tax deductible

You have uttered the words “necessary evil” as an explanation for a moral contradiction

You have uttered the words “the lesser of two evils” to explain an unpopular decision

You use the words “quality” and “equality” interchangeably

And finally, the last one we can think of for today, which, as you can see, if far from qualifying as a punch line:

Your list of inalienable rights extends beyond or excludes life, liberty, and property

If you have said “that’s me” to one or more of the above, you might be a socialist.  If you find that you truly are a Socialist, take comfort in the fact that you form part of a large and vocal majority.  The most logical response, if this is the case, is to fully embrace one’s socialist identity and to leave behind the inherent contradictions of calling oneself a “liberal” or “conservative.”

There is absolutely no shame in identifying as a Socialist.  As Polonius urged his son so we urge you, fellow taxpayer, “To thine own self be true.”

However, if it disturbs you to have identified with any of the above statements, please continue to peruse The Mint, as all of us can aspire towards embracing True Capitalism, and move towards creating a future full of the blessings of real freedom for our children.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

 

Key Indicators for March 5, 2012

Copper Price per Lb: $3.84

Oil Price per Barrel:  $106.97

Corn Price per Bushel:  $6.66

10 Yr US Treasury Bond:  2.01%

FED Target Rate:  0.11%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,705

MINT Perceived Target Rate*:  1.00% AWAY WE GO!

Unemployment Rate:  8.3%

Inflation Rate (CPI):  0.2%

Dow Jones Industrial Average: 12,964

M1 Monetary Base:  $2,199,000,000,000

M2 Monetary Base:  $9,759,800,000,000

Economics, Politics, The Mint, True Capitalism

The benefits of Decentralized power, Rumblings of QE3, the clock is ticking on the currency regime

12/12/2011 Portland, Oregon – Pop in your mints…
There is something strangely satisfying about sitting around a large indoor fire just feet away from the Christmas tree with family.  In those moments, one can partake of all that is right with the world.  It occurred to us that we all strive for these moments yet at times they can seem elusive.  Eternity is placed in our hearts, and time on earth seems to be in short supply.
As such, we must use it wisely.
We have been extolling the benefits of what we have been calling True Capitalism.  True Capitalism is what we here at The Mint humbly offer as the solution to what currently ails the world.  There is one byproduct of True Capitalism, a radical respect of life and property, which is often overlooked and is perhaps “central” to the advantage that it has over every other conceivable construct of society:
True Capitalism works to decentralize power.
In other words, it naturally evens the playing field by removing unfair advantages realized by some at the expense of others.
But isn’t that what Government is supposed to do?  Of course it is!  However, governments circa 2011 are in the middle of an unprecedented power grab.  This centralization of power, they say, is necessary in order to homogenize life as we know it and to help everything run smoothly.
Even if this were possible, there is a fundamental problem created by the centralization of power which is without resolution.  In layman’s terms, it makes for an easy target.
When we see the word target, your mind may conjure up images of vulnerability of a military attack.  However, what we have in mind is much more dangerous.  An army of lobbyists.
Herein lies the weakness of centralized power.  However good its intentions, it will constantly be under attack and subsequent influence of groups who desire this centralized power for their own benefit.  Repelling these attacks is expensive.  Succumbing to them, as is more often the case, will bankrupt a nation.
Governing is not cheap, and there are no economies of scale in it.  Rather, the larger it is, the less efficient it becomes.  Does this sound familiar?  This is what we have now thanks to the Might Makes Right ideology by which we are ruled.
Enter True Capitalism.
In a Truly Capitalistic system, the cost of the nation state drops to zero, for the nation state as we know it would cease to exist.  Does this mean that there will be not be a need for governance?  No, on the contrary, the roles which we now attribute to government will be carried out by any number of organizations.  Governance, in general, would increase, yet it would cost less!
How is this possible?  Voluntary governmental bodies are generally more responsive and efficient, in large part because the cost of governance falls directly to those individuals who desire to pay for it.
Governance has value, and its value can and is be properly set on an open market.  The phenomenon of corporations and persons choosing to reside in low tax venues represents a conscious choice of where and by whom one prefers to be governed by those individuals.
In the west, the value of the brand of government provided in the US and Europe is dropping along with its bond prices.  The fact that nations issue bonds is proof of two things:  That their service oriented businesses are failing and that they will be increasingly reliant upon their ability to forcefully relieve their citizens of their assets (commonly known as taxation) to continue operations.
In other words, they will rely on their Might, the use of force, to justify their “right” to govern.
This untenable “Might Makes Right” system that can only operate as long as people believe that the aggressor has absolute power over them.  This is why countries have flags and dictatorships have the image of the dictator plastered everywhere.  This is why people are being forced into the current banking system, taught to rely upon it, and subsequently shut out of it.
This is a reason why Modern Central Banking and the Corporations that have sprung up around the Central Banks are man’s greatest disaster.
Once the currency and banking systems of Europe and America are completely broken down, people’s blind faith in the currency and its issuer will be destroyed.  The currency regime will then quickly disintegrate
The Federal Reserve will likely allude to QE3 to the tune of $1 trillion dollars today in a desperate attempt to keep the currency regime afloat.
The clock is ticking on these failed monetary experiments.
Do you know where your money is?
Stay tuned and Trust Jesus.
Stay Fresh!

