Current Shamrock Missive

From the Publisher's Desk
September 2008

"There's no art which government sooner learns than that of draining
money from the pockets of the people."
- Adam Smith


The Decline of Amerika! - Part II

If you're in America, a homeowner or investor and your portfolio is too heavily weighted to U.S. stocks, bonds and US real estate, you've already lost 49% of your capital in the last few years thanks to the depreciating dollar.

Unless you diversify your investments to overseas markets, implement a few simple, legal and easy to accomplish privacy techniques immediately, don't cry if the dollar continues to depreciate and your assets decline another 25% to 50% over the next few years.

If you live in Amerika, here's what you might consider:

Diversifying your assets abroad (outside Amerika,) can enable you to:

  • Benefit from rising foreign currencies
  • Benefit from rising foreign stock markets, and
  • Protect their portfolios from the falling dollar.
  • Buy gold in private, not subject to confiscation
  • Place gold, insurance, sensitive papers, etc. in an offshore safety deposit box out of reach from ex-spouses, lawyers and the Terrocrats.

You get ...

  • Lower risk - Adding an allocation of foreign securities to your portfolio provides the potential to offset some of the volatility of your U.S. holdings.
  • Greater diversity - U.S. equities used to account for a majority of the world's capitalization. Not anymore. In 1983, the U.S. represented approximately 57% of the world's investments. By 2006, the number had dropped to 45%. Given the rapid acceleration of markets in countries in Eastern and Western Europe as well as Latin America and Asia, it's likely that the U.S. share will continue to diminish.
    * Diversifying in foreign markets offers you a larger playing field.
  • Higher dividends - Foreign companies often offer higher dividend yields than those of American companies that use their cash for growth, acquisition and excessive compensation instead of returning the money to shareholders in the form of dividends.
  • Bigger profits - While the U.S. economy is under severe pressure from the declining dollar, the mortgage and housing crisis, and rising consumer prices, emerging areas of the world such as China, India, the Asia-Pacific region and South America are experiencing phenomenal growth. In fact, the Chinese economy is already close to surpassing Germany as the world's third-largest economy. That's why U.S. investors are flocking to foreign investment - in an effort to score gains that might not be available through U.S. equities.
  • Optimal investment opportunities - The annualized average returns of most of the world's developed financial markets are currently significantly outpacing those of U.S. equity markets.
  • The safety of being offshore!

All things considered, there's no reason to sit on your duff and patiently wait (wish?) for conditions to get better whilst your life savings and future retirement income are at stake - when you could be participating in the burgeoning global economy and at the very least, be protecting your hard earned assets.

You should remember, however, that there are times when you may want to tread lightly or even back off. But overall, I believe the global expansion unfolding today is revolutionary and there is opportunity abound for everyone, even Americans.

Striking While the Going is Good. There are numerous ways to diversify your financial portfolio globally, including:

  • Exchange Traded Funds (ETFs) that represent foreign stock indexes: China, India, Brazil, Singapore, South Korea, etc.
  • Exchange Traded Funds that put your money in foreign currency deposits: In the euro, Japanese yen, Australian dollar, Canadian dollar, the Mexican peso and more.
  • Mutual funds that are in the business of carefully selecting the best-performing global stocks and sectors.
  • Options on Exchange Traded Funds for much greater leverage, and
  • World Currency Options offered by the Philadelphia Stock Exchange, traded just like stock options, and offered on all major world currencies.

Each of these alternatives has advantages and varying degrees of risk, with options having the most risk, depending on your individual investment objectives, and all require thoughtful consideration.

But whatever you do, don't simply keep your fingers crossed and hope that things will eventually get better. At a time when the U.S. dollar is faltering badly, your financial security may depend on asset/portfolio diversification - and the sooner, the better.

Why? The following AP Article says it all.

Witness tells how US taxes evaded abroad
- AP

A man wanted by Liechtenstein for leaking secret banking information that identified millionaire tax cheats across Europe and the United States has described to congressional investigators how money was concealed.

Lawmakers played a videotape of the testimony by Heinrich Kieber at a congressional hearing Thursday that revealed rare details of offshore practices at two European banks. At the hearing, Swiss banking giant, UBS AG, announced that because of recent revelations, it will stop offering U.S. clients offshore services through branches based abroad.

Kieber appeared only as a silhouette against a white screen with eyeglasses and a balding head apparent. Kieber is living under a new name in an undisclosed witness protection program, according to lawmakers. He has never spoken publicly about his role in exposing tax shelters he says were used by Liechtenstein's LGT group.

