Examining gold analysts’ predictions reveals a surprise… and reason for resource investors to be optimistic about the future.

Common sense dictates that when you need information or advice on something you’re unfamiliar with, you consult with a professional. That’s what people do, whether refinancing a home, choosing an insurance product, or fixing a broken heater. While professionals certainly have their own agendas, they still know more about their products or services than others, and can at least help them make more informed decisions.

Bank and brokerage analysts know their products, too. But when it comes to helping you make an informed decision about where the gold market is headed, they have, as Rick Rule is fond of saying, a record unblemished by success.

Every year major banks and brokerage houses provide their four-year forecasts for the gold price. The following chart documents the average price projection of 25 top analysts over the past seven years, many of whom specialize in the resource industry. I might suggest pushing away from your desk so that when your jaw drops it doesn’t hit the keyboard.

You can see that every year since 2007, bank and brokerage analysts have as a group predicted that gold would fall, sometimes dramatically, over the next four-year period. For example, in 2007 the consensus of all estimates was that gold would decline from $656 to $523 by 2011. Instead, the price rose 140% to an average of $1,572 that year.

Similarly, they predict this year that gold will fall from $1,665 to $1,515 by 2017. Even if they thought gold would move higher the first year, their best guess was that it was ultimately headed lower. So far they’ve been wrong every time.

For the most part, these are analysts who do nothing but study the resource markets all day long. It’s their job. No one gets it right all the time, but this kind of track record is embarrassing.

The obvious lesson is for investors to ignore price predictions from the major banks and brokerage houses – they just don’t get it. I’m sure most readers of this publication already know that.

However, there’s a much bigger implication of this data that may not immediately come to mind…

• Why would I as a fund manager or institutional investor buy a gold stock if my analysts tell me the price of gold is going to fall?

Answer: I wouldn’t.

If the price of the product a company sells is expected to decline over the next few years, would you buy the company’s stock? Its earnings are almost certain to fall. As a manager of millions (or billions) of dollars, you wouldn’t buy any investment with this kind of outlook.

There’s more. These same banks and brokerages have also been predicting the price of oil will rise (almost) every year. While they’ve occasionally been right about that, it means that margins for the gold producers would be expected to fall, since roughly 10% of their costs are related to fuel. So again…

• Why would I as a fund manager or institutional investor buy a gold stock if my analysts tell me profit margins are expected to fall?

Answer: I wouldn’t.

It doesn’t matter that analysts have been consistently wrong. What matters is that if the institutional world believes the gold price is likely decline and/or that margins are likely to fall, they’re not going to stick their necks out and buy gold stocks. They could lose their bonuses or even their jobs if their analyst’s predictions came true and they’d bet against them.

This could be the explanation for why hedge funds, institutional investors, and other large investors haven’t entered this market en masse and could account for the disconnect between the price of gold and the trajectory of gold stocks.

We see the potential in gold equities, as we believe the price of gold is going higher, but big investors with billions of dollars to pour into an market don’t. Their money, for the most part, is still on the sidelines.

This phenomenon leads us to predict that someday these institutional investors will enter this sector en masse. Once the facts sink in and the institutional world becomes convinced gold and silver prices will maintain a sustainable uptrend, they’ll be much more attracted to the equities – and just as stubborn about changing their minds once they’re on board.

Now, it’s possible this group may have to be beat over the head by relentlessly  rising precious-metals prices before they enter the industry. They’ll have to believe that, say, gold hitting $1,900 again isn’t a temporary fluke but a sustainable uptrend. I don’t know what price the metal would have to maintain or how long it would have to stay there before they jump on board, but given the above chart, I think it’s safe to say they won’t be the first to the party. I personally think it will be something along the lines of what we outlined in the recent Hard Assets Alliance letter.

Whenever and however it happens, though, the stampede from institutional investors into this tiny industry will be sudden and dramatic, because they tend to have a herd mentality. No one wants to be left behind. Just like they don’t want to risk buying something all their colleagues are ignoring now, they’ll rush to own the popular and exciting investment when gold stocks have their day.

The consequence of this will result in dramatically higher stock prices. How high? Well, this group loves to use price models, and fair value for Newmont Mining (NEM), based on its Reserves, would be about $200/share (it’s currently trading around $44). And that’s at $1,700 gold – as the spot price rises, the value of NEM will rise exponentially, since gold would be rising faster than costs, even when inflation kicks in.

That is why I’m excited about the producers. It’s the first place the institutional world will turn when gold makes a sustained move higher. Come the day those investors believe gold is about to become part of the monetary system, that bonds are no longer a safe place for money, that inflation is about to get out of control, or whatever it might be that changes their paradigm, they’ll flood into our little market and push share prices higher by an order of magnitude.

When this shift gets under way, we’ll already own the stocks that institutional investors will be clamoring to buy. Maybe we should thank them now.

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We have long said that the IRS and Justice Department are not letting up in their assault on taxpayers with unreported foreign accounts. Despite our warnings, many people with offshore wealth are still sitting on the fence. That “wait and see” approach could land them in jail.

Why? Last week we reported on a 79 year old widow, Mary Estelle Curran, who pled guilty to felony failure to report an offshore account. A Wall Street Journal headline story this week (U.S. Is Preparing More Tax Evasion Cases) bolsters our belief that Americans with unreported offshore accounts need a plan. Now. Holding out and waiting for political common sense is not an option.

Experts across the country agree that the IRS is dramatically stepping up efforts to prosecute people with unreported offshore accounts. Once upon a time, prosecutors seemed to target wealthy business owners with unreported Swiss accounts. Now we see prosecutions against middle class Americans and dual nationals who were simply sending money home to family.

The prosecution against a high school educated, 79-year-old widow from Palm Beach who inherited her overseas money marks a new low point in the IRS’ efforts. The clear signal is that no one is too old or too sympathetic to avoid jail.

Whether a judge sentences Curran next month to prison or not is almost irrelevant. She is now a convicted felon and must pay the IRS $21,666,929 in penalties. This on an estimated tax loss to the government of about $500,000! By our math, that is a 4000% penalty.

The real “story behind the story” in the Curran case is that she attempted to enter the IRS’ offshore account amnesty program. Unfortunately, by the time she applied the government already had her name. Under the current amnesty program rules – called the Offshore Voluntary Disclosure Program – taxpayers are only eligible to participate if they apply before being contacted by the IRS or before the IRS has obtained their name.

With another round of IRS John Doe subpoenas approved this week by a federal judge in Manhattan, no one really knows when the IRS will identify them. Even if the IRS sits on the information for 6 months or more, that person becomes ineligible once the IRS has their name on a list.

Unlike Santa Claus’ mythical list of who has been naughty and nice, the IRS’ list is real and could mean the difference between jail and freedom and of paying a 27.5% amnesty penalty, or in the case of Curran, a penalty that approaches 4000%.

The stakes have never been higher.

We are not fans of the current laws on offshore reporting. But we are realists. Opening a foreign account is legal and makes sense, but make sure it is done correctly and with proper advice. (We help people who already have problems with the IRS – if you need planning advice, start with a professional such as Bobby Casey and his team at Global Wealth Protection LLC.)

As long as one remains a citizen (that includes dual nationals) or holds a green card, the government requires that all foreign accounts must be reported annually on a Report of Foreign Bank and Financial Accounts or FBAR form (TD F 90 – 22.1). Willful failure to file an FBAR is a felony punishable by 5 years in prison. Even an innocent failure to file an FBAR could still land you in hot water with the IRS and cause significant penalties.

There are some exceptions for reporting for certain assets including precious metals held in physical form, but even those rules are complex. Many people we meet think that their global escape plan simply means sending money to an account in Monaco or Lichtenstein or some other country that is rumored to not share information with the IRS. That may have worked at one time but it won’t likely work today.

As noted above, there are options. For those who remain citizens, there is an amnesty but you must act quickly. For those who can demonstrate their innocence, there are other alternatives such as opt outs and in some cases, the ability to avoid all penalties. For those who haven’t yet created an offshore plan, there are experts who can help you before you move money or purchase gold.

If you already have an unreported foreign bank or brokerage account – or other financial assets – seek assistance today before its too late. Understand your options, learn how to correct the problems and protect your financial future.

Presently, the IRS looks back 8 to 10 years, meaning that simply closing an unreported account today and shuffling your assets doesn’t necessarily get you off the hook. In fact, the IRS often considers that an intentional act of evasion depending on how the account is closed and how the money is transferred.

With the foreign banks set to begin identifying account holders with U.S. ties next year under the new FATCA law, the time to take action is now.

About the author. Brian Mahany is an attorney with offices throughout the United States. He specializes in offshore tax reporting and fraud litigation. His firm, Mahany & Ertl, is a preferred legal services provider to the CPAmerica organization of accounting firms meaning they are the lawyers the experts turn to for foreign reporting problems. Brian is also a friend of Global Wealth Protection.

Brian limits his offshore reporting practice to people who have unreported accounts or are under audit / criminal investigation by the IRS. He can be reached at brian@mahanyertl.com or by telephone at (414)704-6731 (direct). Because he is an attorney, the attorney – client privilege, protects all inquiries.

We’ve all heard the phrase, “It’s not what you know, but who you know.”  It is a very common catchphrase that is thrown around lightly like, “It takes money to make money” and “It’s better to try and fail, then never to have tried at all.”

Similarly, my dad used to always tell me to “hire people smarter than you.”  He was very successful in business in his working years and did a great job hiring top talent at his company.

Having been a lifelong entrepreneur, I haven’t had a job that paid a wage since I was 19 years old.  I have employed hundreds of workers over the years and have always tried my best to hire the best qualified person I could.

But more importantly, I have always surrounded myself with like-minded people.  I have been involved in several mastermind groups over the years as well as many networking associations.

Probably the most important networking I have ever done though was to seek out and associate with other entrepreneurs and investors from around the globe.

As managing director of Global Wealth Protection, I run an international firm providing asset protection and offshore planning services to clients from around the world.  That did not come from a 3 card rolodex.

That came from years of traveling the world, running other businesses, and attending educational conferences in all corners of the planet.

In addition to the professional connections made during these travels, it has been a truly rewarding experience personally.

I’ve been snowmobiling in the Taiga in Eastern Siberia, camelback riding in Tangiers, watched MotoGP races from the VIP section in Czech Republic, and had private access to the most exclusive clubs in Miami.

This did not come from my charm or stunning good looks….  This was strictly a function of who I know.

If we really reflect back on our life, the greatest moments in our lives are not our first new car, our first house, or the promotion at work.

Our greatest moments are life experiences shared with people we know.

In our firm, our core business is developing asset protection strategies, both domestic and offshore, that help you minimize your risk and keep as much of your wealth as possible.  It is a global risk management strategy where we assist you with internationalization of your assets.

Because of the connections we have, my business partner – Steve – and I decided to offer education as part of our business model.  This is how the Global Escape Hatch conference business began.

Offshore asset protection and internationalization strategies can be complicated for many and having the right partners makes all the difference.  It takes research and due diligence on your part, and therefore it takes time.

Steve and I decided by offering offshore conferences as part of our business, we would be adding a tremendous amount of value to our client base by helping educate them in various topics such as:

• Acquiring 2^nd passports
• Offshore asset protection
• Offshore banking
• Overseas real estate investments
• Overseas investment opportunities
• Global business
• and much more

In the offshore conference world, there are a few promoters out there, but most have a very different business model than ours (not saying one is better than the other, only comparing).  With most of the other conferences out there, the focus is on sales presentations by the speakers.

They are there to make a pitch and offer you their offshore products and services.  Speakers typically pay thousands of dollars to present at these events and rightfully so, they must make sales to justify the event.

At Global Escape Hatch, we have a ‘no sales pitch’  policy.  Speakers are required to provide educational presentations only, making the event very low key and relaxed.  Our view is that by providing real, actionable value, the attendees will want to do business with you anyway.  No need for a sales pitch.

Selfishly, I wanted to host a conference a couple of times per year to network with other like-minded individuals from around the globe.  I wanted to expand my network of connections to other successful international entrepreneurs and investors.

I personally still attend many conferences around the world for this very reason.  I will be attending FreedomFest in Nassau, Bahamas in February as well as a private event just 2 weeks later in Scottsdale, Arizona.

I wholeheartedly believe that surrounding yourself with other successful people from all walks of life is very important from a professional and personal perspective.  I have never once looked back on life and thought, “I wish I had fewer friends.”

[Bobby Casey is the managing director for Global Wealth Protection and organizer for Global Escape Hatch.  He is also EscapeArtist portal partner and managing editor of EscapeWealth – an offshore asset publication.]

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(In the following essay I will show how a 529 plan is NOT a mechanism for saving money for a child’s tuition, but is in fact simply saving money for a college administrator’s salary)

With a four year college degree estimated to cost over $50,000, and rising every year, parents are scrambling to find a way to set aside money to pay for this looming expense.

One popular item is the 529 plan, named after section 529 of the IRS code. In short, a section 529 plan allows the money that you contribute to the plan to appreciate tax free on a federal level, with withdrawals also tax-free if used for qualified higher education expenses. Differing states have differing incentives as well. Sounds like a good deal, right? Only it isn’t.

In order to understand why 529 plans are a bad deal, one needs to understand the concept of price discrimination.

In terms of economic theory, price discrimination exists when sales of identical goods or services are transacted at different prices from the same supplier.

Let’s translate that into English and use an example: Let’s say you own a hamburger stand. You know that on any given day there are people who come into your burger shop who are not only wealthy but are hungry, and would gladly pay 7 dollars for a burger. Most however are middle income and are not that hungry, and therefore have time to choose where to buy lunch. They might only be willing to pay 5 dollars for a burger.

The problem for you as a supplier is that you don’t know which is which. So, you price your burgers at 5 dollars and a few lucky customers pay 5 dollars for a burger they would have gladly paid 7 dollars for.

Companies go to great lengths to price discriminate. In order to effectively price discriminate two conditions must be met: 1.) The firm must be able to identify the different market segments based upon their willingness to pay, and 2.) The firm must be able to enforce the price discrimination scheme.

The most common example of this is the airlines. The airlines know that business travelers are willing to pay more than leisure travelers. So they did market research and discovered that business travelers don’t like to spend the weekend away from home, and often buy their tickets at the last minutes, whereas leisure travelers plan ahead and usually stay on Saturday nights.

So, the airlines charge more if you don’t stay Saturday night, and if you don’t buy your tickets in advance (although the buy in advance pricing structure seems to be breaking down). The airlines enforce this scheme by making tickets non-transferable.

The most common price discrimination scheme is senior citizen discounts. Another way of saying “senior citizen discount” is “non senior citizen surcharge”.

Senior citizens are more price-sensitive than others in part because they have more time to price compare, and often because they are on fixed incomes.

So, a restaurant will charge a senior a price that reflects what seniors are willing to pay, and a higher price to others. The restaurant can enforce this by checking ID. Theoretically, a 35 year old could get around this by paying a senior to buy his meal for him, but the dollars involved are not enough to make that worthwhile.

Now that you understand price discrimination, let’s take a look at how college tuition works:

Customers approach a college. Some have more income and assets than others. So, how much should they charge? Wouldn’t it be nice if they could figure out EXACTLY how much you are willing to pay before you are quoted a price? Well, that is EXACTLY what they do.

Now, they can’t tell you that is what they are doing, so they quote a ridiculously high price, and then they say “but maybe we can give you a discount if provide us with all of your financial information. During the interview process they even figure out how badly you want to go to that particular school versus another. Only after they have figured out EXACTLY how much you are willing to pay do they actually tell you what the price is. For the very wealthy, the price is the ridiculously high price quoted. For others, it is that price paid over time because the federal government is happy to do you a favor and front that tuition for you (or back a bank that does), as long as you pay them back for much of your adult life (and of course you can’t discharge that debt in bankruptcy under almost all conditions). Others simply get quoted a lower price in the form of “grants”, while others still sign on for indentured servitude in the form of “work-study”. For many it’s a combination of the various schemes, all designed for one purpose: To figure out the max price that you are willing to pay, and to charge you that.