Key Indicators for December 12, 2011
Gold Price Per Ounce:  $1,665 PERMANENT UNCERTAINTY

M1 Monetary Base:  $2,255,500,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,623,700,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Book Reviews, Jesus, True Capitalism

How can men live together in organized society?

We have been reading The Source, by James A. Michener.  Like many of Michener’s works, it is a fictional account which is loaded with facts, history, and at times profound insight.

The following is one of the latter.

It is revealed as one of the characters in the book is attempting to resolve a conflict that is troubling him.  It has to do with a knotted old olive tree and the fresh shoots that continue to grow from it, even though the tree itself appears dead.

He realizes that the olive tree represents Judaism, and the fresh shoots the ways in which it has reinvented itself over more than five millenia.

The character, a Christian Archeologist, is running his thoughts by his Jewish colleague.  The following excerpt from Michener’s narrative is the colleague’s response:

“My thought is that in those critical years (100 – 800 CE) Judaism went back to the basic religious precepts by which men can live together in a society, whereas Christianity rushed forward to a magnificent personal religion which never in ten thousand years will teach men how to live together.  You Christians will have beauty, passionate intercourse with God, magnificent buildings, frenzied worship, and exaltation of the spirit.  But you will never have that close organization of society, family life, and the little community that is possible under Judaism.  Let me ask you this:  Could a group of rabbis, founding their decisions on Torah and Talmud, possibly come up with an invention like the Inquisition, an essentially anti-social concept?”

The Jewish colleague continues:

“…Judaism can be understood, it seems to me, only if it is seen as the fundamental philosophy directed to the greatest of all problems: how can men live together in an organized society?”

The Christian Archeologist responds:

“I would have thought that the real religious problem is always ‘How can man come to know God?'”

To which the Jewish colleague replies:

“There’s the difference between us.  There’s the difference between Old Testament and New.  The Christian discovers the spirit of God, and the reality is so blinding that you go right out, build a cathedral and kill a million people.  The Jew avoids this intimacy and lives year after year in his ghetto, in a grubby little synagogue, working out the principles whereby men can live together.”

“The tremendously personal religion that evolved around the figure of Christ was all the He and Paul had envisaged.  It was brilliant, penetrating and a path to personal salvation.  It was able to construct soaring cathedrals and even more vaulted processes of thought.  Bit it was totally incapable of teaching men to live together.”

It has always troubled us that such a sharp distinction exists between Judaism and Christianity (and for that matter, Islam).  As a Christian, it is obvious to us that Christ came to show that once and for all, the God of the Old Testament, the one and only God, forgives.

History has shown that the blind pursuit of Christianity, Islam, of any other religion which is not firmly based in the precepts of how men can and must live together, bearing with one another, as the Jewish faith relentlessly strives to do, can lead to disastrous results for society.