In the videotaped interview with the congressional investigators, he described ruses that he saw while working at the bank, which he said were used to cover the tracks of money moved into accounts.

The hearing by the Senate Homeland Security and Governmental Affairs investigations subcommittee highlighted offshore tax abuses that they believe cost the U.S. government about $100 billion a year.

The hearing came a day after the panel released a 109-page report that took aim at LGT, owned by Liechtenstein's royal family, and UBS, one the world's largest wealth managers.

Mark Branson, chief financial officer of UBS' global wealth management, said at the hearing that the bank regrets "any compliance failures that may have occurred" and will now provide banking or security services to U.S. citizens only through companies licensed in the United States. He said the bank also is working with U.S. authorities to identify clients involved in U.S. tax fraud.

LGT refused to send a representative but said in a statement that it had cooperated by sending a senior official for a lengthy interview and providing all the documents requested by the panel.

Both LGT and UBS came under withering criticism from the lawmakers.

"Tax havens are engaged in economic warfare against the United States and honest, hardworking American taxpayers," said Democratic Sen. Carl Levin, chairman of the subcommittee. "Today we will look at two banks that relied on secrecy and deception to hide, not just the tax avoidance schemes of their clients but the actions they themselves took to facilitate U.S. tax evasion."

UBS has said it is cooperating with a Swiss investigation as well as an expanding U.S. probe of taxpayers who may have used overseas accounts to hide assets and avoid taxes. UBS has promised to disclose records involving U.S. clients who might have broken tax laws. It also has banned its Swiss bankers from traveling to the United States.

U.S. authorities also have asked the Swiss government to help in the U.S. investigation.

Swiss Finance Ministry spokesman Jean-Michel Treyvaud said that Swiss tax authorities received a U.S. request for "administrative assistance" on Thursday.

He said the request would now be analyzed, but he said nothing further.

The subcommittee report said that UBS bankers searched out wealthy U.S. clients and aggressively marketed services to taxpayers who otherwise would not have opened Swiss accounts. It said the bank's practices resulted in billions of dollars of U.S. taxpayer money in accounts that were not disclosed to tax authorities.

The report said UBS has estimated that it has 1,000 declared accounts in Switzerland for U.S. clients against 19,000 undeclared, with a combined value of $17.9 billion.

Investigations linked to LGT have been launched in a number of countries since German authorities obtained in February the CD-ROM of some 1,400 alleged tax cheats with accounts at the bank that Liechtenstein says Kieber leaked. Germany has since passed the file to other countries, including the United States.

In his videotaped testimony, Kieber described shell companies used as "high grade camouflage." Money was often transferred through bank-controlled legal entities registered in numerous countries with lax regulations, including Panama, the British Virgin Islands and Nigeria, he said.

Additional concealment was provided by fake transactions designed to make it look like clients had withdrawn cash from a bank, when in reality they were credited into a LGT account.

"The only purpose of all of this is to make it extremely complicated for law enforcement agencies to follow the trail, as each step serves as a filter to hide the track of the client's money," he said.

He said that clients were advised how to avoid scrutiny, including not telling anyone including lawyers and family members about hidden money. Clients were also encouraged to use pay phones to contact bank representatives on cell phones from Switzerland and Austria and to use code words in communications.

LGT questions Kieber's objectivity and accuses him of stealing the information, according to Michael Robinson, a spokesman for the bank. It says that much of the information that Kieber has provided involves records going back to the 1970s and 1980s.

"LGT's practices were consistent with accepted industry standards of the time and do not reflect the way in which LGT conducts business today," he said. ***end article***

With Swiss banking all but closed to Americans and many others, the hand writing is clearly on the wall. The authorities want your money to stay inside their country.Why? In order to continue to tax and depreciate your money, amongst other things, as well as for other nefarious use, all at your personal and financial expense.

Tax Haven Bank Secrecy Tricks used by Swiss Bankers UBS for 20,000 American Clients

  • Code Names for Clients
    Pay Phones, not Business Phones
    Foreign Area Codes
    Undeclared Accounts
    Encrypted Computers
    Transfer Companies to Cover Tracks
    Foreign Shell Companies
    Fake Charitable Trusts
    Straw Man Settlors
    Captive Trustees
    Anonymous Wire Transfers
    Disguised Business Trips
    Counter-Surveillance Training
    Foreign Credit Cards
    Hold Mail
    Shred Files
    - Source: The U.S. Senate Permanent Subcommittee on Investigations, July 2008.

