Spain announces guaranteed free money: What's really going on?

Mike “Mish” Shedlock's Sitka Pacific Capital Management,Llc

Spain is about to implement Universal Basic Income. But's let's put the correct label on what's happening.

Universal Basic Income

Please note Spanish Government Aims to Roll Out Basic Income

The Spanish government is working to roll out a universal basic income as soon as possible, as part of a battery of actions aimed at countering the impact of the coronavirus pandemic, according to Economy Minister Nadia Calvino.

Social Security Minister Jose Luis Escriva is coordinating the project and plans to put some sort of basic income “in place as soon as possible,” with the main focus on assisting families, Calvino, who also serves as deputy prime minister, said in an interview Sunday night with Spanish broadcaster La Sexta.

But the government’s broader ambition is that basic income becomes an instrument “that stays forever, that becomes a structural instrument, a permanent instrument,” she said.

Honest Thieves

At least the Spanish government is honest about its redistribution thievery.

They do not all pretend that it's temporary.

Honest Theft™ is the best one can hope for these days.

Guaranteed Free Money™

Rather than labeling this Universal Basic Income (UBI), I propose Guaranteed Free Money™ (GFM)

The money is not really free, however. Government will tax the hell out of everyone then return a portion to everyone.

Of course, some people will put in way more than they get back.

So this is really a redistribution scheme that robs the middle class and upper classes then redistributes the money to everyone to make it appear like a "universal" benefit.

Then again, the MMT crowd will propose this really is "free money", that taxes don't have to be collected, and we can all live in a fairy tale economy of Guaranteed Free Stuff™ (GFS).

Guaranteed Free Stuff™

Guaranteed Free Money
Guaranteed Free Healthcare
Guaranteed Jobs
Guaranteed Standard of Living

In case you are wondering "What can possibly go wrong?" please look at Venezuela, Cuba, or Zimbabwe for some extremely likely answers.

Meanwhile, I have a suggestion: Buy Gold.

For discussion where and how, please see No WSJ, Gold is Not the New Unobtanium: Where to Buy?

Also see Gold's New Breakout is Very Bullish: Here's Why

Mike "Mish" Shedlock

Author

Mike “Mish” Shedlock's

Sitka Pacific Capital Management,Llc

EUR/USD keeps the offered stance just above 1.1700

EUR/USD is coming under heavy selling pressure in what has been a rather grim start to the new trading week, with the pair now trading close to the 1.1700 support area as the US Dollar stages a solid rebound. The prevailing flight to safety mood continues to favour the Greenback, as investors react to the escalating conflict in the Middle East and trim risk exposure across the board.

GBP/USD hits new yearly lows near 1.3300

GBP/USD adds to the recent bearish tone, approaching to the key 1.3300 support to reach fresh YTD troughs against the backdrop of the robust performance of the US Dollar. Indeed, Cable’s decline comes amid the firm demand for the safe-haven space in the wake of the US and Israel attacks to Iran.

Gold battles to retain the positive momentum

Gold now surrenders part of the earlier advance past the $5,400 mark per troy ounce at the beginning of the week. Indeed, the precious metal’s strong uptick remains fuelled by increasing geopolitical tensions in the Middle East amid the intense demand for safer assets.