Friday, October 28, 2011

The Tenets and Benefits of True Capitalism

10/28/2011 Portland, Oregon - Pop in your mints…
We have been kicking around the idea of True Capitalism and cannot shake it.  In our experience, the only hope we have of shaking it and moving on is to write it out, so here it is.  Thank you for listening, fellow taxpayer.  It may be simply a directionless rant, then again, we may solve the world’s problems.  Either way, we aim to make it entertaining.

We will start with what we know:

True Capitalism is man’s most perfect expression of democracy

True Capitalism enables Justice

True Capitalism enables Equality

True Capitalism enables true prosperity

True Capitalism is born in and comfortable with Anarchy

True Capitalism is radically trusting in people

The Breakdown of society is a breakdown of Trust, If there is to be hope for the future, we must collectively learn to trust again.  True Capitalism is a constant test of trustworthiness and a betrayal of trust is quickly and harshly dealt with.  Conversely, those found trustworthy stand to be richly rewarded in a Truly Capitalistic system.  The meting out of natural rewards and consequences increases general trustworthiness.

Anarchy leads to Order, not Chaos
True Capitalism improves society by carrying out the consequences of actions in a rapid and impartial manner.  It encourages men and women to serve one another as they find that serving one another is in their mutual interest.  In fact, it is in their rightly understood self interest (to quote a term from Mises) to serve one another.

Intrigued?  So are we.  But what exactly is True Capitalism?

True Capitalism is a radical respect for life and private property.  It is the recognition that the right of an individual to life and private property are inviolate and that individuals, assured that their life and property are no endangered, will reap the fullest benefits of the division of labor and mutual cooperation which men and women on this earth are capable of.
Participation in the True Capitalistic System is not voluntary, for True Capitalism, as we will find, is not an idealistic concept, rather, it is an ultimate given.  Apart from participation, however, all other actions and agreements which do not violate other’s rights to life or property are completely voluntary.
Let Freedom Ring!
Apart from being a part of the system, nothing done in the True Capitalistic System is purely obligatory.  This is where True Capitalism differs from what has come to be known as “Crony Capitalism,” the system in which most of the world currently operates which is full of random taxes, fees, regulations, and laws which require compulsion or coercion by a nation state in order to be paid or obeyed. 
At the other end of the spectrum, in the Truly Capitalistic system, actions such as paying an entity or observing a regulation may be strongly advisable to the point of being considered a necessity, but not taken under compulsion or the threat of violence by a nation state or another actor in the system.
In a Truly Capitalistic system, the best way to get ahead (obtain more opportunities, leisure, or whatever one desires) is to make oneself useful to his or her fellow man or woman.  The nature of the system is to reward those who best serve others.  Those rewarded then find themselves able to consume goods and services freely produced by their fellow man by using the resources they have obtained by doing the same.
If one lifts the veil of the machinations of today’s nation state, it is abundantly clear that this is more than idea, it is natural law.
We submit for your consideration, that, far from being unattainable ideals, True Capitalism (and by extension, Anarchy), are ultimate givens within which the current system of nation states are forced to operate.
If the nation state were to cease to exist, it can be argued that Anarchy would reign.  This is technically true.  Unfortunately, too many individuals believe that Anarchy would lead to chaos.  We believe that quite the opposite is true.
Out of Anarchy, the Truly Capitalistic System would 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, and a society without borders that would enjoy freedom and prosperity that we cannot even imagine under current conditions.
Stay tuned and Trust Jesus.

Stay Fresh!

David Mint


P.S.  For more ideas and commentary please check out The Mint at

Key Indicators for October 28, 2011

Gold Price Per Ounce:  $1,743 PERMANENT UNCERTAINTY
M1 Monetary Base:  $2,071,500,000,000 RED ALERT!!!
M2 Monetary Base:  $9,607,200,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Tuesday, October 25, 2011

The Three Ring Circus Begins

10/25/2011 Portland, Oregon - Pop in your mints…
What a difference a day makes.  Yesterday, it appeared that the authorities had most of the problems that ail the world’s economy resolved.  All they needed was a little more time, money and cooperation to implement their plans and the good times would be rolling once again!  Today, instead of coordinated, determined action, it appears that a three ring circus of sorts is beginning.

In Ring 1, we have the European Clown Car:  Yesterday, Europe looked ready to announce a plan to simultaneously solve the sovereign debt, banking, and resultant currency crises in one fell swoop.  Today, it appears that Italy is balking at implementing a growth plan on moment’s notice and Germany and France will need a miracle to announce a credible Pan-European rescue package by tomorrow, their self imposed deadline.  What a difference a day makes!

It should be clear by now to most sober persons that regardless of what is announced tomorrow, the Euro as a currency in its present form is not viable.  It should also be clear that the countries who have adopted the Euro will give away what is left of their sovereignty in a vain attempt to preserve it.

Step Right up!  The Economic 3 Ring Circus Begins
In Ring 2, we have the American Elephants:  The US is quietly completing three Bond auctions that will cause the national debt higher than the national GDP.  The official total should eclipse GDP by the end of October.  100% of GDP is when the debt of a mere mortal nation (Greece, for example) has traditionally harkened national bankruptcy.

