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Updated: 6 hours 31 min ago

One Government Has No Problem Confiscating Gold. Is It Yours?

Sun, 03/01/2015 - 18:24

[The following post is by TDV Contributor, Justin O'Connell]

Originally appeared at GoldSilverBitcoin

In recent months a lucky Chinese herdsman stumbled onto a 17-pound gold nugget. But there are now questions swirling around just how lucky he truly is as China's government may force him to turn over the nugget to the state as it is a public "mineral resource."

The ethnic Kazak herdsman tripped over the gold nugget, which apparently was lying "on bare ground," while traversing through China's far western Xinjiang region about three weeks ago. After the local government appraised the rock and investigated the ownership of the nugget, the government decided it might seize the gold nugget, a move that has triggered controversy across China, as legal experts and laypersons alike debate who should get to keep the gold nugget.

The local cultural heritage authority has already admitted the nugget isn’t a “cultural relic” — which would automatically make it a state asset — referring to it instead as a “mineral product,” a separate report by the state-run Xinhua Daily Telegraph said earlier this week.

However, the report quoted a lawyer based in Shanxi province as saying that if the nugget is eventually determined to be any type of “mineral resource,” it would still be the property of the government under Chinese law.

Some other law experts disagree, however.

Cheng Jianwei, a lawyer in the northwestern city of Xining, said that since the nugget was sitting uncovered on the ground rather than buried below the surface, the discovery would be outside the legal definition of “inspecting and recovering mining resources,” according to the Beijing Morning Post report.

Likewise, China University of Political Science and Law professor Li Xiandong told the newspaper that the circumstances of the find show the nugget is “an ownerless thing,” which should belong to the herdsman.

The report said that if the state does take the gold, the herdsman’s outlook for compensation might be dim, noting that in 2011 a farmer found a priceless Neolithic stone ax while digging on his land but received a mere 100 yuan ($16) reward after authorities took possession of it.

Of course, this is a drastically different circumstance than the Executive Order issued by Franklin Delano Roosevelt forcing all gold coin, gold bullion and gold certificates be turned in at a Federal Reserve Bank, branch or agency, or to any member bank of the Federal Reserve System.  Nonetheless, this is still an example of an over-reaching bureaucracy.

Questions or comments? Join us at TDV Blog

What makes The TDV Newsletter so valuable is its keen knowledge of macro-and-micro economics events and theories. While your parent's economic advisors and stockbrokers adhered to the Keynesian paradigm, TDV's monthly Dispatches and Newsletter sees the world through the episteme of Austrian Economics, something every person curious in economics, politics and culture should be familiar with. Austrian Economics understands the driving force behind liberty, slavery, economic indicators, stats and players.

Because this year is going to be a chaotic one, as foreseen by the TDV Staff, Editor-In-Chief Jeff Berwick and senior analyst Ed Bugos are dedicating themselves almost full-time to bringing paid subscribers the best information they can receive in 2015, which could prove to be an ever important year in The End Of The Monetary System As We Know It (TEOTMSAWKI).

What's more you will receive invaluable and private placings in some of today's most exciting companies.

Subscribe to The Newsletter today, and receive TDV's HomeGrown, as well as special reports, including Getting Your Gold Out Of Dodge.

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February 27, 2015

Precious Metals Industry - From Mining to Retail - Consolidated In Recent Years

A post by Justin O'Connell on the current state of the precious metals industry.

Amid depressed prices, there has been quite a bit of consolidation in the precious metals industry, affecting miners and even local coin shops.

A multi-year bull run ended in 2014, after $30 billion in debt had been taken on by gold miners. The miners which minimized their borrowing are now in a position to buy mines from rivals with weaker balance sheets, according to executives at the Investing In African Mining Indaba Conference in South Africa earlier this month, the biggest gathering of the sorts on the entire African continent.

continue reading...

February 25, 2015

A Brief Recent History Of Precious Metals Manipulation Investigations

  A post by Justin O'Connell on precious metals manipulation.   Although terms like “free market” are often used to describe modern life,  evidence of command-and-control markets keeps finding its way into headlines, most notably with Libor - the rigging of global interest rates (or the price of money) - shocking the world.   continue reading...

February 24, 2015

The Bottom Up Revolution of Truth Continues, One Industry at a Time

An article by Ed Bugos on decentralization across industries.

"It is error alone which needs the support of government. Truth can stand by itself. Subject opinion to coercion: whom will you make your inquisitors? Fallible men; men governed by bad passions, by private as well as public reasons. And why subject it to coercion? To produce uniformity. But is uniformity of opinion desirable?" --Jefferson, Notes on State of Virginia, 1787

continue reading...

February 23, 2015

Interview with Ed Bugos about how he became interested in gold, and his current outlook

An interview between Justin O'Connell and Ed Bugos.

The following interview is by Justin O'Connell's GoldSilverBitcoin with The Dollar Vigilante's Ed Bugos. This article originally appeared on GoldSilverBitcoin.

TDV: Ed, thank you for taking time to do this!

TDV: When did you become a gold bug and why?

ED: Justin, I first became bullish on gold in the late nineties, about a decade into my career as a stockbroker, as the “cult of equity,” as Bill Gross called it, reached a fever pitch.  Thanks to the Greenspan Put, you could not go wrong.  By the time 1999 came around nobody remembered the last serious decline in stock prices, at least in the US.

The worst correction in memory was the 1987 crash, which wiped out almost a third of index values in a matter of days, but that 700 point drop in the Dow became irrelevant with the averages four or five times higher then, and following year after year 20% gains in the S&P 500.

continue reading...

Precious Metals Industry - From Mining to Retail - Consolidated In Recent Years

Fri, 02/27/2015 - 16:47

[The following post is by TDV Contributor, Justin O'Connell]

Amid depressed prices, there has been quite a bit of consolidation in the precious metals industry, affecting miners and even local coin shops.

A multi-year bull run ended in 2014, after $30 billion in debt had been taken on by gold miners. The miners which minimized their borrowing are now in a position to buy mines from rivals with weaker balance sheets, according to executives at the Investing In African Mining Indaba Conference in South Africa earlier this month, the biggest gathering of the sorts on the entire African continent.

$2.7 billion in deals have been announced or completed in 2015, including February's $1.1 billion offer for Rio Alto Mining Ltd. by Tahoe Resources Inc.  In 2014 there were $10.5 billion in deals.

“Gold is one of the brighter spots out there in the commodities space today,” said Rajat Kohli, who heads metals and mining at Standard Bank Group Ltd., Africa’s largest lender. “I would expect corporate activity to be reasonably pronounced in gold, not just in Africa but globally. We will see a few transactions, definitely.”

Randgold Resources Ltd., the best performing gold-mining company in the past decade, has been "flat out" overrun with offers to buy assets, Chief Executive Officer Mark Bristow said in an interview.

“People are a bit more confident to move from the sidelines into a bidding process,” Srinivasan Venkatakrishnan, CEO of AngloGold Ashanti Ltd., told Bloomberg. The world’s third-largest gold miner is looking to sell assets or form joint ventures to reduce debt, according to him.

“As the clock ticks on with this gold environment, balance sheets, access to capital, those all sometimes become catalysts for M&A,” Kinross Gold Corp. CEO Paul Rollinson said Dec. 10. “Our strategy has positioned us well to perhaps be opportunistic in that regard.”

Tahoe Resources offered $1.1 billion in cash-and-stock in February for Rio Alto, the largest gold deal in almost 10 months.  Acacia Mining Plc wants to do a massive deal sometime this year. B2Gold Corp recently paid $570 million for Papillon Resources Ltd. to gain control of a project in Mali.

“A lot of people in our sector are a little scared to do deals, to step up and do something that may be considered a risk,” he said. While some companies “are licking their wounds, we’re out doing acquisitions and growing the company very aggressively.”

The public markets are also interested in gold, as the 14-member Bloomberg Intelligence Global Senior Gold index is up 22 percent already this year, outperforming the 42-member MSCI World Metals and Mining index, which is down .03 percent. Gold companies have raised $852 million through public offerings this year, including more than $900 million last month from Canadian producers Romarco Minerals Inc., Detour Gold Corp., Osisko Gold Royalties Ltd. and Yamana.

It hasn't been merely the mining industry where consolidation has taken place. The entire ecosystem around the precious metals market has been somewhat transformed.

In 2012 there was a merger between NTR Metals and Ohio Precious Metals. NTR is a global company refining over 30 million pounds of metal each year. They are involved in commercial refining, industrial recycling and refining, precious metals market making, and bullion minting.

Ohio Precious Metals was founded more than 35 years ago and refine gold, silver, platinum and palladium. OPM receives their materials from jewelry, pawn, coin, photographic, electronic, secondary refining/collecting and banking industries.

The NTR and OPM merger was merely symptomatic. The merger of these two companies created Elemetal LLC and Elemetal has purchased multiple companies in the last year. NTR recently purchased Provident Metals:

Provident Metals™, a leading online provider of bullion, currency and numismatic coins, announced that it has partnered with global precious metals company Elemetal, LLC.

Provident Metals offers a full line of sovereign and private bullion, currency and numismatic coins. Based in Dallas, Provident meets the bullion needs of precious metals collectors and investors across the United States and internationally.

Elemetal™ is a global precious metals company based in Dallas. Its principal holdings include OPM Metals™, NTR Metals®, Echo Environmental™ and DGSE Companies, Inc. Elemetal's operations focus on precious metal recovery, refining, and minting.

Provident Metals President Joseph Merrick stated that this alliance will create unprecedented new opportunities for bullion customers and both companies. "Provident will significantly sharpen its competitive edge with industry-leading prices, increased product selection and faster shipping."

Elemetal Chairman Alan Stockmeister added that, "This partnership allows OPM Metals an unparalleled opportunity to highlight its brand as the largest American-owned, COMEX deliverable gold and silver refiner and minter."

Additional information about Provident Metals and its expansive line of products is available at ProvidentMetals.com.

Another major acquisition by Elemetal was the purchase of Dallas Gold Silver Exchange or DGSE, a publicly traded company. Elemetal, LLC, a global precious metals conglomerate based in Dallas, Texas, adds over 4 million shares of common stock of DGSE Companies, Inc. to its holdings. This merger came about due to intrigue and difficulty, for sure. More is known about this buyout than the Provident acquisition.

DALLAS, Jan. 7, 2013 /PRNewswire/ -- On January 2, 2013, NTR Metals, LLC contributed 4,393,142 shares common stockof DGSE Companies, Inc. to Elemetal, LLC in exchange for ownership units of Elemetal. NTR also agreed to contribute its option to buy 5 million additional shares of DGSE.

Elemetal's other principal holdings include OPM Metals™, NTR Metals®, and Echo Environmental™.

OPM Metals is the largest American refiner of good delivery gold and silver, and has earned SCS Global Services certifications for Certified Responsible Source Gold and Silver, and 100% Recycled Gold and Silver Content.
NTR Metals operates a worldwide network of over 70 precious metals processing locations in 12 countries. It serves more than 25,000 companies, ranging from small, independent businesses to large corporations.

Echo Environmental is a large-scale processor of hazardous and non-hazardous precious metal-bearing industrial byproducts. In 2012, Echo Environmental processed over 30 million pounds of these byproducts.

"We are pleased to expand our presence in the precious metals industry with the acquisition of a significant stake in DGSE," said Alan Stockmeister, Elemetal's Chairman of the Board. "DGSE's retail buying and selling capabilities augment our integration strategy in the precious-metals industry's value chain and increase our capacity to serve the varied needs of our clients."
SOURCE Elemetal, LLC

While the precious metals market remains diverse, there clearly is documented tumult within the ecosystem.

I suspect the reason for the megers and acquisitions rests with the price action. At the same time, however, as the consolidation takes place, new technology is lowering the overhead to enter into the precious metals market. Companies are now offering the options for individuals to, with a one-time upfront payment, run their own precious metals e-commerce company on their own website. In many cases, these business owners won't even need to worry about shipping/handling.

As we can see, numerous changes are coming over the precious metals market, from mining to retail operations. It is an exciting time to be well-positioned around the precious metals, but when you are overleveraged in the industry, surviving periods of soft prices could be daunting. That's why arbitraging new technologies to revolutionize old services is so important.

[Editor's Note: The Dollar Vigilante Newsletter stays up-to-date with the precious metals industry, and, alongside the analysis of Ed Bugos, we offer ways in which you can enter into the industry with minimal effort and prosper from the secular bull market in gold and silver. Join us today to learn more.]

Questions or comments? Join us at The TDV Blog.

Justin O'Connell

A Brief Recent History Of Precious Metals Manipulation Investigations

Wed, 02/25/2015 - 16:10

[The following post is written by TDV Contributor, Justin O'Connell]

Originally appeared on GoldSilverBitcoin.

Although terms like “free market” are often used to describe modern life,  evidence of command-and-control markets keeps finding its way into headlines, most notably with Libor - the rigging of global interest rates (or the price of money) - shocking the world.

What fewer know is the consistent investigation by national authorities into the rigging of precious metals prices by major banks.  There have been more than a few. The Department of Justice antitrust division prosecutors investigation into the price-setting process, which was announced yesterday, is merely the most recent.

In 2010, Bill Murphy of GATA delivered groundbreaking testimony to the Commodities Futures Trading Commission (CFTC):

Click here or on thumbnail

In 2013 a five-year investigation into the manipulation of the silver market closed. Reuters stated

 NEW YORK/WASHINGTON, Sept 25 (Reuters) - U.S. regulators on Wednesday closed a five-year investigation into alleged manipulation of the silver market, saying 7,000 staff hours of investigation produced no evidence of wrongdoing.

The decision by the Commodity Futures Trading Commission was a defeat for silver commentators and investors who urged the probe, saying big banks were using futures and options to hold prices down. Big traders had dismissed the investigation as a waste of time and the charges as a conspiracy theory.

...

Closing of the probe was a rare bright spot for Wall Street commodities players during a year in which the U.S. power market regulator has leveled record fines against two big banks, and the Federal Reserve is considering whether to rein in Wall Street's ability to operate in physical markets. But Democrat commissioner Bart Chilton, who had championed the silver inquiry, said he was disappointed.

"For me, there's not been a more frustrating nor disappointing non-policy-related matter at the CFTC," he said in a statement after the agency's announcement. The Gold Anti-Trust Action Committee, an advocacy group that believes the Federal Reserve and banks are colluding to keep gold and silver prices artificially low, said it was not surprised by the CFTC decision.

"We believe that the U.S. government is part of the trading operation. In essence, you are not going to have the CFTC turns against its own government," GATA Chairman Bill Murphy said.

"We are not even slightly surprised and had expected this."

A JPMorgan spokesperson declined to comment.

German’s financial regulator, Bafin, said in early 2014 that the precious metals manipulation case could be worse than Libor. As Bloomberg wrote.

Jan. 17 (Bloomberg) -- Germany’s top financial regulator said possible manipulation of currency rates and prices for precious metals is worse than the Libor-rigging scandal, which has already led to fines of about $6 billion.

The allegations about the currency and precious metals markets are “particularly serious because such reference values are based -- unlike Libor and Euribor -- typically on transactions in liquid markets and not on estimates of the banks,” Elke Koenig, the president of Bonn-based Bafin, said in a speech in Frankfurt yesterday.

...

Bafin said this week it is investigating currency trading, joining regulators in the U.K., U.S. and Switzerland, who are examining whether traders at the world’s largest banks colluded to manipulate the WM/Reuters rates, used by money managers to determine the value of holdings in different currencies.

At least a dozen firms have been contacted by authorities and more than 13 traders suspended, fired or put on leave in the currency case. Regulators are examining how traders, who communicated in instant-message groups, exchanged information on client orders and agreed how to trade at the time of the fix, five people with knowledge of the probes said last month.

“That the issue is causing such a public reaction is understandable,” Koenig said. “The financial sector is dependent on the common trust that it is efficient and at the same time, honest. The central benchmark rates seemed to be beyond any doubt, and now there is the allegation they may have been manipulated.”

After the US governments recent announcement about an investigation, Switzerland’s financial regulator (FINMA) said it had found “serious misconduct” and a “clear attempt to manipulate precious metals’ benchmarks” by UBS employees in precious metals trading. Reuters reported at the time:

Switzerland's financial watchdog said on Wednesday it had found a "clear attempt" to manipulate precious metals price benchmarks during a cross-market investigation into trading at UBS bank.

The FINMA regulator revealed its findings just days after the precious metals industry decided to automate the setting of reference prices for gold, ending the twice-daily "fix" by a panel of banks which has been used for almost a century.

Along with other precious metal benchmarks, the gold fix has come under increased regulatory scrutiny since a scandal broke in 2012 over manipulation of the Libor interest rate, followed by revelations of similar behavior on the global currency market.

Regulators fined six major banks on Wednesday a total of $4.3 billion over the foreign exchange manipulation, including a 134 million Swiss franc ($139 million) penalty that FINMA slapped on UBS, Switzerland's biggest bank.

If recent precious metals manipulation investigations have shown us anything, it’s that the Department of Justice antitrust division prosecutors investigation into the price-setting process for gold, silver, platinum and palladium might levy some fines, but they will leave the system wholly unchanged at the end of the day and it is likely the fraud will persist. Similar results will come of the Commodity Futures Trading Commission civil investigation, announced yesterday.

According to Wall Street Journal, the banks currently being investigated for precious metals price setting by DoJ are HSBC Holdings Plc, Bank of Nova Scotia, Barclays Plc, Credit Suisse Group AG, Deutsche Bank AG, Goldman Sachs Group Inc, JPMorgan Chase & Co, Societe Generale, Standard Bank Group Ltd and UBS Group AG. Formal requests have been made for information.