So where do 529 plans come in? As the price discrimination scheme has led to ever increasing prices (and thus ever increasing jobs and salaries for college administrators (insert link) , consumers have responded by trying to hide the amounts that they are able to pay. So the colleges, again aided by the federal government, invented the 529 plan. By getting you to put money in the 529 plan, when you approach a college and ask how much it will cost, they will immediately can say “whatever is in the 529 plan, plus whatever we would have charged you anyway”.

So you see, every single dollar you put in your 529 plan goes directly to a college administrator and not to your child.

What are some solutions to this problem? Tune into Global Escape Hatch and sign up below for the next in this series.

“Twenty years from now you will be more disappointed by the things that you didn’t do than by the ones you did do. So throw off the bowlines. Sail away from the safe harbor. Catch the trade winds in your sails. Explore. Dream. Discover.” – Mark Twain

I am going to cut right to the chase…

Look, here are some facts you probably already know.

• The government is printing more and more money.  QE4 (Quantitative Easing) just rolled out, and there are more on the horizon.
• More money in circulation = More inflation.
• Your 401K nest egg is going to be worth less than you expected.
• The stock market is a crap shoot; it’s turned into the world’s biggest casino.
• Solid assets that you can touch and see will be worth more than paper assets if the worst happens.
• Taxes are going up.
• Contrary to what the main stream media is telling you, the economy is NOT getting better.
• You are the only person you can rely on to protect your assets now and in the future.

In this environment, you need to explore all of your asset protection options .  Nowadays, owning  hard assets with geographical diversification is key.  I am going to introduce you to a new asset class acquisition and storage program that can offer you both.

There will be some people who don’t recognize what a fine opportunity this is. Maybe what we are introducing here isn’t for you.  I admit, it isn’t for everyone.

But, don’t you owe it to yourself to find out?

“Keep on going and the chances are you will stumble on something, perhaps when you are least expecting it. I have never heard of anyone stumbling on something sitting down.”

- Charles F. Kettering, Engineer and Inventor

The solution to fighting the inflation caused by quantitative easing is to own real assets that increase in value with that inflation.  You probably know that already.  Chances are you already own some gold and silver or have been thinking about it.  Precious metals continue to be a powerful strategy for protection against a falling dollar.

The problem with precious metals is it’s just that – a hedge against inflation.

Some investors may be more bullish than others, but the truth is, the long term benefits of precious metals are in protecting your net worth.  Not in growing it.

Fortunately, there is an investment available that can protect your assets just as well as gold and silver and now it can also be physically owned.

But unlike precious metals, it shows serious potential for growth in the medium to long term.
Here is your chance to learn about  another way for growth and asset protection.

In these troubling times, you can’t rely on outdated investment advice and strategies.  You owe it to yourself to explore some new options that have become available to you.

Introducing…. the rare and strategic metals that are now used in 80% of all products today.

“The Secret Ingredient of almost Everything!”

The world is fast becoming more dependent rather than less on these rare, strategic, tech metals. Because of this, many of these metals continued to go up in value even during the recent worldwide economic unpleasantness. Now, of course, past performance is not necessarily a guide to the future, but a series of events are unfolding that bode very well for the future for anyone participating in a stockpile of rare and strategic metals.

Furthermore, this relatively new, hard asset class has some other advantages:

There is currently no clear reporting obligation. Unlike precious metals that are sensitive and subject to various tax, treasury and anti-money-laundering controls, rare and strategic tech metals are much less sensitive. These are not financial assets that sit in an account. They are physical things that you own. You can even own them anonymously if you wish, as the companies acquiring and storing them are private. You can even own pure silver & gold this way in industrial granulate form, that doesn’t class as bullion or precious metals.

Americans can hold these physical metals in an offshore Nevis LLC nestled inside a self-directed IRA in a completely IRS-compliant structure. The same also applies to self-directed retirement plans in other countries.

It’s a currency diversification in that you can easily pay in one currency and cash out in another. Sales proceeds can be sent to almost any bank account, anywhere in the world.

What metals are we talking about? They are not household names but they are in almost everything in and around the house. This ranges from kitchen appliances and cutlery, TVs, flat screens, and iPads, cell and smart phones, automobiles and even the new efficient solar panels, medicines, ointments, creams, water purification and jet engines and commercial aviation, to name just a very few of their myriad applications. The world of today cannot live without the metals of tomorrow. In fact, National Geographic in a recent 2011 article referred to them as “The Secret Ingredient of Almost Everything”.

They include such rare critical technical metals as rhenium, indium, gallium, hafnium, tantalum, tellurium and bismuth. Other strategic industrial metals include molybdenum, chromium, tungsten, cobalt and zirconium. These metals are all limited in supply or vulnerable to supply interruption under increasing demand, and are fundamental to the strategic plans of countries and companies!

Current events impacting rare and strategic metal supply and demand ratios

In 2012, there have been two more significant events that show the importance of these metals to the world and also the trend towards a continuing problem of supply meeting demand in this sector, further driving up the values of these metals in the years to come.

Early in the year, the USA, Japan and the EU issued a formal World Trade Organization (WTO) complaint against China regarding the Chinese reductions in exports of rare, strategic, industrial and tech metals like the ones we mentioned previously.

These countries need these metals to initiate and complete their strategic economic plans over the next few years. Over the past two years, China has reduced exports of these metals around 40%.

These countries and their manufacturing sectors, and military have small or no stockpiles of these crucial materials to meet their strategic needs over the next 3 to 5 years, let alone over the next 10 to 20 years.

Most tech metal experts who have studied this WTO complaint feel that China will not comply because they will argue that these governments need the materials for their high tech military applications, and that a WTO complaint cannot be filed around materials used for the military.

They further believe that if the WTO orders China to increase exports of these raw materials so that these countries can meet their strategic economic goals, China will simply refuse, as they really need most of these materials to fuel their own economic strategic plans.

Unfortunately for these countries, the WTO has no teeth, and the only enforcement of their decisions is a series of ping pong ball embargos, back and forth to try and get China to comply. I think we all know how this will turn out as the Chinese are great ping pong players.

The second significant event that occurred in September of 2012 came out of Beijing in an AP, and CNN news reports that China was consolidating the metals market inside China by closing all of the independent, smaller mines and refineries and smelters. They are doing this so that the Central Committee takes over complete control of this sector, can control pricing, and to eliminate a black market that has existed up until now. This will cause another, immediate 20% reduction in exports.

This is bad news for the USA, Japan, Korea, Taiwan, the EU, Sony, LG, Toshiba, Panasonic, Samsung, BMW, the US Military Industrial Complex, and all other manufacturing sectors that need these metals now. The metals that China does release to them will cost more, and they may have to locate their production facility in China, to get access to the metals.

China is not asking anything outrageous. They simply want to receive the true market value for these metals now that there are so many new applications for them in the past 10 years.

This is good news if you are a participant in a stockpile of these metals outside of China, as you will reap the benefits of these increased values in the metals in the coming years.

Furthermore, demand will continue to rise for the products which use these metals, as over 1 billion souls are emerging from poverty in places like China, India and South America, and entering lower and middle class, and they will have all those products that we, in the West, take for granted.

In true price-inelastic form, the products that contain these metals will not go up significantly in price, stunting demand, because such small trace amounts of these metals are used in each product, that it does not affect the price of the end product. Most of the tech gadgets have actually dropped in price, while the values of the rare metals have been going up.

You might wonder, what happens to the demand in the west if the economy falters? Well, if you buy a cheap Chinese knock off phone, or a real iPhone, a luxury car like Mercedes Benz or a bargain-priced Korean or Chinese car, get your medicine from a private doctor or public clinic, it does not matter, as expensive and inexpensive products use relatively all the same rare metals in the same amounts.

To illustrate in numbers the expected increase in demand for some of the aforementioned metals, a February 2012 Metal Report from Deutsche Rohstoffagentur shows that production levels for indium are already not meeting demand, and will increase from 580 metric tons in 2010 to over 1,800 metric tons by 2030. Gallium production will need to increase from 180 metric tons to 600 metric tons to meet increased demand. Tantalum production will need to increase from 600 metric tons to 1400 metric tons to meet demand.

Realistically, production will not be able to increase to the necessary levels to meet this expected demand, so solutions like increased recycling and more efficient use of the metals will need to be initiated. These solutions, and especially recycling, will only further increase the values of the metals.

A “turnkey” provider of rare and strategic tech metals

Schweizeische Metallhandel AG based in Germany and Switzerland, with partner Swissmetal Inc (SMI) who run resale offices in Panama and Italy, is currently the only ¨turnkey¨ provider of rare and strategic tech metals in the world. Physical ownership within allocated, segregated accounts stored at private duty free vaults in Zurich, Switzerland and Panama City, Panama.

Haines and Maassen (HM ) our metal trading partners, who have been operating in this sector since 1948, selected metals for this new program to be gathered in what they metaphorically referred to as ¨baskets¨ that had the best chance of increasing in value now, and in the future. The idea being that this would be a new asset class that German citizens could exchange their devaluing paper currency in for, to hedge against inflation, and worldwide economic malaise.

The program was and is an overwhelming success, with clients now coming from countries all around the world, including an ever increasing amount from the USA to participate in the Key Industry, Tech Metal, Construction and Engineering, and Military rare and strategic metal stockpiles.

Since the program began in 2009, the metals baskets have averaged 16.5% increases in value overall, per year.

The media file around the original German Company is quite extensive, consisting of television and print, whereas the approach to promoting this program in the United States, for example, is done through sponsored investment conferences and symposiums primarily in the US, Canada, and Central and South America, and through newsletters like the one you are reading now.

The metal bundles, referred to as ¨baskets¨ are steadily increasing their value in the face of some very volatile financial markets and widespread economic instability. As you know, the last few months (and years actually) have been very rough times for the financial markets. As SMI regularly tells their website visitors and clients alike, SMI’s wealth preservation strategy is firstly, a safe, secure and private defensive mechanism for rough times with the baskets holding and/or increasing their value very well in that regard. Once your assets are safe, it is enjoyable to also consider the significant potential for profit as well.

If you find this to be as intriguing an opportunity as we do, and believe that it is worth a closer look, then please contact us using the form below to get more details about how SMI’s programs can work for you as a private individual or institutional investor.

I grew up reading Mary Shelley’s Frankenstein. It was one of those fantasy books that I would have never considered valuable to everyday life. Years later, this phrase has started to be muttered in frequent chatter among our famed Washington representatives.

Yes, famed may be used a little tongue in cheek as there is slight humor that these “public servants” find a reason to fill nightly news, destroy business and ruin an economy in just 102 days of work per year. But I digress…

Back to Frankenstein. Some politicians have been calling Roth IRAs a “fiscal Frankenstein” since 2011. They argue that allowing tax-free accounts is a major loophole for the long-term tax collection prospects for the government.

And they’re right. During the continuous faux fiscal cliff negotiations of the past two months, there were many discussions of “closing tax loopholes”.

So logically, a loophole that’s already named Frankenstein was at risk. We rushed many clients through their Roth conversions (and saved them lots of money) before year-end to beat any law changes.

Yet after reading the American Taxpayer Relief Act passed on New Year’s Day, I recognized the loophole GOT BIGGER.

The fiscal cliff means that the government has short-term needs (and we all know they don’t focus on the long-term).

But who thinks long-term?

You do.

Rather than closing the loophole, Congress estimates it can collect an extra $12 billion by expanding the current Roth conversion laws to 401(k) plans.

To recap on the existing law. In 2009 and earlier, only individuals with income less than $100,000 could convert to a Roth (including the income they claimed due to the conversion). Beginning in 2010, you have been able to convert to a Roth without worrying about any income limits.

When you convert $50,000 from a regular IRA or 401(k) to a Roth, you will have claim that as income in the current year. It does bring forward some taxes on money you’ve accumulated on several years of savings.

Congress has estimated these “early” tax payments to add $12 billion in revenue over the next decade.

It feels a little counter-intuitive because you’re paying taxes a little early, but this is an opportunity that can’t be missed.

You can now fix your tax rate on retirement savings. Forever.

Whether you have a 401(k) or an IRA, you can pay no more taxes on those accounts, ever…for you or your heirs.

That’s an extremely powerful estate planning tool.

Why wouldn’t you want an account that is tax-free for the next 100 years? You can then completely ignore the happenings in Washington, knowing you’ve paid your “fair share”.

Sure, tax rates have increased on the highest earners, but we’ve noticed that many still see a great opportunity to convert to a Roth. No need to convert 100% of your IRA immediately. If possible, convert it slowly, over time to manage your income under the upper limits ($250k).

Roth IRAs are strong in 2013 and I can’t wait to see this baby Frankenstein grow-up.

You may not want to wait too long, though. This beast won’t last forever. At some point, Congress will figure out that Frankenstein has turned on them. I can’t imagine it will be in the next few years, but a day early is better than a day late.

Good investing,

PS. Terry Coxon’s Unleash Your IRA enables people to invest in all of the alternative asset classes above…except one.

Thousands have found the information valuable and taken action on more actively controlling their retirement accounts.

I encourage you to pick up a copy of it here.

Maybe I’m fired up about this new law. Maybe I’m upset that I got another parking ticket the same night. I mean – come on – everyone tells me I HAVE to pay my taxes to pay for roads, but you sure as hell can’t be on them, otherwise you get fined!

Miss the meter by 3 minutes? That’ll be $44.00 – thank you, come again. I swear these parking cops are more ninja-like than I am!

Anyways, Saturday the 26^th, this passed:

ADVISORY: BY DECREE OF THE LIBRARIAN OF CONGRESS IT SHALL HENCEFORTH BE ORDERED THAT AMERICANS SHALL NOT UNLOCK THEIR OWN SMARTPHONES.

PENALTY: In some situations, first time offenders may be fined up to $500,000, imprisoned for five years, or both. For repeat offenders, the maximum penalty increases to a fine of $1,000,000, imprisonment for up to ten years, or both.*

Ye-Ouch…

First, let me start by explaining what “unlocking” your phone means. Unlocking a phone removes the restrictions that keep it from working on more than one carrier’s network.

This means, with an unlocked phone, you can use AT&T phones on a T-Mobile network, or Sprint phones on a Verizon network – or – if you’re traveling internationally you can actually use your phone on a local network (handy, huh?).

“Unlocking” is not to be confused with “jail breaking” your phone, which is currently legal. That allows you to install unauthorized software and make critical changes to the operating system (want prettier flowers in the background? You’ll need to do this for sure…)

But there are more sinister things happening here than people wanting to toss you in prison for changing carriers.

First, when did we decide that we wanted a law that would make unlocking your phone a criminal offense?

The answer is – we never did. You see, congress passed the Digital Millennium Copyright Act (DMCA) in 1998. The DMCA forbids most attempts to bypass the digital locks on things like DVD’s, music, and computer software.

Its purpose was to outlaw technologies that bypass copyright protections. But one of the more interesting things in the act was that it gave the Library of Congress the power to issue “exemptions from the law” for three years at a time.

This means that the Librarian of Congress decides what is legal, and what isn’t – like unlocking your cell phone – or deciding…

What You Do And Do Not Own

Now, the wording in the DMCA is fairly vague – and done that way for a reason. Basically it says that most software and gadgets that you own – you don’t actually own.

Your DVD Player, Playstation, iPods, or phones, aren’t actually yours to do with what you please. The DMCA actually makes it illegal to modify or change these products that you have bought and paid for.

