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It's Official - America Now Enforces Capital Controls
It couldn't have happened to a nicer country. On March 18, with very little pomp and circumstance, president Obama passed the most recent stimulus act, the $17.5 billion Hiring Incentives to Restore Employment Act (H.R. 2487), brilliantly goalseeked by the administration's millionaire cronies to abbreviate as HIRE. As it was merely the latest in an endless stream of acts destined to expand the government payroll to infinity, nobody cared about it, or actually read it. Because if anyone had read it, the act would have been known as the Capital Controls Act, as one of the lesser, but infinitely more important provisions on page 27, known as Offset Provisions - Subtitle A—Foreign Account Tax Compliance, institutes just that. In brief, the Provision requires that foreign banks not only withhold 30% of all outgoing capital flows (likely remitting the collection promptly back to the US Treasury) but also disclose the full details of non-exempt account-holders to the US and the IRS. And should this provision be deemed illegal by a given foreign nation's domestic laws (think Switzerland), well the foreign financial institution is required to close the account. It's the law. If you thought you could move your capital to the non-sequestration safety of non-US financial institutions, sorry you lose - the law now says so. Capital Controls are now here and are now fully enforced by the law.
Let's parse through the just passed law, which has been mentioned by exactly zero mainstream media outlets.
Here is the default new state of capital outflows:
(a) IN GENERAL.—The Internal Revenue Code of 1986 is amended by inserting after chapter 3 the following new chapter:
‘‘CHAPTER 4—TAXES TO ENFORCE REPORTING ON CERTAIN FOREIGN ACCOUNTS
‘‘Sec. 1471. Withholdable payments to foreign financial institutions.
‘‘Sec. 1472. Withholdable payments to other foreign entities.
‘‘Sec. 1473. Definitions.
‘‘Sec. 1474. Special rules.
‘‘SEC. 1471. WITHHOLDABLE PAYMENTS TO FOREIGN FINANCIAL INSTITUTIONS.‘‘(a) IN GENERAL.—In the case of any withholdable payment to a foreign financial institution which does not meet the requirements of subsection (b), the withholding agent with respect to such payment shall deduct and withhold from such payment a tax equal to 30 percent of the amount of such payment.
Clarifying who this law applies to:
‘‘(C) in the case of any United States account maintained by such institution, to report on an annual basis the information described in subsection (c) with respect to such account,
‘‘(D) to deduct and withhold a tax equal to 30 percent of—‘‘(i) any passthru payment which is made by such institution to a recalcitrant account holder or another foreign financial institution which does not meet the requirements of this subsection, and
‘‘(ii) in the case of any passthru payment which is made by such institution to a foreign financial institution which has in effect an election under paragraph (3) with respect to such payment, so much of such payment as is allocable to accounts held by recalcitrant account holders or foreign financial institutions which do not meet the requirements of this subsection.
What happens if this brand new law impinges and/or is in blatant contradiction with existing foreign laws?
‘‘(F) in any case in which any foreign law would (but for a waiver described in clause (i)) prevent the reporting of any information referred to in this subsection or subsection (c) with respect to any United States account maintained by such institution—
‘‘(i) to attempt to obtain a valid and effective waiver of such law from each holder of such account, and
‘‘(ii) if a waiver described in clause (i) is not obtained from each such holder within a reasonable period of time, to close such account.
Not only are capital flows now to be overseen and controlled by the government and the IRS, but holders of foreign accounts can kiss any semblance of privacy goodbye:
‘‘(c) INFORMATION REQUIRED TO BE REPORTED ON UNITED STATES ACCOUNTS.—
‘‘(1) IN GENERAL.—The agreement described in subsection (b) shall require the foreign financial institution to report the following with respect to each United States account maintained by such institution:
‘‘(A) The name, address, and TIN of each account holder which is a specified United States person and, in the case of any account holder which is a United States owned foreign entity, the name, address, and TIN of each substantial United States owner of such entity.
‘‘(B) The account number.
‘‘(C) The account balance or value (determined at such time and in such manner as the Secretary may provide).
‘‘(D) Except to the extent provided by the Secretary, the gross receipts and gross withdrawals or payments from the account (determined for such period and in such manner as the Secretary may provide).
The only exemption to the rule? If you hold the meager sum of $50,000 or less in foreign accounts.
‘‘(B) EXCEPTION FOR CERTAIN ACCOUNTS HELD BY INDIVIDUALS.—Unless the foreign financial institution elects to not have this subparagraph apply, such term shall not include any depository account maintained by such financial institution if—
‘‘(i) each holder of such account is a natural person,and
‘‘(ii) with respect to each holder of such account, the aggregate value of all depository accounts held (in whole or in part) by such holder and maintained by the same financial institution which maintains such account does not exceed $50,000.
And, while we are on the topic of definitions, here is how "financial account" is defined by the US:
‘‘(2) FINANCIAL ACCOUNT.—Except as otherwise provided by the Secretary, the term ‘financial account’ means, with respect to any financial institution—
‘‘(A) any depository account maintained by such financial institution,
‘‘(B) any custodial account maintained by such financial institution, and
‘‘(C) any equity or debt interest in such financial institution (other than interests which are regularly traded on an established securities market). Any equity or debt interest which constitutes a financial account under subparagraph (C) with respect to any financial institution shall be treated for purposes of this section as maintained by such financial institution.
In case you find you do not like to be subject to capital controls, you are now deemed a "Recalcitrant Account Holder."