The CFTC subpoenaed HSBC Holdings PLC regarding precious-metals trading, the bank disclosed in its annual report, released Monday. According to the bank, the Justice Department has asked about documents relating to the abovementioned Bafin’s antitrust investigation which took place in November.

Precious metals markets are these days routinely investigated for manipulation.  But that doesn’t make them unique. It makes them like so many other markets we are learning about.  

Universal Market Hijinks

The 2008 financial crisis was caused by a bloated derivatives market via instruments such as credit default swaps (CDS).  (Some argue that derivatives have been manipulated for a long time and that the  $1,200 trillion dollar market is merely a financial liability for the entire planet) Is it a stretch to think that precious metals markets are manipulated when so many other markets are manipulated?

Reuters noted in September 2014:

A Manhattan federal judge said on Thursday that investors may pursue a lawsuit accusing 12 major banks of violating antitrust law by fixing prices and restraining competition in the roughly $21 trillion market for credit default swaps.

...

“The complaint provides a chronology of behavior that would probably not result from chance, coincidence, independent responses to common stimuli, or mere interdependence,” [Judge] Cote said.

The defendants include Bank of America Corp, Barclays Plc, BNP Paribas SA, Citigroup Inc , Credit Suisse Group AG, Deutsche Bank AG , Goldman Sachs Group Inc, HSBC Holdings Plc , JPMorgan Chase & Co, Morgan Stanley, Royal Bank of Scotland Group Plc and UBS AG.

Other defendants are the International Swaps and Derivatives Association and Markit Ltd, which provides credit derivative pricing services.

Bloomberg reported on interest rate manipulation in January 2014:

Royal Bank of Scotland Group Plc was ordered to pay $50 million by a federal judge in Connecticut over claims that it rigged the London interbank offered rate.

RBS Securities Japan Ltd. in April pleaded guilty to wire frauda s part of a settlement of more than $600 million with U.S and U.K. regulators over Libor manipulation, according to court filings. U.S. District Judge Michael P. Shea in New Haven today sentenced the Tokyo-based unit of RBS, Britain’s biggest publicly owned lender, to pay the agreed-upon fine, according to a Justice Department Justice Department.

Global investigations into banks’ attempts to manipulate the benchmarks for profit have led to fines and settlements for lenders including RBS, Barclays Plc, UBS AG and Rabobank Groep.

RBS was among six companies fined a record 1.7 billion euros ($2.3 billion) by the European Union last month for rigging interest rates linked to Libor. The combined fines for manipulating yen Libor and Euribor, the benchmark money-market rate for the euro, are the largest-ever EU cartel penalties.

Global fines for rate-rigging have reached $6 billion since June 2012 as authorities around the world probe whether traders worked together to fix Libor, meant to reflect the interest rate at which banks lend to each other, to benefit their own trading positions.

Just how big is the Libor scandal? Well, the scandal showed the world that the big banks worked together for years manipulating interest rates. It represented the largest insider trading scandal ever. That's pretty big, right? It doesn't end there...

Energy prices are manipulated as well, as the US Federal Energy Regulatory Commission charged JP Morgan with manipulating energy markets in California and the Midwest, earning itself tens of millions of dollars in overpayments at least.

In the age of High-Frequency Trading, any market can be manipulated it would seem, if even just a little. High-tech computers armed with algorithms manipulate stocks, bonds, options, currencies and commodities, including the precious metals. 

Nobel prize winning economist Joseph Stiglitz noted years ago: “The system is set so that even if you’re caught, the penalty is just a small number relative to what you walk home with."

One day precious metals manipulation might catch the imagination of the mainstream media and be turned into a worldwide scandal, only to fade away the same way the Libor scandal did. For now, investigations of banks for rigging precious metals markets will remain ignored by the mainstream financial press. It's merely a footnote in an encyclopedia of modern amoralism. Investigations aplenty have been launched and fines doled out but the underlying mechanisms of the modern mainstream financial system remain in place.

[Editor's Note: Justin's writing appears in the TDV Newsletter]

Questions or comments? Join us at the TDV Blog

Justin O'Connell

The Bottom Up Revolution of Truth Continues, One Industry at a Time

Tue, 02/24/2015 - 14:33

[The following post is an excerpt by TDV Senior Analyst Ed Bugos from the TDV Newsletter]

"It is error alone which needs the support of government. Truth can stand by itself. Subject opinion to coercion: whom will you make your inquisitors? Fallible men; men governed by bad passions, by private as well as public reasons. And why subject it to coercion? To produce uniformity. But is uniformity of opinion desirable?" --Jefferson, Notes on State of Virginia, 1787

That’s one of the most recurring thoughts in my mind these days.  I’m usually thinking specifically of the hazards associated with central banking and fiat currencies, ideas brought to the west only a few centuries ago to support fractional reserve banking, a scheme that produces a recurring “cluster of errors” – i.e., and boom-bust cycle – in its wake.  It has fueled popular delusions of grandeur and manias from tulip speculation to world conquest, and is responsible for many economic collapses.

But history extends beyond the origin of government supported fractional reserve banking systems, Jefferson was no doubt aware, and much of it can be presented as a timeline in human fallibility.

Many important ideas widely considered good today were condemned once, and vice versa.

Most people even today are blithely unaware of what doctrines they hold are true and which are not.

[Consider this one!]

Thankfully, some scholars, not disconnected with Jefferson’s time, came to see it is perhaps better, then, not to sanction force to promote ideas and particularly religious doctrine.  How novel a time!

Jefferson’s critics believe it is naïve to think that general truths would win out by their shear veracity.

But what a farce it is to think that the bad men who would keep them from you might not somehow find their way into politics.  Standing armies were not used to realize truths such as: the sun does NOT revolve around the earth, the world is not flat, wants are infinite, means are scarce, value is subjective, and so on.

But they were certainly used to rob, loot, murder and commit atrocities in the name of God.

Historically truth has come about because someone stood up to hegemony and coercion.

The relevant lesson of history being that fallible humans endowed with too much power for their own good, or for anyone’s good, have always used force to suppress the truth…never to protect it!

But more than anything, as a classical liberal, Jefferson saw the use of initiatory force as immoral.

I don’t know whether he valued diversity of opinion for its own sake.  But I am convinced that he would have valued the free exchange of ideas, and certainly would have tolerated dissent.  He promoted it.

No doubt he understood the importance of consensus on core values, like the nonaggression axiom, property law, etc.  But the use of force to realize these truths would defeat their purpose.  Besides, we are taught government is benevolent and run by all knowing philosopher kings elected by the general population prepared to implement its general will to the betterment of everyone when it is really just an institution run by “Fallible men; men governed by bad passions, by private as well as public reasons.”

So even the justification of initiatory force is based on a lie –a lie that the truth will one day bulldoze.

Antiquity will see men like Rothbard, Mises, and Hoppe as the Socrates, Galileo’s, and Bruno’s of the day.

For the thing about truth is that once it becomes generally realized it sure is hard to stamp out.

Indeed, while critics of the laissez faire system will tend to point to the fallibility of man as a weakness of such a system, others have long realized, ”If one rejects laissez faire on account of man’s fallibility and moral weakness, one must for the same reason also reject every kind of government action” (LvM).

In the real world, much error results from the well-intended misdirection of coercion and force.

If something is true, as Jefferson said, it does not need the support of government.

If an enterprise (or idea) is truly profitable, it doesn’t need subsidies and support from government.

Of course, separation of church and state is no longer that controversial.  But separation of education and state, banking and state, money and state, security and state, and now healthcare and state all rank high as areas of substantial controversy, and industries where government still supports error.

The Bottom Up Revolution of Truth Continues, One Industry at a Time
 

“Uber Technologies Inc. has expanded a fundraising round by $1 billion amid swelling investor appetite for the mobile car-booking application. Uber submitted a filing Wednesday to the Delaware Secretary of State to bump up its fundraising by $1 billion, according to a representative of the San Francisco-based company. That would bring the total in the round, known as the Series E round, to $2.8 billion. Uber had previously collected $1.8 billion of the financing.  Uber has been on a money-raising tear. The company, led by Chief Executive Officer Travis Kalanick, raised $1.2 billion in financing in December, which valued the startup at $40 billion, one of the highest valuations for a closely held technology startup. It recently topped that off with another $600 million. Last month, Uber also closed $1.6 billion in convertible debt…” Bloomberg February 18, 2015

Huge!  A new “sharing” economy is trying to emerge thanks to the internet; ushering in new concepts like ride-sharing (Uber), home-sharing (BnB), crowdfunding, bitcoin, and other innovative services that would have never been conceivable before the internet, which would have never been conceivable before computers, which in turn would have never been conceivable before the existence of electricity, or whatever.  Imagine today what new layers of capital goods the human mind will think up next.

It’s nigh impossible to go far beyond “next” though.

But I diverge, as this isn’t supposed to be a refutation of central planning (yet maybe it is that simple).

What is interesting to note here is the reaction from the man on the street to these newly developing technologies, and the industries emerging from them.  Skepticism is high today.  He thinks that bitcoin, uber, and kickstarter are all fads; more examples of human error – like tulip mania and other bubbles.

Who knows.  It’s hard to tell in an economy where so many industries are propped up or artificial.

I’m not going to claim they won’t fail.

However, they all share in at least two telling aspects.

First, they represent a bottom up revolution of entrepreneurs challenging various government supported cartels and monopolies.  For example, ride sharing represents a challenge to the taxi and other transportation monopolies; home sharing services are challenging the hotel cartels; crowdfunding, the exchange monopolies; bitcoin, the money, banking, and financial monopolies; and so on.

In each case consumers benefit from increased accountability, cheaper and better services, more innovative products, and in the case of bitcoin, a wonderful get around the giant banking leviathan.

Second, and most importantly, the rise of these industries is occurring voluntarily; neither by fraud nor coercion.  This means that many people find true value in them, regardless of your or my opinion.

The only coercion or government support existing here is on the side of established industries.

Typically this support is justified in the name of consumer safety; but anyone with an economics background knows regulation is actually used to raise barriers, restrict competition, and rent-seek.

That’s one reason new competition can emerge –because profits are artificially high to begin with.

Yet ironically while nobody is using a gun to force the acceptance of bitcoin as currency that’s what backs the fiat and monopoly currencies that we use every day.  If it didn’t they would fail.

The first monopoly the Internet ever broke was the media and information monopoly.

No wonder the FCC has to clamp down on this thing!  It’s anarchy!

They have to protect Warren Buffett’s profits.

Heaven forbid should consumers take economic power back.

Lest that all leads to challenging the biggest monopoly of monopolies of all.  Yikes!!

[Editor's Note: For the rest of this piece, subscribe to The TDV Newsletter.]

Questions or comments? Join us at TDV.

Ed Bugos

Dollar Vigilante Senior Analyst Ed Bugos On The Next Phase In Gold's Secular Bull Market & Why He's No Gold Bug

Mon, 02/23/2015 - 15:10

[The following interview is by Justin O'Connell & Ed Bugos]

[Editor's Note: Don't forget to keep up with Anarchapulco this week here.]

The following interview is by Justin O'Connell's GoldSilverBitcoin with The Dollar Vigilante's Ed Bugos. To receive more of Ed's insights, click here.  This article originally appeared on GoldSilverBitcoin.

TDV: Ed, thank you for taking time to do this! 

Ed Bugos: Justin, thank you for having me.

TDV: When did you become a gold bug and why? 

ED: Justin, I first became bullish on gold in the late nineties, about a decade into my career as a stockbroker, as the “cult of equity,” as Bill Gross called it, reached a fever pitch.  Thanks to the Greenspan Put, you could not go wrong.  By the time 1999 came around nobody remembered the last serious decline in stock prices, at least in the US.

The worst correction in memory was the 1987 crash, which wiped out almost a third of index values in a matter of days, but that 700 point drop in the Dow became irrelevant with the averages four or five times higher then, and following year after year 20% gains in the S&P 500.

When Greenspan reversed the 20% drop in 1998, and then flooded the market with liquidity as everyone overestimated the Y2K threat, confidence in equity reached a new historic level, I thought.  I had to go back to the Mississippi bubble to find precedent for the kind of activities and enterprises that were surrounding me in 1999.

It was the first time in my career, which started after the 1987 crash, that I experienced a genuine mania.  It might be instructive to note how that tech/equity bubble was founded in very extreme bullish confidence, much like the real estate bubble grew out of the confidence that real estate values never drop, and perhaps even a little like gold when it spiked to $1900 –that also happened after 10-11 years of consecutive annual gains where bulls became over confident.

At any rate, I had read a lot in the late nineties looking for answers and explanations in history.

And I studied the empirical history of market fluctuations as best I could at a time when the Internet was still just coming into being but not yet robust enough to offer it all online.

I remember having to buy chart books back then to study this data.

Eventually I realized that banking and money inflation played a significant role, and I kept wondering why everyone around me kept telling me not to worry about it because the central bankers have it under control, and that all I needed to watch was the CPI.  I was just learning that “central” banking was not really a free market institution, and I grew suspicious of the Bank of England’s determination to sell its remaining gold at the worst possible time – either they had a really bad trader or it was politically motivated.

I became interested in Bill Murphy’s claim that they were manipulating gold prices as part of the “strong dollar” prop.  But ultimately my questioning drew me to the Austrian School, starting with Mises’ theory of money.  This was all happening in the 1998-99 period when my business went south because of the scope of the Bre-X fraud.  I was determined to bounce back but when I saw how my peers and colleagues had dealt with the bubble, I fell into total despair.  I realized the first sales manager who ever fired me was right, I was not cut out for this business.  I didn’t want to sacrifice clients to the altar of Mamon in order to survive.  It was the beginning of the end of my brokerage career.

I first began to publish my calls for a secular bull market in gold in April 2000 when I left – I helped another retired broker start up a website called safehaven.com, and started my own proprietary website (goldenbar.com) a year later.  We were part of the first or second genres of brokers and other financial professionals rebelling against this state of affairs on the web.

I didn’t even think of it that way at the time, I was just trying to make money on my own, without having to be part of a licentious band of thieves.  I just wanted to do things my way.

But I knew my story was not going to be welcome in the industry, at least not then it wasn’t.

I was calling for gold $2k, which I raised to $2,700 in 2006, and then to $3-5k in 2010 when Jeff and I started The Dollar Vigilante, following the roll out of what is now the longest running interest rate suppression in the Fed’s history.  I first expected the gold bull market to last only 13 years, but after the 2008 crisis I became convinced it would drag out a bit longer, so I extended my $3-5k secular bull market targets to 2017, and I still hold to this.  But please note that this target is not a hyperinflation or dollar collapse target.  I’m still just looking for a repeat of the stagflation outbreak that the US experienced in the late seventies.  By all counts we are still headed there.

However, Justin, let me clarify something.

I do not claim that gold IS money, except in circumstances where it actually is used as money.

I am not a gold bug in that sense.

Being a fully evolved Misesian and Rothbardian I am in favour of sound money, which simply means the kind of money the market picks, voluntarily, and the government doesn’t tinker with at all.  I believe it would pick gold, so on that basis I am happy to be among gold-bug company.

However, I find that the term applies to far too many undisciplined investors, promoters, and other cranks –many of which do not have the slightest grasp of sound economic theory, market history, or political philosophy.  So I still prefer generally NOT to think of myself as a “gold bug.”

TDV:  Well, Ed, since you're a Misesian, it doesn't surprise me that you don't like associating with groups. So, what’s new in the longest running monetary intervention in the Fed’s history?

Ed: The ECB has joined in with a QE of its own; a global alliance has formed to suppress interest rates down to nothing (but it is dissolving with the swiss pulling out first); and the US commercial banks have finally awoken and replaced the Fed as the primary engine of money/credit growth.

However, the risk of a bust scenario approaching has increased because money growth rates in 2014 may not have been high enough to sustain the boom, traders bid sovereign debt values up too far in anticipation of the QE (which has still not even started), the swiss are out, and the BOJ is not being upfront about what it is really doing –I don’t believe it is printing new money supply.

Meanwhile, the capital foundation of the economy is being constantly chipped away at in most of the developed world by the ongoing interest rate suppression.

It continues to fool entrepreneurs into overspending on R&D, housing developments, and many projects they will not be able to finish when prices and interest rates turn up.  The banks can continue to lend money for these projects and post pone the bust, but then they will revive the inflation monster and dollar collapse stories, which I think are all just around the corner again.

The fundamentals are brewing a scary cocktail, especially because debt levels have reached a point where they can no longer afford normal interest rates.

The elements are there for chaos geopolitically too, all in the run up to another election.

Our guess is that the goldilocks delusion is running on fumes.

TDVHave some people been impatient with gold? Expecting it to increase quicker than it has?

Ed: Well, this is a hard thing to adjust to psychologically.  For several years before we broke out past $500 the bulls were impatient with gold, often commenting on how slowly the facts were unfolding.  Back in 2003 my $2000 forecast appeared way too far out of the mean, and nobody paid much attention to it.

Suddenly in 2010 it was too conservative, and the market began to move faster than we were expecting.  In hindsight, given where we were on the price inflation front, clearly the market got ahead of itself when it spiked up to $1925.  If you were just coming into the market after 2010, you were coming into the middle of an ongoing bull market, or just past the middle, and that pace conditioned your expectations.  For this group then yes they are impatient and are likely not going to hold on.  They are the ones probably creating the current opportunity.  Gold and silver require inordinate patience because it is anti-establishmentarian.

That is, all the money and capital are behind on the other side –and behind the propaganda channels.  But it is late in the story and the bad guys have stretched their resources too far.

We are going to transition into the later stages of the biggest bull market history will know.

