Papa Francisco’s Populist Discourse and the meaning of Evo’s Gift

8/2/2015 Portland, Oregon - Pop in your mints…

During the month of July we found ourselves south of the equator in our second home, Bolivia.  It has been two long years since we have walked the earth there and much has changed.  The following are some observations made on our journey.

First off, it is obvious that money is everywhere.  From the construction of new apartment buildings to a new style of McMansions that are being erected by those who have benefited by the DEA’s absence in this country:  The Cholet.  The same increase in economic activity that we have noted in Portland is evident here in spades.  Everywhere you look, there is a new store, restaurant, cafe, or industrial park, all with the comforts of modern architecture with inimitable South American flair.

The first part of our visit coincided with the visit of the extremely popular Pope Francisco, or “El papa Francisco” as he is known here.  We arrived in Santa Cruz on July 6th, two days before the Holy See arrived.  On the 8th, we listened, along with all of Bolivia, the radio call of his descent and landing at the airport in El Alto.  The radio call resembled the call of a soccer game here, with the announcer screaming “Llegó” with the same passion that they yell “gol” when the home team scores.

As a follower of Jesus of Nazareth, we are ambiguous to the activities of the Pope, who to us is simply another follower of the same Jesus, with a slightly larger following.  In other words, we do not recognize or attribute any special authority nor clairvoyance to the Catholic church that is not available to all believers.

That said, it is undeniable that papa Francisco is something special to the Catholic faithful, especially here in South America, as Francisco  (or Francis, as he is known in the English speaking world), an Argentinian (though you would never know it as he does not seem to swear like a sailor) is the first Pope to hail from the continent.

Having listened to his discourses over two days, it was obvious that Francisco is well schooled in the populist platitudes that the likes of Che Guevara awakened and contemporary leaders Hugo Chavez and Evo Morales have resurrected.

True to the populist playbook, Pope Francisco derides economic inequality and envisions a society where all elements of the economy, the productive sector, distributors, and retailers, all carry out their daily chores in harmony with mother earth and one another.  Where every child can enjoy a happy childhood, every worker enjoy a dignified position, and every elderly person enjoy a dignified retirement.

Evo Morales, the Bolivian President, welcomed Pope Francisco with a unique gift, a crucifix where in the place of the cross, Jesus of Nazareth is portrayed as being crucified on a hammer and scythe, a symbol synonymous with Socialism.

Regalo de Evo a papa Francisco

Was the Pope offended?  Hardly, you see, the artistic origins of the gift lie with a popular Jesuit priest who made what to some is the obvious connection between the Gospel and Socialist doctrine.  There is more to the story behind the gift, which you can read here:

http://www.ehagendaurbana.com.ar/2015/07/el-cristo-del-martillo-y-la-hoz.htm

We bring the whole matter up to state once and for all that the Gospel and Socialism have just one common thread:  The Gospel, or the Good News, is that God forgives, and expects us to do likewise.  Nothing more, and nothing less.  It is the most important spiritual and natural event that has ever occurred, in our lives and the lives of countless others, for it is forgiveness and forgiveness alone that unleashes the supernatural and eternal presence of Yahweh in the here and now.

To the extent that Socialism demands that mankind treat one another as they would like to be treated, it is in harmony with the Gospel.  However, any attempt to enforce what should be spontaneous acts of goodwill towards one another makes a mockery of the Gospel and subjects it to the rules of men.  As we have explored in our economic treatise, Why What We use as Money Matters, rules made by men are incompatible with freedom, which is the reason for the Gospel in the first place.

This Freedom extends to the right to be Socialist, but it does not extend to the right to enforce this destructive doctrine on one’s unwilling fellow man or woman.

We admire the Pope, heck, he gave mass in La Paz with one lung and drew out millions of the faithful in South America.  If he wants to use his enormous platform and the freedom afforded to him by the forgiveness of sins through Jesus of Nazareth to expound upon an idyllic worker’s paradise. more power to him.