It is fascinating that the Jews, for all that they have suffered, still strive towards helping all of mankind learn to live together.

It is even more fascinating that, with a few noteworthy exceptions, the Jews have been largely unable to form the society for which their religion continuously strives.

The problem of living together in society can only be solved if two things occur.  First, man must learn to truly and permanently forgive, as God has forgiven us.  Second, he must abandon the Might makes Right ideology and adopt True Capitalism, a radical respect for both the life and property of others, as the basis of his relations with others.

It would not be perfect, but it would be a large step in the right direction.

Believe.

Economics, The Mint, True Capitalism

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part II

11/23/2011 Portland, Oregon – Pop in your mints…

If you were not able to join us yesterday for Part I, please take a brief moment to review it by clicking here:

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part I

We will pick up where we left off…

The acts which are required to carry out an economic system doomed to failure inevitably insures that those who lead would be the worst amongst us in terms of adhering to any sort of moral code, for they have chosen to pursue the economic or political program above the obligations of morality, no matter what the cost.  They possess the ability to mute their conscience and oversee acts that are increasingly despicable and outrageous in pursuit of the aims of the program.

Hayek goes on to argue that as the Totalitarian economic and social program inevitably begins to fail, the leader of said system would increasingly deem it necessary to employ a larger number of individuals to enforce the increasing sacrifices required to continue the program.  He offers three reasons why this inevitable outcome further assures that the leader surrounds himself with and encourages the promotion of those who are capable of the worst forms of moral corruption:

“First, the higher the education and intelligence of individuals become, the more their tastes and views are differentiated. If we wish to find a high degree of uniformity in outlook, we have to descend to the regions of your moral and intellectual standards where the more primitive instincts prevail. This does not mean that the majority of people have low moral standards; it merely means that the largest group of people whose values are very similar are the people with low standards.

Second, since this group is not large enough to give sufficient weight to the leader’s endeavors, he will have to increase their numbers by converting more to the same simple creed. He must gain the support of the docile and gullible, who have no strong convictions of their own but are ready to accept a ready-made system of values if it is only drummed into their ears sufficiently loudly and frequently. It will be those whose vague and imperfectly formed ideas are easily swayed and whose passions and emotions are readily aroused who will thus swell the ranks of the totalitarian party.

Third, to weld together a closely coherent body of supporters, the leader must appeal to a common human weakness. It seems to be easier for people to agree on a negative program — on the hatred of an enemy, on the envy of those better off – than on any positive task. The contrast between the “we” and the “they” is consequently always employed by those who seek the allegiance of huge masses. The enemy may be internal, like the “Jew” in Germany or the “kulak” in Russia, or he may be external. In any case, this technique has the great advantage of leaving the leader greater freedom of action than would almost any positive program.

Advancement within a totalitarian group or party depends largely on a willingness to do immoral things.”

The Might Makes Right ideology, then, far from being a viable alternative to True Capitalism, assures a slow march towards a society which openly ignores the rule of law and, as a consequence, quickly becomes devoid of morality.

Can you now see why the ideological battle between True Capitalism and Might Makes Right is much more than a simple choice of economic systems, rather, it determines the moral basis upon which a majority of the society’s members will act.

 

Jon Corzine - A shining example of leadership in the Might Makes Right system

Unfortunately, we have a shining example of the phenomenon of the worst rising to the top in Jon Corzine, former governor of New Jersey and CEO of the now infamous investment bank, MF Global.  Mr. Corzine is a career investment banker and politician.  In other words, he has been firmly indoctrinated and skillfully trained in two of the most destructive trades known to mankind.

Mr. Corzine allegedly saw nothing wrong with raiding the cash accounts of MF Global’s clients in a vain attempt to stave off the firm’s bankruptcy which was declared on October 31, 2011.  There is no way to sugar coat what happened in the days leading up to MF Global’s demise.  MF Global allegedly robbed its clients’ accounts to meet its own obligations.  The fact that the commodity exchanges have been allowed to operate without immediately making the defrauded clients whole has caused an unprecedented breach of the trust which underpins the smooth operation of these exchanges.