It’s not going to take 10 years to rebuild confidence.  Gold itself has held in rather well.  The NASDAQ and many other bubbles fared much worse in their subsequent collapse.  Of course, I have to stop here before someone thinks I am saying we had a gold bubble.  We had a taste of one.  It was relatively short in duration and extent compared to most bubbles, and in my view it was premature –both the run to $1925 was premature and the current conviction it has ended.

Gold can take a while to get going but it is hard to stop when it gets traction.

Its enemies know that, which is why they like to step on it so hard even when it’s down.

TDV: Can the Fed cease quantitative easing? 

Ed: Yes.

TDV: Can the Fed exit zirp? 

Ed: Yes.

TDV: Can the Fed ever let interest rates normalize? 

Ed: Absolutely not!  Normal interest rates would kill the government, especially today with its debts out of control, and the government is the source of the Fed’s privileged monopoly.  The situation is markedly different even since the 2008 downturn.  When I started writing about the gold story in 2000 the public debt was still at around 50% of GDP…up from the 30-40 percent level during the sixties, seventies, and eighties.

The last time the Fed got out of the way to let the market clear as completely as possible the malinvestment and imbalance between saving & investment that the economy had built up during the sixties and seventies (due to Fed policy) was 1978-80 under Volcker when the public debt was still just a trillion.  Who knows what interest rate level it would take to clear today’s malinvestments and imbalances but the average rate of about 7.5% would gobble up over half the government’s annual federal tax receipts.  At rates anywhere near what we saw in the late seventies, the market would invent a whole new term for “risk free” – not just in US government debt, but every government dependent on the same system and that has underwritten the same dollar system.

Although my gold forecast has not made the transition to a dollar collapse scenario, the risk of one in our lifetime is high as long as governments refuse to rationalize and make themselves smaller.  The alternative is that the Fed (and governments) will never allow a Volcker style reset again until at a minimum they have been punished by the stagflation monster and have come too close to default for comfort.  For now, the path of least resistance is to avoid rate normalization indefinitely – which is why we’re in the longest running monetary intervention in history – which is very risky to the world’s renowned reserve currency.

Allow me to go as far as to say this: if the banks don’t destroy the currency, the congress will; and in this latter situation, the public will aid.  That is because if the Fed tries to normalize rates in order to protect the US dollar at some point it will result in a crisis perhaps as bad as 2008.

The public’s reaction at this point will be different than it would be if the banks (and Fed) instead adopted a hyperinflation policy right off.  In the latter case the public might decry the Fed at last and push for a sound currency, but in the event that the Fed creates another crisis like 2008 by trying to micro manage the financial prices and interest rates the public will demand that the Fed relinquish its private charter.  Once this is done, in my humblest opinion, the last check against the adoption of a hyperinflation policy will have been removed.  Once monetary policy is 100% in the hands of government then it will proceed to destroy the currency as all others ever have.

So we’re on course for stagflation, and now you know what I think it would take to put us on the course for hyperinflation.  We’re very close either way to the adoption of such a policy or major public revolt.  But I fear the revolt will not come until price inflation and interest rates explode.

Both of these are increasingly inevitable.

TDV: What historical precedent is there for the current debt/GDP ratio?

Ed: Very little in the US except during WWII, but that debt was liquidated in the years following the war, which led to a period of immense prosperity in the fifties and sixties until JFK ruined it by adopting a Keynesian style monetary policy again –ultimately undermining the gold exchange standard (Bretton woods).  As mentioned earlier, Russia’s debt/gdp ratio reached similar proportions and it chose a different route: to inflate its way out.

Although, it has implemented sounder currency reform (gold purchases) and is pursuing a relatively laissez faire policy with respect to the economy.  If it resisted these paths the fallout would probably be worse.  But in a broad general sense, with governments as big as Italy, France and Japan all at over 100% of GDP, or close to it, during peacetime, we are in uncharted water.  But I put the blame on the monetary standard born in 1971 that we are operating under today.  This system of crony-fiat monopoly currencies anchored by the fiat and inflation prone dollar has encouraged the policy of suppressing interest rates and accumulating large public debts…during peace time or not.

Academically Keynes died a long time ago but this currency standard brought him back to life.

TDV: Why have oil prices collapsed? 

 Ed: The main reason oil has collapsed is the increase in US and Saudi supplies – in the US it is due to the exploitation of shale oil, all good things from the consumer’s point of view.  There is also an argument to be made for the possibility that the oil price decline signals the end of the boom.

TDV: Does the collapsing oil price hold implications for gold? 

 Ed: Not really.  Over the long run we should expect the gold/oil or gold/commodity ratios to rise, as innovation and economies allow us to economize on the use of commodity inputs but inflation keeps up the value of gold.  In the short term falling oil prices could undermine confidence in other commodities, and if there is a broad enough decline in commodities, then it hurts gold.

However, oil is typically a positive cyclical commodity while gold is often countercyclical.

TDV: What is significant about price inflation in Russia?

Ed: I don’t follow developments in Russia close enough to offer any unique insights other than to point out that the price inflation follows an enormous amount of monetary inflation over the past decade in Russia as the government tried to inflate its way out of a formerly high debt/gdp ratio.

Since the early 2000’s, with a debt/gdp ratio near 100%, they have grown their money stock by over 500%, or about two or three times the average OECD top 40…second only to Turkey.

Now they have a debt/gdp ratio of 10% but have to contend with the ruble’s collapse.  It can be difficult to come out of a currency crisis, especially if you have a history of debasing money.

TDV: Is Russia being forced to sell gold because of the falling ruble? 

 Ed: I doubt it very much.  There are bigger stakes they are vying for.  If anything, to the extent that Russia has a long-term plan to go to gold related money, this would undermine the US dollar.

TDV: What is on your horizon? 

Ed: Jeff and I are going to continue to build on the success of The Dollar Vigilante because we believe that people are going to need to know how to survive the debacle, and because we believe that central banking is not only the biggest scourge on the planet, but also, dying.

You can follow my general forecasts through basic subscription, and my specialized investment recommendations through the premium subscription.  We are constantly upgrading the service, and plan to do more in the way of venture private placements in both private and publicly listed small cap businesses and start ups.  Additionally, I am planning to launch a new subscription for hedge fund and high net worth personal money managers who need a sub-advisor to help them build a decent gold stock portfolio for the next stretch of the secular bull in gold & silver bullion.

You can find me at The Dollar Vigilante and follow me on Twitter.

Ed Bugos

Blockchain Girl Janina Lowisz On The Blockchain ID & Citizenship

Sun, 02/22/2015 - 04:25

[The following interview by Justin O'Connell and Janina Lowisz]

The following interview was conducted by Bitcoinomics.Net with Janina Lowisz, the first "holder" of a "Blockchain ID," about the Blockchain ID, world citizenship and numerous other topics relating to the BlockchainID. 

What is a BlockchainID?

The blockchain ID was invented by Chris Ellis from World Crypto Network and Bitnation founder Susanne Tarkowski Tempelhof, and makes use of the Bitcoin blockchain and available cryptographic tools to provide IDs that are not issued by nation-states but privately. It is one of the pilot projects Bitnation did so far to show how governance services can be done in a private, voluntary and decentralised way. Today, the blockchainID could be used for online verification, as part of a reputation system to facilitate transactions, for voting, or it could be used by stateless people or in war zones. The blockchainID will be available on www.bitnation.co in Q1.

What makes the BlockchainID secure? 

PGP encryption and the blockchain make it a secure, decentralized system that makes it nearly impossible for people to fake your identity, unlike with emails or social network logins.

People create a PGP key and witness each other`s existence at a certain place and time, validate and prove their existence by signing each other`s IDs with their PGP key. The content of the ID is bound to the owner`s key, so he has full control and no one can change it.

The blockchainID includes the merkle root of the latest block to prove the person must have existed at least in that certain time. To prove that it was that block`s specific time, the blockchainID document gets timestamped.

It also includes the venue`s public IP address to prove where it took place.

Click here or on thumbnail

What do you know about Estonia’s e-citizenship, and does this tie into the project?

The blockchainID is a separate project, but certainly the e-citizenship is a fascinating project, too, providing people all over the world with governance services in a voluntary way, enabling them to facilitate their business or make use services like digital identification. It is a step in the right direction and shows that the past version of the nation state is challenged in different ways, which I see as useful promotion also for other alternatives like the blockchainID. However, as the blockchain is worldwide, a blockchain based system could offer worldwide services and would not only be voluntary, too, but also decentralised, making the system more secure. The e-citizenship would still be centralised and therefore its existence is dependent on benevolent policy, whereas the blockchain cannot be stopped.

Do you feel like you’re carrying on a tradition of World Citizenship?  (see: http://en.wikipedia.org/wiki/World_Passport)

The blockchainID is not a passport, and has nothing to do with the “World Passport”. The blockchainID is one of the decentralised applications that Bitnation, a blockchain services provider, will offer. The idea is to use the blockchain for a reputation system similar to ebay. People who use Bitnation services would get a blockchainID on which all their transactions within the Bitnation system could be recorded.

I don`t feel like carrying on any tradition, I more feel like a pioneer that now has the responsibility to promote the social good that the blockchain can do.

Some people think the BlockchainID, by doing away with the nation-state, will usher in a private dystopia run by financial lords. Is this what you want?

I tried to think about what people mean by that.

First, people will not be dependent on companies to have blockchain services available. The tools to create a blockchainID are easily available and everyone can look up in YouTube and GitHub how it`s done. Therefore, there is no need to hire someone and local communities can do it all by themselves.

Second, it will not make a difference to the blockchain whether there are governments or private societies. As it is all decentralised, a company in a stateless society can not shut down the blockchain- same as today, where a government can not shut it down either.

Third, the blockchainID enables people to decide which details they want to make public, e.g. if they want to use their full name, provide their address or not. My blockchainID includes the IP address of the hotel where the event took place. This freedom means people can not be tracked and therefore the blockchainID does not lead to a dystopia-like surveillance “state”.

Some people in comments’ sections say becoming a “world citizen” is useless unless we get invaded by aliens. Do you agree? 

The blockchainID has the uses I mentioned in the beginning, whereas the word “world citizen”, like the Bitnation slogan “blockchains, not borders”, reflects our philosophy, that people should not see themselves as dependent on what the situation in the nation-state is they happen to be born in, but make use of voluntary blockchain services that are available worldwide.

What  technologies and services brought to the world via the Blockchain excite you most?

In developing countries, the blockchain can provide infrastructure and empower local communities, so the social good may be comparable to MPesa.

In general, I think the most useful blockchain application today is the blockchain marriage: Bad behaviour would influence people`s reputation on the blockchain and most important, there is no need for a divorce, as a smart contract ends automatically if it is not renewed, so there are no negative consequences. No one needs to pay for the other one, so the blockchain marriage would mean more justice.

Anything else you’d like to add? 

Thanks for having me, you can follow my Facebook page, follow me @BlockchainGirl, Chris Ellis @MrChrisEllis and Bitnation @MyBitNation, you can visit me at the CoinScrum meetup Tuesday evenings in the Vape Lab in Shoreditch, and join the Bitnation google hangouts, Saturday mornings/afternoons at http://www.meetup.com/BITNATION/.

Justin O’Connell is the Chief Executive Officer of GoldSilverBitcoin.  He is also the author of the bitcoin book, Bitcoinomics, and administrator of the Bitcoinomics website. Justin is also a co-host at Our Very Own Special Show, a lifestyle podcast about music, news, life and other topics, and head researcher at The Dollar Vigilante.  He lives in San Diego, California.

Insights or comments? Let us know!

 

What makes The TDV Newsletter so valuable is its keen knowledge of macro-and-micro economics events and theories. While your parent's economic advisors and stockbrokers adhered to the Keynesian paradigm, TDV's monthly Dispatches and Newsletter sees the world through the episteme of Austrian Economics, something every person curious in economics, politics and culture should be familiar with. Austrian Economics understands the driving force behind liberty, slavery, economic indicators, stats and players.

Because this year is going to be a chaotic one, as foreseen by the TDV Staff, Editor-In-Chief Jeff Berwick and senior analyst Ed Bugos are dedicating themselves almost full-time to bringing paid subscribers the best information they can receive in 2015, which could prove to be an ever important year in The End Of The Monetary System As We Know It (TEOTMSAWKI).

What's more you will receive invaluable and private placings in some of today's most exciting companies.

Subscribe to The Newsletter today, and receive TDV's HomeGrown, as well as special reports, including Getting Your Gold Out Of Dodge.

If you’re interested in receiving articles beyond what you read here everyday, consider our weekly subscriber-only publications, like our Issue, Dispatches, and Homegrown. You may subscribe here.

February 16, 2015

Boy Its Easy To Scare People in the Home Of The Brave

Post by TDV Editor-In-Chief, Jeff Berwick

I had barely just recovered from panicking over SARS, swine flu, ebola, ISIS and North Korea when another super-important crisis came on the scene that demands immediate attention!  The measles!

No, I'm not kidding.  Apparently this latest mainstream media panic is how measles is everywhere and if we all don't get immediately vaccinated we will all get the measles!  I guess, somehow, ebola morphed into the measles... what we really need is a vaccine for propaganda.

continue reading...

February 17, 2015

Profiting From The Rising Chinese Yuan

Post by TDV Director of Offshore, Paul Seymour

At TDV, we aren’t fans of holding a significant amount of your assets in fiat currencies.  However, as those holding the Swiss franc recently found out, as it rose 30% overnight, there is a time and place for everything.

One good option for such diversification is the Chinese yuan, also known as renminbi.  Since China got into the WTO in 2001, after starting to boom economically, the US government has clamored, from time to time, for the Chinese to allow the yuan to “float” in the exchange market.  Instead, and like many other governments around the world, the Chinese have opted to peg that exchange rate as a set relationship to the USD.  The Saudi Riyal for example, has had the same peg for decades, but we don’t hear anyone clamoring for the Saudis to revalue the riyal.

continue reading...

February 18, 2015

TDV Interview With Swiss Metals: How To Profit From Strategic Rare Metals And Their Coming Shortage

Interview by TDV Editor-In-Chief, Jeff Berwick

At The Dollar Vigilante (TDV) we are always looking for ingenuitive ways to keep the majority of your assets outside of the current financial and monetary system.  At numerous conferences we keep running into Knut Andersen, the President and CEO of SwissMetal Inc., and Knut and SwissMetal are also the Gold Sponsor at the Anarchapulco freedom event coming up at the end of this month.

SwissMetal is based in Panama and has a very unique and interesting way to invest in hard assets, like rare and strategic metals with a focus on asset protection of individual and industrial investors.

I had the opportunity to speak with Knut this week to get some insights into what they offer.

continue reading...

February 19, 2015

End Of American Empire: De-Dollarization Will Isolate The US

Post by TDV Editor-In-Chief, Jeff Berwick

The end of the American empire is happening before our very eyes and it is astonishing how, among the preponderance of information, people still do not see the writing on the wall. Every day I am seeing stories that I consider signs of The End Of The Monetary System As We Know It (TEOTMSAWKI).

In the Snowden leaks we learned that the NSA was spying on the SWIFT payment system, which led to Russia, and other nations, to develop their own alternative to the SWIFT system.

continue reading...

End Of American Empire: De-Dollarization Will Isolate The US

Thu, 02/19/2015 - 15:01

[The following post is by TDV Chief Editor, Jeff Berwick]

The end of the American empire is happening before our very eyes and it is astonishing how, among the preponderance of information, people still do not see the writing on the wall. Every day I am seeing stories that I consider signs of The End Of The Monetary System As We Know It (TEOTMSAWKI).

In the Snowden leaks we learned that the NSA was spying on the SWIFT payment system, which led to Russia, and other nations, to develop their own alternative to the SWIFT system.

With tensions regarding SWIFT already high, the UK threatened in 2014 to remove Russia from SWIFT (which SWIFT said it was not interested in doing), and so Russia and China then moved forward on their plans to create a de-dollarized SWIFT competitor.  Russia detailed the SWIFT-alternative in November and set a launch date for May 2015.

Medvedev warned last month of “unlimited reaction” if Russia was cut off from the SWIFT payments system. Needless to say, tensions have been high over global payments as nation-states continue posturing for TEOTMSAWKI. All the more reason to learn about Bitcoin.

News broke this week that Russia launched its own ‘SWIFT’-alternative, with 91 credit institutions on-board, at least at first as more are likely to sign up. According to Sputnik News,

Almost 91 domestic credit institutions have been incorporated into the new Russian financial system, the analogous of SWIFT, an international banking network.

The new service, will allow Russian banks to communicate seamlessly through the Central Bank of Russia.

It should be noted that Russia's Central Bank initiated the development of the country's own messaging system in response to repeated threats voiced by Moscow's Western partners to disconnect Russia from SWIFT.
..

Joining the global interbank system in 1989, Russia has become one of the most active users of SWIFT globally, sending hundreds of thousands of messages per day. In general, SWIFT provides a secure communication network for more than ten thousands of financial institutions around the world, approving transactions of trillions of US dollars.

Earlier this month Russian Deputy Prime Minister Igor Shuvalov expressed confidence that Russia would not be disconnected from SWIFT. In her turn, Russian Central Bank First Deputy Chair Ksenia Yudaeva called upon Russian civilians and financial institutions not to dramatize the current situation.

Russian experts point to the fact that Western businesses would face severe losses if they expelled Russia from the international SWIFT system. On the other hand, the alternative system launched by Russia might reduce the negative impacts caused by measures imposed by the West, including possible disconnection from SWIFT, and diminish Western financial dominance over Russia.
..
 

The core of SWIFT's work is a secure financial messaging service that communicates payment orders to be settled at correspondent accounts — accounts that one financial institution holds with another financial institution.