The only exception to this rule is in Ring 3, the Japanese Tight Rope Walker: Japan, where national debt is north of 200% of GDP.  How do they avoid bankruptcy?  Simple, they print money to pay the debt.  As if to prove our point, today, the Bank of Japan decided that they have seen enough Yen appreciation and announced another five trillion Yen currency printing campaign.

When money doesn’t exist, the sky is the limit, which is why commodities and certain equities are set to explode to the upside.  Bonds, while they may not fall in nominal value, will fall in relative value as they are repaid in severely depreciated currencies.

As if on cue, commodities took off today.  How high and far they will fly this time is anyone’s guess.

As the circus gets underway, the sober amongst us are beginning to wonder, sometimes aloud, “if the Governments, banks, and monetary authorities cannot solve these problems, then who can?”

The answer, fellow taxpayer, is right under our fingertips.  We, the People of the earth can solve it.  The tool we have been given is our own wit and ingenuity.  The only requirement is that we embrace True Capitalism, for better or for worse, for richer or poorer, until death do us part.

What is True Capitalism?  It may be summed up as a deep, radical respect for life, liberty, and private property.  It is an understanding that mutual cooperation is more often than not in our rightly understood interests (to use a Mises term).  It is not simply a choice, it is the only choice.  More to come.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint


P.S.  For more ideas and commentary please check out The Mint at

Key Indicators for October 25, 2011

Gold Price Per Ounce:  $1,705 PERMANENT UNCERTAINTY
M1 Monetary Base:  $2,056,000,000,000 RED ALERT!!!
M2 Monetary Base:  $9,570,500,000,000 YIKES UP $1 Trillion in one year!!!!!!!

Monday, October 24, 2011

European Semi-Solution Extends the False Calm and indirect moratorium on Eurozone Investment

10/24/2011 Portland, Oregon - Pop in your mints…
Today after the western stock markets closed, the German lawmakers announced yet another plan in an attempt to stem the Eurozone’s tandem sovereign debt and banking crisis, which is rapidly accelerating.  The plan, according to AP, would boost the European Financial Stabilization Fund from its current 440 billion Euros approximately one trillion Euros.   
The one trillion Euro figure is an estimate due to the nature of the plan which involves enticing capital to invest in the Sovereign debt issues from Euro member states by creating an insurance fund to partially back sovereign debt issues that would otherwise attract little investor interest.
Think of it as a partial Fannie Mae guaranty for European Governments.  
There is a reason that foreign capital is hesitant to invest in Euro sovereign debt, and it is not for lack of enticement.  Greek, Spanish, Portuguese, and Italian bonds all offer fixed income investors a decent premium over other sovereigns for their perceived risk.  The problem from the point of view of the investors is that the premiums are not high enough if considered against the likely event that they will not get their principal returned.  The problem from the perspective of the Euro sovereign issuers is that they cannot realistically pay even these reduced premiums.
Once it is generally perceived that a nation state will default on its obligations, it is very difficult to attract capital, whether it be the purchase of sovereign bonds or investments in businesses located in the troubled country.
Default, while the most practical solution for any normal debtor, is apparently unacceptable for modern western nations.  For this reason, the Eurozone leadership is moving in slow, measured steps to appear to do just enough to preserve the credibility of the debt issued by the weaker, peripheral states such as Greece, Spain, and Portugal.
Will this latest Eurocrat concoction be enough?
For the moment, it may be.  The German Parliament must vote on their new obligations on Wednesday, just hours before the broader Eurozone working group is set to formally announce the plan, leaving no room for dissent, ala Slovenia earlier this month.  Once the political drama in Germany passes, it will be smooth sailing for the Euro and its sovereign debt markets…for about a week.  
The illusion of viability and solvency
At that point, it will again become clear that the banks and sovereigns will require additional funds (currently the estimate is north of 2 trillion Euros) in order to continue the illusion solvency.
The problem of Euro solvency is no secret.  This is why both banks and sovereign governments are having a great deal of difficulty getting credit from anyone other than other broke European governments, banks, the ECB, and the Federal Reserve.  This latter list of entities have two things in common.  First and foremost, they all have a vested interest in perpetuating the charade that the Euro is a viable currency.  Second, these entities, by virtue of their activities, can only destroy wealth and therefore must coerce the productive class into lending its resources.
To make matters worse, no one in their right mind can invest real capital in the Eurozone under these conditions.  With sovereign governments pushing austerity measures and increasing the confiscation of private assets via increased taxation, any further investment in the Eurozone must be properly seen as an act of charity.
Such is the paradox of solving debt problems by incurring more debt.  Once one believes that the debt cannot be repaid, this belief becomes a self fulfilling prophecy.  The Eurozone is becoming the world’s latest example of this inescapable truth.
Meanwhile, commodity prices, which reflect the fruits of productive activities, are on the verge of exploding to the upside, signaling a growing distaste for fiat currencies.   Will this be the final, violent blow off in commodities?
Stay tuned and Trust Jesus.
Stay Fresh!
P.S.  For more ideas and commentary please check out The Mint at
Key Indicators for October 24, 2011
Copper Price per Lb: $3.46
Oil Price per Barrel:  $91.60
Gold Price Per Ounce:  $1,653 PERMANENT UNCERTAINTY
M1 Monetary Base:  $2,056,000,000,000 RED ALERT!!!
M2 Monetary Base:  $9,570,500,000,000 YIKES UP $1 Trillion in one year!!!!!!!