I started subscribing to this newsletter sometime ago and I find it highly informative and enlightening. It is expensive to subscribe to but worth every penny for the advice and service it provides. I can find nothing in the fine print that says I can't post some of the more interesting ones. So I thought I would share some here. These first ones fairly well sum up what the newsletter is about. October 9, 2013 Sovereign Valley Farm, Pencahue, Chile In August 1973, Jan-Erik Olsson walked into the main branch of Kreditbanken bank in central Stockholm, Sweden and attempted to rob the place at gunpoint. He failed miserably. When the police arrived in short order, Olsson opened fire and injured one of the cops. This only escalated the situation. In desperation, Olsson took four people hostage, and they were held for six days at the bank until police finally used gas to subdue the captors. This sort of thing happens all the time, so it's hardly noteworthy. But what's unique about this event is that the hostages later said they actually felt safer with their captors than the police. The victims had, in fact, become emotionally attached to Olsson and his partner, to the point that they even publicly defended the pair after the ordeal was over. As it turns out, this is actually fairly common. Psychologists call this 'Stockholm Syndrome' after the Kreditbanken robbery; the term denotes a traumatic, positive bond that forms between captors and hostages. To those of us who have never been held hostage, it almost seems fantastical... even intellectually offensive. Seriously, how could anyone ever develop endearing feelings for someone holding you at gunpoint? But when you think about it, this is the very nature of patriotism. Through an entire lifetime of bombastic propaganda, complete with songs and flags and parades, people develop an unquestioning commitment to the state. They'll say things like 'this is the freest country in the world' without a shred of objective evidence to support that conclusion... and overwhelming evidence to the contrary. But meanwhile, we're all held at gunpoint. Spy agencies monitor our phone calls and emails. Central bankers manipulate markets and destroy people who are responsible enough to save. Politicians confiscate people's livelihoods, regulate them to the hilt, authorize discretionary assassination of their own citizens, and actively work to destroy any vestiges of personal liberty. While everyone is allowed to roam around, work, and buy flat-screen TVs, we're all ultimately handcuffed by the state. Everything in our entire lives-- from the value of our savings to our homes and personal property, to even our personal freedom-- can all be confiscated in their sole discretion. I'd be willing to bet the chickens scratching around my yard right now think that they're free... and have no idea that they'll be this evening's dinner. This is a hostage situation, plain and simple. Yet they've skillfully managed to create bonds of affection. The hostages are standing tall, waving the flag, and defending the government's absurd, destructive actions... no matter how much they defy reality. It's gotten to the point that the hostages have begun talking about government actions in the first person: 'There's no way "we" would ever default...' 'In this country "we're" innocent until proven guilty...' 'Airport security makes "us" safer from terrorists...' 'WE should invade Iran...' Hostages have become so inured to the violence of our captors that few people even realize that it's happening. The fear and intimidation tactics have just become part of daily life. This is really hazardous thinking. Hostage situations are dangerous. When things start getting bad, the captors become desperate and start sacrificing their prisoners. Candidly, our courses of action are limited. One can simply hope that the situation will improve, and that you won't be one of the hostages that gets slaughtered. Conversely, you can head towards the big, giant EXIT sign and leave the whole situation behind for greener pastures. Or, you can bear down and stick it out... but at least have a credible escape plan. Reduce your exposure to the captors. Don't have all of your eggs in one basket. It costs you nothing, for example, to move a portion of your savings abroad to a safe, stable bank in a jurisdiction that your home government does not control. It costs you nothing to pursue an 'ancestry' passport in the event that your parents or grandparents hailed from certain countries like Ireland or Italy. Yet in the event that the hostage crisis escalates, it's these sorts of steps that will end up paying enormous dividends for you... and pave the way to freedom. Until tomorrow, Simon Black Senior Editor, SovereignMan.com October 17, 2013 Santiago, Chile "How did you go bankrupt?" Bill asked. "Two ways," Mike said. "Gradually and then suddenly." The dialogue above is from Ernest Hemingway's 1926 novel, The Sun Also Rises. It's often attributed to Mark Twain or F. Scott Fitzgerald, or misquoted as something like "At first you go bankrupt slowly, then all at once." But the theme is the same. Nations go bankrupt in the same way. Banking collapses occur in the same way. Currency crises strike in the same way. They all happen gradually... and then suddenly. Sometimes overnight. History is generous with examples of entire nations that have suffered this fate, from the collapse of the Soviet Union in 1991 to Argentina's millennial financial crisis in 2001. The warning signs are always there, even at the