The Pope speaks to the Socialist Movements in Santa Cruz de la Sierra, Bolivia:

The danger in the Socialist doctrine is not evident in meaningless platitudes spewed by its proponents, nor is it evident in postulations about goals that are as unattainable as they are unmeasurable, such as universal dignity in work and retirement.  The danger of this poisonous doctrine is only evident in the blood spilled silently over the years in its name.  For when authoritarian regimes are allowed to define and enforce such concepts on a large scale, the previously unimagined economic burdens of such a program fall upon everyone, and the end result is invariably a society that lives and treats each other in a quite undignified manner.

A side note, and certainly fodder for further debate here at The Mint, our Mother-in-law posed a very interesting hypothesis about what may be wrong with Bolivian society, which seems hell bent on self destruction despite the gifts Mother Nature has seen fit to surround it with:  The poisonous union of the lie by two strata of society.

First the rich, or those who come into money, those whom we will call the upper strata of society.  This strata of society learns to lie as a means to maintain or improve their status both within their social circle, which in turn feeds a continuous chorus of lies as a group to the populations which they enslave and exploit.

Second, there are the lies of the exploited populations themselves, who learn to lie as a powerful tool of survival in a society where, to paraphrase President Snow of the Hunger Games, the odds are never in their favor.

The union of the accumulated lies tend to make any society impossible to navigate with any form of moral or ideological compass.  For to run the straight and narrow is to be stabbed in the back, and the lies create the sad and universally acknowledged truth that no one can be trusted.

Into such societies the seeds of Socialist ideology find fertile ground in which to grow and take root in the minds of the underprivileged.  They begin to grow and, like GMO crop production, look good until one realizes that the crops are only viable with a disproportionate quantity of productive inputs, and that they leave the soil and its inhabitants desolate once the massive inputs stop flowing.

It is then that the inevitable bloodshed begins, and no amount of platitudes or lofty goals, whether spoken by the Pope or the President, can stop it.

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for August 2, 2015

Copper Price per Lb: $2.37Oil Price per Barrel:  $46.77

Corn Price per Bushel:  $3.68
10 Yr US Treasury Bond:  2.20%Bitcoin price in US:  $279.31FED Target Rate:  0.14%
Gold Price Per Ounce:  $1,095

MINT Perceived Target Rate*:  0.25%Unemployment Rate:  5.3%
Inflation Rate (CPI):   0.3%Dow Jones Industrial Average:  17,690M1 Monetary Base:  $2,998,600,000,000

M2 Monetary Base:  $11,991,900,000,000

Carta abierta dirigida a Evo Morales Ayma

Carta abierta dirigida a Su Excelencia Evo Morales Ayma, Presidente del Estado Plurinacional de Bolivia,

Evo Morales – President of Bolivia, photo taken December 17, 2007 in Brazil by Marcello Casal Jr. of Agencia Brasil http://www.agenciabrasil.gov.br/media/imagens/2007/12/17/1840MC44.jpg

Permítame expresar mi más sincero saludo a Usted, señor Presidente, y a las honorables autoridades de la gran República Andina de Bolivia. Que puedan vivir y prosperar en la tierra bendita que habitan en la que goberna hábilmente como su humilde servidor.

He observado, tanto de cerca como de lejos, su pasión por liberar y elevar a los pueblos que habitan en las tierras que hoy conocemos como el Estado Plurinacional de Bolivia. He observado con admiración la valentía y determinación que usted ha demonstrado al llegar a su posición actual y al continuar con el trabajo diario por la liberación y la dignidad de aquellos que, durante demasiado tiempo, han sido víctimas de la opresión injusta.

Le escribo hoy por dos razones. En primer lugar, para animarlo en su lucha noble. Todos los grandes líderes, como usted sabe muy bien, enfrenten la adversidad, la crítica y la oposición de los que se ven amenazados por lo que representan. Estas fuerzas sólo han aumentado en intensidad a medida que tome medidas para reparar siglos de injusticia.