‘‘(6) RECALCITRANT ACCOUNT HOLDER.—The term ‘recalcitrant account holder’ means any account holder which—
‘‘(A) fails to comply with reasonable requests for the information referred to in subsection (b)(1)(A) or (c)(1)(A),
or ‘‘(B) fails to provide a waiver described in subsection (b)(1)(F) upon request.
But guess what - if you are a foreign Central Bank, or if the Secretary determined that you are "a low risk for tax evasion" (unlike the Secretary himself) you still can do whatever the hell you want:
‘‘(f) EXCEPTION FOR CERTAIN PAYMENTS.—Subsection (a) shall not apply to any payment to the extent that the beneficial owner
of such payment is—
‘‘(1) any foreign government, any political subdivision of a foreign government, or any wholly owned agency or instrumentality of any one or more of the foregoing,
‘‘(2) any international organization or any wholly owned agency or instrumentality thereof,
‘‘(3) any foreign central bank of issue, or
‘‘(4) any other class of persons identified by the Secretary for purposes of this subsection as posing a low risk of tax evasion.
One thing we are confused about is whether this law is a preamble, or already incorporates, the flow of non-cash assets, such as commodities, and, thus, gold. If an account transfers, via physical or paper delivery, gold from a domestic account to a foreign one, we are not sure if the language deems this a 30% taxable transaction, although preliminary discussions with lawyers indicates this is likely the case.
And so the noose on capital mobility tightens, as very soon the only option US citizens have when it comes to investing their money, will be in government mandated retirement annuities, which will likely be the next step in the capital control escalation, which will culminate with every single free dollar required to be reinvested into the US, likely in the form of purchasing US Treasury emissions such as Treasuries, TIPS and other worthless pieces of paper.
Congratulations bankrupt America - you are now one step closer to a thoroughly non-free market.
h/t Jørgen and Panama Investor Blog
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Technology changes fast, but PURE GOLD does not set off the metal detectors. I have no idea why, I just know it doesn't.
How much is my gold worth? The Treasury says it's worth $42 an ounce. Until they mark gold to market, why should I?
We have already tested moving some PM's to Switzerland (have Swiss relatives)and so far it doesn't raise any flags
As a diversion though, we always take a couple billion in UST's, stashed in a hidden suitcase compartment, with us just to throw TSA off the PM trail!
Yeah duuude, I guess we shouldn't take any of it seriously. Here is what the TSA chief council has to say about travelers with large amounts of cash:
"Sometimes a TSA officer may ask a passenger who is carrying a large sum of cash to account for the money. You have asked why such a question is posed and whether a passenger is required to answer.
In reacting to potential security problems or signs of criminal activity, TSA officers are trained to ask questions and assess passenger reactions, including whether a passenger appears to be cooperative and forthcoming in responding.
TSA officers routinely come across evidence of criminal activity at the airport checkpoint. Examples include evidence of illegal drug trafficking, money laundering, and violations of currency reporting requirements prior to international trips.
When presented with a passenger carrying a large sum of money through the screening checkpoint, the TSA officer will frequently engage in dialog with the passenger to determine whether a referral to law-enforcement authorities is warranted.
The TSA officer may consider all circumstances in making the assessment, including the behavior and credibility of the passenger. Thus, a failure to be forthcoming may inform a TSA officer’s decision to call law-enforcement authorities."
-- Francine Kerner, TSA Chief Counsel
IOW, If the TSA guy is having a bad day when you come through with your cash or coins, they can call in the local police to check out your story. Since you're such a smart fellow, why don't you take a look at what happens to travelers who have to explain to the local yokels why they are traveling with lots of cash.
Cool dude. You have your opinion I have mine. I don't need to convince you. But usually to win the argument it's good to toss an incident where it actually happened. However there are several stories about people doing it with no problem. Since there is no record of this happening I'm not worried.
You're right, never happens, just hypothetical bullhockey.
http://www.cnn.com/2009/US/06/20/tsa.lawsuit/index.html
I'm familiar with this story. So where is the mound of gold coins he is carrying? This article only talks about cash. What you are not seeing is the world does not perceive gold as money. This is to our advantage. While you claim it has that value, they will not think "Oh gold is money" they will think of it as "Oh this dudes coin collection is really valuable". To them it would be like carrying a piece of artwork on a plane "That artwork is valuable" not "That artwork is money". TSA are out of control but my whole point is they will not equate gold to money, only that coins have value. It's how they perceive it and how you act around them.
you have to declare if you are bringing more than $10,000 cash into the US from mexico, so other countries may have reporting regulations, and possibly fees
Apparently you missed the story a few months ago about a guy who was stopped in his car at the Canada-US border near Montreal, and was arrested because he had close to a million in gold coins in his car. That's only about 80 lbs, so it's not like the car was scraping the ground or anything.
This is the petit bourgeois mindset of Zerohedge at work. This is why its readership is dropping. Once you realize its ideological bent, it becomes a much less interesting site. It mispredicts, rants, becomes marginalized, etc. Still has some interesting insights, but who wants to wade through all the posts to get the nuggets.
In short, Hedgies are drones. This is what happens when you flat out refuse to revisit your ideology.
You are certainly entitled to visit this site as many times a day as you desire. Just a note: on Thursday we had our all time record traffic day.