Have you ever purchased a music CD? How about an iPod? If you didn’t know, CDs don’t actually fit inside iPods (don’t worry, took me a while to figure that one out also).

So how do you listen to the music you purchased, when the iPod that you also purchased, doesn’t have the capability to play your CD? Simple enough, you rip the songs from the CD and upload them to your iPod. But – the DMCA says that if you do this, you are a copyright infringer (Even though the Record Industry Association of America says it’s perfectly legal, and all right with them!).

But the law gets downright brutal…

When It Comes To The Blind!

Amazon got in trouble a while back for allowing the Kindle to do automated text-to-speech. Of course this means it could cut into the publishers’ audio book sales and it could totally violate their rights!

This leads to ridiculous things like the American Foundation for the Blind having to lobby Congress every three years to protect an exception for the blind, allowing a DRM crack for books to be read aloud.

I don’t know about you, but to me – it’s a little silly that a lobby group is required to go to Capitol Hill every three years to explain that the blind still can’t read books on their own and therefore need this exception…

So they make an exception for the blind, but – only if there are no other alternatives (like an audio version at 4-10x the price).

But what really gets me going about this whole DMCA thing is…

They Don’t Think I Own My Property!

Are you serious? I have a Playstation sitting under my TV right now. If I want to open it up and fiddle with it or throw it out the damn window – it should be my decision – not theirs. I paid for it, I own it, who is the Library of Congress (not even the people who make the laws) to tell me what I can or cannot do with it?

Technically every piece of software you have on your computer is leased from the company. It isn’t yours – understandable. But now all of your electronics are this way too? Physical products you have purchased and own are not actually yours to do with as you please? Come on, guys…

I’m definitely going to need my own Escape Hatch after all of this insanity.

So in the end, if you want to listen to CDs on your iPod, or watch DVDs on your tablet, or use your phone outside of the country; you better not because you could find yourself in prison for 5 years with a bill for half a million dollars (maybe that’s how they intend to pay down the national debt?).

Oh – and don’t ever use the roads you paid for, either – apparently they fine you for that, too.

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The passport as a travel license instead of travel document, and state granted privileges vs. inalienable basic rights

My main man, Bobby Casey, has asked me to write about why citizens of the United States of America might want to seriously consider becoming the citizens of more freedom-respecting countries. He did that because I was recently intimating to him a story about why I became absolutely obsessed with becoming the citizen of such a country myself. It’s not something I did lightly, and if I spelled out the sum total of the sacrifices I’ve had to make in order to become the citizen of another country, you might well have difficulty in believing it.

As I started to recall the whole situation, and the various circumstances surrounding why I did so, I realized that the almost 2-decade (or more) experience probably warranted a series of articles on the subject, and therefore here we have the first installment.

I first started thinking about the reality of packing my bags and moving to another country as far back as 1993, at least. This long journey requires some background information in order to be understood in context. First of all, in addition to loving personal freedom above almost all else, I’ve also had a life-long fascination with far away people and places. But the factor actually driving me to pack up and leave had more to do with an ever-increasing feeling of suffocation which, obviously was only going to continue getting worse. I could go on and on about the multitude of seemingly minor specific reasons. It was the accumulation of them which was ultimately suffocating. The final straw was when I apparently could no longer feed my family due to direct governmental intervention in my life.

Some more background to provide context is necessary, so bear with me. I grew up in the 60’s and 70’s in upstate New York. My parents happened to be racing fanatics, and were both corner marshals with the Sports Car Club of America (SCCA). As a result, I spent many a weekend during my youth at places like Watkins Glen, Pocono, Lime Rock, Daytona, etc. My mom was most likely the first female corner marshal in the world to work a Formula One race back at the US Grand Prix of 1973.

I’ve let you in on this to help you understand, 1) why I felt quite familiar with foreigners at a young age. There’s nothing like seeing guys speaking Italian, or Swedish, etc., putting a beautiful young girl into his Ferrari, or Lotus Europa, or Pantera, while speaking a foreign language, to get a young boy dreaming of world travel. And 2) fast cars, and putting them through their paces, was just the way to go.

So when my Grandpa took me to the DMV on the morning of my 16^th birthday to get my driver’s license, it had been a long time coming. I don’t think I made it 2 weeks before getting ticket number one. That would be the first of countless. Even I would cringe at the thought of what my DMV print-out would look like, but for those of you out there who go and look it up, I defy you to find mention of a single accident. Not even a parking lot scratch on the door.

This all, however, at a very early age started meaning suspensions of my “privileges” for months, and by the time I was 20 or so, suspended for 5 years. Therefore, while I was putting myself through college, my wife was driving my hot 280-Z with bored/stroked motor…..and taking me to class, and work, etc. I suppose there’re some nanny types out there saying “I guess he didn’t learn his lesson”. But actually I was. I was just starting to learn the very important lesson that if a guy wanted to be really free, he’d have to leave the so-called “Land of the Free”.

During this same period I also distinctly recall watching an interview with William F Buckley (this is 1983 or so) very eloquently and logically arguing that all drugs should be legal. His arguments ring true even louder today. Point being, I was also learning the absurdity of victimless “crimes”, and the damage that throwing people in jail for committing such acts has on society. So yes, I learned many valuable lessons during this time, but dropping to my knees before my masters certainly wasn’t one of them. Rather, if I wanted to secure my own freedom to live as I chose, I’d also have to be willing to defend the rights of others to do the same. What do I care as a beer and wine drinker, if someone else wants to smoke pot?

I finally got through those 5 years of being chauferred around during college. After graduation, and while as a reasonably respectable and gainfully employed Big 4 CPA, homeowner, taxpayer, husband and father, a few years later I was told again that I no longer had the “privilege” of feeding my family. At that point I was backed into the proverbial corner. Now leaving the country was no longer an exotic dream, but rather a practical necessity. Therefore off to Saudi Arabia I went, albeit without my wife and 9 year-old daughter, as after 13 years of marriage, we were divorced (one of the aforementioned sacrifices, and certainly the biggest regarding my daughter). But now I was about to start learning some more really important lessons about the land of the free versus the rest of the world, and I’d never look back.

Over in Saudi, if you’re not a skilled driver, your dead pretty quickly. Of course I loved that aspect. It was the personal responsibility and freedom that I’d been craving. Drive fast or get out of the way. No problem with the license. I learned many other valuable lessons from living in that society, but they don’t belong in the scope of this little article. One being the lack of 5^th Avenue brainwashing, and the almost immediate reduction of one’s desires to buy stuff they don’t need with money they don’t have.

Also, as I’ve been very forthright about my problems in the good ol’ US of A, I’d also like to point out that since 1997, and without any changes to my lifestyle, I’ve driven in Saudi Arabia, France, the UAE, Thailand, Australia, Vietnam, Colombia and Peru. Over that second 15 year period I’ve not received a single ticket for a moving violation, nor had any legal problems whatsoever. Coincidence? Probably not.

Now, after all of the background information, I’d like to get to my real point regarding second citizenships. By the way, the whole driver’s license issue isn’t what caused my obsession with changing citizenship. I promise to follow up with that horrific story in the next week or two. I fully accepted responsibility for the fact that I’d fractured numerous statutes regarding victimless traffic offenses, and just accepted the fact that I needed to leave the country that my ancestors had founded in the name of personal freedom, and instead live in Saudi Arabia in order to send child support payments back home to the daughter I could no longer father, etc.

No direct blame at this point, but certainly some growing resentment. I was even starting to question the morality and Constitutional legality of such treatment of a citizen by that government which confiscates money in order to fund its undesired services in the theoretical name of “protection and service”. Of course there’s the lame old support for such treatment in the form of statements to the effect of–“well maybe you drove for 15 years and never hurt anyone, but you certainly might have”. This supposedly then justifies the destruction of a family in the name of protecting “society”, whatever that is. I warn you, that’s a very slippery slope. Following that logic might even one day lead to the invasion of sovereign nations based on the weakly supported accusations and beliefs of certain bureaucrats, who have theorized about what the government of that nation might possibly do in the future.

My current point, though, is the fairly recent and frightening trend by Big Brother to lead the sheeple down the path to swallowing the concept that a passport is now a travel license. As you can see from the above explained concept of “privilege”, that means that a growing force of bureaucrats has the power to decide if you can leave the country or not. In my case, that meant once again having the privilege of working and supporting my former family and myself. This time, I’m not so willing to accept it. In fact, I’m starting to wonder if I have valid grounds to seek asylum, but of course prefer to just legally become the citizen of a country where concepts such as self-reliance and basic personal freedom are still considered inalienable rights.

A law professor at SMU, Jeffrey Kahn, has written a very interesting paper on the subject entitled International Freedom and the Constitution, and I encourage anyone who cares at all about personal freedom, and the accelerating erosion of it in the former America, to read it here . Note that this is just an abstract, and there’s a button near the top to download the entire 80-page article. I’ll give you some salient quotes from it right now.

“This Article makes the case for the fundamental right of U.S. citizens to leave their country and return home again. Surprisingly, Americans do not enjoy such a fundamental right. Under current U.S. Supreme Court precedents, the right to travel abroad is merely an aspect of liberty that may be restricted within the bounds of due process. The controversial No Fly List is one such result. Anyone whose name appears on this government-run database (or one of several variations on it) may find his or her air travel prohibited or subject to varying levels of restriction. Although the so-called War on Terror raises new concerns about a right-to-travel case law developed during the Cold War, no one has yet made the case for stronger constitutional protection for international travel.”

“The Article begins with an in-depth case study (based on interviews and primary sources) of two citizens who were recently denied permission to return to the United States for more than five months. The Article proceeds to explain the origins of weak support for foreign travel and then advances an unconventional source for its heightened protection. Whereas most unenumerated fundamental rights seek their foundation in the substantive due process guarantees of the Fifth and Fourteenth Amendments, I advance a more straightforward textual source: the Citizenship Clause of the Fourteenth Amendment. After developing the historical and theoretical support for my argument, I examine the policy implications of strict judicial scrutiny of travel restrictions, including the No Fly List, which are intended to combat terrorism in a globalized world.”

There’s the foreword which should pique your interest. The article goes on to make strong arguments which should not only frighten the sheeple, but send them running for the door before it’s too late. Following are a few more quotes:

“Even the traveler whose name is not on any list now journeys abroad at the pleasure of the U.S. government, as if on parole from ordinary residence in the United States. Under a new Department of Homeland Security rule, all travelers now require the federal government’s express prior permission to board any aircraft or maritime vessel that will enter or leave the United States.”

“With few clear exceptions, weighing the citizen’s travel interest against foreign policy interests lacks constitutional legitimacy because it equates the citizen of a democratic republic with the subject of a monarchy or an undemocratic dictatorship.”

“So long as the citizen’s actions are not treasonous, immediately dangerous, or contrary to some contractual obligation made to the state, a citizen’s travel (like a citizen’s speech) is none of the state’s business.”

“The passport, for example, began as a temporary travel restriction limited to the worst crises of wartime, but gradually grew into a permanent peacetime restriction. At the height of the Red Scare, a period comparable in many ways to the current so-called War on Terror, the passport could be used as a form of house arrest to keep suspect citizens under watch at home. This tendency toward mission creep, as new threats manifest themselves and new technologies emerge, is examined in the present day.”

“Indeed, restriction of freedom of movement was one of the “injuries and usurpations” listed in the Declaration of Independence.”

“American citizens have a fundamental right to interstate travel that is based on its importance to the life of the individual and the life of the nation. One might expect similar defenses of the right to travel abroad. As the Supreme Court explained in its first substantial case on the question: Travel abroad, like travel within the country, may be necessary for a livelihood. It may be as close to the heart of the individual as the choice of what he eats, or wears, or reads. Freedom of movement is basic in our scheme of values.”

“As I argue in Part III, the right to international travel is not really a reciprocal right at all, but one that citizens qua citizens need to keep their status from descending into something less than citizenship—to become a subject or, worse, an object of the state’s hegemony.”

Match in the tinderbox theory

“Thus, when the D.C. Circuit was called to consider the appeal of a journalist whose application to renew his passport had been rejected on grounds of his repeated disregard for area restrictions placed on its use, the Court began its opinion by noting that refusal of the passport rested in no part upon Worthy’s personal beliefs, writings or character. It was an application of the Secretary of State’s general policy of refusing Government sanction to travel by United States citizens in certain areas of the world, presently under Communist control and deemed by him to be trouble spots. The appellant had traveled extensively in China and Hungary, both of which were under area restrictions. The Court did not even consider that by lodging in the Secretary of State a power to waive those restrictions for reasons of urgency, exigency, or other exceptions to the rule, it was impossible to say whether a refusal to exercise that discretion was a function of a general policy about dangerous areas or an individualized assessment of this particular journalist’s “personal beliefs, writings or character.”

The D.C. Circuit in Worthy also fell prey to the conflation of the state’s discretion to refrain from issuing travel documents that adversely affected its foreign policy (such as undesired recognition of a foreign state or unwillingness to extend the state’s protection to travelers there) with the state’s power to prohibit citizens from traveling to such places of their own accord. The appellate court did not avoid hyperbole in assessing the government’s interests in denying a passport to visit Communist China or Warsaw Pact Hungary: Unless almost the whole of our foreign policy and the titanic domestic burdens being presently borne by our people are devoid of factual foundation, there is presently in the world a deadlock of antagonistic forces, susceptible of erupting into a fatal cataclysm. The capacity of incidents arising from the conduct of individuals to ignite that conflagration is well proven. Worthy says the reasons averred by or available to the Secretary are insufficient to support the restriction of his passport. We hold they are ample.

By “ample,” the court meant an ample demonstration of the executive branch power to conduct foreign affairs. A travel restriction was at least “an instrument of foreign policy” if not a foreign policy “in and of itself.”

The court also evoked the Hostage Act, 22 U.S.C. § 1732, as grounds to keep citizens out of “trouble spots” or “danger zones” in which the President would be pressed to come to their rescue. The court then held that the “refusal of the Executive to accord Government approval for a citizen to travel in such a designated area [was] also a foreign affair.” The court reasoned:

“History establishes that either the behavior or the predicament of an individual citizen in a foreign country can bring into clash, peaceful or violent, the powers of his own government and those of the foreign power. This is a fact, not a theory. The nub of the problem at bar revolves about a fact, not a suppositious theorem. The acts of individuals do cause clashes; the prevention of such acts does prevent clashes. Such clashes, whether diplomatic or military, involve ‘foreign affairs’ . . . In foreign affairs, especially in the intimate posture of today’s world of jets, radio, and atomic power, an individual’s uninhibited yen to go and to inquire may be circumscribed. A blustering inquisitor avowing his own freedom to go and do as he pleases can throw the whole international neighborhood into turmoil. The court was confident that the President possessed the power to act in loco parentis for American citizens willing to risk danger abroad. 191 What is more, as the court had previously explained, citizens are “potential matches” in an “international tinderbox.”

Wow. Here the US Supreme court seems to be warning US citizens that Washington’s desire to stick its finger in everyone else’s pie gives the Secretary of State (or more likely some other government-paid moron working under her authority) the legal right to deny a US citizen the ability to travel, when they merely consider it possible that such citizen might damage Washington’s ability to do whatever it wants in any corner of the globe. A very good reason to be the citizen of a country with less global ambitions in my opinion.

“Finally, in 1978, all conditional language on the imposition of travel controls was struck out.

Neither a state of war nor a presidentially proclaimed national emergency were necessary to initiate temporary travel controls. The controls were permanently installed for all peacetime travel: Except as otherwise provided by the President and subject to such limitations and exceptions as the President may authorize and prescribe, it shall be unlawful for any citizen of the United States to depart from or enter, or attempt to depart from or enter, the United States unless he bears a valid passport.