Sepa que a pesar de el ruido que hacen algunos quienes le insultan por tomar acción mientras ellos se sientan con los brazos cruzados, hay muchos, aunque sus voces sean suaves, que piden a Dios por su salud, fortaleza y sabiduría.

El segundo motivo para escribirle a usted es para ofrecerle tres principios que, a la medida que están permitidos a operar, permitan que los pueblos de la tierra conocida como Bolivia podrán sobresalir económicamente. Bolivia ya es una tierra rica. En las manos de la gente, se hará mas rica.

Junto con usted, rechazamos los principios neoliberales que han causado la destrucción de los pueblos que las han ciegamente implementado. Nuestro objetivo es brindarle las herramientas con las que no sólo Bolivia, sino todos los habitantes de la tierra, puedan lograr observar los diez mandamientos para salvar el planeta que usted ha contribuido generosamente al mundo.

Mientras que los títulos de estos principios pueden aparecer en conflicto con el primero y sexto mandamiento, le pedimos que lea atentamente las explicaciones ya que vera que el funcionamiento de estos tres principios permitirá la realización de sus diez mandamientos para salvar la tierra de la explotación.

Una palabra de precaución, es extremadamente importante que estos principios económicos operen juntos, sino, no funcionaran en absoluto:

Libertad:  Mucho se ha escrito y hablado sobre el tema de la Libertad. Pues, es el precursor de la dignidad y la piedra angular de todas las sociedades civilizadas. La Libertad, desde la perspectiva de la política económica, significa que los pueblos prosperarán a la medida en que las restricciones artificiales sobre su capacidad de trabajar, producir, e intercambiar esten eliminadas. La correlación entre la libertad económica y la sociedad civilizada es tan fuerte, que el coro del himno boliviano resuena con gran significanza:

“Morir antes que esclavos vivir”

El concepto de la libertad no debe limitarse sólo a la libre expresión y movimiento, situación en la que se encuentran la mayoría de las sociedades que pretenden que sus habitantes son libres, sino extenderse a la capacidad de una persona de participar en tanto el comercio como otras actividades sin restricciones artificiales, siempre y cuando el hecho de participar en la actividad no impide la libertad o dañe la propiedad de otros. Esta es la clave de la libertad, ya que mantiene la tierra en equilibrio. Desequilibrios peligrosos se producen cuando las Libertades de un grupo están subordinados a los de otra. Nuestro tercer principio, la igualdad ante la ley, se ocupa de que esto no suceda.

Quizás lo más importante hoy en día, la libertad debe extenderse a la esfera bancaria y a la moneda, dejando la decisión del medio mas aceptable y métodos de comercio más expedientes en manos de la gente.

Propiedad Privada: Para todas las virtudes que el principio de la libertad otorga a un pueblo, el principio no es más que una idea intangible a menos que su consecuencia natural, el principio de la propiedad privada, es respetada por igual por todos los miembros de la sociedad. El concepto de la propiedad privada es la base de cualquier actividad productiva que se desarrolla en la tierra, desde la siembra de un campo a la construcción de pozos para proveer un acceso al agua potable.

Más allá de la propia persona, una persona o grupo de personas deben tener el derecho de poseer propiedad, tanto real como personal, de la que pueden trabajar y compartir de la manera que más le plazca, con la expectativa de que van a tener la capacidad para emplear y disfrutar de los frutos de sus labores.

De la misma manera, el principio de la propiedad privada viene con la obligación de cuidar y mantener la propiedad que uno tiene a su cargo. El principio mismo es el incentivo para que las personas se animen a mantener la propiedad bajo su control, ya que la misma tiene el derecho de disfrutar o preparar para su venta a otro individuo libre dicha propiedad.

Con el fin de ser a la vez productivo y bien mantenido, la propiedad privada debe realizarse a nivel individual, familiar o comunitario. Si la propiedad se encuentra en manos del gobierno u otra entidad grande, será explotada de la misma manera que la propiedades están hoy explotadas por las grandes corporaciones, que no tienen incentivo para cuidar de él después de haber extraído la riqueza de la misma.