The network has become key to the functioning of Russia's financial system since the first bank began to use the service in 1989.

About 360,000 such messages are sent daily, making Russia the second most prolific user of SWIFT in the world, the head of SWIFT in Russia, Roman Chernov, told a conference last year, according to RIA Novosti. Over 600 Russian financial institutions use SWIFT, which saw a 40 percent growth in its traffic in 2014, he said.

As you can see, there is not much the world can do now other than watch the US empire collapse. Americans are more-and-more depressed, and a quarter of them believe the sun revolves around the Earth, so good luck convincing them their government lies. While stock markets continue their absurd runs on the back of a highly volatile dollar, which for now just so happens to be volatile to the upside, the middle class is turning into an impoverished, manic wreck.

The US government will do everything it can to distract from the economic realities of the situation with false flag attacks and lies about terrorism.  (In reality, the US government is the largest terrorist institution on the planet)

The world is doing everything it can to get out from under the collapsing US empire, and this means de-dollarization. This chart sums that up well:

It is not just Russia and China, but also some of the US’s allies who are distancing themselves from the US dollar, which makes the coming changes the world will bear witness to unprecedented.  France's political and business establishment has joined the de-dollarization rumbling.

“We [Europeans] are selling to ourselves in dollars, for instance when we sell planes," French financial minister Michel Sapin told the Financial Times last fall. "Is that necessary? I don’t think so. I think a rebalancing is possible and necessary, not just regarding the euro but also for the big currencies of the emerging countries, which account for more and more of global trade.”

Not just France, but South Korea too have begun to do what they can to extricate themselves from their abuser.

But Wait, What About The Recovery?

The recovery was a lie. It never happened and it won’t happen in the future. Even Goldman Sachs admits now that the global economy is in contraction.

Life in the US is not going to become easier all of the sudden. US persons will have to compete with people all over the world to provide goods and services and this means certainly their wages will continue to fall as they have. 

The only true way to protect yourself from the tumult the United States faces is to get out. That's why TDV Media has begun TDV Groups, which is a network of like-minded individuals who want to help you expatriate and become a Permanent Traveler. Once you've become a Permanent Traveler, you might want to graduate onto becoming a Prior Taxpayer.  Contact TDV Offshore today for more information.

The US is increasingly finding itself isolated, hence the financial war it is waging against its competitors (even allies), the hot wars it fights against perceived terrorists, and the brazen, brutal police state it has developed on the homefront. I am glad I will safely be watching all of this unfold from Anarchapulco.

Questions or comments? Join us at the TDV Blog.

Jeff Berwick

TDV Interview With Swiss Metals: How To Profit From Strategic Rare Metals And Their Coming Shortage

Wed, 02/18/2015 - 21:39

[The following interview is conducted by TDV Chief Editor Jeff Berwick]

At The Dollar Vigilante (TDV) we are always looking for ingenuitive ways to keep the majority of your assets outside of the current financial and monetary system.  At numerous conferences we keep running into Knut Andersen, the President and CEO of SwissMetal Inc., and Knut and SwissMetal are also the Gold Sponsor at the Anarchapulco freedom event coming up at the end of this month.

SwissMetal is based in Panama and has a very unique and interesting way to invest in hard assets, like rare and strategic metals with a focus on asset protection of individual and industrial investors.

I had the opportunity to speak with Knut this week to get some insights into what they offer.

The Dollar Vigilante (TDV): Knut, thank you for taking the time!  First, why don’t you tell us a little about SwissMetal and also your role there?

Knut Andersen (KA): Swissmetal Inc. helps individuals protect their assets and move away from volatile capital markets by using rare strategic metals.

I am the President and CEO, and lead an experienced team of account managers who provide personalized access to these metals for clients worldwide. I also speak at conferences around the world showing investors how to profit from this brand new asset class.

Strategic metals are a set of metals which are vital in 95% of products that are manufactured today, including air, sea, and land equipment, medical equipment, pharmaceuticals, TV’s, cell phones, computers, armaments, night vision goggles, jet engines, clothing, cosmetics and creams, hybrid and electric vehicles, solar panels, and much more.

By purchasing and storing these metals for the future, clients can fight inflation, and make profits by reselling these assets back into the industry when prices increase.

Strategic metals are free from the manipulation that plagues the gold and silver market, completely private and non-reportable since they are non-financial assets, and are fiat currency proof since they can be cashed out in any currency, anywhere in the world. Normally our clients choose to store their metals in our bank level secure vaults, which are 100% insured, and where their assets are fully allocated and segregated.

TDV: Those benefits tick a lot of the boxes for TDV readers.  Give us some examples of what you mean by “strategic metals”.  Which metals exactly?

KA: Strategic metals are a set of elements needed by industry that are either rare, or expensive and difficult to produce. Many of these metals are byproducts of other metal production, and are not found on their own in nature. We focus on metals our industry contacts tell us are in short supply, or are currently difficult to find.

At this time, that includes indium, hafnium, gallium, tellurium, tantalum, bismuth, molybdenum, chromium, cobalt, zirconium, tungsten, rhenium, dysprosium, germanium, and niobium. We also supply gold and silver in the forms most often wanted by industry.

We separate these metals into 4 different diverse baskets focusing on different industries, or they can be purchased as single metals for a more direct play.

TDV: This is a very interesting approach!  I haven’t heard of other companies doing similar things. Do you have competition in this market?

KA: This can be answered a couple of different ways depending on who you consider as competitors.

Within the Strategic Metals space, there are two types of companies you can buy from. The first is from companies who sell strategic metals to industry. These companies aren’t competition for us because they deal with large companies needing manufacturing metals, not individuals looking to stockpile metals for the future.

The second type do sell individual strategic rare metals to individual investors. However those companies haven’t done the leg work to form relationships with industry buyers. So while they will sell you a kilogram of a strategic metal, you are on your own to try find a buyer, and large manufacturing firms aren’t going to purchase that kilogram of metal. They also have very little or no guidance on which metals are in demand, and why.

Swissmetal Inc on the other hand has been working with industry insiders to create diverse baskets focusing on specific industries. We also have the contacts and the network built who are willing to buy back these metals and sell them into the industry. Our group currently manages over 300 million dollars in strategic metals, and within the next few years will manage the biggest stockpile outside of China, so we have the industry clout to actually make the assets work for our clients.

Our real competition comes from outside of the strategic metals world, and is in other asset protection tools, the biggest two being gold and silver. We don’t knock gold and silver, and can actually help our clients with those. But we see strategic metals as an add on because while gold and silver both are prone to manipulation in the market, and gold doesn’t have a strong industrial demand, strategic metals can fill both those gaps.

TDV: Can you expand on that a little, why would clients choose these little known metals over the much more popular gold and silver?

KA: There are a few reasons, and one of them hinges on the popularity itself. Gold and silver are both traded as a paper product on the major exchanges. Because of this, there is much more gold and silver traded on a daily basis than actually exists in the physical form. This causes 2 problems. First, if everyone were to sell at one time, there would be a run on gold and silver, similar to a run on a bank, where there isn’t enough actual metal to meet all the paper flying around.

Next, big entities are in a position to manipulate the market by shorting massive amounts of these precious metals. That drives prices lower causing a panic sell by leveraged investors who would be forced to cover their assets, driving prices even lower. The large entities can then swoop in and buy more precious metals, either in physical or paper form because they have driven the prices so low.

Owning physical gold and silver protects you somewhat from the above problems, but they can still cause volatility in prices if you need to sell in a hurry.

The next issue comes down to supply and demand. Especially in the case of gold. Strategic metals have a growing demand in so many critical items we need in a day-to-day basis. Gold on the other hand, has a few industrial applications like high end connectors, but other than that is little more than a pretty yellow metal. That’s why historically gold is a great hedge against inflation, but if you don’t time it perfectly it isn’t really a profit tool.

TDV: At Anarchapulco, your keynote speech title is “How To Profit From The Upcoming Wave Of Technological Metals Shortages." Could you tell us what that is about?

KA: The world is experiencing an unprecedented technological boom right now, and unlike other booms in the past (like the industrial revolution), the technological boom doesn’t experience the same limitations. For example, during the technological revolution man invented flight, which was a huge advancement. Since then planes have evolved, but there hasn’t been the same jump.

Technology on the other hand feeds itself, so the more innovation we have, the more technology can be developed. This innovation can speed up infinitely until we reach singularity, or the point where new technology is developed instantaneously.


Strategic metals are also known as technological metals because almost all technology relies on these metals to exist. As the technology is increasing at this incredible pace, the mining and production of these metals can’t progress at the same pace, so shortages are very near on the horizon. These shortages are already seen as critical problems in most countries growth plans, and prices should skyrocket as manufactures fight to acquire the metals they need to foster current and future growing demand. We are already seeing the crunch in several metals.

Like I said earlier, strategic metals are crucial in 95% of all products manufactured today, not just technological products. But technology is definitely one of the aspects we are most excited about, and will increase the shortages experienced in all of those other industries.

Another exciting prospect is the fact over 1 billion people will be emerging from poverty over the next few years. All of those people will demand the products you and I take for granted. Everything from cellphones and other technology to clothing, cosmetics, and pharmaceuticals.

TDV: This is a fascinating service you are offering to individual investors that they would not be able to do on their own without.  What kind of clients do you accept?  Do you accept American clients (that is always a big question nowadays)?  What is the minimum investment amount accepted?  

KA: Yes, we do take clients from the US, in fact it’s an area we specialize in because of the difficulty Americans have in many alternative investments. One of the big advantages strategic metals have over other asset protection tools like gold and silver, is they are not considered financial assets or accounts.

So for that reason, there are no reporting requirements, just like there are no reporting requirements if you purchase a car. In fact, we don’t have a mechanism for reporting even if we wanted to. They are completely private and confidential making us a very popular choice for anyone who values their financial privacy.

Of course, depending on the country of citizenship and residency, clients may have reporting requirements when they sell their metals, and need to report a gain. But it is between them and their financial / tax advisers what those reporting requirements are, and we don’t report purchase or sales to anyone.

Another advantage of our business model is, we opened the strategic metals market to almost any investor, as opposed the the millions of dollars it used to take to get involved. Our baskets, or groups of metals, start at around $10,500, and go up to around $53,000. But you can purchase as many baskets and mix and match for the best diversification to suit your portfolio.

For investors wanting a direct play in single metals, the minimum investment is $25,000.

TDV: How does metals ownership work? Do owners need to find storage for their metals?

KA: Owners are welcome to take delivery of their metals, but due to the cost and logistics, most choose to have us arrange storage for them. We store the metals in bank level secure vaults in either Panama or Switzerland depending on the metal. All metals are allocated and segregated to the owner, and are fully 100% insured.

The metals themselves can be owned a number of different ways. Some of our owners choose to just purchase the metals in their own name, while others prefer the added privacy of an entity like an LLC.

Funds for metals can be paid onshore, directly to a bank in the US, and then transferred offshore by us. Or, if funds are already offshore, they can be transferred to Panama or Germany in any currency. We also accept Bitcoin, which I think would be of interest to many people seeing this interview.

TDV: You’ve probably heard of the new MyRA plan in the US, and many of us think this might be a path to nationalizing the IRA. Do you have any thoughts on how to protect those?

KA: Yes, we have a fully compliant IRA / 401K program.

We will work with you and a US-based IRA custodian to setup an offshore LLC which owns the metals, and then the IRA owns the LLC. This is a perfectly legal structure that protects your assets from confiscation, lawsuits and more.

Plus thanks to the magic of triple compounding, profits can really soar in this type of structure.

There’s a little bit more complexity to it, but we’ve compressed it down to 3 simple steps, and it’s a very popular option for anyone with assets in an IRA they would like to protect, and get out of the volatile capital markets. Look at what happened in 2008, many IRA’s were virtually wiped out.

TDV: Speaking of profits, what kinds of return are you getting on these investments.

KA: Since we’ve launched, the gains have averaged around 12% across all of our diversified baskets. But where we really add value, are the inside contacts, and the huge stockpiles we manage. We are able to sell metals back directly into industry, and can take advantage of short term shortages when prices can increase rapidly.

For example, in 2010 prices of one of our baskets jumped 47%. With the shortages we expect on the horizon, those gains could look like small potatoes.

The thing with strategic metals is only minute quantities are used in different products, so from a per unit cost basis, even big jumps in price don’t make a very big per unit cost difference. Even if prices doubled or tripled, a company like Boeing wouldn’t feel too much of a hit on the cost of an engine. But if you are the person holding the stock pile, profits could be massive.

TDV: For many Americans, looking to get into hard assets outside of the US, this appears to be a very, very enticing product, especially in this day and age of Foreign Account Tax Compliance Act (FATCA) reporting.  And, even for non-Americans, this is a unique approach that I am not aware of anyone else doing, anywhere.  I would recommend for those looking for this type of investment/service to contact SwissMetal for more information.  How is the best way for them to contact you?

KA: Getting a hold of us is easy, we are available during normal US business hours and can be reached by phone at 1-855-854-4679 from the US, or elsewhere at 1-786-693-1135. For more information, you can download our full color catalog here. Of course we can also be visited at Anarchapulco this year, or anytime in our Panama based office.

TDV: Thank you for your time Knut and I’ll see you next week!
 

Questions or comments? Join us at the TDV Blog.

Jeff Berwick

Profiting From The Rising Chinese Yuan

Tue, 02/17/2015 - 16:10

[The following post is written by Director of TDV Offshore, Paul Seymour]

At TDV, we aren’t fans of holding a significant amount of your assets in fiat currencies.  However, as those holding the Swiss franc recently found out, as it rose 30% overnight, there is a time and place for everything.

One good option for such diversification is the Chinese yuan, also known as renminbi.  Since China got into the WTO in 2001, after starting to boom economically, the US government has clamored, from time to time, for the Chinese to allow the yuan to “float” in the exchange market.  Instead, and like many other governments around the world, the Chinese have opted to peg that exchange rate as a set relationship to the USD.  The Saudi Riyal for example, has had the same peg for decades, but we don’t hear anyone clamoring for the Saudis to revalue the riyal.

Back in 2005, the rate was 8.3 yuan to 1 dollar.  It had held steady at that rate since 1995.  There was a lot of talk at that time coming from failing US manufacturers, especially within the electronics industry, of the unbeatable “China price”.  The Chinese were simply manufacturing products at good quality, and at a lower price.  What we might call "competition."  Maybe it was time for the people in the US to realize that they didn’t really deserve 40 bucks an hour for doing work that a robot could do better on an assembly line. 

So in 2005, the US Congress, as stooges for their special interest patrons, began talking about unfair trade practices.  Many taking the view that China’s “suppressed” currency was a form of government subsidy, and prohibited under WTO rules. More than a dozen pieces of legislation were then pending in Congress to try and pressure China to allow the yuan to “float” in world currency markets, letting free-market forces establish its value.

That’s a bit of a joke, really.  To say that the world’s fiat currencies are traded in a “free market," I mean.  As the Chinese government has adeptly pointed out in its response to this call to control its currency by the imperialistic oligarchy—“There is no free market in currencies, as there is in wheat or bananas. Currencies trade in global markets, but their supply is controlled by a cartel of central banks, which have a monopoly on money creation. The Federal Reserve controls the global supply of dollars and thus has far more influence over the greenback's value than any other single actor.” 

Steady Appreciation of the Yuan

The Chinese, though, under this growing pressure back in 2005, increased the relative value of the yuan, by reducing the peg rate from 8.3 to 8.1, which seemed to temporarily appease the world market manipulators.  The yuan has since appreciated, slowly, steadily, and year after year, to the current rate of 6.2 yuan to the dollar, or 25% (an average of between 2-3% per year), since 2005.
This slow, but steady appreciation against the USD, has not appeased the market manipulators completely, however. 

In 2010, the subject popped up yet again.  Same old arguments followed with the call-- “China, please help us deal with the predictably negative results of our fiscal mismanagement, by mismanaging your own economy” was essentially the plea.  The Chinese studied the option, and decided not to create even more problems for their own beleaguered people, and by extension their hold on power.

In 2010, when Obama started calling for the Chinese to help out by damaging their own economy, the Chinese embassy in Washington released this thought-provoking response.  I’ll quote some of it, but urge you to read the full text here.

It starts out with “As if the world economy wasn't fragile enough, politicians in the U.S. and China seem intent on fighting an old-fashioned currency war. The U.S. is more wrong than China here, and it's important to understand why, lest the two countries send the world back to the dark age of beggar-thy-neighbor currency protectionism.”  Sounds like a free-willed bureaucrat, to me.  How refreshing.

Then moves along—“A fixed exchange rate is also not some nefarious economic practice rare in human affairs. From the end of World War II through the early 1970s, most global currency rates were fixed under the Bretton-Woods monetary system created by Lord Keynes and Harry Dexter White. That system fell apart with the U.S.-inspired inflation of the 1970s, and much of the world moved to "floating rates." 

[Editor's Note: See our previous article on the Nixon Shock here.]

The Chinese Embassy continues:

“By maintaining a fixed yuan-dollar rate, China has subcontracted much of its monetary discretion to the Fed in return for the benefits of exchange-rate stability. For more than a decade, this has served the world economy well, leading to an explosion of trade, cheaper goods for Americans that have raised U.S. living standards, and new prosperity for tens of millions of Chinese.”

It finishes strongly with—“It's especially dismaying to see the same U.S. and European economists and columnists who peddled Keynesian stimulus as an economic cure-all now tell us that their policies would be working better if only the yuan-dollar price were different. Because their own ideas have flopped, they now want to make the yuan a scapegoat and risk a trade war with China. Haven't they done enough harm already?”

