Tuesday, April 21, 2009

Economic collapse

The stock markets have gone up for six straight weeks. That's a pretty strong sign of a top. Our financial system continues to come unglued as Goldman Sachs leads the looting of the treasury after a financial coup d'├ętat that has stolen $46,000 from each taxpayer to hand it over to the banks now running the country. After over $13.6 trillion has been poured into the banking system, I cannot see that a person I know has been enriched by even a single cent but each American is now indebted to the tune of an additional $46,000.

It's going to end badly. We are not at the bottom; we aren't even near the bottom. In terms of the Great Depression, we are in 1931 or so; the bottom is ahead of us. I expect the dollar to default in the next few months after a General Motors and Chrysler bankruptcy convinces everyone that we are truly in a depression.

US Bonds are on the brink of a collapse. When they do, the dollar will tank and interest rates soar. As measured by John Williams at ShadowStats.com, the real pre-Clinton unemployment rate is above 20%.

I've called for riots by summer but even I have been startled by the number of mass murders in the United States in the last month or so. It's the economy, stupid.

It's going to get worse, much worse as the insane financial policies of both political parties over the past fifty years come to their inevitable conclusion. The United States is bankrupt and soon the rest of the world will realize it. The days of writing checks in the firm belief the rest of the world will not cash them are over. The United States has had 89 years of being able to live beyond our means as a result of being the world's reserve currency. It's over and the deconstruction of the United States has begun.

The risk of World War III being ignited by a US/Israeli attack on Iran has diminished considerably under Obama. However daily pronouncements out of Israel serve to remind us that a Zionist nuclear attack on Iran is still the #1 goal of Israel notwithstanding the 16 US intelligence agencies that all conclude Iran does not have a nuclear weapons program. Israel made it clear under the Clean Break from the Peace Process that they intend to attack anyone who might be a threat to them at some point in the future, no matter how distant.

Derivatives as measured by the BIS showed as $684 trillion [pdf] as of last June. A more current report will come out in a month. I expect it to show an increase in OTC derivatives. That's insane.

I saw the danger in the mere size of derivatives in January of 2002. They were out of control then. Now they are seven times larger and growing. And not a single "expert" in the Obama administration understands the danger of a $700 trillion dollar casino with no regulation and everyone playing with monopoly money. It allows companies such as Goldman Sachs to destroy companies, indeed countries with no risk to themselves. After all, the taxpayers of the United States have assumed all the risk of failure.

Gold is a safe haven and will remain a safe haven. Paper gold may well disappear along with all the other monopoly money assets. We are in for another massive deleveraging that may well drag precious metals shares with it. The safest shares to be in will be those of producing gold and silver companies.

Hunker down. This summer is going to get really fugly. [Editor's note: Fugly - I do LOVE this word.]

Bob Moriarty
President: 321gold

Apr 20, 2009 A Crash this way Cometh Bob Moriarty 321gold ...s

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Move Your Money Out of the Country...and Soon

Things are getting uncomfortable for individuals and corporations looking to deposit their money in tax havens around the world. Just recently, Congress introduced the so-called “Stop Tax Haven Abuse Act,” which is designed to do away with the privacy afforded by doing business or investing outside the U.S. and to eliminate or reduce tax benefits available offshore. Simon Black and Fitzroy McLean, ex-CIA operatives, investment pros, and globe-trotting editors of Casey Research’s Without Borders, weigh in with their no-holds-barred opinion on the topic…

We are patriots. We have proudly served in our country’s military, have extended a helping hand to its public sector, and have plowed our entrepreneurial enterprise into its once fertile soil. We love America, but these days, America does not love us back. It takes without giving and squelches free enterprise. These days, America is no longer the land of the free, especially when it comes to the market.

Just look at the headlines, seemingly ripped from the pages of Atlas Shrugged: Unconscionably large bank bailouts. Punishing regulations and tax requirements. An arctic business climate. Government money bombs. Riots and protests. Slowing trade. Protectionist rhetoric. Demonized corporate executives. Even pirates hijacking cargo ships. One can guess what will happen next.

We predict the next several years will usher in larger, more obtrusive governments, resulting in a decline of personal liberty and financial privacy. The world will become increasingly polarized between two groups: those who consider government intervention a great idea, and the rest of us who happen to be sane.

As such, you can bet your last falling dollar on some absolute certainties: bank nationalization is a given, at least de facto if not de jure; taxes are going up on those of us with any money left; the Fed’s money blitzkriegs will spark a blaze of inflation; and financial privacy will be a thing of the past in the United States.

The obvious and necessary solution is to position one’s finances outside of the United States, and to do so now, while the narrow and finite window of opportunity is still open.

