Move Your Money Out of
the Country... and Soon
By the editors of Without
from Casey Research
Mar 30, 2009
Things are getting uncomfortable
for individuals and corporations looking to deposit their money
in tax havens around the world. Just recently, Congress introduced
the so-called "Stop Tax Haven Abuse Act," which is
designed to do away with the privacy afforded by doing business
or investing outside the U.S. and to eliminate or reduce tax
benefits available offshore. Simon Black and Fitzroy McLean,
ex-CIA operatives, investment pros, and globe-trotting editors
of Casey Research's Without
Borders, weigh in with their no-holds-barred opinion on the
We are patriots. We have proudly
served in our country's military, have extended a helping hand
to its public sector, and have plowed our entrepreneurial enterprise
into its once fertile soil. We love America, but these days,
America does not love us back. It takes without giving and squelches
free enterprise. These days, America is no longer the land of
the free, especially when it comes to the market.
Just look at the headlines,
seemingly ripped from the pages of Atlas Shrugged: Unconscionably
large bank bailouts. Punishing regulations and tax requirements.
An arctic business climate. Government money bombs. Riots and
protests. Slowing trade. Protectionist rhetoric. Demonized corporate
executives. Even pirates hijacking cargo ships. One can guess
what will happen next.
We predict the next several
years will usher in larger, more obtrusive governments, resulting
in a decline of personal liberty and financial privacy. The world
will become increasingly polarized between two groups: those
who consider government intervention a great idea, and the rest
of us who happen to be sane.
As such, you can bet your last
falling dollar on some absolute certainties: bank nationalization
is a given, at least de facto if not de jure; taxes
are going up on those of us with any money left; the Fed's money
blitzkriegs will spark a blaze of inflation; and financial
privacy will be a thing of the past in the United States.
The obvious and necessary solution
is to position one's finances outside of the United States, and
to do so now, while the narrow and finite window of opportunity
is still open.
To be clear, evading (or even
avoiding) taxes at this point is not a wise move, given the size
and scope of the ever-growing IRS. But there are significant
advantages to expatriating your capital now:
For starters, you will actually
have control of your own money. Yes, in certain instances you'll
be obliged to tell the IRS exactly where it is and what you're
doing with it, but no government agency will have the authority
to reach into your overseas pocket and freeze or expropriate
(read: steal) on a whim just so Team Obama can give it away to
pay for someone else's McMansion. Plus, when exchange controls
are implemented and Americans are forbidden from wiring money
overseas, your capital will already be secured in another jurisdiction,
where you will be free to do what you want with it.
Secondly, you will no longer
have to assume the risk of insolvent banks or go through the
hassle of petitioning the government to get your FDIC insurance
bailout. Many overseas banks are far better capitalized than
those in the United States, and some of them are in jurisdictions
with constitutionally protected banking privacy.
Lastly, and probably most importantly,
moving money overseas gives you a last chance at diversifying
out of the dollar, which, in a very short period of time, will
barely be worth the paper on which it's printed.
Bank and Brokerage Accounts
Opening a foreign bank or brokerage
account is easier said than done; the United States government
severely restricts where and under what terms you can open a
bank account, invest in a fund, or engage in other economic activities
that facilitate the protection of and access to your assets.
As the signatory on an overseas account, you are required by
law to inform the federal government on Treasury form TDF 90.22
by the end of June each year. Ostensibly, this has been done
in the name of fighting money laundering, but it has the effect
of severely restricting your freedom of financial movement.
Many foreign banks simply won't
work with you... don't worry, it's nothing personal. Uncle Sam
has been beating them down since the Reagan years, and between
Qualified Intermediary rules, tax treaties, and the USA PATRIOT
Act, Sammy gives himself a lot of regulation to bury the opposition
There are some jurisdictions
that are still excellent banking centers; Switzerland may have
rolled over, but Panama, Uruguay, Singapore, and the United Arab
Emirates have thus far ignored the call for "greater transparency"
(read: government access to private finance).
Some individual banks, like
Credicorp and Global Bank in Panama, or Banco Itau in Uruguay
will not work with U.S. citizens anymore, but there is still
opportunity with the hundreds of remaining banks in these jurisdictions.
Similarly, opening a foreign
brokerage account is a shrewd move, not only to move your money
overseas but also to have greater access to financial markets.
Remember when world markets tanked on Martin Luther King Day
2008? If you were a U.S.-based investor and wanted to sell, sell,
sell, you had to wait a full 24 hours until the markets opened
after the holiday on Tuesday morning. If you had been invested
with global depository shares through a foreign brokerage, you
could have saved yourself several points and gotten out in time.
If you have gold, it would
be highly beneficial to get it out of the U.S. - stat.
If you do keep it in the U.S., your only truly reliable and private
option is to store it yourself in a safe that you bury in your
backyard. Otherwise, move it out of the U.S. now before Team
Obama pulls an FDR and takes your gold from you.
At the moment, gold is not
considered a monetary instrument by the U.S. Customs and Border
Patrol, so there is no legal requirement to declare your bullion
upon leaving the United States. Some countries, like Taiwan and
Uruguay, require you to declare gold in excess of a certain value
to customs officials upon entry.
We recommend Panama, Austria,
Switzerland, and the United Arab Emirates as locations to store
bullion; one particular favorite is a location called Das Safe
(www.dassafe.com) in Vienna
where anonymous safes start at 400 euro/year.
It might sound counterintuitive
after the subprime debacle, but real estate is a sound option
for moving money outside of the United States; there are zero
reporting requirements. It's your business where you own property,
and (so far) no one else's. You can purchase property in a private
way by setting up a corporate structure to hold the assets so
that they're not in your name (Panama is an excellent jurisdiction
to set this up), and although there are many places with depressed
real estate markets, there are also many with good growth potential:
in Latin America, we would recommend Panama, Colombia, Uruguay,
and Chile. In Europe: Slovakia, Albania, and Poland. In the rest
of the world: Lebanon, Hainan Island (China), the Philippines,
Cambodia, and New Zealand.
Time is of the essence - start
looking for your safe haven now.
Without Borders is Casey Research's monthly newsletter dedicated
to finding the best global investment opportunities and the most
beautiful places to live and do business.
If you are interested in specific
strategies for moving money overseas and diversifying out of
the dollar - whether it's overseas bank accounts, real estate
purchases, commodity currencies, or offshore brokerages - Fitzroy
McLean and Simon Black tell you the safest and most robust places
to park your dollars while they're still strong and widely accepted...
places that will keep your personal economy strong even as the
dollar and the U.S. economy suffer. They investigate outstanding
investment opportunities, companies, and stocks you won't hear
about on CNBC as well as lucrative overseas deals that they themselves
scope out and test.
If you want to think, invest,
and live outside the box, test Without Borders now risk-free
- via our 3-month trial subscription with 100% money-back guarantee.
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