I noticed during the February sell off the site traffic on Zerohedge took a tremendous jump according to Alexa. This is evidence to me that many feel comfortable turning to Zerohedge for the most honest explanation for large moves and interpretations of events. I try to provide friends with certain articles from this site however Im sure you know a more aesthetic website would be more appealing to those not yet familiar with Zero Hedge.
Congrats TD. I've been a daily reader since the blogspot days and have realized a wealth of knowledge and insight.
Tyler, here is the problem. DavidRicardo's post has been removed and now all of our replies, including yours, make no sense.... perhaps we could set the machine to only eliminate stupid comments that no one has replied to? or better yet, just leave them, unless they are obvious spambot garbage...
i mean the guy is entitled to his opinion, regardless of how wrong it might be, it was an honest opinion...
Yeah, let him rack up the 'junk' flags like a pinball machine so everyone can see that he's been tarred and feathered by the ZH readership. You could always ****-out really offensive words or phrases but let pocket-Hitler get shellacked.
Worth an experiment anyway.
What does this experiment prove? That if enough people anonymously vote against DR's comment that he can silenced? His dissent erased? All those who junk comments they disagree with are like people who throw rocks and run away. If you don't agree with us we'll shut you up and erase you - this is what "junk" has morphed into here on ZH. Pathetic.
Sorry this reply is so late.
It would be nice if we could have a system that causes junked comments to get smaller, or be minimized (first with a preview, then without one, where you could click to view the comment.
It would also be nice to have a "not junk" button, or a thumbs up/thumbs down system. This could automatically minimize those posters with lots of "thumbs downs", to cut down on trolls and spam-bots.
Nah, I am OK with it, free and open markets are a higher virtue than freedom of expression.
DD, i usually find myself agreeing with you, but in this case, i have to say that all freedoms are equally virtuous, freedom of expression must be and is as important as freedom of markets and anything else
opinion. You come to MY room to insult me...is another way to look at it. Its usually insecure small minded people that have that kind of habit.
Daily Zerohedge reader.
ZH hits record = Market inflection point near. Informed and Ready
Your comment is intelligible and true if everything you say is inverted.That this reflects poorly on you is an understatement.
Too bad ZH is so relevant eh?It must be a penalty to see that an actual fountain of truth exists...and that people are becoming all too aware of the breadth and depth of the criminal element that controls this country.
Get lost scumbag.
Please name a source of information without some sort of ideological viewpoint.
Can you name even one?
"petit bourgeois"?
Class based insults?
Are you serious?
Yeah, I haven't been called "petit bourgeois" lately.
SRSLY.
I'm like, oh yeah? That's GRAND MAL BOURGEOIS TO YOU, F**KER!!!
...at least since I've been living out of my car.
"This is what happens when you flat out refuse to revisit your ideology."
and what ideology is that?
Yeah, last I checked, we all had different ideologies here. Plenty of folks on the left, right, middle, and way out in left field around here.
"...and way out in left field around here." Hello Children from way out here in left field!
This is the petit bourgeois mindset of Zerohedge at work...
So ZH isn't the mental-masturbation room you want it to be---well poop on you. Asshole.
LOL Thanks Perchprism
"Once you realize its ideological bent, it becomes a much less interesting site."
Don't let the door hit your ass on the way out!
Proud to be petit and bourgeois then.
At least Zero Hedge is covering recent, passed legislation that involves more restrictions on freedoms for US citizens...WHILE NO ONE ELSE IS.
Not good enough for Hitler-boy.
"Get in line!" he says.
i believe the correct interpretation is Lenin-boy
I suppose the "petit bourgeois" comment was intended to add an air of intellectualism to your post.
And you contributed to past debates on this site, how exactly?
I'm sure once the RCP has a default site we are all required to read daily, you will be happier.
- We love you man, wish you could stay, here's your hat.
This comment hit a nerve. Is it the most flagged comment ever?
Whatever the various ideological backgroungs the ZH readers are, the backgrounds are going to overlap in some places. Enough to get this comment that junked.
It did not hit a nerve, it was simply junk:Ie pointless and utterly devoid of truth.The crack about readership being down was especially inaccurate, comically so.
IE: Junk, FAIL
Did everyone else see the changes to citizenship rules in the US lately in regards to foreignors visiting the US?
No I didn't, please provide a link so I can.
http://ernie.ey.com/Publication/vwLUAssets/TaxMatters_February2010/$FILE/TaxMatters@EY-Feb2010.pdf
If you’re a Canadian resident (but not a US citizen) who
spends significant amounts of time in the US for either work
or leisure, you may be required to file US federal income tax
returns. That’s because, under US law, you may be considered
a US resident as well as a resident of Canada.
You’re considered a US resident if you hold a green card or if
you meet the “substantial presence” test.
You have a “substantial presence” in the US if you spend
at least 31 days there during the year, and the result of a
prescribed formula for presence in the US is equal to or
greater than 183 days.
HC, I missed that one. Thanks for the heads up. That will DESTROY Florida as the Canadians will no longer come here....
Oh, foo. I'm Canadian, and I worked in the US for a number of years. I always had to file US federal, state, and city income tax forms, but I received a credit on my Canadian taxes for every dollar I paid in the US, thanks to the US-Canada tax treaty. This is nothing new, and will have zero effect on Canadians visiting FL or AZ.
Wait till Uncle Sugar declares everyone in the world US citizens and therefor subject to US taxes...it's probably not that far off considering out shockingly insane Uncle Sugar has been acting.