To be clear, evading (or even avoiding) taxes at this point is not a wise move, given the size and scope of the ever-growing IRS. But there are significant advantages to expatriating your capital now:

For starters, you will actually have control of your own money. Yes, in certain instances you’ll be obliged to tell the IRS exactly where it is and what you’re doing with it, but no government agency will have the authority to reach into your overseas pocket and freeze or expropriate (read: steal) on a whim just so Team Obama can give it away to pay for someone else’s McMansion. Plus, when exchange controls are implemented and Americans are forbidden from wiring money overseas, your capital will already be secured in another jurisdiction, where you will be free to do what you want with it.

Secondly, you will no longer have to assume the risk of insolvent banks or go through the hassle of petitioning the government to get your FDIC insurance bailout. Many overseas banks are far better capitalized than those in the United States, and some of them are in jurisdictions with constitutionally protected banking privacy.

Lastly, and probably most importantly, moving money overseas gives you a last chance at diversifying out of the dollar, which, in a very short period of time, will barely be worth the paper on which it’s printed.

Bank and Brokerage Accounts

Opening a foreign bank or brokerage account is easier said than done; the United States government severely restricts where and under what terms you can open a bank account, invest in a fund, or engage in other economic activities that facilitate the protection of and access to your assets. As the signatory on an overseas account, you are required by law to inform the federal government on Treasury form TDF 90.22 by the end of June each year. Ostensibly, this has been done in the name of fighting money laundering, but it has the effect of severely restricting your freedom of financial movement.

Many foreign banks simply won’t work with you… don’t worry, it’s nothing personal. Uncle Sam has been beating them down since the Reagan years, and between Qualified Intermediary rules, tax treaties, and the USA PATRIOT Act, Sammy gives himself a lot of regulation to bury the opposition with.

There are some jurisdictions that are still excellent banking centers; Switzerland may have rolled over, but Panama, Uruguay, Singapore, and the United Arab Emirates have thus far ignored the call for “greater transparency” (read: government access to private finance).
Some individual banks, like Credicorp and Global Bank in Panama, or Banco Itau in Uruguay will not work with U.S. citizens anymore, but there is still opportunity with the hundreds of remaining banks in these jurisdictions.

Similarly, opening a foreign brokerage account is a shrewd move, not only to move your money overseas but also to have greater access to financial markets. Remember when world markets tanked on Martin Luther King Day 2008? If you were a U.S.-based investor and wanted to sell, sell, sell, you had to wait a full 24 hours until the markets opened after the holiday on Tuesday morning. If you had been invested with global depository shares through a foreign brokerage, you could have saved yourself several points and gotten out in time.
We would suggest looking at Saxo Bank in Denmark.

Bullion Storage

If you have gold, it would be highly beneficial to get it out of the U.S. – stat. If you do keep it in the U.S., your only truly reliable and private option is to store it yourself in a safe that you bury in your backyard. Otherwise, move it out of the U.S. now before Team Obama pulls an FDR and takes your gold from you.

At the moment, gold is not considered a monetary instrument by the U.S. Customs and Border Patrol, so there is no legal requirement to declare your bullion upon leaving the United States. Some countries, like Taiwan and Uruguay, require you to declare gold in excess of a certain value to customs officials upon entry.

We recommend Panama, Austria, Switzerland, and the United Arab Emirates as locations to store bullion; one particular favorite is a location called Das Safe (www.dassafe.com) in Vienna where anonymous safes start at 400 euro/year.

Real Estate

It might sound counterintuitive after the subprime debacle, but real estate is a sound option for moving money outside of the United States; there are zero reporting requirements. It’s your business where you own property, and (so far) no one else’s. You can purchase property in a private way by setting up a corporate structure to hold the assets so that they’re not in your name (Panama is an excellent jurisdiction to set this up), and although there are many places with depressed real estate markets, there are also many with good growth potential: in Latin America, we would recommend Panama, Colombia, Uruguay, and Chile. In Europe: Slovakia, Albania, and Poland. In the rest of the world: Lebanon, Hainan Island (China), the Philippines, Cambodia, and New Zealand.

Time is of the essence – start looking for your safe haven now.

About The Author

Without Borders is Casey Research’s monthlynewsletter dedicated to finding the best global investment opportunities and the most beautiful places to live and do business.

If you are interested in specific strategies for moving money overseas and diversifying out of the dollar –whether it’s overseas bank accounts, real estate purchases, commodity currencies, or offshore brokerages — Fitzroy and Simon tell you the safest and most robust places to park your dollars while they’re still strong and widely accepted… places that will keep your personal economy strong even as the dollar and the U.S. economy suffer. They investigate outstanding investment opportunities, companies, and stocks you won’t hear about on CNBC as well as lucrative overseas deals that they themselves scope out and test.

If you want to think, invest, and live outside the box, test Without Borders now risk-free – via our 3-month trial subscription with 100% money-back guarantee. Click here to learn more.

Move Your Money Out of the Country...and Soon | EFAM | Escape From America Magazine

If you found this article interesting please subscribe for updates with any reader or your email. Also be sure to check out my soon to launch membership website TheStockman.ORG, You can also support the st0ckman by joining the pyrabang network. PyraBang is an awesome concept striving to take down main stream media and their corporate programming.

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