Igualdad ante la Ley: Los principios de la libertad y la propiedad privada deben ser asegurada para todos por medio del funcionamiento del principio de igualdad ante la ley. Para que las personas puedan prosperar económicamente, deben saber no sólo cuales acciones están permitidas, sino tambien que las leyes que hayan aplican de la misma forma a todos los miembros de la sociedad, independientemente de su nivel economico, raza, sexo, color, u origen. Sólo si existe la percepción de una igualdad ante la ley pueden las personas planificar y llevar a cabo sus actividades diarias.

La igualdad ante la ley es la base de una sociedad justa en la que las personas pueden prosperar de acuerdo con sus esfuerzos en atender a las necesidades más intensamente sentidas por su prójimo. Por lo tanto, todas las leyes en una sociedad debe centrarse en la protección tanto de la vida como en la propiedad legítima de la persona o grupo. Cualquier ley que extiende más allá de estos dos campos necesariamente sirve para limitar tanto el derecho como la libertad y la propiedad privada que deben ser considerado sagrados y permitidos a operar sin obstáculos para que el máximo de bien material pueda ser extendida a todos.

Le ofrecemos estos tres principios, sabiendo que en su sabiduría y benevolencia, los pueblos que se encuentran bajo su cuidado se beneficiarán por ellos y convertirse en la envidia de las naciones de la tierra, no por la riqueza natural que cuidan y producen, mas en la nobleza de sus convicciones.

Su dedicación y servicio al pueblo boliviano es una inspiración para toda la humanidad. Nuestro deseo es ver a todo el pueblo boliviano, y los pueblos del mundo, vivir en equilibrio y libertad con Dios, la naturaleza y entre sí.

Que Dios le bendiga a usted y a toda Bolivia.

Le deseo todo lo mejor,

David Mint

An Open Letter to Evo Morales

10/29/2012 Portland, Oregon – Pop in your mints…

While we have taken the decision, along with a silent majority of Americans, not to vote in the upcoming national elections, this does not mean that we have given up hope for change, quite the contrary.

Here at The Mint, for better or worse, we have opinions that cannot be confined to a dot on a pre printed scantron form.  They require words and dialogue.

Enter the open letter.  If one is to effect change in this world, it is important to correspond with those who are in the seats of power and therefore have the ability to effect positive change in this world.  If we can change their mind, they can change the world.

When writing world leaders, it is important to both acknowledge their authority and use terminology which we understand to be important to them.  We must recognize them as an ally for we share a common aim, the good of themselves and their people.  Finally, as people who are derided daily for serving their populace, they need encouragement.

The following is a copy of our open letter to Evo Morales, the President of Bolivia.  A proper Spanish translation will be forthcoming.  Enjoy!

October 29, 2012

An open letter addressed to His Excellency Evo Morales Ayma, President of the Plurinational State of Bolivia,

Allow me to extend my warmest greetings to you, Mr. President, and to the honorable people of the great Andean Republic of Bolivia.  May they live long and prosper in the blessed land that they inhabit which you capably govern as their humble servant.

I have watched, both from near and far, your passion to liberate and elevate the Peoples which inhabit the land known today as the Plurinational State of Bolivia.  I have watched with admiration your courage and determination as you have risen to your current position and as you continue to labor daily for the liberation and dignity of those who have, for too long, been victims of unjust oppression.

I write you today for two reasons.  First, to encourage you in your noble struggle.  All great leaders, as you know all too well, face adversity, criticism, and opposition from those who are threatened by what they represent.  These forces have only increased in intensity as you take steps to repair centuries of injustices.  Know that though there may be some with loud voices who heap insults upon you for taking action while they sit idly by, there are many, though their voices be soft, who pray for your health, strength, and wisdom.

