Politically difficult, but financially necessary.  That is the status of just about any proposed tax increase, intervention or regulation being discussed on Capitol Hill these days.  It seems that anything that is trying to get passed stalls in debate as Congress continues to grow debt (although a ‘debt ceiling’ evidently limits them).

We’re all aware FDR seized gold citizens’ gold through Executive Order 6102 in 1933.  Now prognosticators are saying another confiscation is in the works.

As proof they use simple, but flawed logic; troublesome U.S. debt, devaluation of the dollar, and obscure sections of Congressional law that basically say the government can take anything in trying times.

Do you really think gold is the lowest hanging fruit?

It’s far from it.  Gold and silver today no longer has a value at the U.S. Treasury as it once did.  Since the gold standard was dropped in 1971, the Treasury still uses a $42.2222 price per troy ounce on their books.

The reason confiscation made sense in the 30′s is they could instantly devalue the dollar because of the backing that was required by the gold standard.  Immediately after the confiscation the dollar was devalued by 40% with respect to gold.  Mission accomplished.

To do that today, they would need to offer everyone about $918 per troy ounce.  Would you sell?

Or you’ll read that they’ll confiscate at $2000 per troy ounce then sell it to the IMF for $10,000 per troy ounce.  Really?  Would you take the other end of that deal when the global market price is only $2000.

Gold has a global price and no direct tie to the value of the U.S. dollar.  State governments are beginning to recognize it as acceptable currency while the federal government is prosecuting mints such as the Liberty Dollar for “counterfeiting”.

Bottom line: It won’t happen.

The obvious next step is to determine what truly is the low hanging fruit.  In 1933, gold was savings.  Today, retirement plans are the main savings mechanism (which the IRS has full tracking authority over).

Congressional hearings and testimony have already been heard, a surtax has already been passed (and subsequently repealed), and other countries are doing the same.

I call it ‘governmental’ precedence.  When a foreign government can pass a law imposing serious consequences on its citizens without riots, the U.S. government can use it as a benchmark to pass new laws.

That’s exactly what we’re seeing today.  Earlier this week, Ireland dipped into pension plans for the third time in 2 years.  Let’s use the progression as a better understanding of the precedence the U.S. may face.

First, they forced pension plan managers to re-capitalize failing banks.  Last year, another measure on public pension plan managers forced them to use retirement funds to buy government debt to plug the gap in funding which the EU wouldn’t support.

Finally, they went mainstream.  This week, they announced they would announce a tax of 0.6% of all PRIVATE retirement plans.  Public pension plans were immune (as they already have a chunk of funds tied up in failing banks and soon to be failed government debt).

Ireland isn’t alone.  France, Poland, Hungary, and of course Argentina have all dipped into retirement plans.

The U.S. isn’t far behind.  A similar surtax had already been passed.  But a surtax was too strong to be passed immediately.  They realize they need to take smaller steps.

Their solution thus far has been the “Guaranteed Retirement Account”, penned by Teresa Ghilarducci.  This is ultimately a second social security in which payrolls are used to fund government plans which guarantee a 3% return.

Here’s how it will go down:

First, there will be some event… some sort of financial cataclysm, similar to the market meltdown we saw in 2008 after Lehman.

Bear in mind that most IRAs are managed by boneheads at big financial institutions; they get compensated not based on the performance of their portfolio, but on the total amount of assets under management.  Your interests and their interests do not align.

As such, most IRAs are callously tossed into S&P index funds or some such generic vehicle, citing the safety of broader market diversification, as if that nonsense they teach in MBA finance classes is how the real world actually works.

When a big crash occurs, these un-hedged broad market positions get hammered the most.

This is when Congress will step in. Citing its desire to ‘protect’ the American people from future market shocks, the politicians will mandate that a portion of all managed retirement funds be invested in the ‘safety and security’ of US Treasury bonds. And, just to be on the safe side, let’s park them in 30-year bonds that yield 4.35%.

This is how US taxpayers will end up being forced to loan their hard earned retirement savings to the government at rates far below any expected inflation.

Right now, there is a window of opportunity to take action; US taxpayers with retirement accounts can set up a special kind of IRA structure that allows you to take control of your retirement savings, and even ship it offshore if you want to, completely legitimately.

After taking control of your IRA, you can do any number of things– buy and store gold and silver coins overseas; hold foreign currencies in an offshore bank account; buy securities on international stock exchanges; purchase agricultural property overseas, or even a beautiful apartment on the beach in some sunny country.

The possibilities are incredible… but the most important thing is that you get this retirement money off the radar of the politicians before they pull an Ireland and announce some new measure, virtually overnight. These things can happen very, very quickly.

History has proven that politicians ‘never let a good crisis go to waste’.  If you recognize these risks in advance, you will have time to arrange your finances in ways that may protect your from these scenarios.

If you are interested in learning more about how to protect your retirement accounts from this scenario or one like it, click here to learn more.
US citizens have been convinced over twenty years that high fee, limited investment equity portfolios are the norm for individual retirement accounts (IRAs).  Passport IRA and Jeff Schneider, CPA establish powerful IRA structures for your retirement savings that provide three core benefits:
1)   places the investor back in control with sole signatory authority.  No custodian delays for investment decisions.
2)   expands the universe of options limited by only three IRS regulations
3)   provides substantial benefits for your estate
Passport IRA also publishes a series of informational reports and e-books, often written by founding member Terry Coxon. You can find out more by clicking here.