Makes sense ... protection fee
Thanks to USD, a lot of people around is subjected to US taxation system.
More efficient way to tackle the situation is to wonder who is not subjected to US taxation system.
Gulp! There are 5 million of us in Florida.
If this change was about tax cheats, when exactly did the Obama administration deem that being a tax cheat was wrong?
How many tax cheats did Barry and the boys from Cook County pick to serve his tax and spend, cut the military, limousine liberal, do as I say not as I do, National Socialist DNC cabal?
It is sort of ironic considering that the White House has staffers that owe millions in unfiled and unpaid taxes....
The laws only apply to the little people. It's sad that we don't even have the friggin Magna Carta in effect much less the Constitution.
Billions
Boo fucking hoo. Seriously... a lot of the biggest tax cheats are megabank assholes who are huge beneficiaries of federal largesse. So they're basically munching on the federal trough and then shitting it out in the Bahamas.
Sorry folks but if I pay taxes you gotta pay taxes. If you don't want to pay taxes, maybe you should start supporting some genuine fiscal discipline in Washington instead of running it as your own personal bailout service and no-bid government contract piggy bank.
I'm all for going after tax cheats and the whole "taxes are for little people" mentality.
Do you think for 1 minute this will hit the big boys? It's all about selective enforcement. Like Bush pulling IRS agents off high dollar cases to harass blue collar people. This is to trap the middle class and those with assets looking to escape the coming implosion.
The exemption includes anybody the Secretary of the Treasury deems not to be a risk for tax-cheating. I suppose that means you just have to be a friend of Timmy.
DH, all I can say to that post is if the asshat fits, wear it.
It fits you well, doesn't it?
Is it Pitchfork, Torch and Bloodhound time yet?
Is it Pitchfork, Torch and Bloodhound time yet?
and a plane
Well there is, as noted in the comments, one other country noted for restricting movement of individual assets and it just so happens to be a communist country.
Is it just the hysterical cries that bother you or is it merely your obvious hatred for people who oppose Obama and these types of policies? You know, just to be clear as to whether you have a point or just seek to marginalize and browbeat 40% of the populace.
Exactly what would have to transpire Zina to convince you that the this administration is pursuing or is at least interested in totalitarian levels of control of most or all aspects of personal and corporate affairs in this country?
Or do you think that that's not necessarily a bad thing?
Well, about the "totalitarian levels of control", I think the Obama administration is not the first administration on US that pursues something close to it.
Democracy and civil liberties always were a little weak in the Unites States. Well, in reality, less than 60 years ago, for black people US wasn't different of South Africa apartheid. And you in the U.S. have a two party system that reminds me of MDB and ARENA in the brazilian military dictatorship (1964-1985).
I think the levels of "totalitarian intervention" of a government over society, including the restriction of civil liberties, don't have a direct relation with the level of government intervention in the economy. For example, in the 70's, capitalist France had a level of government intervention in the economy much higher than capitalist Chile, but France was a democracy, and Chile was under Pinochet's totalitarian regime.
So, I have to laugh on tea baggers who cry like babies when Obama try to modify the health care system.
I'm not a fan of Obama, but I don't think he doing nothing very different from past administrations, including Bush administration. In reality, in many aspects, Obama's first term looks like Bush's third term. And if democracy and civil liberties on US are weakening, it don't started in 2009, and it have no relation with health care.
That's rather weak since this post is about moving money overseas and you are the one who brought up healthcare and, in fact, the only one to bring it up.
Sorry, your agenda is showing and it doesn't match your words. But nice try on obfuscation by historical references to other countries that have nothing to do with the subject at hand.
If you're going to mock the tea parties with the kind of idiotic trolling you're doing here, Zima, and stereotype them as militant hillbillies, then I have no respect for you.
The tea partiers deserve credit for standing up to our out-of-control federal government and its fiscally suicidal tax-borrow-and-spend policies. No one else is doing a damned thing about it.
Seriously, assuming you understand the problems, what are you doing about it? Posting stupid rants in the comments on Zero Hedge? What's that going to accomplish, exactly?
So you, as a Teabagee, dismiss a movement of people attempting to right some of the wrongs in government, simply because the erosion started years ago?
His reasoning is that America hasn't been a perfect paragon of virtue throughout its entire existence (just a helluva lot moreso than any other country), so we all deserve bad things to happen to us. Oh, and we should just shut up and take our medicine instead of marching on Washington.
I haven't seen anyone arguing that the road towards totalitarianism started in 2009 nor have I seen anyone defending Bush. However, this is the first post of yours that I've seen where you don't appear to be defending Obama. Is it possible that you just today realized that being an Obama defender made you no different than Bush defenders? If so, congrats. Hopefully this is the beginning of your awakening.
So, I have to laugh on tea baggers who cry like babies when Obama try to modify the health care system.
I'm not a fan of Obama, but I don't think he doing nothing very different from past administrations,
And if democracy and civil liberties on US are weakening, it don't started in 2009, and it have no relation with health care.
Coming soon to a strip mall near you: Zina's 6 month course "How to Write Good"
Aside his formulaic, MSM talking-points post, it's not too bad considering Portuguese is his first language.
Great. Thanks for clearing that up Zima.
Poly Sci terms aren't much help.
A simpler, more easily grasped term: Nanny-state.
your so lame you repost the same damn content on two different subjects on your initial, first ever ZH post, and your probably aren't even fucked up. plus you use verbage like girlie acronymism to show your "malehood". i don't know, are you a white haired soccer player?