What’s Coming Next, and How to Play it

Therefore, full-fledged release of the yuan to the wind, like the recent CHF move by the Swiss, doesn’t seem likely.  It is, though, an almost 100% certainty that the yuan will continue its steady appreciation against the USD.  It could, at this point, be viewed as a safe haven currency from the demise of the USD.  Thereby taking the USD one step closer to the land of no-longer-world-reserve-currency status.  Good riddance.

In 2012 there was around $3.8 trillion conducted in global trade. Of that 380 billion was settled in Chinese yuan, or 10%.  Since then, the pace of international deals being traded outside the USD has been picking up exponentially.  For example, here in Brazil it was recently announced that all trade with Uruguay will be henceforth conducted in local currencies without passing needlessly through the USD. 

Brazil, 7th in global GDP, does a lot of trade with its BRICS partner China as well.  Japan, Australia, and New Zealand, all trade with China through their local currencies.  Russia, just behind Brazil in GDP at #8, obviously will never do anything in the USD, ever again, and is doing huge energy deals with China. 

That thanks to the war the US has declared on Russia in the past few months.  Announcing economic sanctions is a declaration of war.  It’s tantamount to parking battleships in the harbors.  To call it anything else is just naïve.  I’m watching the Russians’ new payments system with interest, as they have already set up a domestic payments system to compete with SWIFT, and potentially get us all out from under the sanctions of the USG, and its failing currency.

As the yuan is looking like a safe haven, you should strongly consider moving a portion of your USD or EURO in to it.  It doesn’t have the volatility of gold, and therefore also not the upside potential.  It is a fiat currency, and therefore certainly has some risk, but relative to all other fiats, the least of any out there.  Almost like going into Chinese government bonds, but with more liquidity.  We should note that there are some who believe the entire Chinese economy is extremely overheated, and unstable.  I think that instability is true of the US economy as well, though.

Chinese bonds are also now on the radar, yielding 3.6% vs 2.3% for US treasuries.  As noted recently on Bloomberg “There's going to be a big shift when that currency (yuan) opens up, when it goes into everybody's indexes,  noting this week's opening of the Hong Kong-Shanghai stock connect allowing cross-trading of equities on the two exchanges is a big step to internationalizing the Chinese currency.”

Central banks are also now saying they’ll be buying Chinese government bonds, by the way.  Do you think the yuan is going down anytime soon? 

How To Take Advantage Of This Trade

At TDV Offshore, we can set up that brokerage account for you, allowing you to trade on the Shanghai market in yuan.  Furthermore, we can get you accounts with banks in jurisdictions outside the US to protect your cash from seizure without due process, and which will also allow you access to the yuan directly, without going into equities.  Both without need for a personal visit.  Right now, as the USD is temporarily over-valued, is the ideal time to finally make the move you know is right for you, and your family’s future.

The brokerage account can be done for $800 if you just want a personal account.  We recommend the added protection of a correctly structured/domiciled company to hold it, and that is $2,200-3,500 all-in, including the account in its name, depending on jurisdiction.

Contact me at pseymour@tdvoffshore.com to get an engagement form to liberate your assets from the tyranny, and protect it from losses as the USD devalues.

Questions or comments? Join us at The TDV Blog.

Paul worked for several years with Big 4 CPA firms in both the US and Saudi Arabia, and then spent many years as a multi-national corporate Controller and CFO in places like Florida, Riyadh, Abu Dhabi, Cairo, and Medellín. In his second, more free life, he has found a natural home in the offshore industry following almost 2 decades as a permanent expat from the former America.

 


 

Boy Its Easy To Scare People in the Home Of The Brave

Mon, 02/16/2015 - 18:59

[The following post is by TDV Chief Editor, Jeff Berwick]

I had barely just recovered from panicking over SARS, swine flu, ebola, ISIS and North Korea when another super-important crisis came on the scene that demands immediate attention!  The measles!

No, I'm not kidding.  Apparently this latest mainstream media panic is how measles is everywhere and if we all don't get immediately vaccinated we will all get the measles!  I guess, somehow, ebola morphed into the measles... what we really need is a vaccine for propaganda.

I think I had the measles... and the mumps... and the chicken pox.  It definitely was not a fun couple of days but I'm not sure it is worthy of widespread panic.

After all, this is how the Brady Bunch reacted in 1969 when all their kids got the measles.

Click here or on thumbnail

It was a lighthearted, relaxed approach that mostly meant poor Alice just had to serve breakfast in bed for a few days.  Not like in the US today where EVERYTHING is an emergency and something, anything must be done!

In the 70s, if your child, named Kelly, got the measles you'd often invite her friends over so they could all get it and then enjoy immunity.

In the 2010s, your child is quarantined in a room in isolation left to wear only a paper gown. Various talking heads discuss how inconsiderate and anti-science her mother is. Kelly is taken by the state and her mom arrested for depraved indifference. Next election cycle some panderer wins on a platform to pass Kelly's Law mandating everyone vaccinate or pay fines and face jail time.

Of course, with wonderful democracy, it is people like this who "vote" and demand these actions.

Now, there is even discussions with airlines in the US to demand vaccine proof before being allowed to fly.

Please don't tell me that the thing that finally stripped Amerikans of their ability to travel wasn't just the proposed national ID cards but was the threat of the measles!

It's amazing just how scared and totalitarian many Amerikans are.  Some have been shrieking like banshees demanding that everyone is immediately forcibly vaccinated for the measles due to the dire threat!

The logic of the pro-vaxers is that everyone must be vaccinated for their own safety... but this logic makes no sense.  If they really believe vaccines work and they vaccinate themselves then the unvaccinated pose no risk to them.

And, to put it mildly, the record and evidence of vaccines, especially for things like "swine flu" is far from compelling.

In probably one of the most unbelievable cases, children in war torn Syria, which has been turned into near hell on Earth by the US government, were injected with the measles vaccine... because of course, when you are living in a war zone you should really be worried about getting the measles!  The result?  34 Syrian children died from taking the vaccine.

Even the history of vaccines and their effectivity is highly questionable.

I'm no expert on vaccines, other than my own mother being paralyzed after taking the Swine flu vaccine... so I won't get into a long and detailed argument about the true risks and rewards of vaccines.

What I will do, however, is once again sit back and watch people in the "home of the brave" be scared to death that a few kids in the USSA got the measles and shake my head.

 

Jeff Berwick

Americans Are Stressed Out About Money, Annual Survey Shows - TDV Week In Review: February 15, 2015

Sun, 02/15/2015 - 16:29

[The Following post is by TDV Correspondent, Justin O'Connell]

Originally appeared at GoldSilverBitcoin

Americans are stressed out. And, perhaps unsurprisingly, they are most stressed over money, according to a new survey. Over 1-in-4 Americans report feeling stressed over money most or all of the time, and most say this stress over money has remained the same as last year (59%) or gotten worse (29%).

The survey was conducted by the American Psychological Assn.'s annual survey of stress in America, which was issued this past week. According to the survey, the stress has paralleled the nation's unsatisfactory recovery. 36% of the poor report they feel stress over money all or most of the time. Among those living in households with income over $50,000, half as many, 18%, report they feel chronic financial stress.

Average stress levels were higher in 2007 than in 2014.  In 2014, however, stress levels began to change along income lines. Lower-income households averaged stress levels of 5.2 on a 1-to-10 scale on which 10 was the highest. Those with higher household incomes averaged stress levels of 4.7.

As LA Times notes,

The psychological pulse-taking makes clear that this increasingly skewed pattern of stress will probably exacerbate the dramatic inequities in the health of poorer and richer Americans. Those living in lower-income households were almost twice as likely as wealthier respondents to tell survey-takers that financial insecurity stands in the way of their living a more healthful lifestyle.

Compared with higher-income respondents who experienced less stress, those with high stress and low income were more likely to say they had skipped, or considered skipping, a needed trip to the doctor out of financial concern. They were more likely to say they dealt with their stress in unhealthful ways, such as drinking alcohol, surfing the Internet, watching TV or eating. And they were more likely to say they felt lonely or isolated in their stress.

Money, work, family responsibilities and health concerns led as sources of stress for Americans, according to the survey. 58% said paying for essentials was a significant source of stress.

38% of men said that paying for essentials was a somewhat or very significant source of stress, while 49% of women said so.

The American Psychological Assn.'s executive vice president, Norman B. Anderson, said the latest survey "continues to reinforce the idea that we are living with a level of stress that we consider too high."

The findings are particularly worrying considering 50% of Americans are living in poverty.

Originally appeared on GoldSilverBitcoin

Insights or comments? Let us know!

Justin O’Connell is the Chief Executive Officer of GoldSilverBitcoin.  He is also the author of the bitcoin book, Bitcoinomics, and administrator of the Bitcoinomics website. Justin is also a co-host at Our Very Own Special Show, a lifestyle podcast about music, news, life and other topics, and head researcher at The Dollar Vigilante.  He lives in San Diego, California.

What makes The TDV Newsletter so valuable is its keen knowledge of macro-and-micro economics events and theories. While your parent's economic advisors and stockbrokers adhered to the Keynesian paradigm, TDV's monthly Dispatches and Newsletter sees the world through the episteme of Austrian Economics, something every person curious in economics, politics and culture should be familiar with. Austrian Economics understands the driving force behind liberty, slavery, economic indicators, stats and players.

Because this year is going to be a chaotic one, as foreseen by the TDV Staff, Editor-In-Chief Jeff Berwick and senior analyst Ed Bugos are dedicating themselves almost full-time to bringing paid subscribers the best information they can receive in 2015, which could prove to be an ever important year in The End Of The Monetary System As We Know It (TEOTMSAWKI).

What's more you will receive invaluable and private placings in some of today's most exciting companies.

Subscribe to The Newsletter today, and receive TDV's HomeGrown, as well as special reports, including Getting Your Gold Out Of Dodge.

If you’re interested in receiving articles beyond what you read here everyday, consider our weekly subscriber-only publications, like our Issue, Dispatches, and Homegrown. You may subscribe here.

February 9, 2015

TSA Demands Internal Passport for Domestic Travel

Post by TDV Contributor, Wendy McElroy

Precedents exist for requiring citizens to produce special ID for domestic travel; they include Nazi Germany, apartheid South Africa and Russia (both Imperial and Soviet).

Over the Christmas season, the Transportation Security Administration (TSA) quietly announced that America was walking down that path. By 2016,  all domestic air travel will require either a traditional passport or a federally-compliant ID card called “Real ID.”  State driver's licenses will no longer allow Americans access to domestic flights, as they do now. Real ID will constitute an internal passport.  (The drop-date date is commonly reported as January.)

continue reading...

February 10, 2015

Bitcoin Watch: The Gamemakers Wait

Post by TDV Contributor, Scott Freeman

In 2014 hundreds of millions of dollars in new venture capital were invested in bitcoin-related ventures. The two focal points for these investments were China and the United States. While more money was probably invested in the US, developments in China were the most obvious. The funds went both into software infrastructure and market liquidity, and as a result, between January 2014 and January 2015 the landscape has changed to the point of becoming virtually unrecognizable.

Whereas one year ago there was only one liquid futures market (796.com), today two of the top 3 Chinese exchanges - Huobi and OKCoin - have developed futures markets. Beijing-based OKCoin dominates the market, with futures trading volumes ranging from $100 to $200 million US dollars per day. One year ago, it was very difficult to use margin to engage in leveraged speculation on Bitcoin price moves; today, though functionality is still far from perfect, up to 20:1 margin is available.

continue reading...

February 11, 2015

TDV Editor-In-Chief, Jeff Berwick, on US extortion rackets.

US Government To Extort Only 14% From Overseas Corporations In Rare Limited Time Offer

Some are heralding a possible “tax holiday” for overseas US corporations proposed by Barack O'bomber. The reality is many companies have found a way to arbitrage the tax code and create their own personalized tax holiday year-round thanks to clever planning, so they likely won't be repatriating their funds.

So what does the Lameduck King want?

In a one-time charge, just 14% of foreign earnings of US corporations will be stolen, with the extorted funds officially going to infrastructure investments around the country. This money will most likely go towards building prisons to house Americans. Sounds like a deal! Unfortunately, this plan won't be enough to repatriate money.  Here's why...

continue reading...

February 12, 2015

TSA: New Sheriff, New Rules?

Changes within the Transportation Security Administration (TSA) should  prompt you to reconsider the wisdom of crossing into or out of the United States. The TSA is slowly turning from counter-terrorism to criminal law enforcement, which will include the pursuit of tax violaters. And you may not be able to rely on the agency's notorious incompetence for much longer.  

continue reading...

February 13, 2015

A Perfect Conspiracy

TDV Legal Analyst Jim Karger on the widening grasp of the IRS and US government.

 I write this sitting on my rooftop in San Miguel de Allende, Mexico.  The temperature is 72 degrees F.  The sky is blue and cloudless.  There is an occasional light breeze.  By all accounts, life is dead solid perfect.  And I am not the only one to have made that observation.  Indeed, San Miguel has been voted and described by a myriad of publications as the best city in the world in which to live.  Having resided here in the land of eternal Spring for 13 years, I agree.  In fact, I would like to spend the rest of my life here, yet I now ponder whether that will be possible.

continue reading...

Insights or comments? Let us know!

A Perfect Conspiracy

Fri, 02/13/2015 - 18:23

[The following post is by TDV Legal Correspondent, Jim Karger]

I write this sitting on my rooftop in San Miguel de Allende, Mexico.  The temperature is 72 degrees F.  The sky is blue and cloudless.  There is an occasional light breeze.  By all accounts, life is dead solid perfect.  And I am not the only one to have made that observation.  Indeed, San Miguel has been voted and described by a myriad of publications as the best city in the world in which to live.  Having resided here in the land of eternal Spring for 13 years, I agree.  In fact, I would like to spend the rest of my life here, yet I now ponder whether that will be possible.


 

You see, Mexico, like so many other nations, appears outwardly to be sovereign, but in fact is a vassal state of the 900-pound gorilla to the north.  Its history of subservience to the United States dates to 1836 when U.S. citizens, kindly allowed by Mexico to live in the Mexican state of Texas, revolted against the Mexican government to establish a U.S.-backed Republic of Texas, a country that existed less than 10 years (from May 14, 1836 to December 29, 1845) before it was annexed to the United States.  It was theft on a grand scale and set a precedent that exists until today:  the U.S. takes what it wants when it wants.

And, Mexico is hardly the first or the only nation that exists to serve the United States.  Canada, likewise critically dependent on the U.S. economy, asks “how high” when the U.S. says “jump.”  And, like Mexico, Canadians pretend their nation is not at the beckon call of its southern neighbor in the face of all evidence to the contrary.  Indeed, citizens of all vassal states are allowed to engage in the fantasy of autonomy until the U.S. wants something, at which time all pretenses must stop and the vassal states are expected to drop to their knees.  (Most of the European Union falls into the “vassal state” category, as does much of south and central America, Australia, and New Zealand.  The list goes on.)  Right now, on this rooftop, I am concerned only about Mexico, my adopted home, and the most recent effort of the United States to disregard its sovereignty as well as the privacy of its own citizens.

Enter FATCA

We begin this story of a conspiracy with the Foreign Account Tax Compliance Act (FATCA), about which I and others have written extensively.  This legislation requires all nations and all banks in all nations become the unpaid agents of the United States Internal Revenue Service (IRS).  When enacted in 2010, it stunned even those accustomed to wild-eyed U.S. bullying and hubris.  

By way of background, the U.S. is one of only two nations in the world that taxes its citizens and permanent residents on their worldwide income regardless of where they live.  FATCA effectively cuts off companies from access to critical U.S. financial markets if they fail to pass along data on their American residents and customers.  This effectively eliminates the right of Americans to bank in foreign countries absent complete compliance.  FFIs must report account numbers, balances, names, addresses, and U.S. identification numbers on every U.S. account holder and if they fail to do so they must withhold a 30% tax that goes directly to the IRS and is non-refundable on outgoing wire transfers.

Many countries initially and rightfully objected to FATCA as a gross incursion on their sovereignty, but then fell into line, one by one, agreeing to identify all U.S. customers with accounts in their domestic banks or eliminating the problem by closing their accounts, which many have done. As of this writing, more than 100 nations have agreed to “step ‘n fetch it” for the Leviathan.  

Mexico broke its knees falling on them so fast.  Indeed, it was one of the earliest signatories to FATCA.  

But that was not enough for the United States.  It still left them in a dilemma:  how to find each and every U.S. citizen and permanent resident that walks the face of the earth and collect every last dime of tax on every last dime of their earnings, regardless where earned.  FATCA will surely identify many Americans, those with large bank accounts, but many, perhaps the majority, of U.S. citizens and permanent residents who live outside the U.S. live quietly under the radar in places like Mexico, a place that more than one million Americans call home.  The U.S. knows there is gold in the hills of Mexico because “a mere 7,000 (income tax) returns from Mexican based U.S. taxpayers” were filed in 2011.

Whoa!  Only 7,000 out of more than a million actually filed a U.S. tax return?  This fact acted to confirm my long-held anecdotal perspective that most Americans file their last U.S. tax return the year before they step across border to live in Mexico.  They don’t report their accounts with the FBAR form, something required of those who own or have signatory authority on foreign accounts that total more than $10,000, if only because many don’t have bank accounts at all, and if they do, they total less than $10,000 USD.  In short, many Americans come to Mexico not because they are rich, but they can live here well being poor.  

Many likewise don’t file U.S. tax returns, many for decades.  And most have gotten away with it simply because there is no (current) requirement to inform the U.S. government know where you are at all times.  And, a lot of Americans stop filing tax returns for good reasons – like death, for example.  In short, the IRS can’t tax or threaten you if they don’t know where you are or even if you are alive.  