beginning. Over a period of years, sometimes decades, a tiny trickle of warning signs turns into a steady stream... and eventually a great flood. The United States is clearly within this model, somewhere between a steady stream and a great flood. It shows. Last night, after more than two weeks of utterly embarrassing theater, the government in the Land of the Free inked a deal to kick the can down the road a few more months. And in doing so, they set a very dangerous precedent. As part of the bargain codified in HR 2775 (which President Obama signed into law), the Treasury Department is authorized to SUSPEND the debt ceiling. In other words, for all intents and purposes, there is now NO LIMIT government borrowing. This limitless borrowing authority will expire on February 7, 2014. But it sets the precedent that dismissing the debt ceiling is a perfectly viable course of action. Congress has effectively removed their handcuffs... so you can almost assuredly bet down the road that this provision will be extended, and ultimately become permanent. No one in the Land of the Free seems to care. But foreigners do. The lead commentary out of China's state media the other day was very clear in its position: "It is perhaps a good time for the befuddled world to start considering building a de-Americanized world." America's dominance is coming to an end. Nearly every piece of objective evidence points to this conclusion-- from the US government's absurdly unsustainable finances to the worldwide backlash against their desperate spying tactics. For several years now, this decline has been happening gradually. But we are quickly reaching the bifurcation point where the steady stream of warning signs will turn into an epic flood of consequences. As these events unfold, this will become the biggest story of our time. The end of the US dollar hegemony will affect nearly every human being on the planet. And if history is any guide, what follows will be incredibly tumultuous. Until tomorrow, Simon Black Senior Editor, SovereignMan.com September 25, 2013 Sovereign Valley Farm, Pencahue, Chile It goes without saying that parents want the best for their children... and that each generation wishes the next to be even more prosperous and successful. For the most part, this has been the historical pattern since the Industrial Revolution; every successive generation has enjoyed an almost uninterrupted rise in standard of living, made possible both by the development of new technologies and the passing of a large pool of savings. Today, though, in the West... the pinnacle of civilization... this trend is coming to a screeching halt. Wealth is being destroyed at an astounding rate through the insidious trifecta of debt, inflation, and taxes. Both personal and public debt levels in the developed West are rising. And this constitutes a transfer of wealth that ends up in the pockets of bankers and foreign creditors. The steep rise in public sector debt spells out an inevitable conclusion of rising taxes. Politicians try to kick this can down the road for as long as possible, but eventually they are left with no alternative (in their eyes) but to raise taxes. This is what recently happened in Japan; the government debt level there is over twice the nation's GDP. And so they recently passed a steep increase in sales tax despite every historical indication that raising tax rates don't raise tax revenue. In the Land of the Free, for instance, tax rates since the end of World War II have been all over the board... from 25% to 90%. Yet overall tax revenue has remained consistently at roughly 17.7% of GDP. Raising tax rates does NOT increase tax revenue. But politicians fail to understand this point. In their minds, raising taxes is the only way to raise revenue. And this is a major threat to your livelihood. Last, and perhaps most destructive, however, is inflation. Inflation is the worst form of deceit. The government creates a monopoly over the money supply, awards it to a tiny central banking elite, and then those very people who are entrusted with preserving the currency's purchasing power continually debase it. Savers are foresaken. Retirees and the middle class get decimated. And bankers make out like bandits on the rise in paper asset prices. In conducting any long term financial and estate planning, it's imperative to account for these three ingredients. And I would suggest the following: 1) Consider a well-structured international trust A trust may be the single most effective asset protection and estate planning tool available. It's nearly bullet proof to creditors. And if set up properly, a foreign trust can completely disconnect from the tax system upon your death. With a foreign trust, you can be sure that your savings will be passed along to your children with minimal interference from government, creditors, or the tax man. 2) Buy land overseas Owning property abroad not only gives you a bolt hole in case you ever need to leave, but it's also the best way to move a substantial amount of money overseas. Owning property overseas, even for heavily regulated US tax slaves, is currently non-reportable. And you could easily park six or seven figures in savings by purchasing well-located property in a thriving economy abroad. If purchased smartly, this can also be a great hedge against inflation. 3) Maximize gift tax deductions Though the rules are subject to change, each year parents have a tax-free limit that they can pass gifts to their children, plus a lifetime gift tax allowance. If you're not maximizing your gift tax, you're inviting the tax man to get between you and your children upon your passing. 4) Invest in precious metals overseas Precious metals are an obvious inflation hedge. And owning gold and silver at a safe deposit box facility overseas is also non-reportable. Some facilities, like Das Safe in Vienna, are even anonymous. If your children have access to the facility, the precious metals can pass very quietly and anonymously to them upon your death. Until tomorrow, Simon Black Senior Editor, SovereignMan.com