As the above clearly reveals, the US authorities are closing the doors for offshore opportunity so you need to jump onboard before its too late! Don't belive me? Then read on!

Case History Not so Great Britain imposed exchange controls not so many years ago, i.e. during my life time. The United Kingdom imposed exchange controls on 4 September 1939. Only in 1979 did the new Conservative government abolish UK exchange controls.

The United Kingdom abandoned the gold standard on 21 September 1931. The currencies of British colonies were almost all linked to the pound sterling through currency boards; being on a sterling-exchange standard rather than a gold-exchange standard, they followed the pound sterling off gold. Over the next few years, some former British
colonies (Australia, New Zealand, South Africa) and other countries that had important trade links with the United Kingdom switched from gold to the pound sterling as their official or actual anchor. The result was termed the sterling area. The United Kingdom imposed exchange controls on 4 September 1939, the day after entering the
Second World War. Most countries that were not current or former British colonies soon left the sterling area.

Among the remaining countries, both current- and capital-account transactions were free of restrictions within the sterling area, but were restricted in dealings with outside countries. After the Second World War, the United Kingdom returned to the gold standard under the Bretton Woods system. It removed exchange controls on 15 August 1947, but reimposed them on 20 August 1947 after suffering a large loss of foreign reserves. Sterling had a dual exchange rate from 1961 until the United Kingdom abolished exchange controls. The sterling area remained in existence because sterling was not fully convertible. It began to crumble after the United Kingdom again abandoned the gold standard on 23 June 1972. By January 1973 the sterling area had shrunk to the British Isles and a few small British colonies; even Hong Kong had abandoned sterling as its anchor currency. The United Kingdom abolished exchange controls on 24 October 1979, ending the sterling area.
- Source: http://users.erols.com/kurrency/ki.htm

In March 1976 the value of the British pound began to slide. The slide turned into a rout and triggered an economic and political trauma. By September confidence in the pound had collapsed. In April 1975 the Wall Street Journal had run the headline 'Goodbye, Great Britain, ' advising investors to get out of sterling. Now the British Labour government under its new Prime Minister James Callaghan was forced to seek help from the International Monetary Fund, a familiar option for Third World countries but highly unusual for a developed western economy. This expert new study uncovers the roots of the most searing economic crisis of postwar Britain. The weakness and instability of the British economy in the mid-1970s, the consequence in part of the 1973 rise in oil prices, raised international alarm.

The US government in particular feared economic crisis would drive Britain into a left-wing siege economy, endangering NATO and the EEC. Anticipating the danger, the US Treasury set out to force Britain to make major domestic policy changes. The sterling crisis provided the opportunity. The IMF provided the weapon. Arriving in London in November 1976, the IMF mission announced that the price for the loan included deep cuts in public expenditure. The consequent political crisis was fought out in private and in public, amongst members of the British Cabinet, the Labour Party, the Treasury and the Bank of England. It involved the US President, Treasury and State Department, the Federal Reserve, the German Chancellor and the Bundesbank. Burk and Cairncross uncover the efforts of the Labour government to escape IMF conditions. They also examine the political agenda, the loss of economic control, the rise of monetarist ideas and the change in the climate of opinion. Juxtaposing gripping arrative with expert analysis, the book provides surprising answers to critical questions and reveals how the breakdown of the postwar consensus on macro-economic management paved the way for the triumph of Thatcherism.

Sounds familiar? It should because this is (nearly) what the US economy and dollar are going through today, isn't it?

What affect on the public? In the event of a continued US dollar and economic/housing meltdown, the government could take all kinds of draconian measures to save you from yourself.

  • For example;
  • Placing wage and price controls placed into law
  • Implementing exchange controls that might outlaw citizens from having assets OUTSIDE your country
  • Demanding that all citizens and residents repatriate their financial assets back to Amerika (or your country) under dire penalty!
  • Forbidding you from owning gold
  • Limiting you from traveling abroad. This could be accomplished by simply by passing a law limiting the amount of funds one could "take out of the country." [Note: The UK did this very successfully in the mid 1960's. So don't think the US, the UK or you're country wouldn't do this if push came to shove!]
  • Plus throw in everything else you can dream of that the Terrocrats would cook up in order to save their ass and steal your assets to keep their shill game going.

Don't think any of the above could happen? Think again because it has happened previously in the US and elsewhere and there is certainly a real possibility of any one or all of the above and more happening again.