But not to be dissuaded from total and complete compliance by every American citizen and permanent resident, the U.S. and Mexico, in what appears to be three unrelated events that, in fact, are totally related, have worked together to insure the U.S. gets what it wants (again), which is everything.

Conspiracy:  Step 1:  Offer Expats A “Deal”

Mexico has long had to deal with U.S. citizens who violate Mexico’s immigration laws, e.g., come to Mexico on a tourist visa and never return to the U.S., disappearing into the bi-cultural societies of places like San Miguel de Allende.  In true Mexican fashion, when they are caught, they are not immediately deported, or deported at all.  They usually face a fine but also get the opportunity fix the problem.  Let and let live.

Mexico collects money; the putative Mexican resident gets a resident card, and everyone is happy.  Which makes it curious that Mexico recently announced that this year, 2015, between January 12 and December 18th, the Mexican government will allow undocumented foreigners who come forward to “legalize” their status to do so without paying a fine.

Sounds good, but to whose benefit?  Mexico is out the revenue from the fines.  Besides, they have never really cared if Americans live here as long as they don’t take the jobs of Mexicans, which few do if only because most Americans won’t perform hard labor for $20 dollars a day.  One might argue that by identifying these gringos that some of them might pay income taxes to Mexico, but the numbers would be minuscule, either because they are pensionados living here on their pensions, 401k's and/or Social Security, or they, like many of their Mexican counterparts, earn money under the table.  

Which brings us to the interests of bully-boy to the north . . .

If American citizens and permanent residents of the U.S. living in Mexico take the bait and self-identify to avoid the inevitable fine, and legalize their presence Mexico, then Mexico knows where they are -- their names, addresses, finger prints, and photos.  And because these American citizens are in Mexico using their U.S. passports, the U.S. immigration authorities will also know.  

Getting warmer . . .

But this still doesn't solve the entire problem, mostly because the U.S. State Department has never acted as an agent of the Internal Revenue Service.  

Until now . . .

Conspiracy:  Step 2:  Information Sharing

In an altogether curious email from the U.S. State Department to some U.S. citizens residing overseas is a reference, “I Haven’t Filed All My Tax Returns, What Can I Do?.”  It then references the IRS offshore programs (which includes the current version of the IRS’ Offshore Voluntary Disclosure Program (OVDP) which has acted to deplete the net worth of those who jumped on board early, confessing their sins and paying dearly for the right not to go to jail, even though some were criminally prosecuted anyway.

As one tax professional opined on seeing this State Department memo, “In my career of more than 25 years as a tax professional, working in the international tax area, I have never before seen communications sent by the U.S. Department of State, directly discussing U.S. federal tax obligations.

"However, there have been many changes in the last few years in how aggressive the IRS (and Tax Division, Department of Justice) has become in enforcing U.S. tax laws overseas.   See, Should IRS use Department of Homeland Security to Track Taxpayers Overseas Re: Civil (not Criminal) Tax Matters? The IRS works with Department of Homeland Security with TECs Database to Track Movement of Taxpayers.

"This seems to be part of a bigger trend of the IRS to use other governmental agencies and their resources in identifying and locating U.S. taxpayers and their assets overseas."

Indeed it does.

Sounds like the perfect conspiracy, and it is, but there is still one piece missing – how does the U.S. enforce its will in Mexico?  How does it squeeze blood out of the proverbial turnip?  There are many ways, including filing suit and attempting to seize Mexican bank accounts and real estate of U.S. citizens believed to be evading U.S. income taxes, or even seeking arrest warrants in Mexico to enforce criminal complaints and indictments in the U.S.  But most countries don’t like to deport for tax offenses, and besides, the process can be long and costly.  

Something more effective and nefarious is needed to complete the conspiratorial circle, to make it dead solid perfect.  

Enter Congress . . .

Conspiracy:  Step 3:  Hold The Family Hostage

As recently observed by Martin Armstrong at Armstrong Economics, “just two days after taking charge of the committee chairing the House Homeland Security subcommittee hearing, U.S. Rep. John Katko introduced two bills. He is looking to effectively close the borders using terrorism as the excuse (as always) to hunt down Americans. Katko is a former federal prosecutor.  So he knows precisely what he is doing writing a law that is so broad, that anyone suspected of a crime cannot leave the country, which for expats, likewise means a prohibition on entering the U.S. because even if one could enter without being detained, they could never return home.

“Katko’s bill will direct the TSA Office of Inspection Accountability Act (H.R. 719), requiring TSA to now conduct criminal Investigators spending at least 50% of their time ‘investigating, apprehending, or detaining individuals suspected of committing a crime.’ This bill will now result in the arrest of anyone for any alleged crime whatsoever and that will apply to taxes.”  

[Editor's Note: Read TSA Demands Internal Passports For USA Domestic Travel]

According to Armstrong, “Katko is constructing a highly dangerous version of the Berlin Wall around all American citizens. He is converting the TSA into a police force less concerned about air safety and focused more on catching anyone the government can argue violates some law federal or state.”

Because most Americans have, at a minimum, familial, if not business, ties inside the United States, and thus return from time to time, with this legislation the U.S. will create the perfect extortive tool:  “If you ever want to see your family again, pay up – all of it – taxes, penalties, interest, and perhaps even some prison time.”

And if that's not enough, there is always the threat of arrest when one tries to cross into the U.S. or back into Mexico, back to home.  

Conclusion

The government of the United States is failing, completely and utterly.  It is financially bankrupt and morally vacuous.  It remains standing solely because the dollar, for the moment, remains the world reserve currency, allowing such gross overreaches as FATCA, and the extortion of virtually every other nation in the world.  That will change sooner than later, perhaps when China or Russia, or both, back their currency in whole, or part, with gold.  But that is another story we will save for later.

In the meantime, the U.S., now in its death throes, is burdened by inconceivable debt that cannot be repaid, an economy supported by a diminishing, asset-stripped middle class, all of which is actively ignored by an incurious, anesthetized population more interested in the size of Kim Kardashian's ass than in their own privacy.  The behemoth is now thrashing, flailing, doing anything and everything to stay alive, including extorting other nations and its own citizens.  The beast will be come more aggressive and violent as it approaches its final breath. Until then, American expats everywhere, including Mexico, have decisions to make.  

I only hope my personal decision does not require me to leave this rooftop. 

Questions or comments? Join us at The TDV Blog

TSA: New Sheriff, New Rules?

Thu, 02/12/2015 - 13:29

[The following post is by TDV Contributor, Wendy McElroy]

Changes within the Transportation Security Administration (TSA) should  prompt you to reconsider the wisdom of crossing into or out of the United States. The TSA is slowly turning from counter-terrorism to criminal law enforcement, which will include the pursuit of tax violaters. And you may not be able to rely on the agency's notorious incompetence for much longer.   

Meet the New Sheriff. Not Quite like the Old

John Pistole stepped down as head of the TSA on December 31, leaving an acting administrator to keep the seat warm. On February 3, Rep. John Katko (R-Camillus,NY) conducted his first hearing as chairman of the House Homeland Security Subcommittee on Transportation Security. News reports glowed about his 'performance', saying “Katko looked as if he's done this before.”  All signs point to Katko becoming a new power player behind the TSA.

The man is a hard-liner with a mandate. The freshly-elected Katko is an award-winning federal prosecutor who secured his Congressional seat by a staggering 20 percentage points of the vote even though his democratic opponent overspent him by millions. After his first subcommittee hearing, Katko explained that his training in the US Attorney General's Office made heading the subcommittee “a very easy transition.”   

Having been a prosecutor also defines his vision of the TSA and whom its agents should target. Pistole had publicly stressed the need to control terrorists. Katko now publicly calls for the detection and detention of anyone suspected or guilty of committing a crime...any crime. Only one month into his stint at the House of Representatives, Katko has introduced two bipartisan bills aimed at reforming the TSA. 

One of them, the TSA Office of Inspection Accountability Act (HR 719) would require TSA law enforcement officers to “spend on average at least 50 percent of their time investigating, apprehending, or detaining individuals suspected or convicted of offenses against the criminal laws of the United States.” Katko accuses the current TSA of relying “primarily” on the “criminal         investigations conducted by other agencies.” He wants its agents to conduct their own investigations.

There is no indication of which crimes would absorb 50% of the focus of TSA agents.  The category “crime” is so broad that it includes everything from prostitution to drunk driving, murder to rape, insider trading to bribery, domestic violence to child support arrears. Tax violations, money laundering and other financial 'crimes' are likely to be among the most hotly pursued 'crimes' because they invite the confiscation of goods and bank accounts; they would be profitable. And, since individuals only need to be “suspected” of a crime, almost anyone crossing the US Border could be summarily detained aka arrested.

“Show me the man, and I'll show you the crime.” - Lavrentiy Beria, head of Joseph Stalin's secret police

HR 719 (and Katko) would convert the TSA into an explicit frontline for the enforcement of criminal law in America.

Don't Rely on the TSA's Incompetence

In an article entitled “New Bill Turns TSA Into Tax Police,” InfoWars (Feb. 6) observed, “The TSA already delves into a treasure trove of private information about all Americans in the name of security before they even arrive at the airport, including tax identification numbers, vehicle and job history, and property ownership records.”

But the TSA confronts two problems in gathering information about travellers. First, it is an incompetent bureaucracy. Second, few people have signed up for its PreCheck program through which the TSA hoped to reap a bonanza of sensitive information.

The PreCheck program allows a traveller to be approved for quick TSA processing at airports; for example, the traveller will never need to remove his shoes or to endure secondary screening. The cost to the PreChecked traveller is $85 and the surrender of personal data on everything from financial transactions to interactions with family.  

TechDirt (Jan. 23) listed the type of “commercial data” that enrollment opens to TSA eyes. It includes: “public record data, such as criminal history and real estate records produced by federal, state, and local governments; other publicly available information, such as directories, press reports, location data and information that individuals post on blogs and social media sites; and wide ranging data such as purchase information, customer lists from registration websites, and self-reported information provided by consumers that is obtained by commercial data sources such as data brokers.”

But not enough travellers were willing to turn their data over to the TSA in exchange for keeping their shoes on. Of course, the TSA views the low enrollment as a marketing problem rather than the result of their offering a bad product. The official solution? The TSA quietly announced its plans to hire huge data mining companies to woo Americans into the PreCheck program.  Those who fly should expect solicitations and promotions from the quasi-private sector – also known as crony capitalists – over 2015.

Before you sign up, however, read the small print because the data companies want more than your enrollment. They will want permission to access your credit card accounts, your grocery receipts, your Facebook and twitter posts...and to do so on a continuing basis.

The information has clear commercial value to any company that possesses it. But the data will also be used to provide the TSA with an assessment of a traveller as a terror risk. The TSA is confident enough about this method of assessment that it is considering a reduction in airport screeners for whom the massive outsourced data mining would substitute.  (It is not clear whether the information will be used by other government agencies. But private companies have the 'advantage' of not being subject to constitutional restraints on their behavior.)

If HR 719 and Katko are successful, then the TSA will undoubtedly receive an assessment of a traveller's criminal status as well. Even if HR 719 is not successful, criminal evaluations are likely to occur. In soliciting bids for “multiple vendors” of PreCheck, for example, the TSA was clear that it  explicitly wanted data correlations between terrorism, criminal behavior and commercial conduct. Moreover, the bid solicitation reads,

“Contractors may use commercial data to conduct an eligibility evaluation (also known as pre-screening) of potential applicants. The eligibility evaluation shall include, at a minimum, validating identity and performing a criminal history records check to ensure that applicants do not have disqualifying convictions in conjunction with the TSA Pre✓® disqualifying offenses…” 

[Note: the actual bid solicitation seems to have disappeared from online.]

Of course, the evaluations may (and probably will) occur whether or not you enroll in PreCheck; but they will be more difficult to generate and, perhaps, less thorough.

In a sad irony, travellers who eschew PreCheck for privacy reasons may receive enhanced scrutiny. The Federal Register describes the PreCheck program as “a risk-based approach to aviation screening that allows TSA to focus its limited resources on unknown and perhaps high-risk travelers.” This means greater suspicion and TSA time-hours will fall upon those who have opted not to be pre-cleared as a terrorist risk or as a criminal. Such people can expect longer lines, greater inspection and more indignities.

Two facts seem clear about the TSA in the coming year. First, the agency will focus increasingly upon criminal screening, including (and, perhaps, with special emphasis) upon financial and tax 'crimes'. Arrests, fines and confiscations at the border will almost certainly increase. Second, travellers will be evaluated with more competence by semi-private data companies than they were by low-level civil servants. Any information culled – even from unrelated parties such as Facebook – may be a larger factor in your ability to cross the border... or for the process to move forward smoothly.  

Conclusion

Stop travelling to or from the United States. If you live within American territory, consider other options. If you choose to stay, be aware that the borders are closing, and it may happen more quickly than you expect.

[Editor's Note: TDV Passports and TDV Offshore are both equipped to help you get out of the US]

Questions or comments? Join us at TDV.

Wendy McElroy

US Government To Extort Only 14% From Overseas Corporations In Rare Limited Time Offer

Thu, 02/12/2015 - 03:49

[The following post is by TDV Chief Editor, Jeff Berwick]

Some are heralding a possible “tax holiday” for overseas US corporations proposed by Barack O'bomber. The reality is many companies have found a way to arbitrage the tax code and create their own personalized tax holiday year-round thanks to clever planning, so they likely won't be repatriating their funds.

So what does the Lameduck King want?

In a one-time charge, just 14% of foreign earnings of US corporations will be stolen, with the extorted funds officially going to infrastructure investments around the country. This money will most likely go towards building prisons to house Americans. Sounds like a deal! Unfortunately, this plan won't be enough to repatriate money.  Here's why...

The biggest US corporations, according to Citizens for Tax Justice, found that the effective corporate tax rate is just below 20 percent for the 288 largest profitable American companies.  They're already getting a deal... And good for them! Their hardwork deserves to be rewarded.

According to some analyses, many profitable companies pay zero percent US income tax rates, which should be every individual's ultimate goal when it comes to financial planning: paying no taxes.

I am totally in favor of tech giants Apple and Google protecting hundreds of billions in revenue from the taxation of brutal governments. In fact, I believe these companies do all of humanity a service when they game the rules of the extortion system and take money out of the state coffers, and ultimately out of the pockets of corrupt politicians and their cronies.

Thank the lord for companies like Caterpillar, which decided to spend $50 million on a scheme to route profits through Switzerland and out of the hands of IRS thieves. They should keep their $2 trillion, and so they do.

The mainstream press knows this and has caught on to the fact that Obama’s planned tax holiday won’t work because these corporations are already paying a lower rate on their taxes through the sorts of responsible financial plannings provided at TDV Offshore. The mainstream media would like you to believe that these companies are stealing from YOU, the "taxpayer", but really all they are doing is preventing the destructive US government from using their earnings to do evil around the world, killing people you've never met and who have done you no harm.

The US has one choice to bring much of these profits back: eliminate all income taxes. This is the only way to truly ensure that hundreds of billions in US profit currently sent overseas actually stays in the US.

Until then, the US will suffer through the capital drain that has accelerated in the 21st century and especially in the wake of the 2008 financial crisis. Burger King caught slack from the media over its tax inversion merger with Canadian brand Tim Horton’s, but the iconic fast food chain never even looked back, and nor should they have. They weren't the first, and they aren't the last.

Taxation is theft. There is no way around it. Aiden Gregg and I spoke about it in this episode of Anarchast, where we beefed up this argument.

Click here or on thumbnail

Everyday more and more people see this plain truth.  If you're one of them, contact us today about how you can escape the feedback loop of wealth confiscation and poverty.

Questions or comments? Join The TDV Blog.
 

Jeff Berwick

Bitcoin Watch: The Gamemakers Wait

Tue, 02/10/2015 - 14:44

[The following post is by TDV Contributor, Scott Freeman]

In 2014 hundreds of millions of dollars in new venture capital were invested in bitcoin-related ventures. The two focal points for these investments were China and the United States. While more money was probably invested in the US, developments in China were the most obvious. The funds went both into software infrastructure and market liquidity, and as a result, between January 2014 and January 2015 the landscape has changed to the point of becoming virtually unrecognizable.

Whereas one year ago there was only one liquid futures market (796.com), today two of the top 3 Chinese exchanges - Huobi and OKCoin - have developed futures markets. Beijing-based OKCoin dominates the market, with futures trading volumes ranging from $100 to $200 million US dollars per day. One year ago, it was very difficult to use margin to engage in leveraged speculation on Bitcoin price moves; today, though functionality is still far from perfect, up to 20:1 margin is available.

Unsurprisingly, trading is overwhelmingly dominated by Chinese exchanges, since they can not only draw on the world’s largest economy, but also benefit from a virtually regulation-free environment. China has no capital gains taxes, so Chinese residents are free to trade to their hearts’ content without worrying about any need to report profits or losses, and exchanges have no need to report back to Big Brother on their clients’ activities. Volumes have expanded rapidly, with reported volume on bitcoin futures markets now surpassing spot market trading by a factor of 5 or more. While it is difficult to comment on the reliability of these statistics, there seems little doubt that the increased ease of leveraged trading has led to a substantial increase in volume. If the reported numbers are correct, overall volumes are now at least 10 times the levels we saw back in January of 2014.


 

On the security front, we also saw several security breaches, the most memorable being the theft of 19,000 bitcoins from Bitstamp on January 4, 2015. This apparently pushed Bitstamp to finally take the plunge into multi-signature technology, which requires at least two approvals to finalize a transfer. This technology was added to the bitcoin code base in 2011; however, it had been very rarely used prior to December 2014, when Bitfinex first started using it. Nonetheless, multi-sig technology remains difficult to implement, so broad-based adoption is likely to take some time. None of the Chinese exchanges has yet implemented multi-sig.