The passport was no longer merely a document that provided evidence of the bearer’s identity and a request from either the bearer’s government or, in the case of enemy aliens or foreign diplomats, from the host government for safe passage through a sovereign jurisdiction. The passport became a license issued by a government permitting its own citizens to travel abroad: The passport ceased to be a document of identification and comity; it emerged as a device to restrict liberty to travel out of one’s own country and to monitor one’s citizens in foreign lands.”

The Cold War policy was summarized by Louis Jaffe in terms that resonate today:

“Nearly every passport denial has been a decision to keep the citizen here within the high-walled fortress where he can be isolated, neutralized, kept, let us say, to his accustomed and observable routines of malefaction. It has been simply one facet of our tactic of domestic security, and only incidentally a matter of foreign policy.”

Jeffrey Kahn’s article was based largely on the assumptions that Americans have Constitutional rights in general, and specifically regarding the right to due process. When he wrote the article just 4 or 5 years ago, those rights seemed to actually exist. As demonstrated by the passage of Congress, and the signing by the President, of the Indefinite Detention clause of NDAA over a year ago, in conjunction with many other similar actions, the Constitution in general, and due process specifically, have apparently been thrown under the bus.

In just a few short years since this article was written and published, the Executive Branch has gone a very long ways toward creating Executive powers that continually look like tyranny at best, and totalitarianism at worst while skirting the Constitutionally provided separation of powers. If you read this, and Kahn’s article in its entirety, and still see no reason why a current US citizen might want to become the citizen of just about any other nation, I’ll share with you soon some very personal, and painful experiences, which might push those of you who are still unsure, over the fence.

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Over the years, we have routinely expressed the importance of planting multiple flags. If you live, work, bank, invest, own a business, and hold your assets in the same country of your citizenship, you are putting all of your eggs in one basket, and once that basket heads in the wrong direction, you can kiss your assets goodbye.

There are nearly infinite possibilities that pose substantial risks to your wealth and security, including taxes, litigation, confiscation, inflation, regulation, and good ole’ fashioned social decay.

Making the effort to move assets overseas, diversify your currency holdings, buy foreign property, set up foreign structures to operate a business, etc. are all major steps in the right direction to preserve your livelihood and safety.

If you have executed only a few of those steps, you are ahead of the 99% of the population. You will be safe while others watch their freedoms, their wealth, and their critical thinking be eroded by corrupt bureaucrats and the mainstream media.

One of the ultimate tools in preserving wealth, freedom, and security that we have touched on before is acquiring a second passport. This tool provides additional freedoms of travel, possible tax advantages, banking convenience, an escape hatch, and security. After all, nobody hijacks a plane and threatens to kill all the Dominicans.

Most importantly, when your home country starts heading in a catastrophic direction, a second (or third, fourth, etc.) citizenship provides you with options… and that’s what real freedom is all about– the power to choose.

Even without a cataclysmic event in your home country, a second passport pays big dividends. With a second passport, suddenly you find that you can open bank accounts and travel much more easily.

So how do you go about obtaining one?

For starters, if you’re a member of the lucky bloodline club, you may have been born as a second or third generation citizen somewhere. Many countries have programs that grant citizenship to descendants of emigrants– Ireland, Poland, India, and Italy are examples.

If, for instance, you could prove your lineage to Irish grandparents, you would have a case to apply for Irish citizenship. There are many more countries that have such programs, but I’ll save that topic for another time.

Second, there are a handful of countries where you simply pay for citizenship, either through an official program, or an unofficial program.

In terms of official programs, most people who have done even the most cursory research have read about Dominica and St. Kitts, both of which charge about $200,000 to $450,000 for citizenship.  These are the most famous, but there are others, including Austria and even the United States.

Former Thai Prime Minister Thaksin Shinawatra is traveling around the world on passports from Nicaragua and the Bahamas… and not because those countries have official programs for ordinary investors, but because Thaksin used his connections to make compelling donations.

Clearly, unofficial programs generally come down to knowing somebody of significant influence in the government. In most countries, the head of state has the authority to naturalize a foreigner at his/her discretion, and this happens frequently in small countries that have been assisted by the actions or donations of a particular individual.

Now … assuming that you don’t have any heads of state in your rolodex, aren’t descended from Polish grandparents, and don’t want to swallow a $395,000 pill for St. Kitts citizenship, the next category may be of interest to you. It’s called an expedited citizenship, in which an individual can become naturalized through some special program offered in the country.  Typically this can be marriage, adoption, investment, religious affiliation, and of course, birth. We’ve found and offer an expedited citizenship that will allow you to have a passport in 6 – 8 months. This is an accelerated investor program where there is no investment required – just an income of $3,000 per month. And, residency is not required. The passport is from the Dominican Republic.

Dual Citizenship

Dual citizenship is permitted. Once citizenship is granted you have the option of living and working in the Dominican Republic for the rest of your life.

Tax Free Status

A second passport and Dominican citizenship is the key to preserving your wealth. If you have income coming in from outside of the Dominican Republic you do not pay income tax on this income.

Security

Protection of bank accounts, real estate and businesses, both abroad and within your own country.

Confidentiality

The Government of Dominican Republic does not inform the country of your current citizenship or residency about your second or third citizenship.

How To Get One - For the procurement cost of $24,900, this passport and citizenship can be yours in 6 – 8 months. In addition, apply now and receive your accommodations and airport pickup free.

Want to renounce US citizenship?

The DR passport offers a low-cost way to do it. Millions of people are disconcerted, dismayed, or outright disgusted at President Obama’s victory, and they sense a continued decline of civil liberties and economic opportunities.

The frustration and apprehension is understandable.  We can’t begin to tell you how many emails we’ve received over the last few months, mostly from US citizens who have reached their breaking points, asking, “Where can I get a second passport?”.

The Dominican Republic offers one of the most economic passports in the world.

This is an island retreat where it’s perfectly acceptable to do nothing but lounge poolside for an entire day. Where white sand beaches and year-round tropical temperatures welcome the adventurous and serene alike. We do the heavy-lifting for your citizenship. You enjoy a wide variety of activities, including horseback riding, tennis, water sports, and more. Or, simply relax in the sun and do nothing at all. The DR is only a short flight from the US or Canada. And, there are numerous direct international flights from around the world including Europe, Central and South America. The process is incredibly easy for you. Simply make three short trips over a 6 – 8 month period and receive your passport.

• Getting a passport in the DR is cheaper than practically any other country in the world
• The DR only taxes its citizens on money earned in the DR

We require of you certain documents and about 3 hours during your first of three trips into the country. In between, you can play a round of golf, scuba dive the crystalline Caribbean waters, or try your hand at kite boarding. Enjoy a quiet morning stroll along the beach, dine in wonderful restaurants, or indulge in a massage treatment. Its wealth of activities and ideal tropical climate make the Dominican Republic a blissful island oasis.

On your second and third trips you will do nothing except show up. We will require very little of your time while the warm ocean breeze welcomes. Our attorneys will finalize all the important details while you listen to faint sounds of waves crashing on the sand drift from the nearby beach.

We are offering hotel accommodations and chauffeur service for a limited time. Contact us below for more information.

Even John Maynard Keynes would call Obama stupid right now. As much as I despise Keynes, even this capitalism destroyer would not raise taxes at a time when the economy is still on such shaky ground.

In my humble (but accurate) opinion, the ideas developed by Keynes that have been the basis of economic policy for decades have been the most destructive force for global well being. And yet, even this thieving parasite would not recommend raising taxes like the Obamessiah is proposing.

Clearly Obama‘s economic advisers have not even attended Econ 101, where they would have learned about the Laffer curve. For those of you unfamiliar with the term, it is defined as; the curve that shows the relationship between tax rates and tax revenue collected by governments.

You can see the graph below:

Essentially what this is saying is that in order to maximize tax revenue, you must find an optimal tax rate. Too high of a tax rate will actually decrease the amount of tax revenue collected. Historically the US has collected approximately 20% of GDP in tax revenue, no matter what the tax rate has been.

Right now, that number is more like 25%, which means we should soon be seeing a reversion to the mean, or even a swing below 20% as the high earners take advantage of loopholes as well as move their businesses and investments offshore.

Take the recent example of Britain. In 2009-2010, more than 16,000 people declared an annual income of more than 1 million GBP.

Just before the last general election, Gordon Brown introduced a new 50% top rate of income tax. Guess what happened. The number of people that declared annual incomes of more than 1 million GBP fell to 6,000.

This resulted in 7 billion GBP lost tax revenue. In other words, by raising the top tax rate on high earners, Britain lost two-thirds of its millionaires.

Another consideration is not just the British millionaires that are reducing their taxable income and/or moving to more suitable jurisdictions. The country now has created disincentives for entrepreneurs and investors to put capital to work. Not smart.

In France earlier this year, Hollande proposed a 75% tax on incomes over 1 million EUR. He had a lot of resistance but responded with, “It’s a message of social cohesion…It’s a matter of patriotism.”.

In other words, I’m a socialist, get over it.

Now the US’ own socialist president is declaring war on the productive. Take a look at the chart below for comparison of 2012 to 2013 tax rates (only showing single filers for simplicity):

For entrepreneurs and investors, the most important thing to consider is the impact on your investment capital. In 2012, if you earned more than $398,250, your dividend tax rate was 15%. In 2013, it jumps to 43.4%, or a 289% increase. Your capital gains tax goes from 15% to 20%, or a 33% increase.

I will leave the moral issue alone for a minute and just discuss the practical side. Some pundits argue that the wealthy won’t stop investing just because of tax rates. If you listen to Warren Buffet you may even start to believe this garbage.

But the numbers don’t like. Britain lost two-thirds of its millionaires by raising taxes on the wealthy. Guess who runs companies, invests in productive assets, and hires workers? You guessed it, the wealthy.

You may argue that the wealthy have a moral obligation to fund the government because the country provided them with the ability to make so much money. Sure, that may sound nice and fluffy, but reality shows that when you go on the downward slope of the Laffer curve, the wealthy either leave the country, or move their assets offshore.

So while the libtards may stand on their moral high horse proclaiming the need for social justice, the ones that actually foot the bill are packing up shop and moving overseas – morality be damned.

Some argue that high tax rates did not have a negative effect on the US during the ’50′s-’70′s, but that is a naïve viewpoint. Keep in mind this was post-WWII when all of Europe was rebuilding. There weren’t a lot of great opportunities for investment in that region.

Communism was widely accepted globally making places like the Soviet Union unfriendly (to say the least) for investment. South America was in shambles with dictator after dictator doing his best to rob every last nickel from the people.

This left America as the bastion of capitalism and comparatively the best place to invest your productive capital. The problem today is that this is no longer the case.

Much of Asia is booming with even communist China hugely capitalistic in its economic policies. (As a side note, China just lowered its already low dividend tax rate from 10% to 5%. If redistribution of wealth is a communist ideal, who is really the communist country?). Nearly all of Eastern Europe has privatized its economies and lowered tax rates. Many have even gone to a low flat tax.

One of my favorite examples is Estonia. Estonia has a flat 21% tax rate on earned income. There is no corporate tax at all. No dividend tax. No capital gains tax. No estate tax. No interest income tax.

If you own a company in Estonia, you only pay the 21% tax on distributed earnings. So if your company earns 1 million USD in profit and you only pay yourself 100,000 USD, you only pay the 21% on the 100,000 USD. No tax on retained earnings. None.

I just had a conference call yesterday with a guy from the US who runs a software company. He is moving his company to Estonia within the next 3 months. He employs 25 people and they are all earning over 6 figures per year.

He has decided that he has had enough. His company is growing, but all future growth will be handled by the Estonian company. He will gradually transition all operations over to Estonia. And why not? The wage rate is lower as is the tax rate. Compliance issues are virtually non-existent making it much easier for him to do what he does best – provide value to his clients.

The ill-informed patriot may say this guy is un-American and a traitor for jumping ship. I say America has lost touch with reality and is driving people like this guy overseas due to their uncompetitive economic policies.

So what’s the next step, you may ask. What do you do to protect yourself from higher taxation and dwindling economic activity in the good ole USA?

Clearly if you are reading my newsletter you know my answer will be internationalization. For many, that is perceived as a huge undertaking. In reality it is not that big of a deal, and you will find much more freedom, peace and prosperity once you take the steps to internationalize your assets and your life.

If you are completely new to this, you really need to set up an offshore bank account now. Who knows how much longer this opportunity will exist. I can easily see the day where Americans are either forbidden from opening an offshore bank account, or the offshore bank will no longer accept Americans.

We have a very unique product that allows you to open a private offshore bank account holding multiple currencies and even the ability to buy and sell precious metals in an allocated holding, online. It is a great way to get started and a great bank. Email us here if you are interested in learning more.

Take steps to protect your investment portfolio today. I have personally realigned my portfolio eliminating the more risky stocks and sticking with the large, dividend paying stocks, some real estate investment trusts that specialize in government offices (no recession in government), and a couple of resource plays. Additionally, my cash savings are now being moved into physical metals and foreign currencies.

You need to consider an income stream that can be earned from anywhere. My team and myself have built Global Wealth Protection as a completely virtual company. We have products and services that can be provided to our clients from anywhere in the world, and the work can be managed working from a city apartment in Medellin – Colombia, a beach house in Ambergris Caye – Belize, or even the McDonald’s in Amsterdam.

Our team works hard to provide you with tools and strategies for internationalization of you and your assets through offshore companies, offshore banking, offshore trusts, offshore foundations, education, and offshore seminars like our upcoming Global Escape Hatch – Belize 2013.

Whatever your area of expertise encompasses, you really need to start thinking about how to make your income portable in order to free up your life to live and work from anywhere you chose. You may still chose to live in Topeka, Kansas, but it certainly won’t hurt you to have the option of internationalization for your business.

The world is clearly in a state of chaos with all that is happening now, but for you that should mean chance to improve your life and capitalize on the opportunity. Let us know if we can help you with your internationalization plans.

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Take a first-class vacation on us while getting a second passport at the same time!

The Dominican Republic is a beautiful, diverse and freedom-minded country in the Caribbean.  It is only a short flight from the US or Canada and has numerous direct international flights from around the world, including Europe, Central and South America. We invite you to come vacation at a tropical all-inclusive resort on the beach for three-days while we process your application.

• The Dominican Republic is very close and easily accessible to those who live in the United States (it is only 3.5 hours from New York, or 2 hours from Miami), Canada and Europe (9 hour direct flights from many European capitals).
• The process is incredibly easy for you. Simply make three short vacation trips over a 6 month period to receive your passport.
• Getting a passport in the DR is cheaper than practically any other country in the world (see below).
• The DR only taxes its citizens on money earned in the DR.

Millions of people are disconcerted, dismayed, or outright disgusted at President Obama’s victory, and they sense a continued decline of civil liberties and economic opportunities.

The frustration and apprehension is understandable.  We can’t begin to tell you how many emails we’ve received over the last several weeks, mostly from US citizens who have reached their breaking points, asking, “How can I get a second passport?”

A second passport is like an insurance policy. Rather than protecting you from risks of fires, floods, and fender benders, a second passport helps protect against sovereign risks.

Throughout history, as once powerful empires have slid into terminal economic decline, political leaders have routinely resorted to plundering their citizens: capital controls, exchange controls, price controls, and even direct confiscation of savings.

From Argentina to Greece, these same tools are being applied throughout the world today. A second passport gives you the means to defend yourself against these measures.

Predominantly, a second passport ensures that you ALWAYS have a place to go in case you need to leave your home country.  Plus, it opens up new financial opportunities, making it much easier to establish foreign bank accounts to move your savings away from your home government’s thieving hands.

We recently learned from our sources on the ground that Panama is not granting US citizens second passports after those people have fulfilled the residency requirement. Is this the beginning of a new trend? Will other Americans be denied second passports wherever the US has a cozy relationship with the issuing government?