"You're" so lame, for your edification, Teach.
Cale a boca e va tomar banho.
This should be good for at least 50 points (up) on Dow tomorrow morning.
The vice tightens with another turn...
Well thats a problem. My wife and I moved to the Netherlands for work and we were planning on buying a house here if the euro got close to parity. Houses in Amsterdam that we are interested in cost about 300,000 to 400,000 USD. We are savers and don't believe in taking out bank loans despite the tax advantages. I don't want to owe a bank anything.If I read this law correctly we now have no hope of moving cash out of the US to buy a house.
If you have sufficient physical Gold, taking out a loan is not such a bad idea (just make sure you have enough money to make payments for a few years just to be sure). And if you haven't moved money out of the US by now (and for the life of me I can't figure out why you hadn't done that - the US Govt. has been practically shouting from the rooftops for the past year that it wants to COMPLETELY rape and pillage all its citizens), MOVE IT OUT NOW.
Perhaps you could go to US, withdraw your money as cash, buy physical Gold with it and then somehow get it out of the country, like via Mexico/Canada? Not sure how to do it...just a thought.
$300,000 in gold is less than 300 troy ounces; that's about 20 pounds of gold. How hard is that to pack into, say, your toaster oven if you're moving to Europe? It wouldn't show up on the X-ray, and I doubt customs would be looking for drugs going into Holland, which is one of the most liberal drug regimes in the Western world.
Me, I'm thinking of buying a set of cheap golf clubs, and filling the shafts.
You can still move the money out, the law is aimed at tax cheats. In fact you can probably have it wired to escrow. The NY Times reports that "Individuals have stashed an estimated $1 trillion in offshore accounts, the government says, allowing them to avoid up to $70 billion in taxes each year. The federal government estimates that abusive offshore schemes by corporations cost our Treasury an estimated $30 billion in tax revenue as well."
$100 billion in lost tax revenue. Chump change with $1,400 billion deficit.
Parse carefully.
The NYT said "avoid", not evade, and you can be damned well assured that if they could have said evade, they would have.
Recall: avoidance is legal, evasion is not.
So now we have the nuance of calling legal avoidance abusive, not illegal.
Again, if they could have used the word illegal, they would have.
What they "cost our Treasury" is precisely nada, since "our Treasury" (fancy that thought) is entitled to none of those "lost revenues".
So unless you can find some more damning quotes from that NYT article, I call bullshit on the whole "OMG offshore accounts are costing us tax revenue" narrative.
I would mail the money in gold to the Netherlands. It's not illegal.
If history is any guide, these kind of loopholes will only exist for a short time now. It's time to get it out ASAP while they last.
The window to escape "Prison USA" is shortening by the hour. Even if you can't break free, at least make sure your money does. Get it out of the banks and purchase physical Gold or you may find your money locked into "Prison Dollar" (or worse "Prison US Govt."/"Prison bankster") for eternity.
So where to go?
NZ, Aus ... huge debt per person and same problem as US.
Europe ... Euro expected to be parity with USD, Islamic takeover makes one a Dhimmi
So where to go?
Singapore ... high taxes
China, Russia ... Please! You've got to be kidding.
Israel ... Duck and cover
Canada ... don't get sick, US implodes then so does Canada
So where to go?
Your own backyard, The Rocky Mountains. We've been waiting for you.
everything won't fall apart immediately, and america may well remain the best place to be, even though it's worse than it was. however things may continue to deteriorate, for a long time
Canada ... don't get sick
Please blow me. Then explain why Canada, which spends about half what the US does on health care per capita still shows up with a longer life expectancy, better child mortality statistics, and equivalent wait times in Emergency rooms.
The only problem with Canadian health care is wait times for certain procedures, like MRI's and knee replacements. These have been, and are, improving.
Of course, the absence of contingency fees for ambulance chasing lawyers, and the resultant lower malpractice claims and insurance costs have nothing to do with this. Defensive medicine has nothing at all to do with exorbitant US medical costs.
The USA is pretty much finished now...
The USA has been finished for a decade. I've been telling my folks for about a year to expect capitol, wage, and price controls. These things have a pattern to them. It's almost like natures way of telling us there is a shit storm coming. We all knew the US was dead, we only needed to look at the debt and unfunded liabilities to know that. This is just a symptom of the rot and disease.
It sad really, it's kinda like if Mohammed Ali. Used to be the greatest, now just a broken old man, an empty shell of what he once was.
I would rather stay than go.
At least for now.
Shameful already knows my overseas option (Peru). It's not nearly perfect, but it is an option. And cheap.
.....
Gordon is very right about two things:
-- get assets OUT of the USA now, at least some!
-- Buy.Gold.Now. Right now, skip work tomorrow and buy gold! Maybe some extra ammo too.
What we want is Capitol control. What we got is capital controls.
America, not just for milking anymore. Now you have to kick in for grain and grass to feed the cow that makes the milk. Why whine? could always be worse.
Nuggets?, there are nuggets posted here?
These new controls only track those who transfer cash or receive cash for some type of service and think that hiding it in another country is clever.
For those who do not deal in cash, all of this is irrelevant. I have an Andy Worhol painting that I will trade for gold. I need a bedroom expanded in my home and I will pay in silver. I have a diamond and sapphire broach, that I will trade for a used truck that, I will trade for a boat that, I will trade for a girlfriend that can cook.