Our second motive for writing to you is to humbly offer you three principles which, to the extent they are followed, will allow the Peoples of the land known as Bolivia to excel economically.  Bolivia is already a rich land.  In the hands of the people, it will be made richer.


Evo Morales – President of Bolivia, photo taken December 17, 2007 in Brazil by Marcello Casal Jr. of Agencia Brasil http://www.agenciabrasil.gov.br/media/imagens/2007/12/17/1840MC44.jpg



Together with you, we reject the Neo-Liberal principles which have wrought destruction on those Peoples who have blindly employed them.  Our aim is to provide you with the tools with which not only Bolivia, but all of the inhabitants of the earth, can strive to observe the ten commandments to save the planet which you have generously contributed to the world.

While the titles of these principles may appear in conflict with your first and sixth commandments, we ask that you carefully read the explanations and see that the operation of these three principles will allow for the accomplishment of your ten commandments which to save the earth from exploitation.

A word of caution, it is exceedingly important that these economic principles operate together, or they will not operate at all:

Liberty:  Much has been written on the subject of Liberty.  Truly, it is the precursor to dignity and the cornerstone of all civilized human societies.  As it applies to economic policy, liberty means that Peoples will prosper to the extent that artificial restrictions on their ability to work, produce, and trade are removed.  The correlation between Liberty and civilized society is so great, that the chorus of the Bolivian anthem rings especially true:

“Morir antes que esclavos vivir!” {For those reading this in English, it translates as: “We will die before living as slaves.”}

The concept of Liberty, to be productive in society, must not be limited merely to speech and movement, as it is today in most societies which pretend that their inhabitants are free, but rather extended to the ability for a person to engage in trade and other activities at will to the extent that engaging in the activity does not infringe upon the Liberty or property of another.  This is the key to Liberty, as it keeps the earth in balance.  Dangerous imbalances occur when the Liberties of one group are subordinated to those of another.  Our third principle, Equality before the law, deals with this.

Perhaps most importantly today, Liberty must be extended into the banking and currency realm, leaving the decision of the most acceptable medium and methods of trade in the hands of the people.

Private Property:  For all of the virtues that the principle of Liberty bestows upon a people, the principle is nothing more than an intangible idea unless its natural byproduct, the principle of Private Property, is respected equally by all members of society.  The concept of Private Property is the basis for any and all productive activity which takes place on the earth, from sowing a field to building a wells to provide access to clean water.

Beyond the ownership of one’s person, which should go without saying, a person or group of persons must be able to lawfully possess property, which they may choose to work and share as they please, with the expectation that they will be able to both employ and enjoy the fruits of their labors.

In the same way, the principle of Private Property comes with the obligation to care for and maintain the property that one is entrusted with.  The principle itself provides the incentive for the property to be maintained as persons will naturally care for something that they will either enjoy themselves or prepare for sale to another free individual.

In order to be both productive and well maintained, Private property must be held at the individual, family, or community level.  If property is held by the government or another large entity, it will be exploited in the same way that property is today exploited by large corporations, who have no direct incentive to care for it after they have extracted the wealth from it.

Equality before the Law:  The principles of Liberty and Private Property must be secured for all by the concurrent operation of the principle of Equality before the Law.  For people to prosper economically, they must know not only which actions are permitted, but that the laws which are enforced are administered in the same manner to all members of society, regardless of perceived wealth or lack of wealth, race, sex, color, or origin.  Only if there is a perceived equality before the law can persons plan and carry out their daily activities.

Equality before the law is the basis for a just society in which people may prosper in accordance with their efforts to help their fellow-man by serving their most intensely felt needs.  As such, all laws in a society should focus on protecting both the life and rightful property of the individual or group, any law extending beyond these two realms necessarily serves to limit both the right to Liberty and Private Property which must be held sacred allowed to operate unhindered so that the greatest possible amount of material good can come to the greatest possible number of persons in a society.

We offer you these three principles, knowing that in your wisdom and benevolence, the Peoples who find themselves under your care will benefit greatly and become the envy of the nations of the earth, not for the natural wealth they care for and produce, but for the nobility of their convictions.