Many countries like Panama have residency requirements which take 5 years to get a passport. The problem is, as many US citizens have recently found out the hard way, anything can happen during those years leading up to passport eligibility. The solution: a legally expedited passport in 6 months.

If there ever was a need for another citizenship and passport, it is now. The idea that US citizens need to become a citizen of some other country simply to invest or bank abroad is unbelievable, and yet that is exactly where we are at the moment. In addition, matters will only get worse. The financially stressed US government will chase money and revenue from wherever it can.

The goal of FATCA is to identify US citizens with undeclared assets hidden in overseas bank accounts. In terms of banking or investing abroad,  it is the bank or financial institution turning US clients away – not because it would be illegal in that jurisdiction to open an account for a foreigner (or American specifically) but rather to avoid any hassle or aggravation in dealing with the US government. The result is to get another citizenship and passport, or as the banks are increasingly stating, “take your funds elsewhere.”

If you don’t qualify based on these factors, in most countries, you can acquire citizenship following a period of prolonged residence. Among other countries,  Australia, Canada, Hong Kong, New Zealand, the United Kingdom, and the United States, exchange residence rights for domestic investment. Eligibility also depends on your age, education, life skills, health, and other criteria. Your spouse and minor children can often accompany you, although in some cases they may be subject to a separate qualification process.

But there are only a handful of countries which offer official, legally mandated expedited citizenship and passports.  The Commonwealth of Dominica, the Federation of St. Kitts Nevis, and the Dominican Republic.

Under Dominica’s (not the Dominican Republic) program, you may acquire citizenship and passport in return for a cash contribution in 2 months. Total costs, including all fees for a single applicant, come to about $105,000. Add $25,000 if you need a passport for your spouse and up to two children under 18. Dominican passport holders can travel without a visa, or obtain a visa upon entry, to nearly 100 countries and territories. You can also live or work in most members of the Caribbean Community (CARICOM), including Antigua, Barbuda, Barbados, Belize, Grenada, Guyana, St. Kitts & Nevis, St. Lucia, St. Vincent, the Grenadines, Suriname, and Trinidad & Tobago.

In the Federation of St. Kitts & Nevis, there are two ways to obtain economic citizenship. The most practical strategy is to make a direct contribution. Total costs, including all fees for a single applicant under this option, come to about $225,000 or $275,000 for an applicant with up to three dependents. It will take about 3 months. Alternatively, you may purchase qualifying property worth a minimum of $395,000. However, fees and taxes under this option are much higher than if you make a direct contribution. St. Kitts & Nevis passport holders can travel without a visa, or obtain a visa upon entry, to more than 130 countries, including nearly all of the 27 member countries of the European Union. You can also live or work in most CARICOM countries.

The least expensive option is to obtain citizenship and a second passport from the Dominican Republic. There are numerous promoters and facilitators which offer this service, but only a few can procure citizenship and passport in 6 months. For a total cost of $24,900 and the required documentation, plus three trips into the country, you can be a citizen with passport in 6 months.

With a second citizenship and passport you can potentially structure your life to pay near zero in taxes, divorce your government (expatriate) if you desire, or at the least have some semblance of financial privacy. The sooner you start the process, the sooner you’ll receive citizenship.

Please contact us below if you would like to learn more about this program.

This past year has been a wild one for the Internet and electronic privacy in general. Governments and marketers have gone far beyond what we would have guessed in 2012: their surveillance state is taking shape faster than expected.

THE GOOD NEWS

I normally like to get the bad news out of the way first, but this time I’ll go through a brief piece of good news and an ugly story about the UN (what isn’t ugly about the UN?) and their supposed takeover of the Internet. Then I’ll close with the nasty news.

The good news is that we have a new feature at Cryptohippie, and more on the way.

Because the exits from our network are in Europe, some popular entertainment sites wouldn’t allow our users to enter. Hulu and Netflix are the ones many of our customers asked about, and we also received questions about some YouTube videos being blocked. There was really nothing to be done about it at the time, and if missing a few bits of entertainment were the price of security, it would be a small price to pay.

But it’s our job to give our customers what they want – at least as much as we can – so we created a special secondary exit that isn’t blocked. So, with about ten minutes of changing settings, you can now get the missing sites. Security for this secondary exit is slightly modified (an extra hop, but somewhat less anti-correlation), and the speed is slower, but you can now watch America TV from anywhere.

THE UGLY NEWS

I’m sure you’ve heard lots of stories about the UN trying to “take over the Internet” at some upcoming meetings in Dubai. A lot of these stories are written to scare people, and are being placed in the “news” by journalists allied with the various belligerents. (Friends don’t let friends watch network news.)

The fight that matters is over control of ICANN, the group that doles out IP addresses, among other things. Up till now, the Internet has generally been managed by multiple “stakeholders” (the big telecoms, some governments), but because of US piggishness, everyone outside the US/EU/Israel alliance has thoughts of taking it over.

Our best guess is that ICANN will remain mostly intact; the US will probably back-off a bit and promise to play nice. But this is the crucial issue; ICANN must not be owned by the States.

The next big fight is over what is being falsely called a tax. The problem here is that the big companies have been pushing the little companies around. For example, more or less every server on the planet is over-priced because incoming and outgoing traffic are charged the same, allowing Google to index everyone’s web site at the site’s expense. Because of this, the smalls want mandatory contracts that would charge separately for initiating traffic. Google and their ‘friends’ are trying hard to squash this one. We’re guessing that they’ll succeed.

I pass on the cyber-security, “caller ID” and disconnect contract issues: they really don’t matter much anyway.

One thing to remember is that none of this is about privacy, censorship or free speech. This is about politics, economic issues and the usual jockeying for dominance. All of these parties are already spying and censoring.

OK, THE BAD NEWS

Let me start with a few links:

The NSA is spying on every American, and very deeply spying on us. Read it here.

A surveillance system has been installed inside of Facebook. See this and this.

AT&T has been giving all of its Internet traffic to the NSA since at least 2006. Read it here.

Union thugs have no problem intercepting emails. See here.

Newspapers are having no problems intercepting emails. See here.

Stores are now installing face recognition systems. See here.

The FedGuv is paying big bucks for systems to “predict crime”. Read it here.

The FBI is building a nation-wide facial recognition system. Read it here.

Biometric identification is being rolled out in grammar schools. See it here.

I’m hesitant to continue, because it may overwhelm you, which is not helpful. But we’ve lost the luxury of time and you should know.

The really scary thing is that the snoops of the world are not content to take all your information: they’re also using it to generate individual-specific feedback. You’ve seen this for several years already: after you do a Google search on skis you start to get ads for discount travel to Vail. That was just the initial phase.

The really bad news is that psychologists and marketing experts are taking this information (a very detailed virtual ‘you’) and are building systems to invisibly guide you toward decisions that are “better for you.” I know that this sounds like a distopian novel, but it’s very real.

The instigator and architect of this dark story is the Administrator of the White House Office of Information and Regulatory Affairs – one of Obama’s ‘Czars’.

Here are a few things this guy has been writing in books and scholarly papers:

It is legitimate for choice architects to influence people’s behavior. (These “choice architects” are his academic/government friends.)

Government agents (and their allies) might enter chat rooms, online social networks, or even real-space groups and attempt to undermine percolating conspiracy theories.

Government can supply these independent experts with information and perhaps prod them into action from behind the scenes.

And yes, this is precisely what is taking shape now. It has government, corporate and academic support, and lots of experts are getting very nice paychecks for building it (while avoiding any thoughts of responsibility).

Advertisers are finding their holy grail in this: being able to catch you just at the moment when you’re in the mood, then delivering a custom ad that shows you precisely how to scratch the itch they implanted.

The bottom line is this: A very deep surveillance state is being completed now. It’s your choice whether or not you’ll escape it. If you can’t afford our privacy system, get Tor, GPG, Pigeon and OTR and learn how to use them. If you don’t want to do that, pay Cryptohippie to do it for you. But do something.

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Two things will always be true about capital controls: they will always fail in the end and they will always protect the guilty. The Swiss have printed unprecedented amounts of francs to peg their currency against the euro. In the end, that decision will have a cost that is impossible to calculate. Not only are they intentionally keeping the value of their currency artificially low to have a shot in hell at having an export market to the rest of Europe, they will also suffer disastrous fallout after the artificial peg finally fails. The market always takes its pound of flesh in the end, despite the most dubious of efforts by mankind.

How comforting is it to know then, that the Obama administration is wasting no time in pushing for a nationalized 401k and IRA plan? The largest debtor nation in the history of the world cannot wait any longer for the low-hanging fruit of the roughly 9 trillion dollars held in American retirement accounts. A recent hearing sponsored by the Treasury and Labor departments marked the beginning of the Obama administration‘s efforts to nationalize the nation’s pension system, and to completely eliminate 401ks and IRAs from existence. Deputy Treasury Secretary, Mark Iwry, presided over these hearings. Iwry is a long time critic of 401k plans, because he says they benefit the “rich” and were originally designed as a tax haven for corporate executives. Here is a short video of Mark Iwry and his fellow cronies gleefully discussing how much better they will be at managing your financial affairs than you could ever be.

The administration’s vision of how this would transpire is to essentially take the newly confiscated retirement accounts and roll them into what would essentially be annuities that pay out pre-defined benefits at some arbitrary time in the future that is, as of yet, not disclosed. Let’s spell this out, shall we? The very same group of bureaucrats that have held seats in the Senate for decades, who long ago bankrupted the social security trust fund, now want to “manage” your 401k plan. What glorious vehicle do these jackals and thieves want to place your money into? Why, the US Treasury’s, of course! Every central bank is in simultaneous competition to see who can create a hyper-inflation holocaust first, and the US government wants you to invest in bonds. For anyone new to “Market 101″, bond prices move inversely with inflation. As inflation intensifies and rises, bond prices fall. None of this will be discussed at these types of hearings that are held and moderated by the players within the administration that know the real reasons for this agenda.

It’s simple, really. There are simply no new natural buyers of US treasury paper. The sovereigns that have in the past allowed us to monetize our record-shattering deficits are finally stepping away from the table. A quick look at some of the latest available data from the treasury’s own website confirms this. The top two foreign holders of US treasury debt are China and Japan. From September 2011 until September 2012, China reduced treasury holdings from 1270.2 billion dollars down to 1155.5 billion. I’ll attach the link here to the treasury’s own numbers so you can see for yourself just how much of that slack Japan picked up for Uncle Sam.

This would be the very same Japan whose own economy is still reeling from a tsunami (both a natural one and a man-made one). The Fukushima nuclear disaster from 2011 continues to symbolize grave long-term consequences for a country that has a debt to GDP level in excess of 230%. As a reminder, historically speaking, bad outcomes are usually seen above 90% debt to GDP. Japan’s demographics exacerbate these debt problems, as most of their population is no longer exactly what would be described as a “spring chicken”. So a debt-riddled, aging country with an energy crisis (Japan essentially has no natural source of hydrocarbons) is, for the moment, sopping up the treasury issuance that China no longer finds appealing. Do you think that might be because they are seeing an opportunity to push for a new reserve currency to settle international trade outside of the US dollar? Unless you only pretend to read Global Wealth Protection, you probably already know the answer to that.

These forces and trends, ladies and gentlemen, are why the buyer of last resort to monetize US debt is going to include more than just the US Federal Reserve in the near future. In the same basic way that Bank of America was saved by putting their depositors’ money at risk to pacify nervous international counter-parties, so will the US government be temporarily bailed out with your 401k money. Why anyone would question this logic with smoking gun after smoking gun materializing for over 4 years now can only be explained as herd mentality. These psychopaths talk about their plans openly and in broad daylight, and yet people still shake at the thought of liquidating what they have within a system that asks them to bend over at every turn. If you’re comfortable with your return on “investment” and have been paying into social security for more than 5 years, then I highly encourage you to leave your 401k as is for the vultures.

For everyone else that thinks the things we write about in these pages has merit, I’d like you to consider the fact that Japanese Pension Funds have been buying physical gold lately. I’d like you to consider how completely and totally unsurprising that is after the man that runs the largest bond company in the world essentially comes out in the light of the day and tells them they must do so. In the bond world, when Bill Gross speaks, people listen. Are you listening yet? Do you hear the train whistle? Can you see the flicker of light coming through the tunnel? I can and I have.

Watch for this in the coming weeks. The misinformation campaign will continue to get louder. Websites and individuals that practice in truth and practical solution will continue to be harassed if they are fortunate and shut down if they are not. The window for your time to act grows smaller by the day. The administration is already talking of a deficit this fiscal year in the neighborhood of 1.6 trillion dollars. That’s a big hurdle to clear in a very unstable global bond market. Keep your monies in electronic form within this debt paradigm, and very very soon you will become part of their solution and your own problem. Take a look around the world. Do you really think you need to see one more enemy when you look in the mirror?

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OFFSHORE CASH FLOW AND A SECOND PASSPORT ARE AVAILABLE IN ONE OF THE FASTEST GROWING ECONOMIES IN THE WORLD – Here’s how you can participate.

With the hospitality sector of Panama‘s economy expanding from the steady increase in business tourism, medical tourism, shopping tourism, cruise ship tourism and about to get another big boost from the new convention center, it may be a good time to see how you can get involved.  Notably, Panama’s hotels have been steadily raising rates and occupancies have been strong since the announcement of the expansion of the Panama Canal.  Of course, many businesses have and continue to expand in Panama, however, owning a hotel — or a hotel unit, can be a unique way for individuals to gain passive commercial cash flow from the growth of Panama’s hospitality sector.

The Panama Canal expansion, international airport expansions, free trade zone expansion, subway system and infrastructure improvements all point to Panama’s fast modernizing society. A tax-favorable environment, investment stability laws and property rights laws are compelling attractions for foreigners making investments in Panama.  Perhaps most compelling are the effects of Law 41 of August 24, 2007, which allows multinational corporations to headquarter their facilities in Panama, with numerous incentives.  Multi-billion dollar companies— more than 60 last year, and another 200 projected during 2012, and over 500 by 2014, are projected to establish their Latin American headquarters in Panama.   These multi-national corporations relocating to Panama bring in massive amounts of foreign capital and create a chain reaction of job growth for Panama’s economy. But if you follow the money, the big hotels are betting that this will bring a lot more business travelers to fill rooms.  Statistically, the Panamanian government reports that business travelers are reaching double digit increases, and are staying longer with each visit.

Panama’s Tourism Authority (ATP) has a $40 million advertising budget specifically promoting business conventions and conferences in Panama.  ATP is providing many incentives for companies to hold these events and expos in Panama and has already confirmed 32 international events for 2013 with that number steadily growing. This initiative has already created a 25% increase in their direct hotel occupancy estimates for 2012 alone.

Successful hotels can produce a lot of cash flow for their owners. It’s no surprise that with relatively low cost to build, low taxes, low maintenance costs and low insurance costs, few hotel owners offer the opportunity to share in their bounty.  This scenario changes when you consider the boutique hotel ownership opportunity we have found for our clients, that has many advantages for people who want to participate in the profitable hospitality industry.

The Unicorn Park Inn Hotel by Radisson has 96 suites.  The suites are attractive to business travelers who want to have the comforts of a living room and studio, while staying in town.  The hotel also provides a full array of virtual business services all under one roof catering to business traveler needs.  Hotel suite demand in Panama has largely been overlooked by the big box hotels and suite rates have been climbing, which is good for the market niche that this hotel services.  But for the Unicorn Park Inn by Radisson, an additional success factor is that the international Italian designer, Coveri House, will be using the hotel to host its fashion shows orientated to the emerging Latin American fashion industry.  This will enhance Unicorn Park Inn by Radisson’s hotel traffic, room revenue and occupancy.  The Unicorn has the Radisson Park Inn flag, which gives international access to travelers through the Carlson worldwide reservation system.  But the key for individual owners is that they can get participate in the commercial cash flow that their hotel rooms generate.