During 2014 we also saw a gradual evolution in views regarding the ultimate usefulness of bitcoin. Innovative solutions were proposed to make use of the blockchain as a permanent public record of events, including ownership of assets at a given point in time. Some progress was also made towards increasing the acceptance of bitcoin as a medium of payment; nonetheless, this remains a minor function. What has become increasingly clear is that bitcoin excels as a means of moving large sums of capital quickly from place to place.

If I need to make a payment, or move the equivalent of 1m USD in collateral somewhere on a Sunday afternoon, bitcoin is the only way to do it. Finally, bitcoin has revealed itself to be the speculator’s dream come true, with a substantial market capitalization, high volatility, no regulation and the availability of 20:1 leverage. For the moment, those are the primary drivers behind bitcoin usage.

Prognosis for 2015


 

In 2015 it is to be expected that the Chinese exchanges will continue to evolve by adding both additional functionality and security features. Given their regulatory advantages, they will likely continue to remain the innovation and volume leaders. Nonetheless, a more secure regulatory environment in the US and the EU leaves room for optimism that bitcoin-related businesses will continue to multiply in both of those jurisdictions, as well. Particularly notable is the recent launch of a full exchange by Coinbase in the United States. Though it does not (yet) offer any type of advanced functionality, it does seem to have substantial liquidity, which is a good base on which to build on.

On the price front, the past two weeks we have seen yet another short-lived bitcoin spike, with prices rising quickly to the US$300 mark, holding there for approximately one day, then returning to the low $200s.

This is the second time in the past several months where we have seen such a short-lived pump, and this is sure to negatively impact the confidence of long-term bitcoin holders. Nonetheless, prices still remain substantially above last month’s lows around the $150 / 900 RMB mark, and as long as bitcoin avoids falling below, say, $190, temporary ups and downs in the low $200s should not impact confidence levels any further.

My feeling is that the market – and the gamemakers - are waiting for impulses from the broader financial market. For now the US dollar up-trend seems to be intact, and bitcoin seems to be no exception to this general trend. How much longer can this last until the next crisis incites a rush to the exits? All I can say with any certainty is that the dollar pump cannot last forever, and when the market reversal comes, it is likely to benefit bitcoin, as well. A nice currency crisis in Europe with, say, the imposition of currency controls in multiple countries, could be just what bitcoin needs to start a new sustained upswing.

[Editor's Note: In the TDV Newsletter, TDV's financial team analyzes the current market trends and their future trajectories. TDV Chief Editor Jeff Berwick and TDV Senior Analyst Ed Bugos bring you the actionable insights you need to survive and prosper at The End Of The Monetary System As We Know It]

Questions or comments? Join us at The TDV Blog!

Scott Freeman is the CEO of the IT Group, which is a Shanghai-based group of companies focusing on information technology and financial services. He’s always on the lookout for self-starters who bring along creativity, enthusiasm and know-how. He can be contacted at sfreeman@tdvmedia.com.

TSA Demands Internal Passport for Domestic Travel

Mon, 02/09/2015 - 17:00

[The following post is by TDV Contributor, Wendy McElroy]

Precedents exist for requiring citizens to produce special ID for domestic travel; they include Nazi Germany, apartheid South Africa and Russia (both Imperial and Soviet).

Over the Christmas season, the Transportation Security Administration (TSA) quietly announced that America was walking down that path. By 2016,  all domestic air travel will require either a traditional passport or a federally-compliant ID card called “Real ID.”  State driver's licenses will no longer allow Americans access to domestic flights, as they do now. Real ID will constitute an internal passport.  (The drop-date date is commonly reported as January.)

An internal passport refers to an identity document that people must produce to move from place to place within national borders. It allows a government to  monitor the movement of its own people and to control that movement by granting or denying ID. In the past, governments have used internal passports to isolate 'undesirables', to regulate economic opportunities, to reap personal data, to intimidate and command obedience, and to segregate categories of people (like Jews) for political purposes. It allows a government to bind anyone it chooses to his or her place of birth.
The upcoming Real ID requirement targets only air travel. But that's how it begins – with airports.

After people became numb to years of ID demands, questioning and searches at airports, those tactics spread to train stations and subways.  Then highway check-points were established in areas that lay within 100 miles from an “external boundary,” including coasts. U.S. Customs and Border Protection agents now have the authority to stop a traveller if they have “reasonable suspicion” of an immigration violation or other crime. Although the agents do not currently have authority to demand ID from American citizens, they often do so.

The ACLU has repeatedly cautioned that “[i]n practice, Border Patrol agents routinely ignore or misunderstand the limits of their legal authority in the course of individual stops, resulting in violations of the constitutional rights of innocent people....These problems are compounded by...the consistent failure of CBP to hold agents accountable for abuse. Thus, although the 100-mile border zone is not literally 'Constitution free', the U.S. government frequently acts like it is.”


 

Recently, highway checkpoints have occurred well outside the 100-mile “exemption” range, with agents demanding to see ID. They detain and threaten those who refuse the illegal demand:

Click here or on thumbnail

The total control of movement always begins with airports. Real ID will be reality in the US by the end of the decade and, perhaps, long before. And it is not likely to be limited to air travel.  

Real ID Walks In Through A Back Door

Under the Real ID Act of 2005,  state driver's licenses and other ID needed to conform to federal standards. The IDs were to be used for “official purposes” as were defined by the Department of Homeland Security (DHS).  Examples of explicitly defined “purposes” include for entry into federal buildings and for boarding  commercial air flights. But the law also provided the DHS with the authority to require Real ID for other undefined purposes, apparently at its discretion.  

To be compliant, the state IDs must incorporate specific personal details about each bearer and link that information to a unique identifying number. The minimum information required consists of a front-facing photo that is compatible with facial recognition technology, a full legal name, signature, birth date, gender, and main address. (RFID chips were not mandated but the Act left the future possibility open.)

The issuing state must verify the information and encode it in a machine readable manner such as bar codes. Then, the data must be linked to every other state's motor vehicle databases. The networking would permit an easy data-merge with federal databases such as the FBI's Next Generation Identification system. The latter is a national facial recognition system, which serves other functions as well.

The Real ID Act experienced a huge backlash from privacy and fourth amendment advocates, as well as from states' rights ones. The states themselves rebelled because the federal government hoisted the cost of implementing the program onto their shoulders. Some states – for example, Idaho, Hawaii, New Hampshire, and Maine – flatly refused to comply. DHS estimates that somewhere between 20-30% of Americans live in non-compliant areas.  This means the states have to scramble to abide by federal standards by 2016. The Real ID will have a white star inside a gold circle in the upper right corner to indicate that the data has been verified.

The verification process is not a simple one for the state or for the individual. The Marietta Daily Journal (Oct. 23,2012) reported, “[M]any drivers in Georgia were surprised when they attempted to renew their driver’s licenses. What was a quick point and click online is no longer. Federal requirements for the Real ID Act, now require drivers to visit a Department of Driver Services office if they don’t already have DDS secure license marked by a white star in a field of gold in the upper right corner of the license.


“Many Georgians haven’t renewed their licenses in many years, so naturally, they were caught by surprise when they had to produce, in person, proof of identity, Social Security card and proof of residence. But there is more. You have to prove your citizenship as well. How? According to the DDS, either with a 'valid, unexpired U.S. passport', an original or certified copy of a U.S. birth certificate/amended birth certificate filed with the State Office of Vital Statistics. Birth certificates issued by hospitals 'are not acceptable'.”

This is nothing less than the federalization and standardization of all identifying documents throughout the United States. Those who are unable to document such niceties as their existence (that is, their birth) will become second class citizens. They will be unable to fly and excluded from entering into federal buildings, which may be necessary for them to obtain government permissions or fulfil legal requirements. Joining the ranks of the second-class will be the holders non-compliant licenses; these lack a white star and are  stamped "Not for Federal Official Use" instead. "Not for Federal Official Use" holders will need a traditional passport or to apply for alternate DHS documentation if they wish to fly.

What To Expect

Many states and, so, many individuals will not make TSA's January 2016 deadline for Real ID. Some hope the humanitarian TSA will push back the deadline as it did last year. And a delay may happen...for logistical reasons. If it does, those who wish to escape a nation with internal passports may have another year to do so.

But the main hope of delaying Real ID is a confrontation between the federal and state governments. In 2012, the governor of Montana declared,

“Montana will not agree to share its citizens' personal and private information through a national database, nor bear the exorbitant cost [of] building such a database. Furthermore, the Act tramples on our state's right to determine our own licensing procedures and protocols, and would interfere with our state's work to improve drivers' license security. Montana is in no mood at all for another heavy-handed play by the federal government, such as what transpired in 2008 when the homeland security director threatened to prevent Montanans from boarding an airplane unless we complied with the REAL ID act. We refused, and will refuse again.”

Brave words. But Real ID is coming. When it arrives with both feet, Real ID  will make it much more difficult for freedom-loving people to avoid the federal behemoth. Of course, that is its purpose. FATCA and related global measures gave the feds access to every cent that any American possessed in the world. Now Real ID wants to ensure that no American can avoid federal detection within domestic borders. 

[Editor's Note: Contact TDV Passports today to learn how you can live peacefully, without the threat of coercion from the TSA, in another country.]

Questions or comments? Join us at the TDV Blog.
 

Wendy McElroy

Silver-Investor David Morgan On Industrial Demand, Bitcoin, Dividends & Oil - TDV Week In Review

Sun, 02/08/2015 - 06:36

This week Justin O'Connell sits down with Silver-Investor David Morgan for a chat. Post originally appeared on GoldSilverBitcoin.

How long have you been investing in silver?

Since my early 20’s, once I had a job and some sort of cash flow that was the real beginning.  I did buy a few silver coins as a kid but nothing of significance.

What got you interested in silver?

I first discovered silver and really thought about it when the coinage changed in 1965 in the United States.  I was eleven years old at the time and this got me to thinking about the monetary system. It seemed to me even as a kid that something was wrong but at that time I certainly did not know the whole story but it did spark a quest in me– obviously.

What’s the hottest story in silver right now?

There are really two stories, one is the Silver Institute just commissioned a study which forecasts an increase in Industrial demand of 27% through 2018 which means 142 million additional ounces of demand. The other story involves the silver stackers on a global basis are buying government minted coins in record numbers because many of them see the currency wars which we and others have forecast for so long.

Why do we constantly see record American Silver Eagle sales?

Simply more people are waking up to the truth with many websites such as Max Keiser with the buy silver take down JP Morgan as one of the best examples.  This campaign really spread the silver story and the interest and ACTION followed and continues to grow.

What is the connection between precious metals prices and interest rates?

There is a correlation, at least in the last bull market.  Gold and silver prices will continue to improve in price as interest rates climb until the real rate of interest is above the real inflation rate.  If we use Shadow Stats.com and know real inflation is the U.S. is around 9%, that suggests gold and silver could continue to rise until we see interest rates near 10% or so.  But we all know the system is very unlikely to hold together with that high an interest rate, which means the market itself will realize there is “no way out” this time and that just could be the place where the acceleration in the price of the precious metals goes nearly straight up.

Did you see the movie Looper? What did you think about the use of silver bullion in that film?

I did see the movie Looper, and reached out to the writer through a subscriber of mine that used to be in the film industry at a rather significant level.  I never received a response.  To me the movie indicated that in the future to do anything significant in society you will have to use real money — silver and gold.

What other investments do you like?

I think energy is an important sector, especially for those looking for income.  If you do your research you can find companies that are viable outside of fracking that will be able to pay dividends to their shareholders.  Energy (oil) is still the most important of all commodities because nothing happens without energy.

I also look at the technology sector, this is where we did quite well early on adapting to the cell phone industry before most people even knew they existed.

What do you think about Bitcoin?

I wrote a long article about Bitcoin which can be found by using Google and typing in my name and Bitcoin.  Being free market- the market knows better than anyone (assuming truly free markets).  This type of ideas time has come, however there are some concerns and some have been expressed by Charles Savoie whom has done research for us from the founding of Silver-Investor.com.  Let me suggest people make up their own minds after getting some education on the matter.  Personally, I still favor value backed systems so perhaps a Bitcoin type system backed by precious metals will evolve to the point where it truly does become the monetary standard on a global basis.

What is in your future?  

I plan to continue to write The Morgan Report even after the peak in precious metals and we called the top to the best of our ability.  It may “waffle” for a couple months as we determine what might be the next investment story that is underfollowed and unknown — similar to the silver story when we started.

What is in the future for Silver-Investor?

Actually at this point we are considering the possibility of selling the business when the market gets overheated.  We would keep TheMorganReport.com but let the Silver-Investor go and move on, hopefullly to the next big thing.

What do subscribers enjoy when they sign up for your publications?

The Morgan Report focuses on Money, Metals, and Mining. We concentrate on the resource sector, with primary emphasis on the precious metals, but have invested in moly, copper, uranium, lithium, base metals, drillers and other companies. We provide a unique service by filming many of the mining trips and providing them to our members. Additionally, at the second level of service you can email questions directly to us and we guarantee they will be answered. Lastly Basic Plus Members receive a desktop widget that is our unique software/ Alert Service. Further description is available on the website.

Resources-

YouTube – Silverguru

Twitter-@silverguru22

Free e-letter available

TheMorganReport—30day Free Trial go to TheMorganReport.com/free

E-Mail:  support@silver-investor.com  Phone 480-325-0230

 ………………………………………….

David Morgan (Silver-Investor.com) is a widely recognized analyst in the precious metals industry and consults for hedge funds, high-net-worth investors, mining companies, depositories and bullion dealers. He is the publisher of The Morgan Report on precious metals, coauthor of The Silver Manifesto, and featured speaker at investment conferences in North America, Europe and Asia.

Before we get to the review, be sure to check out TDV Newsletter, because this month (and year) is going to be special. Jeff is dedicating himself almost full-time to bringing paid subscribers the best information they can receive in 2015, which could prove to be an ever important year in The End Of The Monetary System As We Know It (TEOTMSAWKI).

Subscribe to The Newsletter today, and receive TDV's HomeGrown, as well as special reports, including Getting Your Gold Out Of Dodge. Moreover in the Newsletter, senior analyst Ed Bugos analyzes what is going on in Europe, as well as the yellow metal in what is looking like what could be the first big year for gold in a few years.

If you’re interested in receiving articles beyond what you read here everyday, consider our weekly subscriber-only publications, like our Issue, Dispatches, and Homegrown. You may subscribe here.

February 2, 2015

A Genius Propaganda Move By The Croatian Government

TDV Chief-Editor, Jeff Berwick, on the brilliance of the Croatian Propaganda Department.

When I first read the news I was taken aback.  It said, "Croatia wipes out the debts of thousands of its poorest citizens in 'fresh start' scheme".

I thought to myself, "Could it be?  A government or banking system that actually does something somewhat helpful for the poor?"

Government, that beacon of goodness, and the banking system, that place that cares not about profit... <sarcasm> ... actually gave a gift to the poor?

continue reading...

February 4, 2015

Ross Ulbricht Found "Guilty" in Third World Banana Republic Court

Jeff Berwick on the unfortunate fate of Ross Ulbricht.

In what I described as being the trial of our generation, Ross Ulbricht, of the Silk Road free market online marketplace, was found guilty today on all charges and now faces sentencing of 30 years to life.

The charges included charges of narcotics conspiracy, money laundering conspiracy, and engaging in a continuing criminal enterprise.  This from a government who constantly says conspiracy theorists should be jailed.  Not to mention that dealing in narcotics amongst two voluntary parties is not a crime.  Nor is trying to keep your funds out from under the purview of the all-seeing eye of the US government.  If there is no victim there is no crime.

continue reading...

 

February 5, 2015

The Gringo Motorcycle Diaries & The Income Free PT Lifestyle

 Director of TDV Offshore, Paul Seymour, on the prior taxpayer lifestyle.

It occurred to me, as my new wife pointed it out to me, that I hadn’t published anything for quite a while. First, I’d like to remind you that, in my last, or maybe two articles ago, I urged you all to move some over-valued USD to a safe jurisdiction, and while you were at it, get some Swiss Francs instead. 

With a move of only USD 10,000 into CHF, your profits from the revaluation of the CHF would have covered the fees to move your funds to safety, and get diversified.  Very few took heed.  Hate to say I told you so, but..

continue reading...

February 6, 2015

Get Your Kids Out Of Public School

TDV Chief Editor, Jeff Berwick, on public skool.

The face of socialized "education" is really starting to rear its ugly head now.  It's always been bad but now it is going nightmare-level bad very quickly.

While I could pick from hundreds of public school atrocities from this week alone, just take a look at these two, both in the supposed "freer" state of Texas.

TDV VIDEOS

February 5, 2015

Anarchast: Benny Wills Joy Camp!

Jeff interviews Benny Wills of Joy Camp, activist comedian- filmmakers and actors, topics include: being an anarchic idealist, comedic videos about controversial subjects, people more readily accept a message when cloaked in humor, a shift to the good is well underway, street protest ineffective, 9/11 truth, James Corbett, American Sniper, propaganda, the Joy Camp TV show project, Anarchapulco!

Click here or on thumbnail

February 4, 2015

Anarchast: Jose Rodriguez: Bitcoin in Mexico!