Perhaps Mr. Corzine thought he was still a politician.  In Government, it has become a common and acceptable practice to rob a legally established trust fund and replace it with the government’s IOUs.

Mr. Corzine is but the most recent example of the level of hubris and moral corruption required to occupy a high level post in the government and financial sectors circa 2011.

The MF Global bankruptcy and subsequent actions taken by the regulators have called into question whether or not the rule of law will prove supreme in such a situation.  As a society increasingly leans towards a Might Makes Right ideology, the excuses for ignoring the rule of law proliferate.  Hayek observed the inextricable link between the rule of law and Freedom when he wrote the following:

“NOTHING distinguishes more clearly a free country from a country under arbitrary government than the observance in the former of the great principles known as the Rule of Law. Stripped of technicalities, this means that government in all its actions is bound by rules fixed and announced beforehand.”

The most famous modern excuses for ignoring the rule of law during the war on terror and the financial crises are: “These actions are taken in order to protect the American people,” and “These actions have been taken to ensure the stability of the Financial System.”

Fellow taxpayer, do you personally feel safer than 10 years ago?  Do you believe that the financial system is more stable than five years ago?

These are important questions, for the answer may reveal which side of the ideological battle one identifies with.  True Capitalism or Might Makes Right, for there is no ideological middle ground.

The governments of the world are busy tirelessly advancing a failed program.  It should come as no surprise, then, that nearly every action that the governments have taken to fight the war on terror and the financial crisis only seem to have made the original problem worse.

It is clear that as long as the Might Makes Right ideology is embraced by institutions and governments, those who are best able to ignore basic morality and the rule of law are most likely to populate their halls of power.

It should come as no surprise, then, that man’s only hope for justice is to reject Might Makes Right and embrace True Capitalism.  Only then will lasting peace and prosperity be attainable.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 23, 2011

Copper Price per Lb: $3.34
Oil Price per Barrel:  $98.01

Corn Price per Bushel:  $5.98
10 Yr US Treasury Bond:  1.95%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,700 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  -0.1%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,121,700,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,644,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, Gold, Politics, Silver, The Mint, True Capitalism

Why the morally corrupt are assured of promotion in and leadership of the Might Makes Right ideological system – Part I

11/22/2011 Portland, Oregon – Pop in your mints…

After a brief break in our faithful correspondence, we are compelled to pick up the proverbial pen to complete an incomplete thought in a vain attempt to eat Thanksgiving dinner in peace.  If you are a new reader of The Mint, we will simply relate that the Mint is the product of a deep felt agitation by its author.  It is what could be referred to as therapy.  The thoughts, once on paper, leave us in peace.  Until then, they stir, deep in our spirit, waiting to escape via these words.

How very fortunate and long suffering you are, fellow taxpayer.

Before we continue our mantra of Anarchy, True Capitalism, Natural Law, and Might Makes Right, we will share a few important observations.

First, the MF Global implosion is now reported to have left a $1.7 Billion hole in the capital base of a highly leveraged commodity and derivatives market.  MF Global was a primary dealer, one that had the unconditional trust of the exchange and other secondary commodity dealers.  It was a silent pillar of these markets.  The aftermath of their implosion, both in loss of capital and confidence, has only begun to unfold.  Commodity markets are no longer “safe” by normal standards.  This situation is best watched by your money at a distance.

Second, while Europe implodes, the US has been spending most of its time firming its position in Asia.  There has been speculation that the US is moving to aggressively devalue the dollar vis-à-vis the Yuan.  Will it be the 10:1 reverse split that we have speculated about here?  No one knows, but it would appear that the US Dollar will not serve as a reliable store of wealth in the short term.  Silver and Gold come to mind as viable substitutes as this drama plays out.

Occupiers take note of a Bolivian tactic of blocking major thoroughfares

Finally, It appears that the Occupy protesters are now wising up and using tactics which we call the Bolivian tactic, that of blocking major thoroughfares.  It is much more effective, not to mention exciting, than urban camping.  As a practical matter, if your livelihood in any way relies on a major thoroughfare being open in an area where the protests are growing, we suggest that short term contingency plans be considered.

