Catalunya Employs Classic Democracy as Oregon Taxes Weed

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

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

1) Do you want Catalunya to be a State?

2) Do you want that State be Independent?

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

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

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

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

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

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

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

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

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

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

Oregon Taxes Weed

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

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

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

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

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

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

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

Can Catalunya peacefully remove the yoke?

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Key Indicators for November 9, 2014

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

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

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

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

Ode to the Auto Feo, Part V – The Bitter End

9/1/2011 Portland, Oregon - Pop in your mints…

With the markets relatively calm until the sparks fly later next week, we conclude our tale.  Our tale is, among other things, a recount of the recent history of Bank of America wrapped up in a vehicle metaphor:  “Ode to the Auto Feo,” originally inspired by the recent passing of a vehicle that taught us many valuable lessons.

You can catch up with the “Ode to the Auto Feo”, Parts I,II, III, and IV by clicking on the following links. 

Ode to the Auto Feo, Part I –  The Birth of a “Need”

Ode to the Auto Feo, Part II –Optimism and Desperation are Poor Bedfellows

Ode to the Auto Feo, Part III –Lemon Discovery

Ode to the Auto Feo, Part IV – Acceptance and Admiration

Our story continues:

After careful reflection, we could see that our reasons for adopting the fateful “gasoline only” policy in the Auto Feo were two-fold and that they reflected two of our character traits which, taken individually are admirable, yet when combined, can lead to terrible decision making.

The first and most obvious of these traits is frugality.  While we do not think of ourselves as especially frugal, we do tend to choose certain items or activities upon which to focus our frugality.  This focused frugality in and of itself can prove extremely useful where investments in proven strategies are concerned.

The second, perhaps less obvious, trait which was expressing itself in this decision was our sense of adventure.  This trait can prove extremely useful when there is something to be gained from the undertaking and adequate margin for error for the undertaking’s failure. 

The terrible decision, then, comes when we combine this sense of adventure, which, we repeat, requires ample margin for error, with our frugality which, by definition, does not provide for any margin of error.

Hence, in retrospect it was obvious that adopting the gasoline only policy in the case of the Auto Feo was a terrible decision.  The only thing to be gained was sheer entertainment value reaped by those unaffected by the decision, a group that you, fellow taxpayer, are happily a part of.

Now that we understand the motivation for such a decision, we offer you the inspiration.

We were inspired by the desire to avoid buying a quart of oil each week (frugality) and, by extension, to avoid further staining our driveway with oil spilled out of the engine block.  To accomplish this, we discovered (or perhaps imagined) an experiment that the military had conducted in which they had never put oil in new vehicles and had been able to rely on the resulting engine shavings caused by the friction to serve as a sort of permanent lubricant for the pistons as they slammed up and down in the engine block.

Now most sane persons and certainly those who are mechanically inclined will quickly realize that there is a big difference between our situation with a 17 year old vehicle which held two quarts of oil and the military who had new vehicles which had never been filled.  There was also a big difference in our respective circumstances.  The military could afford to lose a few vehicles to this sort of experiment.  We, on the other hand, would be walking if it did not pan out.

The experiment began with promising results.  The vehicle’s performance, which was not that great to begin with, deteriorated only slightly.  This did not concern us as.  After all, we only had 1.5 miles to drive each day.  We continued through rain and shine, confident that we were actually on the verge of improving the Auto Feo’s performance and significantly extending its useful life.

Like so many of today’s fiscal and monetary policies, the delusion of sustainability was to be, uh, sustained until the day it came to a catastrophic end.

Six more months passed and two things happened in quick succession.  One turned out to be an omen, while the other an illusory victory.

The omen appeared one late Spring evening when we came upon the Auto Feo in the parking garage on our return commute to find that the driver side window had been shattered and the vehicle’s contents, which consisted of a Bible and a pair of jumper cables, had been clumsily rifled through.  The thief took the jumper cables.

With the bi-annual emissions test that is required in Oregon just one week away, our frugality again kicked in and we resolved to use clear plastic and duct tape to temporarily replace our driver-side window until we could be sure that the vehicle would be cleared by the authorities to operate another two years.

Note to self:  If you need to cover a broken out window in a vehicle, make every attempt not to use opaque or transparent plastic.

We hobbled along for a week of near misses at intersections with limited visibility out of our driver’s side.  On a Saturday, we made the trek to Hillsboro to submit the Auto Feo to the automotive equivalent of a colonoscopy.

Arriving at the emissions testing center, we found ourselves apologizing unnecessarily for the condition of the vehicle and explaining that we wanted assurance that Oregon’s green gods would allow the vehicle to continue to operate on the roads of their realm.

“We wanted to see if it would pass before fixing the window,” we offered.

“Looks like its seen better days, let’s take a look,” said the attendant.