Nuggets?
i think i would be selling that Andy Warhol painting ASAP, not much BTUs in it, i imagine.
waterdog. Thanks, made my day. LOL
RON PAUL
The Dollar will crash... Political and Social chaos will ensue!
Blood will run in the streets!
Is he wrong?
http://www.youtube.com/watch?v=8h8NlNvlgnw
Turbo Timmy will probably be the enforcement officer. LULZ
It would be nice to know how legislation by, say, the Iranian parliament (or pick your country) would be received if it mandated the closing of accounts in a U.S. bank by said bank. Interesting concept.
It's very unlikely that Mexico would decree no foreign bank accounts for its ex-pats.
davidricardo; your outburst rather intrigues me. Perhaps you care to elaborate.
Were you referring to the text of HR 2847 in your curious and untimely rant? I am at a loss to see how you could refer to ZH itself. Poor chet, MB and some others struggle mightily to keep up in class but their contributions are worthy if only because they remind one of the fact that humanity is indeed composed of a seething bell curve of varying ability and also because they are so easy to dismiss.
You also seem to be a little too conscious of class. You must therefore be English... and (permit me) your sensitivity in this regard reveals considerable suffering. May I infer that it is you who resides amongst the boisterous masses of the petit bourgoisee? Reverse psychology 101 here. Cognitive Dissonance please forgive me. If I had to guess, poor old davidricardo is one of "Thatcher's children." A bright grammar school boy who has never been allowed to forget his origins. Manners, old boy, manners!
Oddly, your comment is in reaction to the first report of (de facto) capital controls by the US, something many have predicted for years now. An event which is as ominous as it is profound.
assume the worst, prepare for the worst......if it doesnt actually turn out that way, then bonus! Either way its win win, and thats the way I like it.
+106
I think we have a winner this evening.
This law doesn't put currency bonds at risk for full redemption does it? It sounds like foreign debt and equity securities are exempt but you can't repatriate USD's you might have stashed back unless you disclose who you are, correct?
The pace is quickening. The extraordinary has seemingly become ordinary as the process of inundation continues. This is epic.
True.
it feels like everybody is trying to grab that last dollar and its becoming more evasive.
I'll be eligible for US citizenship in a few years.
Pros: Eligible for social security when I retire
Neutral: Can vote (hardly call it a 'pro' given the choices of who to vote for)
Cons: US will forever claim a stake in anything/everything I ever earn/generate/create.
For now I'll stick to not being a citizen. If/when my wife and I relocate, I'll just make sure that her name isn't on any of the accounts (She's a US citizen)
The only pro won't exist in a few years, or the Dollar will be slag and the payout won't buy anything. Stay away from the Titanic, she is taking on water fast. I'm honestly thinking of dumping my citizenship when I leave. I could not imagine wanting to come to the US now.
Don't do it. It's a prison masquerading as a country.
GG - Home arrest with a cell phone rather than a bracelet.
dup
Well, welcome to the world, naivetes! When did you Americans (and Canadians, Europeans, Australians...) notice the noose tightening?
You've had FinCen tracking your every financial move now for a decade. You've had a $10,000 limit on carrying out cash. You now have no bill larger than $100. You've had the authorities working hand-in-hand with MasterCard and Visa, etc., to track overseas transfers. Your own militaristic, control-freakish Obongo and Coleman have been targetting financial privacy for years...and you paid no attention.
Speaking for myself I was chasing girls and getting my undergrad degree. I just started making real money so before I wasn't concerned. When I was working a dead end job to pay for school it's not like I was looking for wealth preservation. I'm stunned how far it went without really a hiccup though. I mean looking at history, people have revolted for a lot less then what has already happened.
You youngin's are absolutely screwed, IMO. You're like a fancy new sportscar, that your gubmint just installed a permanent throttle restrictor on
Yep. Uncle Sugar is going to try to get us to slave away to pay for his madness. Look at the black whole of SS and Medicare/Medicaid liabilities. There is a reason I'm looking for a new place to call home. Uncle Sugar is going to try to enslave my generation right after he sucks the blood out of the Boomers with assets and the Gen Xers.
Some of us have been devotees of the Austrian School for decades; lone voices in the wilderness. Some of us tried really hard to wake people up, but the fiat game just seemed to keep getting better and better, Greenspan kept lowering and lowering, and no one would listen. No one would believe that the game would end.
Most people STILL don't believe it; But don't you dare tell me I didn't notice the noose tightening. I'm the guy who was handing out libertarian literature that everyone laughed at and walked past.
God bless you guys! It's because you guys were willing to get laughed at in public that I found out about the Austrian school. Ron Paul, Peter Schiff, Lew Rockwell. Doing some good, but the ship is hard to turn, but the efforts are appreciated by those you all have reached!
Same here. What a dreadful burden to carry; the overpowing desire to bring light to others. I thank SW for allowing his light to shine in my direction. I shared this with Cog Dis recently I would like to share it again:
We were drowned out by the Kudlows, Steins, Liesmans......
Like Shameful, I was in college and grad school when the USA took its major turn from OK to awful, blatant police state. Sure, if I had somehow been obsessed with such things I might have noticed the changes, but instead I was trying to get good grades, make a little over minimum wage, and chase girls. I don't think you need to be a 40+ financial compliance expert to get a little worried about these new laws.
