Geographic Diversification --- protect against currency controls / devaluation

[murphy_p_t]

If you could implement a PP outside your own country, where would you do this? The assumption is that the reason for doing so is to have more than 25% (the gold) of your assets outside the control of the gov't where you live. For example, suppose your country may go the route of Argentina...devaluation / currency controls...

For a US person, maybe Canada, Norway, Singapore?

Of course, by doing so, you take on currency risk...but maybe gaining additional diversification makes this risk worthwhile?

[KevinW]

I think the best case is a reasonably stable and financially developed country whose border is close (maybe 100 miles?) and easy enough to pass through. Canada would qualify if you live near that border. *Maybe* Mexico, I haven't researched their PP options or banking industry. If I were in Germany, all the large neighbors are probably OK, but Switzerland has its appeal, of course.

If there were no viable options nearby, I'd probably pick a country that is relatively passive in world affairs, rather than a military power, on the grounds that they'd be less likely to be sanctioned or invaded. Maybe Australia, Japan, the Netherlands, or somewhere like that. Not UK, Russia, or China, though.

Some cities are more global than nationalistic, and try to be accommodating of foreign travelers and business. NYC, Hong Kong, and Dubai come to mind. That has a certain appeal.

Also craigr posted this map of perceived corruption, which is a factor: http://cpi.transparency.org/cpi2011/results/

[Snowman9000]

Pushing this topic back to the top, I find it an appealing argument that a person would be wise to be a citizen of Country A, a resident of B, and have his money in C.  Unfortunately I've done neither of the two diversifications implied.

The record of government abuse of their citizens' wealth shows that mostly they attack said wealth within their own borders.  It is the low hanging fruit.  It is not out of the question to think the US might impose controls, exit taxes, and the like.  Further, if you, a non-resident of C, have money there, I'm of the impression that C is usually reticent about attacking your money since you are not their citizen. 

So, is there a right answer to the OP's question?  Or is there a handful of "good enough" countries.  I think it is the latter.  Maybe it would be better to spread the money around 3 or 4 offshore places?  Say, I dunno, Panama, Switzerland or Austria, Australia?  Which countries are still friendly to accounts owned by US citizens?  I read that after recent US actions, many banks overseas simply decided it was not worth it to mess with US money.  Anyone have some ideas?

A bigger question to me is, how does one proceed?  This gets almost no play here on this forum, but I think it is a very important aspect of asset protection.  Are there any trustworthy experts a person can go to?  How would we do due diligence on them?

Should you make sure NOT to use a bank which has US branches?  I can see pros and cons to having a US branch available to you.

[craigr]

A bigger question to me is, how does one proceed?  This gets almost no play here on this forum, but I think it is a very important aspect of asset protection.  Are there any trustworthy experts a person can go to?  How would we do due diligence on them?

This topic is covered extensively in the new book. Nothing is absolute, but I think we list options that are low risk and also low-cost.

Should you make sure NOT to use a bank which has US branches?  I can see pros and cons to having a US branch available to you.

If you are using an overseas financial institution, you are much better off if they have no US branches. It is one less stick that can be used to put pressure on them.

[escafandro]

Maybe it would be better to spread the money around 3 or 4 offshore places?  Say, I dunno, Panama, Switzerland or Austria, Australia?  Which countries are still friendly to accounts owned by US citizens?  I read that after recent US actions, many banks overseas simply decided it was not worth it to mess with US money.  Anyone have some ideas?

I am in the process of opening an account to diversify here:  https://www.keytradebank.lu/en/
Maybe you can explore this option.

[murphy_p_t]

A bigger question to me is, how does one proceed?  This gets almost no play here on this forum, but I think it is a very important aspect of asset protection.  Are there any trustworthy experts a person can go to?  How would we do due diligence on them?

This topic is covered extensively in the new book. Nothing is absolute, but I think we list options that are low risk and also low-cost.

Craig...have your or MT actually used / implemented the options you mention in your book? (Especially for options other than gold)

[craigr]

Craig...have your or MT actually used / implemented the options you mention in your book? (Especially for options other than gold)

Absolutely. I eat my own dog food.

[Snowman9000]

Well I have already asked Santa for the book, so I'll look for that info!

[murphy_p_t]

Craig...have your or MT actually used / implemented the options you mention in your book? (Especially for options other than gold)

Absolutely. I eat my own dog food.

I reviewed the index a few weeks ago...I saw lots of references to gold storage internationally...I didn't find anything that would suggest options for cash, bonds, stocks to be held in a foreign brokerage, etc.

Are those covered and did I miss them?

thanks.

[craigr]

I reviewed the index a few weeks ago...I saw lots of references to gold storage internationally...I didn't find anything that would suggest options for cash, bonds, stocks to be held in a foreign brokerage, etc.

Are those covered and did I miss them?

No they are not mentioned for several good reasons:

1) If you hold US Bonds/Cash "overseas" it really is being held in a US bank most likely.
2) If you are a US Citizen and you try to purchase non-US registered mutual funds you either a) can't and b) they would be enormously taxed to make it unappealing.
3) Most brokerages located overseas probably won't take US persons, and if they did, they would almost certainly charge a ton more in fees over what you can get by just using US brokerages.

So basically gold is the best asset to hold because it really is stored outside the US financial system (or whatever system you're in) and it can be done cheaply even if not at a US financial institution.