Your dedication and service to the people of Bolivia is an inspiration to all of humanity.  Our desire is to see all of the Bolivian people, and the Peoples of the world, live in balance and freedom with God, nature, and each other.

Be encouraged and may God bless you and all Bolivia.

All the best,

David Mint

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

Key Indicators for October 29, 2012

Copper Price per Lb: $3.49
Oil Price per Barrel:  $95.54
Corn Price per Bushel:  $7.37
10 Yr US Treasury Bond:  1.75%
FED Target Rate:  0.16%  ON AUTOPILOT, THE FED IS DEAD!
Gold Price Per Ounce:  $1,710 PERMANENT UNCERTAINTY
MINT Perceived Target Rate*:  0.25%
Unemployment Rate:  7.8%
Inflation Rate (CPI):  0.6%
Dow Jones Industrial Average:  13,107
M1 Monetary Base:  $2,334,000,000,000
M2 Monetary Base:  $10,199,400,000,000

The Problem with Socialism, A Bank Run, and Bolivia Retains its Cheap Gas

1/11/2011 Portland, Oregon – Pop in your mints…

The final week of our stay in Bolivia was marked by the government doing an about face in their attempt to raise gas prices and a good old fashioned bank run.  Not exactly the relaxing vacation we had expected but in Bolivia, things are nothing if not interesting.

First, the about face in gas prices.  As you will recall, the government surprised nearly everybody by announcing that they were no longer going to subsidize the domestic fuel market, a move which meant an immediate 80% increase in the price of gasoline and diesel fuel.  Even the spineless neo-liberal governments that Evo Morales, the current President, had marched to overthrow did not have the chutzpah to try such a feat.  This was truly rare.

What was not rare was the typically Bolivian response to such government insanity.  While Evo's supporters attempted to downplay the move as "bueno para el Pais" (good for the country), the rest of the country did the sensible thing and went on strike.  All transport Bolivian transport workers, who make up for what they lack in equipment by their ability to organize and party, set a 24 hour strike for Tuesday, December 28th.  To boot they increased fares for all types transit in the country.  The bakers, then, set a strike of their own, we were to go three days without and on the fourth day we would pay 40% more than before for our daily bread.

Gas Prices Rise in Bolivia by Decree, Estonia to Enter the Euro, Will China’s Grand Experiment End with Runaway Inflation?

12/27/2010 Cochabamba, Bolivia – Pop in your mints…

We are back here at The Mint to ponder what is and what may be as the Gregorian calendar turns another year older.  We can be certain of two things for 2011.  Both Bonds and Fiat currencies (the most prominent of them the US Dollar) will decline in value.  Whether or not the decline will be severe is open to debate but every passing day under current circumstances and accompanying monetary and fiscal policy lead them ever closer to tumbling off a cliff.

What catches our attention today is that, last night here in Bolivia, the Vice President, Álvaro García Linera, who greatly admires and in appearance closely resembles the founder of Wikileaks, Julian Assange, came on TV to announce that the price of gasoline and diesel fuel, which are completely controlled via subsidies by the government, would go up 72% and 82% respectively effective immediately.  This takes the price from roughly $2.12 per gallon to roughly $3.66 per gallon.

Assange and Linera, seperated at birth?

The reasoning for the move, as explained by the government, is to kill the trafficking of “contraband” gasoline from Bolivia to, most notably, Chile.

Thoughts on Rest, The Peoples World Conference on Climate Change, and What Will Become of Municipal Bonds in 2011?

12/21/2010 Cochabamba, Bolivia – Pop in your mints…

As the days of 2010 wind down and the markets begin to calm down for the upcoming Holidays, we here at The Mint will take a few days to relax and unwind.  Relaxation, the art of doing nothing, either physically or mentally, is extremely underrated in today’s go-go society.  God gave us the Sabbath when He created all that we know and see and later commanded us to observe it.  The logic of relaxing at least one day a week is infallible.  Anyone who has worked weeks on end will tell you they are completely stressed out and tired.  Even plants and fields produce more abundantly for longer periods of time if you give them adequate rest, which would be every 7^th year.