November 21, 2013 Miami, Florida Today I'm in Miami at a conference on Global Residency and Citizenship where I'm slated to speak this afternoon as part of a panel. So far it's been really interesting; there are several Presidents, Prime Ministers, Finance Ministers, Ambassadors, etc. from a number of countries-- Malta, Cyprus, St. Kitts, Antigua, etc. Each of them is here for the same reason; they're trying to convince a room full of investors and attorneys to invest in their country. Bear in mind, most of these countries are in dire fiscal straits. St. Kitts & Nevis, for example, has one of the highest debt levels in the western hemisphere as a percentage of GDP. And you probably recall what happened in Cyprus-- the government and banking system were in such bad shape that they had to 'bail in' the banks by stealing customer deposits. They're desperate to raise cash. And they've had to resort to innovative methods. Many of them are now 'selling' residency. For example, Hungary has a program where you can invest in government bonds. And in exchange, you can become a resident. Portugal has a similar program called the Golden Residency program, whereby you can simply purchase a property or some other such investment in exchange for a very tax efficient class of residency. After six years, you can even apply to become a naturalized Portuguese citizen. Then there are other countries that are selling citizenship. Malta has a program whereby you can invest 650,000 euros (about $875,000) in exchange for citizenship. Cyprus and Antigua also both have similar programs, though at different price points. These programs are undoubtedly controversial. Political opposition groups are hammering home fears about how criminal terrorist masterminds will be able to acquire Maltese citizenship and use it for nefarious purposes. You'd think they'd be happy that some foreigner is willing to pay almost a million dollars for a travel document... money that the government desperately needs to pay down its sizeable debt burden. But I suspect the fear-mongering will quiet down once the money starts rolling in. This is the future. Rather than treat people like dairy cows and work horses, governments are going to have to position themselves to attract talented, productive residents and citizens. As The Economist wrote in October last year: "The world's most valuable resource is talent. no country grows enough of it. Some, however, enjoy the colossal advantage of being able to import it." Fortunately, this is already happening. Panama has a very popular program to attract retirees to move to the country; it's been so successful for them that the program has been copied throughout the region. Many European nations, from Spain to Ireland, are now providing residency to any foreigner willing to bring capital into the country and help them mop up all their excess housing inventory. Places like Singapore and Chile have been rolling out the red carpet for entrepreneurs and businesses, providing all sorts of subsidies and tax incentives. This is a good thing. When governments compete, people win. And those who refuse to compete will eventually run out of dairy cows... In our modern times, we can be mobile. We're not chained to the land as if we're living in the feudal system. There's nothing stopping a family from uprooting and heading overseas if the lifestyle, business opportunities, and tax environment would provide a better quality of life. And I'm pleased to tell you that, even though there are a lot of serious economic storm clouds on the horizon, there are more and more governments starting to realize that they have to become competitive. I'm following this trend closely and will have more to report as the opportunities unfold. Until tomorrow, Simon Black Senior Editor, SovereignMan.com
October 28, 2013 Sovereign Valley Farm, Chile You know the old rule of thumb about laws-- The more high-sounding the legislation, the more destructive its consequences. Case in point, HR 3293-- the recently introduced Debt Limit Reform Act. Sounds great, right? After all, reforming the debt seems like a terrific idea. Except that's not what the bill really does. They're not reforming anything. HR 3293's real purpose is to authorize the government to simply stop counting a massive portion of the US national debt. You see, one of the biggest chunks of the debt is money owed to 'intragovernmental agencies'. For example, Medicare and Social Security hold their massive trust funds in US Treasuries. This is the money that's owed to retirees. In fact, nearly $5 trillion of the $17 trillion debt (almost 30%) is owed to intragovernmental agencies like Social Security and Medicare. So now they basically want to stop counting this debt. Poof. Overnight, they'll make $5 trillion disappear from the debt. On paper, this looks great. But in reality, they're setting the stage to default on Social Security beneficiaries without causing a single ripple in the financial system. Remember, when governments