David Pierce, CCIM, a recognized expert in the commercial and investment real estate industry, recently stated: “The Unicorn Boutique Hotel by Radisson represents one of the best passive commercial cash flow opportunities that I have evaluated in many years… at greater than a 10% passive commercial return prior to asset appreciation.”

An internationally recognized offshore investment advisory recently released a real estate report entitled, “Five Hottest Investment Markets for 2012″ and featured the Unicorn Boutique Hotel by Radisson, stating this opportunity can produce “long term yields that can build your wealth.”

During June 2012, Escape Artist determined that the Unicorn Hotel by Radisson ownership opportunity is the “Best-in-Class” for passive commercial cash flow in Panama City.

One of the reasons for the accolades is that the Unicorn Boutique Hotel is uniquely situated with all suites, and is a very manageable size rather than the behemoth hotels that have hundreds of employees and huge overhead.  The Unicorn Boutique Hotel by Radisson is being built by an international developer with 40-years of experience, who is providing qualified purchasers with attractive incentives during the construction phase, which will be completed in approximately 18-months.

As an added benefit, the purchase of a unit at the Unicorn Boutique Hotel by Radisson, when placed in the name of the purchaser, qualifies toward Panama’s Temporary Resident Visa, which leads to the Permanent Visa, Citizenship and Passport.

More than half of the units have been contracted by people seeking passive commercial cash flow and the ability (if desired) to leverage the purchase into a Visa and Passport in Panama. Interestingly enough, some people have used their Self-Directed IRA funds to make their purchase and more recently, some people have chosen to make their hotel unit purchase using gold.

The Unicorn Boutique Hotel by Radisson gives purchasers an opportunity to participate in the robust hospitality industry that is growing with Panama’s fast expanding economy.

For more information contact us using the form below.

Investors are scared…

In fact, they’re even more scared today than they were in late 2008.

That’s hard to believe… In 2008, the market was down close to 50% from its late-2007 highs. The housing market was crushed. Bear Stearns, Merrill Lynch, Lehman Brothers, and AIG had all gone out of business in one way or another. Officials from the Federal Reserve and U.S. Treasury were running around like chickens with their heads cut off… bailing out losers in the financial industry.

It felt like the end of the world.

For many investors, it feels like the end of the world… again. And that gives investors who can remember just one important idea about the market a tremendous advantage…

The media has whipped investors into a frenzy over the “fiscal cliff.” The “fiscal cliff” is a shorthand term for the government spending cuts, tax increases, and a reduction to the U.S. federal budget deficit that – unless Congress does something to stop it – will automatically go into effect at midnight, December 31.

Of course, fear sells, so I’m not surprised the media is playing it up so much. But you’d be insane to pay much attention to it. It’s a smokescreen.

Instead, pay attention to the trend I told you about last year. My managing editor once told me it might be the most important concept our readers will ever learn:

Don’t believe it? Think of all the horrible things that happened in the 20th century: the Great Depression, two World Wars, and the end of gold-backed U.S. dollars. Despite all that and more, U.S. stocks – as tracked by Dimson, Marsh, and Staunton in their excellent book, Triumph of the Optimists – appreciated about 1.5 million percent.

Last year, the big bogeyman wasn’t the fiscal cliff… it was the debt ceiling. President Obama called the debt ceiling issue “financial Armageddon”. Treasury Secretary Tim Geithner called it a “catastrophe”. Federal Reserve Chairman Ben Bernanke said it was “calamitous.”

But I told you it was just “The Great Debt Ceiling Hoax.”

And what happened? Well, investors got scared… Stocks bottomed out in early October 2011… And the market is now about 26% higher than it was then.

To put an end to the phony drama of the debt ceiling hoax, President Obama signed the Budget Control Act of 2011 into law on August 2, 2011. That law created what’s now being sold to us as the “fiscal cliff”.

So guess what they’ll do this time? The most likely outcome is that our government will create another law to prevent the so-called fiscal cliff from ever arriving. But even if it does… it will never be as important as the idea of buying great companies at good prices… and then holding them for years, while collecting ever-increasing dividends.

No matter what happens with the “fiscal cliff”, people will continue to drink Coke. They’ll continue to use computers powered by Microsoft software. They’ll continue to eat burgers from McDonald’s. They’ll continue to use IT services from IBM.

If you want an idea that’ll help you cut through the noise and make great, winning bets when everybody else is panicked, this is it.

Business trumps politics. It’s been true for at least a century now… and it will continue for at least a few more.

Good investing,

Dan Ferris

Editor’s note: Dan Ferris recently completed a special report about a little-known income opportunity – known to some as the A.O.P. – that has grossly outperformed the S&P 500, the DJIA, Utilities, REITs, and other major asset classes… with 16.6% annualized returns. Enter you details below to learn about the one investment that will likely continue to beat the market for years to come.

Everyone is currently worried about the so-called fiscal cliff—a truckload of new taxes (and an across-the-board cut in government spending) that will take place at the end of the year if Washington can’t come to an agreement. There’s no question those taxes will put a strain on many Americans—Americans who are already feeling the strain of a bad economy. But what’s being ignored in the debate is this: We’ve already fallen headfirst off the freedom cliff.

Over the last century, the U.S. government’s role has transformed from the original one of protecting individual freedom to redistributing wealth (Medicaid, welfare, Social Security, farm subsidies, etc.), usurping economic functions that should be private (mail, education, mortgage securitization), and interfering in voluntary economic transactions (virtually everything done by Washington’s alphabet regulatory agencies). Given the omnipresent role of the state in our affairs, is it any wonder we’re facing a massive deficit?

A government that limits its function to protecting American freedom via a police force, military, and legal system, is relatively affordable. War-time aside, during the whole of the 19th century, when the U.S. came closest to capitalism, federal government spending as a percent of GDP stayed around 3%.

What about state and local government? Tack on another 6% or so. And then keep in mind that this was not perfect capitalism. Particularly at the state and local levels, government was doing things it should not have been doing, such as building roads and canals and operating the post office.

The biggest problem today is not that our leaders cannot come to an agreement. It’s that they are trying to satisfy the irreconcilable views of Americans: We want government to do everything—but we want our freedom. We want government to fulfill everyone’s every need—but we don’t want to pay for it.

The result? We have two political parties that agree on what government is doing but are bickering over how to make it affordable. The Democrats say the key is raising taxes. The Republicans say the key is to jigger with the programs and make some minor cuts. But no one is asking: should government be doing things other than protecting our freedom?

Consider the question raised.

Click here to order Yaron Brook and Don Watkins’ new book, “Free Market Revolution: How Ayn Rand’s Ideas Can End Big Government”.

Each problem has hidden in it an opportunity so powerful that it dwarfs the problem.

“The greatest success stories were created by people who recognized a problem and turned it into an opportunity.”

In the overwhelming amount of Economic Reports and Statistics that we see (or don’t see) on a regular basis, almost every one of them are, and have been, moving in a negative direction in regards to our economy as a whole, and for us as individuals. Almost all of them are moving at an accelerating pace in that negative direction. In fact, most of them are growing at an “Exponential Pace”.

Not only that, but almost every one of these stats are deliberately misrepresented, manipulated or seasonally adjusted, making things seem better than they really are.

Also, the government and the Federal Reserve (which is neither Federal nor has reserves) are using every fiscal and monetary tool and policy at their disposal to artificially prop up the economy.

When we put it all of these indicators together, the eventual day of reckoning will be that much worse because the natural economic and business cycles have been artificially prolonged – mostly by building up more and more debt.

Never in the history of central bankers has the hidden coordination, influenced pressure, gargantuan money creation, doctored statistics, and interference with financial markets been so broad, so deep, and so profound.

The force of a correction is equal and opposite to the deception that preceded it. Never have we faced such a convergence of so many existing, probable and potential crises.

I am not, however, a ‘Doom and Gloomer’. I believe tremendous opportunity still exists. We are rapidly facing a choice:

1) Recognize these dangerous times and dangerous delusions and take steps to avoid their effects, or
2) Remain ignorant and/or uninformed of them and risk losing our lifestyle when the house of cards comes crashing down.

If the sources of information I’ve been reading and studying for many years are right, the next few years could be very rough for the unprepared. That’s why I’ve made it part of my mission to get the word out and to provide some common sense solutions.

STILL NOT CONVINCED? THEN CONSIDER THIS:

The US Dept of Labor States:

Out of 100 Americans age 25 today, when they reach 65…

54 are DEAD BROKE

36 are DEAD

5 are STILL WORKING

4 are COMFORTABLE

1 is WEALTHY

The ODDS are against most of us!

It seems that if we do things according to ‘conventional wisdom’, it’s not going to work out well for the majority.

Gerald Celente / Trends Research said, “I am always amazed that people would listen to the people that didn’t see it coming to say what’s going to happen next.”

My studies, education and experience have shown me quite vividly that the public always chases yesterday’s news (especially when it comes to investing and protecting their own wealth and purchasing power). That is why they have lost trillions of dollars in equity over the last few years with smaller and smaller equity in their homes, stocks and bonds, IRA’s, 401K’s and other retirement accounts. It’s all a matter of not understanding what a “Wealth Cycle” is and being invested in the wrong thing at the wrong time.

Last week a friend (who is a tax lawyer) and me discussed the potential economic malaise:

“I have prepared hundreds and hundreds of tax returns since 2008, when the cracks in our system became obvious. So I’ve had privileged access to both personal and business financial information that most people never see. In almost every case, no matter how intelligent and successful the people may have been, they had major investment losses of between 30 – 50% in their portfolios. One case was especially eye-catching. The client worked for one of the major brokerages on Wall Street and made over $500,000 in salary managing money in retirement accounts for the public. He personally lost over $500,000 (about 40%) in his own personal investments.”

Both he and his clients had failed to move from an over-valued asset class to the under-valued asset class that was starting a new wealth cycle.

These cycles, when one asset class outperforms all the rest, usually last about 14 – 20 years. It can’t go on forever. Eventually that asset class becomes over-valued and the cycle begins to slow or stop altogether. This causes a great wealth transfer and that’s what has happened starting around the year 2000. We are now in the middle of a great transfer of wealth to those invested in the appropriate hard assets.

I’ve actually been privately advising people within my own circle of influence of this for about ten years. Unfortunately, most have not listened to date. But it is now undeniable to me that hard assets are the place to be both now and for the foreseeable future. When they have run their course and the public comes flocking in at the height of the cycle, it will be time for us to move on to the next cycle and do it all over again.

Within the realm of Hard Assets we have identified one especially profitable area: Rare Strategic Metals.

National Geographic magazine calls these strategic metals “the secret ingredient of almost everything.”

They include such rare critical technical metals as rhenium, indium, gallium, hafnium, tantalum, tellurium and bismuth. Other strategic industrial metals include molybdenum, chromium, tungsten, cobalt and zirconium. These metals are all limited in supply or vulnerable to supply interruption, and under increasing demand.

To see a video about these metals and the usages, click here.

WHO ARE SWISSMETAL INC?

Schweizerische-metallhandelsag.ch (SMH) is the parent company, based in Switzerland, this company has been interviewed by respectable news sources like the Financial Times Germany, Deutsche Welle, Foonds, Evonik and many more. In the USA, rare strategic metals are offered by SMH’s American sales arm, SwissMetal INC (SMI), which works in partnership with SMH Germany.

SMI offers an opportunity to own these specialty metals, in physical form, stored in duty free zones in Switzerland or Panama.

A world without these specialty metals would be a world without cell and smart phones, computer chips, iPods, LCD monitors, surgical lasers, and jet engines, to name just a few.

However, supplies of these elements are increasingly uncertain. China accounts for more than 90% of the supply of these metals. And in 2010, that country imposed drastic restrictions on their export quotas.

The outcome was predictable. Prices have risen dramatically. But it’s not too late to capitalize on what could be the biggest natural resource crisis of the century. You can still diversify out of faltering paper currencies and physically own your own portfolio of rare strategic metals.

The fact is that only limited amounts of these Rare Metals are refined every year. Current and emerging industrial nations’ manufacturing demand is outstripping the available supply. This is a problem for manufacturers, but it has been very beneficial to the participants in SMI´s RIM´s stockpile in Switzerland, whose metals have inherited the exponential increase in value while they were sitting in our vaults for the past 2 years.

China and India currently have almost 400 million people receiving electricity for the first time. These people want all the products and conveniences that their counterparts in the West have enjoyed and taken for granted for years. What this means is that, even if something happened to reduce the demand for Rare Strategic Metals in Europe and the USA particularly, it would be more than made up by demand coming from these and other emerging countries in Asia and South America.

Furthermore, if a large sector of any population experiences financial hardship, they will not stop using all the electronic gadgets that have become essential to their daily lives. They will switch to less expensive items that still use Rare Strategic Metals.

If you are wealthy, you might buy a Lexus, an Apple computer, a Swiss watch and go to private hospitals, if you are in the middle class, you will buy a Toyota, a Samsung, a Citizen watch and go to public health care. Poor people will buy Chinese imitations, take public transportation and may not be able to afford a doctor. Regardless, all of us use the same metals in different products, cheap or expensive.

To give you an idea of how the metal prices might eventually affect the end price, let’s look at the humble laptop. If the laptop today costs $500 and within a few years the metal used in the lap top increases by 500%, the same laptop might then cost $20 more. The reason is simple: manufacturing uses trace amounts of each metal, and is absorbing the increased rare metal costs in their already wide profit margins.

This probably would not stop you from buying it, or for the manufacturer to stop making them. But as an owner of the metals, if you saw an increase in value of even 150%, during this same time period, you would be more than pleased.

Early in 2012 the USA, Japan and the EU issued a formal World Trade Organization (WTO) complaint against China regarding the Chinese reductions in exports of rare, strategic, industrial, and tech metals like the ones we have mentioned previously.

These countries need these metals to initiate and complete their strategic economic plans over the next few years. In the past two years China has reduced exports of these metals around 40%.

These countries, their manufacturing sectors, and military, have small or no stockpiles of these crucial materials to meet their strategic needs over the next 3 to 5 years, let alone over the next 10 to 20 years.

Most tech metal experts who have studied the WTO complaint feel that China will not comply because they will argue that these governments need the materials for their high tech military applications, and that a WTO complaint cannot be filed around materials used for the military.

They further believe that if the WTO orders China to increase exports of these raw materials, so that these countries can meet their strategic economic goals, China will simply refuse, as they need most of these materials to fuel their own economic strategy.

Unfortunately for these countries, the WTO has no teeth, and the only enforcement of their decisions is a series of Ping-Pong ball embargos, back and forth to try and get Chinese compliance. I think we all know the Chinese are masters at Ping-Pong.

The second significant event that occurred in September of 2012 came out of Beijing in an AP, and CNN news report that China was consolidating the metals market inside China by closing all of the independent smaller mines, refineries, and smelters. They are doing this so that the Central Committee takes over complete control of this sector, controlling pricing, and eliminating a black market that has existed up until now. This will cause another, immediate 20% reduction in exports.

This is bad news for the USA, Japan, Korea, Taiwan, the EU, Sony, LG, Toshiba, Panasonic, Samsung, BMW, the US Military Industrial Complex, and all other manufacturing sectors that need these metals now. The metals that China does release to them will cost more, and they may have to locate their production facility in China, to get access to the metals.

China is not asking anything outrageous. They simply want to receive the true market value for these metals now that there are so many new applications for them developed over the last 10 years.

Again, this is good news if you are a participant in a stockpile of these metals outside of China, as you will reap the benefits of these increased values in the metals in the coming years.