I think we will see more demonstrations, clashes and protest. You can't have an uncontrolled Govt.. The Checks and Balances are the people if they decide ever decide\to wake up.
Boehner said the Govt doesn't represent the people.. I think he realizes how bad it is.
Boehner is all talk. He is one of the problems in the GOP. The GOP needs to turn out the old guard and send Boehner back to the tanning booth (maybe they can pay the 10% tanning tax for him) and get some new blood like Paul, Ryan, Bachmann, Hayworth (once he defeats McCain) and DeMint
As with health-care-reform-which-leads-directly-to-nationalized-healthcare, I say:
Yes We Can. But Let's Not.
I expect to repeat that mantra again, and again, and again...
Thanks for keeping me informed, ZH.
I don't expect things to change for the better anymore. There is a reason behind the larger events and trends in today's world, and those who understand and follow that reason will not let things go in any other direction.
Do you think that the West's leaders suddenly became stupid, corrupt and/or venal in the last 50 years? No, there have always been good and bad in our capitals; today is no different.
Do you think that Japan suddenly forgot everything that built them before 1990, and just can't get it together nowadays? Doubtful.
So then, what's going on? Why are all of the advanced nations declining while jobs and wealth are funneled into the third world?
The answer begins July 16th, 1945. The Trinity test in New Mexico.
With the development of the a-bomb, and later the far more powerful h-bomb, the best and brightest who advise presidents and prime ministers came to a rather logical conclusion: In a world where a single device can destroy a city, we can't live in a world of "haves" and "have nots".
Knowledge and technology will not stay contained. The bright boys figured out that eventually, the ability to make these bombs would end up in the hands of the undeterable among us... those with nothing to lose. And then the world would start losing cities.
So they decided that the world would have to be re-engineered. We couldn't have anybody with nothing to lose anymore. At first, they tried bringing the bottom up. For two or three decades up until the 70's they tried to spread knowledge and skills to the third world, but this effort was largely futile, most of the lessons didn't take.
That left them with one choice -- bring the top down and the bottom up by directly transferring whole industries overseas. Hollow out the West (and the East if they grew too big like Japan) for the sake of humanity.
They obviously couldn't announce this agenda, the masses might object. But they sure got really good at selling the idea in Washington, London, Brussels, et al... 'cause every leader of every party starts following their plan as soon as they get any real power.
Why do you think that every Western nation keeps on exporting their jobs? Blind belief in free trade? Nah... insurance payment that (hopefully) will deter a future madman with a bomb.
Why do you think that every Western nation refuses to deal with their economic problems and growing deficits? Political logjams? A little, but mostly in the name of managed decline.
Why do you think that the leaders of every Western nation jumped onto the AGW bandwagon? A growing green awareness? Nah... wealth transfer and goodwill payments to the third world.
Why do you think that every Western nation suddenly decided to import millions from the third world? More labor? Nah... they are unwitting future human shields against aggression from their old countries.
I think this is the reason that the great global forced leveling is ongoing, and the reason no one seems to want to stop it: Fear.
Nothing but the potential death of millions can explain why leaders of every stripe abandon their beliefs, left, right, and center, as soon as they reach the top. None of them behave any different from the other, and convergences like this don't occur by accident. There is a goal, there is a plan, and it is seen by them as more important than your hopes, dreams, or living standards.
Nuclear blackmail and the deaths of millions is the only agenda I can see that's big enough, universal enough, to command such allegiance from our leaders.
That's an interesting theory, but the people who really think about these things seem to have reached a different conclusion. You might want to look up this book by Herman Kahn:
http://en.wikipedia.org/wiki/On_Thermonuclear_War
hah three chord sloth i am not sure i trust your words. need to listen without outside interference. maybe i really need IS some interference with this one, ZH†
yet we continually antagonize the 2 nations, with the capability, to vaporize america. must be the carrot and the stick approach
They're not worried so much about nations like Russia, they are deterable with policies like MAD.
It's the dirt poor nations with nothing that scare them. They're the ones with no important ties to the current international system who might stick a single bomb on a truck bound for Zurich or Brussels, thinking they would get away with it, and they'd be better off with whatever new international system arose from the chaos.
They're afraid of one tin horn dictator nuking the capital city of the tin horn dictator next door... unleashing a mass migration of sickly and/or simply fearful refugees into all the surrounding countries, spreading instability and civil wars.
The main problem they currently face is they've not figured out how to stabilize most of Africa yet. Once they get their arms around that, the industry transfer will accelerate as there will be a whole new continent that needs elevating.
what about this latest Black Widow cult and Russian we will find them and prosecute.
i am sorry, when woman enter the fray, all bets are off.
just my 2¢s
Well, take a look at China. Twenty years ago, China was considered by many to be non-deterable. They had no industrial base to retaliate against, 2/3rds of their population ws spread out in hamlets and villages, and if you hit their cities and they lost 300 million people you'd probably be doing them a favor (tho they'd never admit that publicly).
So we funneled much of our industrial base to them, and now China is clearly on the deterable side. They have a huge investment of time, money and labor in their industrial belt so they have to protect it, and they are dependent upon international trade for their economic health. They've been "developed", so now they can't go rogue without suffering a huge hit. They are deterable. The West traded a chunk of their prosperity for security.
Ugh. Gotta go to work. Later!
I've maintained a minimally used TT pipeline out of the US for the past ten years. Only use it for vanilla transactions & it's a US based Japanese owned bank. If I need to drop the hammer, my assets are off-shore in a few key strokes.