These events and any pain they cause should be short term, maybe three to four months of adjustments, if they are allowed to simply run their course.  If the Government continues to intervene, they will plague us indefinitely.  We pray for the former and prepare for the later.

With that off our chest, we continue pondering life as we know it.  Our question today is:  Why does it seem that the worst morals seem to come out on top?  First, a glance at Isaiah:

“ And I will make boys their princes, and infants shall rule over them.  And the people will oppress one another, every one his fellow and every one his neighbor; the youth will be insolent to the elder, and the despised to the honorable,”  Isaiah 3:4-5

Have you ever complained about a politician?  The government?  How about your boss?  The current state of society?  If you haven’t, you are indeed a rarity in this day in age, for there is much complaining, and seemingly much to complain about.

How did we arrive at this, fellow taxpayer?  If democracy is supposed to deliver the cream of the crop in terms of leadership in the government, why does it seem that most politicians are the epitome of immoral liars?

This question was thrust upon us as we were reading the “Is there no shame” rant at zerohedge.com and came across the words “Hayek’s theory that the worst always rise to the top.”  We then perused Hayek’s theory in an excerpt from the “Road to Serfdom.”

In the section entitled “Why the Worst Get to the Top,” Hayek states that:

“There are strong reasons for believing that the worst features of the totalitarian systems are phenomena which totalitarianism is certain sooner or later to produce.

Just as the democratic statesman who sets out to plan economic life will soon be confronted with the alternative of either assuming dictatorial powers or abandoning his plans, so the totalitarian leader would soon have to choose between disregard of ordinary morals and failure. It is for this reason that the unscrupulous are likely to be more successful in a society tending toward totalitarianism. Who does not see this has not yet grasped the full width of the gulf which separates totalitarianism from the essentially individualist Western civilization.”

Suddenly, it all makes sense.  As man has generally chosen to pursue the Totalitarian, or what we call the Might Makes Right ideology, it would follow that those thrust into power should be among the most immoral, unscrupulous, human beings on the planet.

In summary, the Might Makes Right ideology unwittingly promotes the worst individuals to positions of power, as they are best suited to carry out the immoral and contradictory demands which are invariably made of the persons occupying positions of power in such a system.

Depressed?  Don’t be.  It doesn’t have to be this way.  More tomorrow.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 22, 2011

Copper Price per Lb: $3.34
Oil Price per Barrel:  $98.01

Corn Price per Bushel:  $5.98  
10 Yr US Treasury Bond:  1.95%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,700 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  -0.1%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,121,700,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,644,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, Gold, The Mint, True Capitalism

Natural Law: The Golden Rule

11/15/2011 Portland, Oregon – Pop in your mints…

We continue today with our brief examination of the foundations of society here at The Mint.  We are finding that while society appears complex on the surface, the further that its elements are reduced, the foundation is extremely, perhaps painfully simple.  Any complexity that we experience is not a product of an inherent complexity in natural laws, rather, it is a product of the human relationships and actions that are a result of man’s choice of response to the demands of natural law.

For those of you joining us for the first time, let us get you up to speed with a synopsis:

Anarchy, the lack of government, is man’s natural state.  It is an ultimate given.  It simply is.  A clear understanding of the current state of affairs depends upon grasping this inescapable fact.

In response to Anarchy, man has two choices.  He can choose to mutually cooperate with his fellow man, respecting both his fellow man’s right to live and his right to property, or He can choose to take his fellow man’s life and property through the use of force.  We have called the path of mutual cooperation “True Capitalism” and the path of forceful coercion “Might Makes Right.”

Ideologically, there is no middle ground between these two paths.  In practice, men live at various points on the spectrum between these two ideological extremes.

We argue that True Capitalism is the response which creates the greatest benefits for the greatest number of people.  The proof of the superiority of True Capitalism is that it allows man to best adapt and react to the inescapable demands of Natural Law.  Like Anarchy, Natural Law is immutable.  It does not change, for its statutes are etched in the foundations of the earth itself.