Furthermore, demand will continue to rise for the products which use these metals, as over 1 billion people are emerging from poverty in places like China, India, and South America, and entering the lower and middle classes, and they will demand products that we in the West and the developed East take for granted.

To illustrate in numbers the expected increase in demand for some of the aforementioned metals, a February 2012 Metal Report from Deutsche Rohstoffagentur shows that production levels for indium are already not meeting demand, and demand will increase from 580 metric tons in 2010 to over 1,800 metric tons by 2030. Gallium production will need to increase from 180 metric tons to 600 metric tons to meet increased demand. Tantalum production will need to increase from 600 metric tons to 1400 metric tons to meet demand.

This is simply not possible as the production levels of most of these metals are finite, as they are byproducts from base metal production.

In early July, Japan set a premium price for solar energy that was three times the rate of conventional power. This meant utility companies would be paid three times more for electricity sourced from solar. It’s widely expected that the premium will ignite the use of solar power.

Japan is just one of many countries making such moves – India, for example, recently decreed that all government buildings should be equipped with solar panels; this is a country with 1.2 billion people, so that is a lot of solar panels.
Realistically, production will not be able to increase to the necessary levels to meet this expected demand, so solutions like increased recycling and more efficient use of the metals will need to be initiated. These solutions, and especially the high costs of recycling, will not be able to meet the growing need, or slow the increases in the values of the metals, in the near future.

To see a video of how the world would look like without these metals, click here.

Swissmetal INC (SMI) is in the Americas providing ‘turnkey’ rare strategic and precious metal acquisition services combined with anonymous allocated and segregated storage in Switzerland and Panama at prices, and in quantities, appropriate for individuals and institutions.

SMI ‘baskets’ of critical strategic metals, beginning at just below $7,000 USD, are ideally suited for the long-term preservation of purchasing power as a defensive investment to counter the negative effects of inflation and economic downturns.

Owning these baskets also adds a significant upside potential to your portfolio, given they have appreciated an average of 16.5 % a year for the past three years consecutively, during what most will admit have been very tough investment markets.

SMI has also developed a cost-effective and efficient, fully IRS-compliant method of utilizing individual retirement accounts (IRA) in combination with an offshore LLC to own these strategic metals. This allows IRA owners to use previously unavailable alternative investments, worldwide, to diversify and potentially increase the investment returns in their IRA. Very significant liability protection is an additional benefit of the offshore LLC included in this program.

The individual ownership of these critical strategic metals is a truly ground floor chance for you to purchase metals within a wealth cycle which is only in the early stages and which has proven over the last 5 years to be safe and secure with intrinsic growth of the assets.

Before this program was developed 5 years ago, even if you knew about rare strategic metals and wanted to own them, you would have had to start with hundreds of thousands of dollars (maybe even millions) to buy in, likely in a long-term purchase contract, and you’d have to find a competent broker, deal with packaging, shipping, storage, assay values, import and export duties, custom fees, paperwork, taxes and various other miscellaneous expenses at each stage – costs called ‘ex-works’ that often end up doubling or more the initial wholesale metal price. This is not very likely to attract individual investors!

SUPPLY AND DEMAND ISSUES

Industrial buyers are quickly trying to gain control of the supply chain as demand and prices increase, and supplies decline. Governments are also involved in a ‘control of supply’ issue. Korea, in June 2011, placed Indium, a metal in three of SMA’s baskets, on their critical substances list to protect Samsung and LG, two very large electronics manufacturers.

The USA, through Congressman Mike Coffman and others, has passed the RESTART ACT 2011 to stockpile rare metals to protect US industry and the military from shortages. China, of course, restricted supply of these metals significantly in late 2010 and continued decreasing its exports of these metals throughout 2011 and now again into 2012, hoarding them for their own use and using their monopoly of the supply of these strategic metals as a political and economic weapon internationally.

Given that these are technology metals, the demand is constant and increasing. There may be fewer homes being built lately in the USA, but if you watch the sales of Apple and the millions of technology devices being produced and used worldwide, all with these critical technology metals inside, you will quickly realize the huge profit potential.

Contact us today using the form below to learn more about protecting your assets with strategic metals.

(Interviewed by Louis James, Editor, International Speculator)

Dear Reader,

Before we get to this week’s conversation, I am very pleased to announce that Doug Casey has just published a new book, featuring some of our best conversations: priceless takes on a wide variety of subjects, including the TSA, war, corruption, Cuba, and your health. Many of the subjects covered in this publication and the book – like the one Doug and I discuss below – are the result of questions from readers. The book, Doug’s first in many years, is called Totally Incorrect, and is a convenient way to share Doug’s singly unique and insightful perspective with others.

Whether for yourself or as gift to troduce your friends to a different way of viewing the world, you can pre-order a copy of Doug Casey’s new book today at a substantial discount – they will ship to you and to bookstores on December 12.

Thanks for reading and contributing. Our audience very much helps shape the course of these conversations.

Best regards,

Louis James
Senior Metals Investment Strategist
Casey Research

L: Hola Doug, what’s on your mind this week?

Doug: I got a letter from a reader in India – Shanmuganathan – asking some very interesting questions regarding my views on karma. Feel like talking philosophy? It will make us feel like we’re back in a college dorm room, enveloped in a haze of alcohol and smoke – at least in my case.

L: I didn’t smoke even back then, but I did my fair share of drinking in college. There are stories… At any rate, sure, I’m game. You often say you’re a solipsist, but never go into it – and that has to be related. Now is as good a time as any to get metaphysical.

Doug: It is. But let’s start with a definition, as always. My Webster’s Dictionary says:

Karma: The force generated by a person’s actions held in Hinduism and Buddhism to perpetuate transmigration and in its ethical consequences to determine the nature of the person’s next existence.

L: Clear as mud.

Doug: Must be written by a professor. My translation into English would be: In Buddhism and Hinduism, the ethics of one’s actions are believed to shape one’s next life, after you are reincarnated.

But I like to look at it in a less religion-specific way. I see it as a general “what goes around comes around” principle. Put simply: causes have effects. You reap what you sow. If you do things that harm other people, there will tend to be a certain kind of reaction, and you probably won’t like it. In this sense, yes, I do believe in karma. But that leads to a bigger question: whether we are reincarnated. Which is to say, what is the nature of reality itself? Are you just a biomechanical body? Does that body have a “soul,” as the Christians believe? Or are you actually a spiritual entity that is just temporarily inhabiting a body – which is different.

L: Okay, but before we tease that apart, can you tell those among our readers who may not know what a solipsist is?

Doug: There are many versions – just as there are many notions of karma – but the basic idea is that you create your own reality. The most extreme version of this is that all of reality is just a figment of your imagination. It’s all in your head.

L: If it’s all in your head, where is your head? It must exist, and therefore there must be a reality of some kind in which it exists, or even the illusion you may be imagining doesn’t happen.

Doug: I wouldn’t go quite that far. If pushed, I would say that reality is like a common construct of almost everyone’s imagination. I control my own reality, as you control yours. Outside there are seven billion other humans; I’m not about to deny their existence.

L: Aw, you’re spoiling the fun, Doug! If our world is not all just a figment of your imagination, I can’t blame Obama, Bush, the Clintons, and all the horrors around the world on your perverse imagination.

Doug: [Laughs] Well, that relates to why I’m currently working on a sextet of novels – a series, each stranger than the last, which will explore the nature of reality on this obscure little ball of rock by reforming the reputations of six unjustly besmirched, politically incorrect occupations. As Will Rogers correctly said, “It’s not what people don’t know that’s the problem. It’s what people think they know that just ain’t so.”

L: But seriously, this doesn’t help me, Doug. Reality must still have external existence to the collective imagination – exist for the same reason an individual head must exist for the mind it contains to imagine anything.

Doug: If you’re actually a spiritual entity, then “you” don’t need your brain or your body – they’re just tools for dealing with the world of matter, energy, space, and time. This is what people mean when they say they get out of their bodies. As you know, I’ll entertain almost any concept about almost anything. I’ve talked with a number of people personally – who seemed absolutely sane and sincere – who claim to have done that. And, like most of us, I’ve read third-party accounts of OBEs (Out of Body Experiences). Regrettably, I haven’t had one. Nor have I seen a real Indian rope trick. The whole area is overrun with charlatans and psychos. So I’m highly skeptical. But I do cotton to the concept of mind over matter. Therefore I keep an open mind on the nature of reality.

It’s a paradox to me that religionists of all stripes believe in the magic recounted in their holy books (virgin births, transubstantiation, teleportation, miracles of a thousand kinds) and they aren’t willing to discuss these things as other than dogma. At a minimum, I find it makes for an entertaining conversation.

Seriously, though, the nature of reality is very uncertain even among – or especially among – theoretical physicists. As anyone familiar with modern physics knows, what feels like solid matter to us is really mostly clouds of electrons surrounding nuclear particles that are themselves clouds of quarks and other smaller particles… At heart, quantum mechanics seems to suggest these things may or may not even exist until we look for them.

L: At heart, everything is a distribution of probabilities – the universe is math?

Doug: Something like that. It’s been said that any sufficiently advanced technology is indistinguishable from magic. So for all we know, we could be living in The Matrix. I’m urgently looking for the red pill.

L: [Chuckles] Have you read Neal Stephenson’s Anathem? It’s his best book, in my opinion. In it, he looks into these issues in a most clear, insightful, and humorous way.

Doug: No, I’m sorry to say. Stephenson’s a genius, and I like all his stuff that I have read.

But let’s not get distracted. The point is that the many-worlds interpretation of quantum mechanics – and the possibility of communication between alternative realities – gives us a plausible explanation for many things some people might regard as supernatural.

Who knows, it might even be possible that Napoleon Hill was literally right, and that our thoughts affect the world around us. We can think positively about wealth and grow richer. Some people believe that if they want something they only need “manifest” it. Personally, I’m all for keeping a positive, happy thought, but since we live in the material world, it’s also very helpful to employ things like diligence, persistence, intelligence, and a whole bunch of other virtues to make sure the manifestation occurs.

L: And we can’t afford the luxury of a negative thought. I do agree with Hill, but Doug, I always understood that to be a psychological phenomenon. When you’re depressed and anxious, it shows; people can see it, and most don’t want to be around such people. The negativity becomes a self-fulfilling prophecy, a very vicious cycle. Conversely, when people project optimism, strength, and ability, most people respond to that positively – even if it isn’t true, as politicians illustrate every day. This is quite different from our thoughts operating on a quantum level and somehow altering reality from the subatomic level on up…

Doug: Yes and no. When I imagine a red cat in my mind and have him move around as I wish, does he exist? I’d say yes, on some level, even though he has no mass, and I can locate him anywhere in space I wish. I lift a book with my hand, I move all the atoms in it, all the particles and waves that comprise it, and it interacts differently with the universe, via light, gravity, and no one knows how many more ways.

L: Okay, but when I drop that very heavy book of medieval metaphysics on my foot, cause has effect, and I feel the unpleasant effect shortly. That’s quite different from wishing I’d get a million dollars in the mail and the thoughts in my mind somehow reorganizing the particles and waves that make up the world around me so that the mailman arrives with a dishwasher-sized box full of $100 bills.

Doug: Is it? I’m not denying the laws of physics. The clouds of almost-emptiness that we think of as our bodies interact with the equally almost-empty space around us in ways that no one fully understands. When you drop that book, you create the future moment in which it hits your foot. We all create reality as we go – and who can really say how deep that process reaches?

But we don’t have to argue about that; we agree wishing is not a very effective way to influence the world around us. Taking action tends to be much more effective. Whether that’s in the apparently solid world of the proteins and other chemicals that make up your body and mind or something deeper, the outcome is the same. And the idea of karma encourages people to take responsible and constructive actions. I’m all for things that encourage people to take responsibility for their actions.

L: I suppose…

Doug: This reminds me of something my old man once said. I’ve said it before, but it strikes me as being profound enough to bear repetition. I was about 20 years old, and I’d asked him some sort of cosmic question. His answer was: “It’s all a matter of economics.” Some months later, I asked him another cosmic question, and he said: “It’s all a matter of psychology.” I’ve thought about these answers often over the years, and it seems to me that they are absolutely correct. Almost everything in the material universe boils down to economics, and almost everything in the non-material world – what you might call the spiritual universe – is a matter of psychology.

L: Hmmm…

Doug: Think about it. It’ll grow on you. The essential point for now is that I do believe in cause and effect – more specifically, that actions have consequences. If you look at that from an ethical perspective, that’s really what karma is all about. In point of fact, all causes have effects, all actions have consequences, and no one can ever escape those consequences – not for long.

L: Karma is cosmic payback, via psychology and economics?

Doug: Yes. Simply put, karma means things can and will come back to bite you, so you’re well advised to anticipate the consequences and be prepared to accept them.

L: I would agree with that… and I’m not a solipsist. This is why I’m not afraid that real freedom will lead to chaos in society. Success in a free society requires responsibility. This is an inescapable fact that manifests itself in the myriad self-regulating features of the market – and a “market” is really nothing more than a kind of mass psychology. Your father’s second, and perhaps deeper, answer.

Doug: Okay then, let’s look at Shanmuganathan’s questions. He asks:

“How do we explain the crooks and evil guys having a jolly good life on the planet? Why does karma not do its… karma?”

Well, I suspect that if we could explore and understand the inner psychology of such people, we’d find that they are not actually having a very good life, even if they appear to be. A good case can be made that criminals, even if they have genius IQs, are actually stupid – if we use my preferred definition of the word: showing an unwitting tendency to self-destruction.

When people look at the apparent success of criminals, they only look at their material possessions. But that’s very shortsighted, even though possessions are important. They fall into the realm of “have.” Things you have aren’t part of you; they can be lost or taken away. More important is the realm of “do.” Things that you do are indicators of who you really are. But most important is the realm of “be.” Things that you are represent your essence.

My view is that a wise and ethical person concentrates on “beingness.” If you get that right, you’re capable of doing. And the doing results in having. The reality of the average person you see at Walmart in those Black Friday videos seems to begin and end with “having.”

Criminals tend to focus largely on having, less on doing, and not at all on being. Especially as life goes on, I believe that takes a toll on them. Their being starts to resemble The Picture of Dorian Gray.

L: I don’t doubt that a guy like Muammar Gaddafi was far from being a truly happy man, long before he came to his grisly death.

Doug: Right – and he’s by no means alone, and certainly far from the worst. It’s a sign of how degraded the average human is that they apotheosize criminals – people like Mao and Stalin still have gigantic fan clubs. Almost all professional politicians are of that type – although very rarely on their scale.

L: Do you suppose Gaddafi had an official food-taster?

Doug: I’m sure all those guys do, including the president of the US; they know that many, many people want them dead. Of course there are a few real bad apples out there who are enjoying a very good life at the present. It’s just a matter of statistics. There’s nothing about karma that says everyone gets their just deserts immediately. As in economics, the immediate and direct effects are easy to see; the indirect and delayed effects are often both more subtle and more important. It certainly appeals to many people’s sense of justice, including my own, to think that people always get what they deserve. If you actually are a spiritual entity, you can’t escape your fate by dropping your current body. The Hindus who originated the idea of karma definitely believe in reincarnation.

As we’ve touched on many times, I don’t believe in any of the doctrines of the world’s major religions – gods, goddesses, heaven, hell, etc. – but I am inclined to believe that living beings inhabit physical bodies for a time but have a separate existence. I have absolutely no proof for that. It’s based on intuition, not hard data.

L: That’s unusually candid for a believer, Doug. But come on, you never believe anything just because you’d like it to be so – you scorn investors who make that mistake. You must have had some experiences that convince you this is possible…

Doug: I hate to be characterized as a believer, since I’m a professional skeptic. That said, I’ve had several relevant experiences, actually, that are completely inexplicable but very real. But they occurred in my mind, as opposed to the material world. Many, many other people have as well. I’m not talking about experiences induced by drugs, alcohol, or the like.