She was apparently unfazed by the appearance of the vehicle and we later thought that apart from these people, only body shops and junkyards see more pathetic looking vehicles on a regular basis.

We winced as we watched the attendant place the probe into the Auto Feo’s tailpipe and had to remind ourselves that it was not human.

“Looks like it failed,” said the attendant.  “But it did improve at 2,000 RPMs,”

“Can we give it another try?” we offered in a desperate last ditch effort to forestall the diagnosis.

“Why not?” said the attendant.

And then a miracle occurred.  The Auto Feo passed the emissions test.

We joyfully drove home and quickly arranged to have the driver’s side window replaced.  Our experiment was going swimmingly and the emissions test somehow validated our hypothesis.  The military was right, we are better off not adding oil to your vehicle!

Our delusion, which was now government sanctioned, was allowed to carry on.

Astute readers will quickly draw a parallel between our Auto Feo tale and Bank of America and the current banking system in general:  Our emissions test is a metaphor for the so-called stress tests that have been run on the banks in America and Europe in an attempt to shore up confidence.

When will these delusions end?

In the case of the Auto Feo, two short months after the government sanctioned emissions test gave it the green light, we were forced to make a journey farther than our normal 1.5 mile daily jaunt.

The Bitter End - Rest in Peace, Auto Feo!

Through knocks, heaves, and roars, the Auto Feo dutifully carried us on our route until, a mere .5 miles from home, the Auto Feo froze up.

We feared the worst but in our optimism we had the vehicle towed to our house.  We waited for the morning.

The next morning, it started!  This truly was a miracle.

Alas, the miracle was that the Auto Feo was simply saying goodbye.  For in the evening, when we jumped in to drive it home, the Auto Feo did not immediately respond.  A brief heave was all it could muster as we cranked the starter.  And then, all was silent. 

Our experiment was a failure, the Auto Feo had passed on.

Bank of America has been in the news a lot lately, and for all the wrong reasons.  The behemoth is too big to succeed and for every client that is making money, there seem to be two or three who are going bankrupt, leaving B of A to foot the bill.

Although management will never admit it, the Bank is now throwing Hail Marys late in the fourth quarter in a desperate attempt to raise capital.  While this is exciting to watch, you probably don’t want to put your money on the team who has resorted to such a desperation tactic.

Returning for one last, painful look at our automobile metaphor, It appears that the FED has decided not to change the oil (i.e. replace member banks’ worthless assets for fresh cash) and the banks will be left to lubricate their engines with the metal shavings as its worthless assets disintegrate on the balance sheet.

How long until B of A seizes up?

Stay tuned and Trust Jesus.

Stay Fresh!

David Mint

Email: davidminteconomics@gmail.com

P.S.  For more ideas and commentary please check out The Mint at http://www.davidmint.com/

Key Indicators for September 1, 2011

Copper Price per Lb: $4.15
Oil Price per Barrel:  $88.71

Corn Price per Bushel:  $7.29  
10 Yr US Treasury Bond:  2.15%
FED Target Rate:  0.08%  ON AUTOPILOT, THE FED IS DEAD!

Gold Price Per Ounce:  $1,825 PERMANENT UNCERTAINTY

MINT Perceived Target Rate*:  2.00%
Unemployment Rate:  9.1%
Inflation Rate (CPI):  0.5%!!!   UP 0.7% IN ONE MONTH, 8.4% ANNUALLY AT THIS PACE!!!
Dow Jones Industrial Average:  11,494  TO THE MOON!!!

M1 Monetary Base:  $2,108,800,000,000 RED ALERT!!!
M2 Monetary Base:  $9,473,600,000,000 YIKES!!!!!!!

Candidates Begging at the MAX, Bloated Pension Promises, and More of the Same from the FED…

11/3/2010 Portland, Oregon – Pop in your mints…

Today Ben Bernanke and his band are completing their sound checks and preparing to sing the tune that the markets are waiting to hear.  It is a classic tune (debauching the currency is as old as the concept of currency itself) that the FED is simply performing a modern version of to the tune of $1 Trillion dollars .  As we wait for Ben to sing and for the election results to roll in, the markets are calm so we will satisfy ourselves today with a personal anecdote, the significance of which we are still pondering.

As you may or may not know, Portland has a public transit system that is the envy of much of the US.  Due to a little old fashioned foresight and out of the box thinking and "redirection" of federal highway dollars (which took place long before we pitched our tent here), we enjoy transit amenities on the scale of much larger cities with technology that may rival any city in the world.  Whether or not the public can afford it is another story.  Trimet, the organization in charge of the system, allows employees to retire after 10 years with full health benefits for the employee and their family.  At last count, benefit costs were higher than the wages paid to existing employees.  Something has to give.