Last Thursday we presented the Natural Law of supply and demand, a law that deals with what is concrete and tangible.  Today we will deal with second law which primarily governs human relationships and works in conjunction with the law of supply and demand.

It is popularly called the Golden Rule.

The Golden Rule is articulated and exalted as an ideal in some form in nearly every society and religion on the planet.  The Bible famously articulates the Golden Rule in the following way:

“Love your neighbor as you love yourself” (Deuteronomy 6:5)

It is important to note that the Golden Rule is a positive declaration.  It is a call to action.  In many societies and religions the Golden Rule is stated in a negative declaration, a command to abstain from action.  An example of this can be found in Hinduism:

“One should never do that to another which one regards as injurious to one’s own self.”  (Anusasana Parva, Section CXIII, Verse 8 )

The negative declaration is sometimes called the Silver Rule.  It is important to understand that only the Golden Rule, the positive call to action, is Natural Law.  Observance of the Silver Rule, while highly advisable, does not rise to the level of Natural law.  However, it is a logical corollary to the Golden Rule.

Compliance with the Golden Rule, as with all natural law, is indispensible.  It is ignored at one’s peril, for it operates regardless of one’s acceptance of its validity or not.  The Truly Capitalistic society greatly facilitates and encourages compliance with the Golden Rule.  Conversely, compliance is hindered in a society that has embraced Might Makes Right as its ideological response to Anarchy.

“Wait a minute,” some of you are saying, “I’ll give you that the Golden Rule is a great ideal but Natural Law?  No one requires it of me, right?”

Remember, the essence of Natural law is that it is universally true and applicable to all.  The law of Supply and Demand, for example, can be ignored for a time, but every moment of ignorance causes the consequences of that ignorance to accumulate further until a final breaking point is reached.  The result of the failure to comply with the law of supply and demand is material scarcity and ultimately death.

The same is true of the Golden Rule.  Every moment of ignorance causes the consequences of that ignorance to accumulate further until a final breaking point is reached.  In the case of the Golden Rule, the result of the failure to comply is by definition a failure to properly comply with the law of supply and demand as well, with the end result, as mentioned above, being material scarcity and ultimately death.

Compliance with the Golden Rule is a necessary prerequisite to compliance with the law of supply and demand, for the Golden Rule governs relationships in the purest sense.  This is evident to most who have taken the time to ponder it.  So broad are the implications of the Golden Rule that the origins of both the rule of law and more recently the concept of human rights can be traced to it.

What thrusts the Golden Rule out of the realm of being simply a good idea and into the realm of Natural Law is this:  All attempts to comply with the Golden Rule serve to coordinate the actions of men in such a way that the greatest number of human needs are met in the most efficient way.  Any deviance from the Golden Rule, by definition, is a failure to meet human needs in the most efficient way.  Again, by definition, failure to meet human needs in the most efficient way means that a greater number of human needs are simply not being met.

Far from being simply a moral standard, the Golden Rule is elemental in the determination of supply and demand.  As the equilibrium price serves as the beacon of production for the law of supply and demand, the actions taken by men, governed by the Golden Rule, initially determine the supply and demand factors which, when combined, produce the equilibrium price.  In this sense, the Golden Rule serves as the beacon for both supply and demand which enable the creation of an initial equilibrium price.

How can the Golden Rule run ahead of the Law of Supply and Demand?  This is one of the beauties of Natural Law.  Natural Law always compliments and never contradicts itself.

An Example of the operation of the Golden Rule

Each human being has needs and wants which are sources of uneasiness.  Human Action, to paraphrase Von Mises, consists of men acting to dispel their most intensely felt uneasiness.  If a man is hungry, he will direct his actions towards getting something to eat.  Other tasks will be put on hold until this intensely felt uneasiness is relieved.

The operation of the Golden Rule, in the example of mans the need to alleviate hunger, operates in the following way.  A man feels hunger.  He has two options before him with which to fulfill this need.  First, he can forage, hunt, fish, or perform any series of actions with the end of fulfilling this need.  Second, he can voluntarily cede some of his production (or production for others via his contribution of labor) or appeal to the charity of someone else in return for something to eat.