Reporting requirements are dangerous to your health! With the type of reporting available worldwide nowadays, it is most likely that your offshore assets are already known to, or will be made known to the US authorities in a short period of time, assuming you haven't already 'voluntarily' reported them. The article above "Witness tells how US taxes evaded abroad" and "Tax Haven Bank Secrecy Tricks used by Swiss Bankers UBS for 20,000 American Clients" clearly proves the point.

Not so long ago our British friends had severe exchange controls placed on them in order to "keep them in the UK." I know because I personally experienced this stupidity from the government's nonsense. Whilst traveling to France on summer holiday, we were only allowed 50 quid (fifty pounds) to take out of the country and there weren't any
credit cards back in those days. Our French hosts felt so bad for us, they refused to accept any money from us. I've never forgotten that kindest and am always ready to reciprocate with French friends and associates.

Try traveling abroad with just $1,000 today for ALL your expenses, including charges on your credit card. You certainly wouldn't get very far would you? This would be, could be an extremely efficient way for your government to "keep you in Amerika, the UK or elsewhere," wouldn't it?

Since GB did exactly that, why not in America? The US trade deficit is at all time highs, the wars in Iraq and Afghanistan show no end in sight, and the financing of these wars far exceeds those of financing all previous American wars, with the sole exception of the Second World War (in today's depreciated dollars.)

Wage & Price Controls President Nixon announced on Aug. 15, 1971, "I am today ordering a freeze on all prices and wages throughout the United States for a period of 90 days." He threatened that the controls "will be backed by government sanctions, if necessary."

Most of Nixon's wage and price controls didn't last just 90 days, but until 1974. The price controls on petroleum lasted until President Reagan ended them in 1981. Ending the gold standard in 1971 also meant the country was off the gold standard for the first time since the American Civil War, and although the gold standard was restored after that war, America has not gone back on the gold standard since 1971.

Gold hit an all-time high of $850 in January 1980, when investors bought heavily in the face of high inflation linked to strong oil prices, Soviet intervention in Afghanistan and the impact of the Iranian revolution. After adjusting for inflation, that level gold was equal to $2,079 at 2006 prices.

What today's gold cost? You can see we have a way to go before gold truly exceeds it January 1980 level of value. Buying gold might be a good idea, even at what appears to be today's high cost, in order to retain your wealth and capital.
- Source: Shamrock's Missive, January 2008
http://www.ptshamrock.com/secret/jan_2008.html

Here's what we predicted in our January 2008 Missive, i.e. just a little more than six months ago:

  1. $100 per barrel of oil - Today it's hovering near US$150 and don't be surprised if oil reaches US$200 per barrel in the not too distant future!
  2. Zimbabwean dollar to decline further. [Editors note: In our January 2008 missive it was 30,655 Zimbabwe Dollar to one USD! Today as I write these words it is 1 US Dollar (USD) = 26,998,616,030 Zimbabwe Dollar (ZWD). That's right 26 BILLION plus zim dollars for one US dollar. The largest Zim currency note in January 2008 was a half billion Zim$ note. Take a look at http://www.ptshamrock.com/images/other/5Billion%20note.jpg That 5 billion zim dollar note isn't enough to buy a coke at McDonalds... even if they had any there to sell, which they don't! In fact inflation is so bad and things are so bad in Zimbabwe, prices are rising at a 9,000,000% hyperinflation rate and a single egg costs 50 billion Zimbabwe dollars. In fact Zimbabwe will introduce a $100-billion bank note by the time you read this article as the nation continues to struggle with the world's highest inflation rate.
    Source: http://www.voanews.com/english/2008-07-20-voa3.cfm Under Robert Mugabe's watchful eye, the Zimbabwe inflation rate has reached a milestone: a 9,000,000% hyperinflation rate since 1980. Back then, the U.S. dollar and the Zimbabwe buck were nearly equal in value. Today, your average $200,000 home in the U.S. would cost over 950 trillion Zimbabwe dollars. In other words, the mighty 5 billion Zimbabwe bills are worth around US 0.185 [eighteen and one half US
    cents!] For a true horror story read
    http://www.thezimbabwestandard.com/index.php?option=com_content&view=article&id=18556:rising-inflation-leaves-zimbabweans-poorer&catid=31:zimbabwe-stories&Itemid=66
  3. US dollar to decline further. [Editors note: 1 USD = 0.68 EUR on 12/31/2007, i.e. the time of publishing our January 2008 missive. As I write this missive, i.e. late July 2008, it is 1 Euro = US Dollars 1.59 USD as of 7/19/2008 or 1 US Dollar = 0.63121 Euro as of 7/19/2008. That's a whopping 9.3% depreciation of the USD in a little more than six months during 2008!
  4. The U.S. government will make threats to offshore governments/banks to enforce US policies. [Editors note: See the article on Swiss banking above.]
  5. US mortgage meltdown. No need to talk about that debacle. Fannie Mae and Freddie Mac are soon to be bailed out at US taxpayers' expense.
  6. Gold will continue to rise.