Jeff interviews top Latin American Bitcoin entrepreneur Jose Rodriguez, topics include: the problem with government and banks becoming corrupted by the monetary system, Bitcoin businesses are not immune from corruption but it is incorruptible itself, big mainstream investment in Bitcoin, Unisend, Max Keiser, StartCoin, difficulties with business banking in Argentina, big growth in Bitcoin in Mexico, Mexican central banks like Bitcoin and not a lot of Bitcoin regulation in Mexico.

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As always, thank you for subscribing!

Get Your Kids Out Of Public School

Fri, 02/06/2015 - 18:45

[The following post by TDV Chief Editor, Jeff Berwick]

The face of socialized "education" is really starting to rear its ugly head now.  It's always been bad but now it is going nightmare-level bad very quickly.

While I could pick from hundreds of public school atrocities from this week alone, just take a look at these two, both in the supposed "freer" state of Texas.

On January 28th, it was reported, that nearly two dozen elementary school boys and girls (age 11) were stripsearched in Gustine, Texas, after some feces was found on the gym floor.  Call me old fashioned, but back in my day, something like this would be dealt with via some questioning and some stern words from the Principal.  It definitely wouldn't have been handled by strip searching the entire class in, what can only be assumed, was a search for some left over remnants of poo that may pin the culprit?

As if that wasn't bad enough, three days later, Bill HB 868, or "The Teacher's Protection Act" was put forth in the state's legislature.  The proposed bill affords teachers legal immunity in the "unlikely event" that they happen to kill any of their students during school-sanctioned events.

Yes, you read that right.  The bill wants to make it so that if a teacher kills their student(s), no matter what the circumstance, the teacher has legal immunity!

You have to love these socialists/statists... most of their ridiculous laws are always enacted under the guise that "we have to protect the children".  Now, apparently, the kids aren't so important and we must now "protect the teachers".

I've said it before, and I'll say it again, I consider it a form of child abuse to force your children into these indoctrination camps.

And they are indoctrination camps.  

Boy In A Band recently came out with a great track called "Don't Stay In School" which mirrors a lot of my thoughts on school.

Click here or on thumbnail

Of course, many in the US have both the father and mother working fulltime just to be able to pay all the taxes and keep up with the Federal Reserve's inflation and may think they have no other option other than public school for their children.

If this is your situation I would first try to earn more money and do so in such a way as to pay less taxes (which I recently described how to in the January issue of TDV Homegrown).  I'd also look to earn more income via the internet so you can just leave the US to live a freer life.

PEACEFUL PARENTING AND UNSCHOOLING

There are plenty of options in regards to providing your children will the skills they need in life and none of them have to do with public school which will mostly just waste 12 years of their life.

In my personal situation, with an 8 and 10 year old, they happily go to a Montessori school in Acapulco that is, perhaps, the nicest place I've ever been.  It's mostly outdoors with big trees, an olympic size swimming pool and loving and caring teachers.  The cost?  Under $400/month (the same style school in New York state is about $3,000/month).

But, school, in any form, is unnecessary.  The reason?  Kids want to learn.  They yearn for knowledge and it is often the drudgery of being forced to learn about things they are not interested in in traditional schools that demotivates them from wanting to learn.

Dayna Martin is a world expert on unschooling and none of her kids have ever been in a school.  Her oldest son, in his early teens, has already owned and operated numerous businesses.

I had this opportunity to sit down with the entire Martin family recently to ask them about unschooling.

Click here or on thumbnail

Dayna and her family will be at Anarchapulco at the end of this month hosting a one-day "Peaceful Parenting and Unschooling" workshop where she'll spend time with many families showing them different ways to engender smart, open-minded, entrepreneurial children in a family environment.

The workshop will be held on the beach in Acapulco, Mexico, on February 26th and is followed by the Anarchapulco conference from February 27th to March 1st.

There are other options, much better options, than interning your children into government indoctrination work camps where the teachers may stripsearch them or have full immunity to kill them if they wish.  I hope you can make it to Anarchapulco to hear more and meet others living these lifestyles which are happier, healthier and cheaper than most other traditional ways of living.

Jeff Berwick

The Gringo Motorcycle Diaries & The Income Free PT Lifestyle

Thu, 02/05/2015 - 18:56

[The following post is written by Director of TDV Offshore, Paul Seymour]

It occurred to me, as my new wife pointed it out to me, that I hadn’t published anything for quite a while. First, I’d like to remind you that, in my last, or maybe two articles ago, I urged you all to move some over-valued USD to a safe jurisdiction, and while you were at it, get some Swiss Francs instead. 

With a move of only USD 10,000 into CHF, your profits from the revaluation of the CHF would have covered the fees to move your funds to safety, and get diversified.  Very few took heed.  Hate to say I told you so, but..

Secondly, yes, while on the road throughout South America, while I was in in northern Perú to be exact, I was contacted by a new client.  Nothing new about that, as I talk to potential new clients all the time.  All of our clients are like-minded freedom-lovers, and I’m blessed to be able to work with such intelligent, refreshing people.

This client, however, turned out to be a bit different, and over the course of a few months, we made plans to meet up in Buenos Aires to see how traveling together might go.  Over a couple of months in Argentina and Uruguay, as you can see by the result, it went very well.  Although she has returned temporarily to Europe to fulfill a modeling contract, the return visit to South America in the near future will be a permanent move.  Another former US citizen in South America leading a better life outside the curtain.

That’s just an aside, though, if such a change in one’s life could be referred to so lightly.  There are a couple of reasons why I haven’t written for a while, and therefore needed some prodding.  First, it seems that quite a few North Americans had time during the holidays to finally do what they knew was right all along, and move at least a portion of their assets to safety.  No Europeans recently, for some reason, although they have every bit as much to gain by doing so.

In fact, what I’m hearing from up there sounds progressively more like real fear.  I haven’t stepped foot behind the curtain since before 9/11, and didn’t really need any reassurance that I’d made the right call on that one.  I’m just continually amazed at how far people can get pushed before they’ve had enough.  Seems like more and more have gotten to that tipping point.  Therefore, I’ve been spending much more time establishing new trusts, LLC’s, IBC’s, and bank or brokerage accounts than ever before.  I do all of that personally, by the way.  That in addition to all of the conversations and correspondence it takes to get these new clients on board, and start moving with the due diligence requirements, etc.  

In addition, and as I alluded to above, I’m on a two-year tour of South America by motorcycle, and writing a book.  I had fallen behind on that project, and have been playing catch up.  The trip was borne out of a long-time dream going back to my first trip to Colombia about twenty years ago.  Back when everyone assured me that I’d never get out alive.  Instead, what I discovered was a country and culture that would obviously become a place of choice for many to emigrate to.  I was simply amazed at how inaccurately my new home country had been portrayed.  Back then I was still a suit-wearing corporate geek, but it started a lot of wheels to turning. The seeds of the PT Lifestyle were sown.

When I started out on this motorcycle journey, it was strictly for pleasure, and a way to try out the true perpetual traveller (PT) lifestyle.  Just for fun, I published three or four blogs about my first three to four legs of the journey, on a far less significant website.  To my surprise, the response was incredibly loud and positive.  Therefore, the concept of the Gringo Motorcycle Diaries, as a full-fledged book, was born.  The title being inspired by a book I became aware of many years ago down here written by Che Guevara.

When I set out, I truly thought the journey would take 5-6 months.  Now, 16 months later, and a little over half way, I realize that was wholly unrealistic.  Happily so, as it turns out.  It has been a life-changer, which isn’t any surprise to me.  I fully expected that based on past life-changing experiences. 

My parents, and grandparents, were typical middle class Americans of their times.  They worked, slept, ate, and raised their kids.  They took a family vacation every summer with the measly two weeks allotted to them, and never had passports.  Why would they?  With two weeks a year off work, international travel was pretty much out of the question.  Back then we could cross into Canada without all the paranoid machinations.  I’m not sure if that’s still possible or not.
I’m making that all up for them, after starting out on the same miserable trail.  I was in the same rut in my twenties.  Graduated from college, got married, had student loans and credit card tabs from putting myself through school, mortgage, two car payments, etc etc.  

Luckily, what seemed at the time to be a very unpleasant sort of business with the government, got me my first international post in Saudi Arabia.  So at age 33, I had that first passport, and would never look back.  First thing I learned was how wonderful it was to not pay income taxes, as taxes are forbidden by the Koran it seems.  I was still paying the FICA with the US companies, but no income taxes in Saudi Arabia. 

Also, I was given 8 weeks of paid leave per year, and airfare.  For the first time in my life, I was actually getting ahead, while seeing the world at the same time.  Trips to Egypt for a Nile Cruise, Hungary and Malaysia for the F1 Races, a several weeks tour of Europe by train, four weeks in Australia, Christmas at the coffee farm in Colombia, etc etc. 

I also once had to leave Saudi Arabia in order to get my work visa, so was paid to spend about twelve weeks meandering around Thailand back in 2002.  Let me assure you, that if you’ve ever been stuck in that rut my grandparents, parents, and the younger Paul were in, that a few months of paid vacation in a free country like Thailand, after a life-time of slavery behind the curtain, it will change your life, and whole manner of thinking about it.

Therefore, I was fully expecting this journey to be yet another life-changer.  Why? Because after all of those earlier travels, and several more years spent in South America, I had become convinced that South America is the place to live.  I also know that there are double-digit millions of people in both North America and the EU who have a similar gut feeling.  Many of those, however, are absolutely clueless about how big and diverse this continent is, and therefore the whole Latin American culture which also includes Central America and parts of the Caribbean.  

CULTURAL IGNORANCE

A couple of quick stories on that point.  When I made that first visit to Colombia back in 1996, I had been living in Florida for many years.  Sometimes while driving around the back roads of north-central Florida I would stumble across migrant Mexican farm-workers making homemade tortillas, and rolling up some sort of homemade food, and selling it for a buck. 

I noticed how different it was from Chi Chi’s or Taco Bell.  I was therefore looking forward to getting down to Colombia to see what the Chimichangas were like down there.  When I inquired, they crinkled their foreheads, and got in a huddle to ask about Mexican restaurants.  Back in those days, Medellín didn’t have any, so I was out of luck.  I could have sancocho, chicharrón, papa criollo or even a tamale, but chimichangas?  Medellín has changed a bit over the past twenty years, though, and Mexican grub is also now available….

Then recently, an American who I respect completely as an intelligent guy, and like-minded freedom fighter, said that he had spent some time in Tijuana, and that was enough of Latin America for him…..Wow.  Therefore I know there’s a need to shed a lot of light here for those who know it’s time to leave, but don’t yet know where to go. 

From 2004-2011 I rode around Colombia on a small, very non-descript bike making 1 or 2 week trips here and there.  Back in 2004 many Colombians were still afraid to travel from Medellín up to the coast, but I considered that fear to be unjustified, and went on my merry way.  Meeting some great people along the way, who seemed to truly appreciate my courage, or lack of sense, as their perspective may have been.  What I learned was that even within the country of Colombia, the cultural differences were quite immense, and that I couldn’t begin to imagine what all of those differences would be like throughout the entire continent.

I sometimes wonder if shouldn’t have been a cultural anthropologist instead of an accountant.  Many of the personality tests indicate that I’m cut out more to be an analytical scientist, and I truly love traveling around and observing, comparing and contrasting cultural differences.  I can’t begin to tell you the differences I’ve noted throughout Colombia, Ecuador, Perú, Chile, Argentina, Uruguay and now Brazil. 

Mind-blowing, and with Paraguy and Bolivia still yet to come.  I won’t be telling you about my personal opinions, nor presenting dry charts with cost of living data in them.  Instead, I’m just laying out my real-life experiences, and observations so that the reader can put themselves in that same situation, and judge for themselves whether it’s a good, or bad thing.  Those experiences cover the gamut regarding the people & culture, the governments, the police, weather, prices, everything.

THE PT LIFE IS INCOME TAX FREE

I get a lot of inquiries about how to legally live tax-free.  First of all, I’d like to point out that the majority of people have been expertly brainwashed into thinking that income taxes are the only taxes which matter.  Personally, I’m paying a shed-load of taxes, but thankfully no income taxes.  The biggest tax I pay as a PT is the IVA (VAT or sales tax).  That has ranged from 12% to 22% during my ride-about.  Also whenever I buy gas, which has ranged from USD 1.50/gallon to $7.15, I know there’s a lot of tax in there. 

Whenever I rent a cabin or apartment, I’m paying the owner’s real estate taxes, and taxes on the utilities and wifi etc.  Although some countries don’t charge motorcycles a highway toll, others do, and that’s certainly a tax.  Some countries will have additional “sin taxes” on the beer and wine.   Others prefer to make such items cheap, and keep the populace stupefied.   Let’s not forget obligatory contributions to the bankrupt social security scheme. 

I realized 20 years ago that I’d never see a dime of that.  But then, I also foresaw the current Ameriken police state back then. It just took even more guts to talk about it then. I guess now there’s an obligatory tax to cover your “free” healthcare?  If you don’t pay it you lose your house? Unbelievable.  Yeah, that sounds like freedom.  Trust me, that’s not gonna be happening down here.  The people have too many stones for that.

Even worse is that all along the supply-chain, governmental fees are being added to the prices you pay before the IVA gets added on top.  In Colombia, there’s a tax of .4% on every bank transaction if you use a Colombian bank.  Don’t get me started on Argentina.  Those people really need our services just as bad as the Yankees.  Then there are tangible and intangibles taxes.  You get the point.  

Therefore, not paying income taxes is a minor victory, at best, but if you only spend three months or so at a time in any given country, on a tourist visa, you’re not a resident, and owe no taxes.  If you wanted to, you could make a day trip to a bordering country when your tourist visa expires, and cross the borders again, and renew your tourist visa.  There’s a whole industry in Thailand for people who regularly do that.  They’re called border runs.  Some countries will even give tourists relief on the IVA, too.  When I was paying with my international credit card (issued by a private jurisdiction bank) in Uruguay, I was sometimes automatically refunded a large percentage of their 22% IVA.

Not paying taxes in countries where you don’t live just makes basic common sense.  Something which long ago went by the wayside in tax-and-spend nations.  Taxes are not the right of governments, and their functionaries.  They are payments made by citizens, and hopefully permanent residents, for services provided.  That’s the huge, and valid objection to the USG stance that people not living in the US must still pay income tax. For what, I ask?  So that the MIC can fund its scheme of global imperialism, which they call “defense”.  Thereby endangering the lives of US citizens who are smart enough to leave, by creating great animosity towards them?  Or maybe to fund my own surveillance, again in the name of national security?  Please sign me up for that immediately.

GETTING STARTED

As you can see, none of my current lifestyle happened over night, nor is it for the majority.  The worn out expression about good things taking time, is almost always true.  First I liquidated everything, and got my money to a safe jurisdiction.  Then I obtained citizenship in a free country.  Basically any one, other than the US, EU or Canada, and Australia.  That took several years, and postponed this trip, by the way.  Now I feel like I’m reaping some reward, although living in, and riding around Colombia for a few years wasn’t exactly a big sacrifice,   I have less material possessions, that’s for sure.  Much less, in fact.  How much is your personal freedom worth?  I find the lack of material goods to be extremely liberating in itself.

Where will we end up?  That’s uncertain.  We both know we do want a home base.  Possibly three.  There goes the lack of material goods, but when in safe jurisdictions, one feels less stress about having, and therefore keeping them.  Maybe one on the coast, or an island, one in the mountains, and one on the outskirts of a nice city.  All three in separate South American countries. 

We’re far from rich, but that’s doable down here.  None of them would be lavish.  Just cozy, and perfectly located.  The sale of just one McMansion would easily buy and furnish all three of the places I’m thinking of.  Possibly with a bit leftover as a cushion.  You’ll want that cushion too.  It might take years to find a decent income stream, and don’t ask me what that’ll be. 

Probably something you never thought of before.  Easiest option is buying, and renting out local real estate.

Contact me at pseymour@tdvoffshore.com to take step number one, and Chris Martin at TDV passports to take step number two.  Based on what I’m hearing, your USD may drop to a level whereby you won’t be able to afford to leave.  Suddenly the sale of your McMansion will get you much less house denominated in a stronger currency, like the Colombian peso, or Brazilian real.  Maybe that’s the plan?  You need to be diversified, and in a jurisdiction which still respects due process of law.

If you’d like to start on web-based business, we can do help with that as well.  We can:

    •    Establish the company in a tax-free jurisdiction
    •    Design, construct, and host the website itself
    •    Set up a company bank account in a privacy and due process respecting jurisdiction, and
    •    Establish a merchant account so you can accept credit card payments for your goods and services via the website.  Including the website chopping cart/buy buttons,
    •    Link the merchant account to your private bank account

“When fascism comes to America, it’ll come wrapped in the flag, and carrying the bible” – Sinclair Lewis         

On that note, god bless Amerika.

[Editor's Note: For more information on PT, contact TDV Offshore today]

Questions or comments? Join us at TDV.

Paul worked for several years with Big 4 CPA firms in both the US and Saudi Arabia, and then spent many years as a multi-national corporate Controller and CFO in places like Florida, Riyadh, Abu Dhabi, Cairo, and Medellín. In his second, more free life, he has found a natural home in the offshore industry following almost 2 decades as a permanent expat from the former America. Contact him to learn more about the realities of economical offshore asset protection pseymour@tdvoffshore.com

Anarchast: Benny Wills Joy Camp!

Thu, 02/05/2015 - 13:57

Jeff interviews Benny Wills of Joy Camp, activist comedian- filmmakers and actors, topics include: being an anarchic idealist, comedic videos about controversial subjects, people more readily accept a message when cloaked in humor, a shift to the good is well underway, street protest ineffective, 9/11 truth, James Corbett, American Sniper, propaganda, the Joy Camp TV show project, Anarchapulco!

Click here or on thumbnail

 

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