As the second way is the most expedient, it is likely that a majority of people will elect this option.  Now reflect upon the Golden Rule:  “Love your neighbor as you love yourself.”  The person who chooses to comply with the Golden Rule will quickly understand that if he has the need to be fed, it is likely that his neighbor (in this sense, neighbor would mean anyone in the geographical realm in which he is equipped to serve, up to every person on the planet if it is possible for him to serve them) is likely to have the same need to some degree.  With this revelation, he unwittingly is on his way to discovering demand.

As he seeks to voluntarily fulfill this demand, he will need to either produce the supply of food himself or he can voluntarily cede some of his production (or production for others via his contribution of labor) or appeal to the charity of someone else in return for a supply of food with which to provide his neighbor with something to eat.  The information that his adherence to the Golden Rule provides him with regarding the needs of his fellow man will serve to guide his speculation as to where to best employ his limited time and capital.

It is a simple example, yet its simplicity serves to highlight the operation of the Golden Rule and can apply to any situation regardless of the complexity.  The Golden Rule, in modern business school lingo, is the origin of market research; it is the impulse for entrepreneurial activity and is the basis for subsequent human actions.

The Question of Charity

What about charity?  Wouldn’t adhering to the Golden Rule quickly lead to widespread scarcity and bankruptcy as catering to everyone’s preference to receive something for free would quickly deplete all available supplies and production?

The answer lies in the Golden Rule itself:  “Love your neighbor as you love yourself.”  Would you like to provide something for someone and not receive compensation?  Our guess is only if you are in a position to give something away and are willing to do it.  If all members of society are complying with the Golden Rule, the norms of charity will fall under the governance of the law of supply and demand.

The beauty, the perfection, of the Golden Rule is that above all it demands balance in human relationships and by extension, balance in the supply and demand of material goods.

True Capitalism Enable Compliance with the Golden Rule

True Capitalist ideology completely subjects itself completely to the Golden Rule and, in return, most accurately directs human actions towards fulfilling the most urgently felt needs of the greatest number of people. 

Inefficiency is naturally wrung from the system at its source as errors are quickly corrected and information is quickly disseminated via equilibrium prices.  The proper identification of demand by default leads to the most efficient allocation of scarce resources possible.  The liberty of life and property which is ensured in the Truly Capitalistic system allows men to supply this demand by employing their limited time and resources without unnecessary hindrance.

The Golden Rule may not provide everyone with what they expect or what they think they desire, but complete submission to it not only creates the most efficient allocation of resources, it gives humans the best information to base their attempts to mutually cooperate to fulfill the myriad of human desires.  It has the added social benefit of creating the greatest amount of harmony and goodwill possible in human relations.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 15, 2011

Copper Price per Lb: $3.49
Oil Price per Barrel:  $99.39

Corn Price per Bushel:  $6.45
10 Yr US Treasury Bond:  2.06%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,781 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  0.3%
Dow Jones Industrial Average:  12,096  

M1 Monetary Base:  $2,215,000,000,000 RED ALERT!!!  THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,532,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Economics, The Mint, True Capitalism

Responses to Anarchy: True Capitalism vs. Might Makes Right

11/9/2011 Portland, Oregon – Pop in your mints…

We have been mulling over the basic tenets of True Capitalism, the economic system which is man’s most productive response to the state of Anarchy in which he finds himself.  Far from being an undesirable reign of chaos, Anarchy, the absence of government, is the natural state of man.  If Anarchy is simply an ultimate given, then it is man’s response to Anarchy that must be examined.

In response to this natural state, man has two options:  He can choose to mutually cooperate with his fellow man, respecting both his fellow man’s right to live and his right to property or He can choose to take his fellow man’s life and property through the use of force.

In other words, man may choose the path of True Capitalism or Might Makes Right.  Ideologically, there is no middle ground.  In practice, men live at various points on the spectrum between these two extremes.