Anyone who has been alive for a while and put their mind to the question will tell you that no, we humans are not logical beings.  Therefore, with few exceptions, we fail to observe Sabbaths (i.e. we don’t rest!)  Our weekends are full of activities which rarely count as restful.  Our Holidays and vacations are often more demanding than everyday life.  Yes, moments of pure, blissful rest are few and far between on this wonderful planet.

We are still here in Bolivia.  Our In-Law’s house, where we are staying, is a stone’s throw away from the stadium in Tiquipaya where Evo Morales, the first indigenous President in Bolivian History, recently held the “The People's World Conference on Climate Change and Mother Earth Rights.”

The Tiwanaku, Tension on the Korean Peninsula, And a War that will Benefit No One

12/20/2010 Cochabamba, Bolivia – Pop in your mints…

We are still whiling away the time here in Bolivia.  The food here is different, the result of years of more than 34 ethnic groups exchanging and mixing recipes.  “Silpancho”, for example, is a dish of rice and potatoes covered by a razor thin meat patty with a fried egg and chopped peppers on top.  It is like a meat pancake with egg on top.  Perhaps one day it will appear on the menu at IHOP. 

Bolivia is rich in History.  The most dominant culture in the “Altiplano” (High Plain) of the Andes Mountain Range which occupies much of Western Bolivia was the Tiwanaku.  The Tiwanaku, to which the present day Aymara of Western Bolivia trace their origins, began as a small agricultural village around 1500 BC.  Around 400 AD, the population began to urbanize and went from being a local force to a predatory state.  They learned the way of Empire.  What is the way of Empire, you may ask?  Simply put, it is to dominate by force, create trade agreements, create cults (religion), demand tribute, and control the “redistribution” of what is collected as tribute.  Does this sound familiar?

In the case of the Tiwanaku, their form of tribute was food.  They took the food production from regions located in what are now Peru, Bolivia, and Chile and then redistributed it according to the political need of the elites.  The Empire spread due to its continued food surpluses until a widespread drought occurred and food production began to slow and, consequently, the influence of the Tiwanaku began to weaken until, in 1000 AD, what was left of the Tiwanaku Empire simply disappeared.  Later to the region came the Incan and later the Spanish conquerors but before they came, this area lay desolate for nearly 450 years.

Armageddon on the Way, Nothing Normal about what is happening to Bond Markets

12/17/2010 Cochabamba, Bolivia – Pop in your mints…

We can’t shake the feeling that Armageddon is on the way for Bonds Markets in general and especially for any form of debt owed by a government of any size, no matter how powerful.  The Keynesians believe that government debt is simply a myth, just another data point in their mechanical view of the world.  Is private debt shrinking?  Public debt must expand.  In their fantasy world, as private debt is expanding, Public debt shrinks.

We do not know what planet Mr. Keynes lived on, but here on planet earth, government officials make promises to obtain votes.  These promises cost money.  Usually a lot more money than the government takes in.  Remember, the government, by definition, cannot do anything productive, economically speaking.  It can provide protection and justice, which has a price, but as for productive efforts, they are almost exclusively inept.  Ditto for “government investments.”  Investments worth making do not need government assistance.

Back to our point, public debt never shrinks as Keynes thought it would when the government in question runs a surplus.  Too many promises to keep, “investments” to make, wars to wage.  You see, Empires are built in the 21^st century by incurring debt, not by paying it off.

Austerity - Not Everyone is a Fan, Higher rates Crush Bonds and Pummel Stocks

12/16/2010 Cochabamba, Bolivia – Pop in your mints…

Ah, the price of austerity.  In a world where up was up and down was down, where all was what it seemed and things worked “as they should”, any attempt to save money or generally economize would be a good thing.  All the more if it meant that the government was retreating from intervening in the economy in areas where it can only do harm.  That would be 99% of government intervention with the remaining 1% being upholding valid contracts between parties.