Things are only going to get tighter. If you think you might want to wire assets out of the country get your ducks in a row now, rather than later.
In the words of Carlito Brigante:
"Here Comes the Pain!!!!!!"
China guy,
sweet red dragon/chinese luck symbol avatar.
suppose we could get at those offshore bank accounts in the caribbean, where the bush people were hiding their money (i always said obamas first act as president should be to find a boat, a bunch of marines, and travel around the caribbean where UNTOLD PURLOINED WEALTH has been parked.) does red state america give a shit, hardly, do the scumbags who ripped of the country for eight years care, for sure, dont ya think? tea party my ass, the bastards are trying to cover their tracks. dont confuse populist justice with fascist confiscation of wealth. certainly the bastards on one side will try to pull it off, but we know where the bread is buttered.
Aye. There's the rub.
I'd really like to believe they can be separated. But I don't.
I yield to no one in my contempt for those who looted the financial system.
But my faith in the institutions of our Government to exact "popular justice" without also implementing a "fascist confiscation of wealth" is zero.
I suspect I'm not alone in my estimates.
This is one of the reasons why I moved all of my money off the US dollar plantation some time ago. Fuck Congress, fuck the President and fuck his IRS.
There's no better place for freedom-loving Americans than New Hampshire... In a vote that ended in September 2003, FSP participants chose New Hampshire because it has the lowest state and local tax burden in the continental U.S., the second-lowest level of dependence on federal spending in the U.S., a citizen legislature where state house representatives have not raised their $100 per year salary since 1889, the lowest crime levels in the U.S., a dynamic economy with plenty of jobs and investment, and a culture of individual responsibility indicated by, for example, an absence of seatbelt and helmet requirements for adults.
http://www.freestateproject.org/
Sorry, the Ron Paul voting platform started in NH and the votes were sooooo extremely contaminated and manipulated — I heard an extensive and intelligent and in depth, detailed account of the fraud on that one — lost complete faith in NH and the people there. It was rigged and scammed in every township with barely a peep from any of the citizens. Complete roll over.
i may be in error, but i recall New hampshire as a state forcing people to take the H1N1 shot ,ability to confine you if you dont take it etc. Didnt sound that great to me!
Hate to break into the paranoia-fest, but this rule is not a big deal. You already were required to report foreign accounts over (if memory serves) 10K$. There is no prohibition against sending money out of the country - you need to report the account yearly, that's all. This is because some folks tried to duck paying taxes, by depositing money in confidential accounts in Switzerland and other places. This rule makes it more difficult for them to be tax cheats.
Yeah, no big deal, just another new link in the chain, a chain that would never be used to restrain. No worries. Hey, where's the remote?
Useful idiot.
You should check out the movie "Idiocracy". Probably look like home to you.
Welcome to China
That doesn't make me feel much better, especially the last one. A disclosed estate trust, for instance, should have no presumptions or control over beneficiaries placed on it.
What, again?
I think it's reasonable to assume that this is about the government tightening the noose, no matter what the terminology is.
That's what the law says. Now put yourself in the position of a foreign entity (bank, real estate company, brokerage, etc.) that you, as an American citizen, are trying to deal with. You represent a tiny fraction of their day-day business, but if they do business with you and accept your cash or bank transfers, they have to deal with all this extra reporting crappola. Unless there is some big money involved, they are likely to tell you to go someplace else. They don't need or want the aggravation, and in many countries it is illegal for them to disclose account information to foreign etities. The end result is you are shown the door. Now is that a capital control in the strict sense? No, but it achieves the same result.
We're not leaving. We're not hiding. And we're not fighting...depending on your definitions.
We can just save more and defund the credit system. We can restart political and civic society.
USA is well suited for evolution. The economy needs to be reconfigured to take globalization of wages into account. Historically, capital flows have been minimally tampered with compared to human flows; over time it will cease to matter.
But in a world of 2050 or 2100, what is the household economy of the average US family? What is being produced? Is it just real estate agents serving Wal-Mart cashiers buying $50,000 tract houses (OK, marked at $500,000 but you know about the currency already)?
The fate of the recently invented 'professional' class is the least told story in the whole mess, and yet the most important; for without the professional class, the white collar, the knowledge worker, there simply won't be much left of the USA that most here think of. With manufacturing mostly gone and farming barely a memory......
Entertainment superstars are a figment of technology; technology that will have barely 100 years of dominance. How many opera singers or guitar players got super-rich before controlled mass broadcast? The same number that will in a few decades: none or nearly so.
Similarly, who is going to care if the American professional class is deflated and debted into oblivion? Who can posit the realistic scenario in which we don't wage equilibrate with Oaxaca and spend our spare time listening to guitarists down at the local plaza for beer money?
Ultimately the parasite will destroy the host. The real question is, how much freedom, literacy, dignity and tradition will we maintain as our flourescence of middle class wealth is stripped away? And, what can we do to slow it down, and to maintain as much as possible for our children?
Someone at ZH get on this.......and oh yeh those market rumors too......
Ironic postscript: the middle class standard of living peaked right when middle class people were bitching the loudest, about 1972. Archie Bunker, The Jeffersons....gotta laugh....not that we don't have some awesome gadgets now, just that no one owns their stuff any more, all bank-owned from a net worth standpoint....can a rented life really be better even if it's all blingy and shit?