get this deep in debt, someone is going to get screwed. They may default on their obligations to their creditors, causing a crisis across the entire financial system. Or perhaps to the central bank, causing a currency crisis. But most likely, and first, they will default on their obligations to their citizens. Whatever promises they made, including Social Security, will be abandoned. And if you read between the lines, this new bill says it all. Not to be outdone by the United States Congress, though, the International Monetary Fund recently proposed a continental-wide 'one off' wealth tax in Europe. Buried in an extensive report about Europe's troubled economies, the IMF stated: "The appeal is that such a tax, if it is implemented before avoidance is possible and there is a belief that it will never be repeated, does not distort behavior (and may be seen by some as fair)." In other words, first they want to implement capital controls to ensure that everyone's money is trapped. Then they want to make a grab for people's bank accounts, just like they did in Cyprus. The warning signs couldn't be more clear. I've been writing about this for years. It's now happening. This is no longer theory. Over the last few weeks I've been having my staff revise a free report we put together two years ago about globalizing your gold holdings. In the report I mentioned that capital controls are coming. And that some governments may even ban cash transactions over a certain level. These things have happened. Cyprus has capital controls, France and Italy have limits on cash transactions. And given this new evidence, it's clear there's more on the way. Every rational, thinking person out there has a decision to make. You can choose to trust these politicians and central bankers to do the right thing. Or you can choose to acknowledge the overwhelming evidence and reduce your exposure to these bankrupt western countries that will make every effort to lie, cheat, and steal whatever they can from you... just to keep the party going a little while longer. It's time for people to wake up to this reality. You only have yourself to rely on. Not the system. Not the government. And certainly not the bankers. Until tomorrow, Simon Black Senior Editor, SovereignMan.com
December 13, 2013 Sovereign Valley Farm, Chile One of the things we talk about routinely in this column is the fraudulent nature of the global monetary system. When you step back and look at the big picture, it seems ludicrous. We have essentially awarded totalitarian control of our money supply to a tiny banking elite. And in controlling the money supply, they have the power to set or manipulate the price of just about everything on the planet. I'm certain that at some point in the future, financial historians will look back with astonishment at how we could allow ourselves to be bamboozled like this. We have literally entrusted the entirety of our wealth, savings, and livelihoods to just a handful of people. It's insane. What's even crazier is how few people really understand how this system works. If anything, we're told that there's a crack squad of brilliant economists making decisions about things that are simply too complicated for us little people to understand. And we just have to trust them to be good guys. As a regular reader of Notes from the Field, I'm guessing that you already understand that this monetary system is one of the most blatant, destructive scams in history. But chances are, you have a lot of friends and family who don't get it. This is always a tough nut to crack. People can be very intransigent in their ignorance. They've grown up for their entire lives hearing about how they live in a free country with the strongest currency and richest government in the world. They've become so brainwashed that suggesting anything to the contrary is tantamount to blasphemy. And it can be very difficult to talk to them about the truth. Fortunately the holidays are coming up. So if you're thinking that you might want to educate some of the important people in your life, here are a few inexpensive gift ideas that might just transform someone's entire worldview: 1) Book: The Creature from Jekyll Island. G Edward Griffin's investigation into the creation of the Fed really does read like a detective novel. At 600+ pages, it's long. But it's a real page-turner. And after finishing it, your loved ones won't ever look at money, politics, or banking the same way ever again. 2) Book: End the Fed. Written by none other than Dr. Ron Paul, End the Fed synthesizes historical analysis, common sense economics, and his own personal experiences from decades in Congress, all to argue one simple point-- that the Fed is destructive and has utterly failed in its mission. 3) Movie: Money for Nothing. This is my personal favorite, one I definitely recommend checking out. Even if you are up to speed on these concepts, I can almost guarantee that you'll learn something. Money for Nothing is a 90-minute documentary that was professionally and impeccably assembled by Jim Bruce and his all-star team. The film is not only incredibly entertaining, their access to top former and current Fed officials was simply incredible-- names like Volker, Yellen, Plosser, Fisher, Lacker, Poole, etc. Money for Nothing is available for purchase (DVD or digital download) at www.MoneyforNothingthemovie.org Until next week, Simon Black Senior Editor, SovereignMan.com I've read the books and agree with the recommendation. Haven't seen this movie but will be checking it out.MM