Alas, this is not the world in which we live.  In Greece we see rioting as the government attempts to do the wise thing and cut back.  Like any bad credit risk, they are not cutting back by choice but rather at the behest of their creditors.  Like an addict needing intervention, so are the debt ridden nations of the western world.  Concretely, Greece wants to change its labor laws to give people incentive to work and by extension business incentives to hire them.  Naturally, this is an affront to “workers rights” that cannot be tolerated. 

Spain’s credit rating is on the verge of being lowered and generally the uncertainty of just what will occur in Europe has investors jittery.  In the US, at least we can count on the FED and Congress to continue to trash the currency.  The masters of the Euro are not so sure about trashing the currency but for some strange reason do not want to let any sovereign debt go bad.  Sorry EuroFEDS, you can’t have it both ways.

Bonds continue their descent with no end in sight.  This usually means that they may actually rise in the coming days.  Don’t be fooled.  Any strength in the Bond markets should be taken for nothing more than a hallucination and a selling opportunity.  Stocks were taken down today by the “Mega Maid” suction of the collapsing Bond Market.  Higher rates make re-financing or rolling over existing debt harder.  It must be either paid or written off.  The money for these activities must come from somewhere and, directly or indirectly, it comes out of equities.

Bond Market Tumbles Downhill and Why Bolivia May Avoid The Collateral Damage

12/15/2010 Cochabamba, Bolivia – Pop in your mints…

A quick look at the markets shows that Bonds are continuing a capitulation that is beginning to border on dramatic.  Market forces will always overpower any government, military, or central bank on the planet.  Never bet against them.  The case against Bonds has been clear for some time now.  The trick is guessing when what is obvious will become common knowledge.  It is at that point that the Market executes its judgment.

The verdict is in:  Bonds are guilty of gross oversupply.

From our perspective here at The Mint, we believe that this dramatic rise in Bond yields is one of the warm up acts to the grand finale which involves high rates of inflation (probably hyperinflation) and the disintegration of the US Dollar system that has dominated the financial world for nearly a century.

Now that we know how the play will end, what will be interesting to see is how the rest of the acts will play out.  But before sitting back to enjoy the fireworks, ensure that you have adequate protection for your assets, meaning a portion of them in real estate or preferably physical Silver and Gold.  A month’s worth of food could come in handy as well.  Once that is taken care of, you truly have little to worry about.  Now help your family, friends, and neighbors do the same.

A Victory for Freedom! Pondering Relative Wealth in The Plurinational State of Bolivia

12/14/2010 Cochabamba, Bolivia – Pop in your mints…

A quick glance at the news today reveals that a Judge in Virginia finally decided to read the constitution.  He has in essence ruled, in a matter that will certainly end up in the Supreme Court of the land, that Americans cannot be compelled to purchase something.  In this case, it is health insurance.  In 2014, if you do not purchase health insurance, then you have to pay a fine.  The requirement to purchase health insurance is logical if you want to make health care reform work.  Unfortunately, making health care reform “work” requires surrendering liberties to the government that we reckon a majority of gringos are not willing to let go of.

At The Mint we believe that Freedom is more important than universal health care and hope that this provision is struck down.  It is one thing to give incentives to purchase something, which the government shamelessly does as a backdoor subsidy to many industries via the tax code.  It is quite another to require the purchase of something and impose a penalty if you do not purchase it.  The latter reeks of totalitarian desperation to support a broken industry.

So chalk up one minor victory for Freedom!  Now on to our musing of the day…

We are relaxing down here in the southern hemisphere in what, in economic terms, may be one of the poorest countries on the planet.  How do you define poor?  It is all relative, of course.  If you are defining wealth in terms of an increase of US dollars or their equivalent that are traded in exchange for goods and services, then yes, you could call Bolivia poor.