L: Sure, but I’ve never heard a story that couldn’t be logically explained – head trauma, anoxia, hypothermia… simple inebriation.

Doug: Understood. The mind is very good at tricking a person; David Copperfield, Penn and Teller, Chris Angel, and others are masters at it. Sure, so it’s likely pointless to debate what happens after death. Although, as you know, I don’t like to argue or debate anything – it’s much more productive, as well as pleasant, to have an open-minded discussion, to see if one can learn something – at least about one’s self or others, if not about physical reality.

For now, I’ll add that just because, waaaay out on the edge of the bell curve, there are some people who do bad things and “get away” with them, that doesn’t change the fact that for most people, most of the time, the consequences of truly evil actions are real, serious, and usually not long delayed. It’s why ethics is so important, however underrated.

L: Cosmic just desserts with a quantum cherry on top. Whether as a matter of economics or psychology, the odds are the same; being nice beats being naughty, and being creative beats being destructive. Spiritualism optional.

Doug: Well said. One thing I like about this perspective is that karma isn’t a god, and doesn’t require any consciousness – godly or otherwise – to operate. It’s just the way the universe works. The laws of physics, economics, and karma have a life of their own. And that gets to Shanmuganathan’s second question:

“How does karma affect the well-meaning but idiotic economists? The best example is India’s Prime Minister, Dr. Manmohan Singh – an economist by profession. Very honest and simple guy, but completely idiotic when it comes to economic policies wherein a nation of a billion people are forced into poverty because of his ideas. How should karma treat such people?”

Other people may have different views, but in my view, karma is not a conscious process; it’s an aspect of the nature of our universe. Statistically, there are outliers that seem to flaunt karma, but that doesn’t mean karma isn’t working – it’s just the law of large numbers. If you do a lot of bad things, you increase the number of shots people take at you. Sure, it’s possible to dodge all the bullets, but that’s not a great business plan. The Bible was quite incorrect to say that the bread goes not to the wise, nor the race to the swift, nor the battle to the strong. Damon Runyon had a much better grip on reality and karma when he pointed out, “Maybe – but that’s not the way to bet.”

L: Ah – Ecclesiastes. It’s the way to play the odds.

Doug: The universe itself is based on probabilities. So there is no sense saying karma “should” do something. As a speculator, as an investor, and as a gambler – I wear each hat at different times – I base my life on assessing odds. My perception and belief is that acting responsibly – acting as though payback is coming, one way or another – leads to a better life in this life. And it’s the only thing that can help the next one, if there is one, after you discard this body.

This is why I believe in what you might call basic virtues: productivity, prudence, patience, persistence – we’re big on the letter P around here, like the 8 Ps [laughs] – plus a bunch of others like fortitude, honesty, gratitude, courage. Not so big on faith, hope, and charity – which are typically vices. I believe these virtues are their own rewards. Maybe that’s what karma is: the aspect of the universe that rewards virtues and punishes vices.

L: I thought you didn’t believe in vice…

Doug: [Chuckles] Well, as always, we have to be careful to use words accurately, to forestall misunderstanding. As I just pointed out, conventional religious virtues are typically vices, but most things people think are vices (like smoking, gambling, drinking, swearing – all things fun) are usually no more than diverting foibles. But there certainly are some anti-virtues: larceny, brutality, dissipation of wealth, willful stupidity, cruelty. At any rate, karma is just another way of saying that these things have negative consequences, just as virtues are their own reward.

I’m still thinking about all of this – just as people before me have for thousands of years. It’s easier to ask these questions than to answer them, as you know. What do you think?

L: Me? These are “Conversations with Casey,” not “Conversations with Wolf” – people want to know what you think.

Doug: Maybe, maybe not. After all, in Plato’s dialogues, I thought that what Glaucon had to say was just as interesting as what Socrates had to say – Socrates just had a better PR agent in the form of Plato.

L: [Laughs] Well… I’ve always been more in the Aristotelian camp – I’ve no use for Plato’s world of ideal forms. Like Bud Conrad, I’m an empiricist; I want to know what the data show. And in 47 years of life, I have never experienced or seen any data that makes me believe in anything supernatural.

Now, you might say that your individual life force, your essence, your soul, or whatever you want to call it, inhabiting a particular body for a given time is not supernatural, but just a non-matter aspect of nature. Fine, but I’ve never seen any evidence of that, either.

All the evidence I have seen tells me that life is nothing more than a self-sustaining chemical process. So is sentience and even sapience. Like a fire, my life will last as long as I can find fuel, not get clogged up with ash and soot, etc. And when I go out, nothing will be left but decay and a little fading heat. That and my intellectual legacy, which too will likely fade, though I hope it lasts longer than it takes my body to cool to ambient temperature.

Mind you, I don’t declare that what you believe is untrue – only that I see no evidence for it.

So, not wanting to count on evil deeds being punished in the next life, I’m very keen on just desserts in this life. This is part of why I’m so keen on self-defense and resisting crime – especially crimes by those in uniform. If I had Bruce Wayne’s net worth, I would definitely have the same vigilante streak in me. Don Quixote is my hero.

Doug: [Laughs] A rational analysis, as I’d expect from a guy who makes his living digging the truth out of corporate executives, and sometimes the ground itself. I can’t argue with what you say – apart from the fact I don’t argue – if only because you’re quite correct: there is no hard proof for these things. But even though I do believe karma generally gets things done, it certainly doesn’t mean you have to rely on it. I’m reminded of the famous poster with two buzzards sitting on a tree in the desert. The one says to the other: “Patience, my ass. I’m going to kill something.”

But back to Shanmuganathan’s second question. If it’s true that we construct and control our own realities, I doubt that most supposedly well-intentioned idiots really are that well intentioned. There are no accidents. That’s why I tend to be rather suspicious of people who are accident-prone.

L: [Laughs]

Doug: I’m serious. People who create “accidental” train wrecks via misguided public policy are not in the same class as people who routinely stub their toes and drop glasses, but in both cases, their actions tell you something about them. Didn’t Jesus say: “By their fruit shall you know them”?

L: I agree about political apparatchiks. The entire class of people in public policy who are sincerely well intentioned may be limited to one man: Ron Paul. But even if it’s a bit larger, I’m sure most political entrepreneurs are at the very least manipulators who want to try to force others to do as they think best. But I suspect most are outright criminals – sociopaths, as you say – using the most leverage they can get for their predations. The existence of Santa Claus seems more probable to me than the existence of a misguided plunderer or economy-smasher.

Doug: I agree, of course. And, regarding the “well intentioned,” even – or indeed, especially – the worst criminals don’t think they’re doing anything wrong. Hitler really thought he was a hero for trying to eradicate the Jews. Hitler, Stalin, Pol Pot, Mao, Caesar, Alexander – all of history’s most famous mass murderers – all sincerely believed they were doing good. It’s one sign of a sociopath. There’s a lot of truth to the saying that the road to hell is paved with good intentions.

And like you, I’m all in favor of “helping” those who commit misdeeds meet the consequences of their actions sooner, rather than later. But I do believe that even if we don’t, karma will catch up with them sooner or later. Either way, if you act in ways that draw “bad karma” to you, you face increased odds of both immediate and direct retribution as well as long-term settling of the books.

So whether you believe you are a spiritual being clothed in your current human form only temporarily or a complex piece of meat that will go out of existence like your fire, cultivating good karma is a great guide for personal ethics.

L: It fits perfectly with what you’ve said should be the only law needed: do as thou wilt, but be prepared to face the consequences.

Doug: That’s not an accident either.

L: But if the odds dictate the same behavior, whether or not karma exists, what use is the concept?

Doug: Well, I believe karma exists, whether you believe it or not. [Chuckles] Or whether you exist or not. Let’s just say that it’s a way of thinking about these things that can help people live better lives and enjoy them more.

L: Fair enough. I don’t see any direct investment implications.

Doug: No; I’d say there are life implications.

L: Okay, then – thanks for an unusual and stimulating conversation.

Doug: My pleasure, as always.

Inside the Mind of a Multimillionaire

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A few weeks ago, I called Apple…

I spoke to an investor relations person about the company’s massive cash hoard. She confirmed Apple has $121.3 billion in cash and securities on its balance sheet… Of that amount, a “substantial portion” of the company’s cash is “indefinitely reinvested” in accounts outside the U.S.

Specifically, $82.6 billion of Apple’s total cash position is held in foreign accounts.

The story is similar at other big-name blue chips… For years, companies like Microsoft, Cisco, and Johnson & Johnson have kept a large portion of their cash offshore. This strategy allows them to pay lower taxes on their earnings.

It sounds like a good idea. But it’s not. A preoccupation with tax rates is hurting shareholders. Let me explain…

At 35%, America has one of the highest corporate tax rates in the world.

This means companies are required, by law, to pay 35% of the income they make to the government. But corporations have found a legal workaround… Businesses that earn big profits in lower-tax countries leave that money overseas, so they pay lower corporate taxes.

Apple, for example, paid a lower effective tax rate in its latest fiscal year of 25% – well below the U.S. corporate rate of 35%.

I realize most shareholders would like the companies they invest in to pay the lowest possible tax rate… That’s why many investors don’t care much about their companies’ massive offshore cash holdings. But they should…

Longtime DailyWealth readers know I’m an enthusiastic supporter of software giant Microsoft. I recognize it’s one of the all-time-greatest creators of shareholder value. Microsoft has compounded shareholder wealth by an average of more than 25% per year since it went public. Few corporations can say the same.

So why is the stock of such a wonderful business trading at such a depressed market valuation? 

Right now, the S&P 500 is trading around 16 times earnings. Microsoft trades around 11 times earnings. It should trade at a premium to the market, not a discount. What’s going on?

According to the most recent data available, Microsoft has over $60 billion in cash, cash equivalents, and short-term investments. More than 90% of it is sitting idly in accounts outside the U.S. Microsoft would have to pay $19.4 billion in taxes if it were to bring that cash home to the U.S.A.

You may think shareholders will end up better off if the company doesn’t essentially light $19 billion on fire. But Microsoft shareholders should fear bad capital allocation much more than they fear the taxman.

The U.S. taxman won’t destroy 100% of the dollars a company brings home. We can’t say the same for companies themselves…

I recently spoke with one of Microsoft’s investor relations representatives about the $8.5 billion purchase of Luxembourg-based Skype in October 2011. She offered the Skype deal as evidence Microsoft uses offshore money to create shareholder value. Microsoft paid more than three times what eBay paid for Skype not too long ago. Is Skype three times closer to making a net profit? I sure hope so…

That’s not the only bad acquisition management has made. In 2007, Microsoft bought out digital marketing and service provider aQuantive. The acquisition cost $6 billion and was recently written down to zero. The money is gone.

Tell me… would you rather own 100% of aQuantive and Skype… or 65% of $14.5 billion? The aQuantive acquisition was essentially a 100% tax on the invested capital. The U.S. government, by contrast, charges just 35%. Who is the bigger threat to your money?

Most people view taxes as bad and corporate mergers and acquisitions (M&A) activity as good. It’s silly. It’s like saying you’d rather lose your money gambling than have it stolen from you. It doesn’t matter who ferried your cash away. It only matters that it’s gone.

Piling up cash to avoid paying taxes is a denial of reality. Corporate managers deny reality when they pretend tax efficiency is a priority. And shareholders deny reality when they let management get away with it.

There’s really only one solution to the problem: return the excess capital sitting idly on the balance sheet to the owners of the company. Investors are starved for safe, growing income now more than ever.

Microsoft generated over $29 billion of free cash flow last year. It paid out $6.4 billion in cash dividends. It could have paid out triple that amount. Microsoft has enough cash to raise its dividend by 50% immediately. If it instituted a policy of paying out 60% of its free cash flow, I wouldn’t be surprised to see shares rise 40%.

My point is simple: Tax efficiency is NOT more important than smart capital allocation. Shareholders should revolt against companies that think it makes sense to play tax games with shareholder money. They should insist the money be brought to the U.S. for distribution to shareholders via dividends or share repurchases.

Good investing,

Dan Ferris

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What is Barack Obama’s vision for America? Here’s one telling clue: In a new interview with Rolling Stone, the President declares that the individualist credo of novelist-philosopher, Ayn Rand misses “what’s best in America”.

Really?

Rand, who immigrated to America from Soviet Russia when she was 21, praised this country as “the greatest, the noblest and, in its original founding principles, the only moral country in the history of the world”.

America’s greatness, in Rand’s judgment, lay in the fact that it was the first nation in history to treat government as the individual’s servant rather than his master. As she put it, “All previous systems had held that man’s life belongs to society, that society can dispose of him in any way it pleases, and that any freedom he enjoys is his only by favor, by the permission of society, which may be revoked at any time. The United States held that man’s life is his by right . . . that a right is the property of an individual, that society as such has no rights, and that the only moral purpose of a government is the protection of individual rights”.

In America, the government’s only job was to protect the individual’s right to life, liberty, property, and the pursuit of happiness from violation by physical force or fraud. In this atmosphere of freedom, individuals flourished. From the founding through the beginning of the twentieth century, government kept Americans free to create, innovate, and compete, to keep the results if they succeeded, and to try again if they failed.

It was during this era that immigrants flocked here by the millions and America became known as “the land of opportunity”—not the land of handouts (there was no welfare state in America during this time) or of guaranteed success, but of freedom to make your own way without obstruction. Today the supporters of Big Government are fond of telling us that “a hungry man is not free”. Those who immigrated to America during the nineteenth and early twentieth centuries knew otherwise. They arrived poor—even famished—but ambitious.

The results are a matter of historical record. Untold numbers went from rags to riches, while the great majority of individuals were able to live better than their parents and grandparents had. Average wages for workers, for instance, more than tripled during the nineteenth century while working hours declined by nearly a third.

Obama mocks this as a society where “you’re on your own.” But Americans during this era were not “on their own” in the lone-wolf, asocial sense he insinuates. Free Americans developed complex webs of association based on voluntary agreement. As Tocqueville famously observed at the time, “Americans of all ages, all stations of life and all types of disposition are forever forming associations. There are not only commercial and industrial associations in which all take part, but others of a thousand types”. There were businesses, charities, social clubs, private insurance agencies to protect against disease and injury, and a whole lot more. By limiting government, Americans unleashed voluntary association.

In a sense, however, Americans were “on their own”. Limited government meant that other people’s wants and needs were not your unchosen responsibility. The corollary was that you and you alone were responsible for securing your own wants and needs. You were responsible for developing the knowledge, skills, and traits of character you needed to earn a living. You were responsible for saving to meet life’s unexpected twists and turns. You were responsible for educating your children. You could ask for help from other people during hard times—but you could not demand it as a right. You were on your own.

That was not a bug, but a feature. It meant that the bad choices of your neighbor didn’t constitute a claim on your time and wealth. You could go right ahead and focus on making something of your life, rather than be dragged down in the muck of his.

This is the America that Rand upheld and fought for. But Obama thinks this is not “what’s best in America”. Then what is? Basically, it’s everything that’s not distinctively American: entitlement schemes, rampant economic controls and regulations, and government infrastructure projects copied from other countries. For Obama, caring about others doesn’t mean respecting their freedom or helping them voluntarily when they hit tough times—it means enacting collectivist policies that restrict economic freedom and redistribute earned wealth.

In short, what’s best in America according to Obama is everything that came after the era when government’s power was limited by the principles of the Declaration of Independence.

That, not Rand’s individualism, is what’s truly un-American.

If you are interested in delving deeper into this particular topic, you can check out our book, “Free Market Revolution: How Ayn Rand‘s Ideas Can End Big Government”.