Now we're certainly not clairvoyant nor claim any such nonsense. However seeing the very clear signs of pending financial and privacy related disaster is or should be, as clear to you and I as seeing the fork in the road ahead. The question is; which fork do you take?

You are being tracked! The US authorities are already tracking EVERYONE, US and non US citizens' alike, traveling inside, into and out of the USA today. American's and others, are even being tracked outside the USA whilst traveling and they probably don't even realize it. The databases for accomplishing such monstrous intrusions are
mind boggling.

According to reliable sources, the US federal government alone has more than 138,500 plus such databases and they are currently growing exponentially at a rate of around 1-3% per quarter. That's an awesome number of databases with hundreds of trillions of terabytes of information on your every move. This information stored on you by the government includes;

  • Your financial, physical and other movements including but not limited to which books you read,
  • How you pay for one product, service or another,
  • Your preference of travel
  • Whether you have a meat or a veggie meal on flights and
  • Your aisle or window seat assignment preference;
  • Where you travel to
  • How long you stay there
  • Which hotel/s you stay, etc. and so forth!

And these figures don't include local or state agencies data bases either. Further, least our Yankee friends forget, your new US passports do have a tracking chip inside that records all your details into those databases upon your return. Ditto for mobile phones, automobiles and the list goes on and on ad infinitum.

International travelers entering the United States face potential inspection and seizure of their laptops and other electronic devices, and copying of the electronic files they contain as part of the country's border security. Upheld in April by the U.S. Court of Appeals for the Federal Circuit federal appeals court decision, such activity by border patrol agents has drawn criticism - especially as the U.S. Department of Homeland Security has not complied with
requests to provide information - and was the subject of a U.S. Senate hearing last month.
- Source: http://www.thetransnational.travel/news.php?cid=laptop-seizure.Jul-08.09

That's a very sobering thought if you're to think about it.

There are more than 900,000 Americans on the Home Land Security (HLS) "Watch List"
- Source: American Civil Liberties Union,
http://www.aclu.org/safefree/general/34237leg20080227.html

The cause and effect of such nonsense is that people have their basic right of freedom of movement and privacy impeded.

Starting this past May 2008, all US citizens are required to have an internal passport, i.e. a HLS approved driver's license. - Source: http://www.boingboing.net/2007/03/01/department-of-homela.html

Though the US is not alone in requiring an internal passport, most striking was the former Soviet Union, former Communist Germany, North Korea, etc. - Source: http://en.wikipedia.org/wiki/Internal_passport

The trend towards internal passports and national ID cards is indeed increasing and regrettably, we don't see an end in sight!

What To Do? This article "The Decline of Amerika" should cause considerable consternation to Americans and anyone anywhere in the world who cares about their personal and financial liberties being stolen. [Editors note: For a good read on the subject, check out: "The Thief of Privacy - a FREE PDF download Report!" at
http://www.ptshamrock.com/secret/thief_privacy.html ]

Our advice if you wish to remain in Amerika, are an American or legally reside in the US is simple: obey all laws; comply with all US filing requirements, pay all the taxes they say you owe; don't lie or commit perjury whilst signing documents, don't break any laws and especially don't try to be funny and play games with the authorities! The authorities aren't stupid. Remember lying to any US federal official is a serious felony offense with a minimum five year sentence. Unlike former President Bill Clinton, you're unlikely to get off scot free from any perjury charges.

Alternatively if you don't care to lie down, roll over and get slaughtered like lambs being led to slaughter; have a reasonable amount of assets you'd like to protect (US$100,000 or more,) and are willing to invest a small sum for some sound practical advice in order to preserve your capital, you might want to email our leprechaun for some thoughtful and personal Mano-a-mano consulting advice.

The doors are most certainly closing for Americans and many other Westerners' that's for sure. The question you need to ask yourself is; "What are you going to do about it?"

See you next issue

Shamrock

"The people never give up their liberties but under some delusion."
- Edmund Burke, 1784

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