Responses to Anarchy: True Capitalism vs. Might Makes Right

What may come as a surprise is that all of the Nation States on the planet have come into existence by and base their operations on the principal of Might Makes Right.  No matter how much freedom the Nation State may allow its citizens, it must be recognized that the Nation State stakes its claim on the individual’s life at birth, by declaring them a citizen and in many cases requiring either military service or registration to be conscripted into military service should the nation state deem it necessary.  The Nation State then stakes its claim on the individual’s property through either taxation or a myriad of rules and regulations regarding the use of said property.

Far from being an ultimate given, the Nation State, at a basic level, is an entity which provides varying levels of security and welfare services.  What differentiates the Nation State from other agencies providing security and welfare services (think security firms and insurance companies) is that the Nation State enjoys a geographic monopoly which it enforces by both the threat and use of violence against its captive audience, otherwise known as citizens.

This is the world today, and any sober look at the facts will lead one to conclude that man has chosen Might Makes Right as the dominant response to our Anarchic natural state.

Yet there is a better way.  True freedom and prosperity can be found by embracing True Capitalism and abandoning the Might Makes Right doctrine.  In contrast to Might Makes Right, a revolution cannot be undertaken to change man’s response to Anarchy from Might Makes Right to True Capitalism by violence, for by definition violence is simply a furthering of the Might Makes Right response, not a step towards a Truly Capitalistic society.

As the famous David Wilcox lyric goes:  “resentment doesn’t die with the dead”

Rather, a revolution which would naturally, by definition, bring about a Truly Capitalistic society involves rejecting all aspects of the Might Makes Right doctrine.  It involves renouncing any and all choices which make use of violence, whether undertaken personally or by directing the Nation State to use violence on one’s behalf, to take the life or property of another while at the same time asserting one’s rights to have their own life and property respected as inviolate.

On the surface, a Truly Capitalistic society may not look that different from the current structure of things.  There may arise security and insurance companies which serve geographical areas in tandem in such a way that they closely resemble current Nation States.  However, assuming that the paradigm is changed and man truly embraces Truly Capitalistic ideology, nobody will be compelled under the threat of violence to be a client of the security or insurance company.  Rather, individuals holding property would be free to choose between defending and securing their own property and income streams or voluntarily contracting with the security and insurance companies for these services.

In a Truly Capitalistic society, the division of labor would flourish and the property and resources would quickly pass from unproductive hands to productive hands, organically balancing the competing goals of maximizing output and capital preservation.

Companies who abuse their clients would quickly be abandoned and weakened while those who deliver the best service and value to their clients would prosper and attract more clients.  This rule naturally applies equally to security and insurance companies in stark contrast to the monopoly on these services currently claimed by the Nation State.

The lack of compulsion under the threat of violence is the key difference between the response of True Capitalism and Might Makes Right.  Might Makes Right naturally engenders fear and evokes a response to others based on this fear.  True Capitalism engenders, encourages, and rewards trust and evokes a response of trust in others.

Only upon this trust can a truly free and prosperous society blossom.

The choice between True Capitalism and Might Makes Right is one which must be made.  Anarchy demands a response, and these two options are the only responses known to man.  All other supposed choices are simply points on the spectrum between these extremes, but the choice of guiding ideology determines where man and society are moving along this continuum. 

The ideologies of True Capitalism and Might Make Right are like magnets, and remaining at a point in between them on the continuum is not an option, for society is always being pulled in one direction or the other depending upon the dominant ideology adopted by a majority of the people.

This is an ideological battle which must be won if mankind is to survive and prosper.  Life and death are laid before us.  Choose life, that you may live.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for November 9, 2011

Copper Price per Lb: $3.44
Oil Price per Barrel:  $97.42

Corn Price per Bushel:  $6.61
10 Yr US Treasury Bond:  1.96%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,789 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.0%
Inflation Rate (CPI):  0.3%
Dow Jones Industrial Average:  11,936  

M1 Monetary Base:  $2,122,700,000,000 RED ALERT!!! THE ANIMALS ARE LEAVING THE ZOO!!!
M2 Monetary Base:  $9,507,600,000,000 YIKES UP $1 Trillion in one year!!!!!!!