Capital Controls

Discuss this Post at the Economics Table inside the Diner

 

Simon Black’s “Sovereign Man” Blog gives me tomaine poisoning anytime I go over there to Dine, so mostly I avoid it. However, one of his posts appeared a couple of days ago on Zero Hedge on the topic of Capital Controls, which with the current insolvency of about all nations and banks are likely to be implemented in force in many places quite soon.

Simon lists a few forms of Capital Cotrols you can expect to see coming down the pipe here

– Setting a fixed amount for bank withdrawals, or suspending them altogether
– Forcing citizens or banks to hold government debt
– Curtailing or suspending international bank transfers
– Curtailing or suspending foreign exchange transactions
– Criminalizing the purchase and ownership of precious metals
– Fixing an official exchange rate and criminalizing market-based transactions

Why do countries drop down CCs? Basically because when a monetary system is crashing and banks are going insolvent in a given country, anybody who HAS any money is trying to GTFO of Dodge and take their money with them on the way out the door.

Who does this generally apply to? Not J6P who has little saving to take out of the country anyhow. It’s the wealthy who make this run for the fire exit. Shipping Magnates in Greece, Real Estate Developers in Spain, yadda yadda.

Simon characterizes CCs as the one of the worst forms of Goobermint Theft imaginable:

Establishing capital controls is one of the worst forms of theft that a government can impose. It traps people’s hard earned savings and their future income within a nation’s borders.

Simon is trying to make this sound like a Common Man’s Problem, but it’s not, it’s a Simon problem. See, Simon likes to run around the world extracting what wealth he can everywhere he goes, and he wants to be able to keep all the money regardless of WTF happens in any given country he is running a Biz in.

These days, Simon is no doubt quite worried about Assets and Bank accounts he has over in Eurotrashland, though one suspects most of the Bank Accounts are in Switzerland where they are slightly safer than they are in say BNP Paribas.

He ALSO is investing much of his hard earned Cash in Chile, where he just “picked up” an 1100 Acre farm, no doubt for pennies on the dollar from some poor farmer behind on his mortgage.

Besides this, Simon recommends having money in a foreign bank account, having PMs in a secure jurisdiction and have a place to GO overseas with your loot when things swirl down the toilet in your neighborhood.

The problems with Simon’s advice should be obvious now. Exactly which Foreign Bank would you pick to safely deposit your money? In Europe for example, when those banks go Belly Up, the LAST Depositors who might see any of their money are the foreigners. Far as Gold goes, Simon himself mentions that one of the typical forms of Capital Controls is the confiscation of PMs, so I am not sure how having them protects you all that much once the Nation States are in such dire straights they have to try to keep anything worth anything insed their borders. Far as having a place to GO is concerned for the average Pigman, where do you PICK? Simon seems to think Cheeeelay is a great spot, where he is neighbors with Speedy Gonzalo Lira. Exactly why these guys think the Chilean Goobermint is so much more trustworthy and dependable than the FSofA one or any of the Eurotrash ones is beyond me. How many times has that Goobermint turned over in the last 40 years?

What about for J6P though? Are Capital Controls really that bad for him?

Not really, because he isn’t leaving the country anyhow, and preventing Pigmen from leaving with their wealth is good for him. Since he has no Gold in the basement safe, its no skin off his nose if Gold is confiscated from Pigmen. You also prevent foreigners from taking wealth out of assets they “own” in a country, like say farmland. If the Chinese say bought up all of Iowa, without Capital Controls they could just take “their” corn and ship it over to China.

Who does the Wealth of a Nation really belong to? Does it belong to individuals who sieved out wealth over the years from a Nation into their own Bank Accounts, or does it belong to all the people of the nation from whom the Wealth was sieved to begin with? The wealth came from THEIR labor and the resources of the land THEY live on. Why should some foreigner be able to remove this wealth with no control on it by the Nation?

Of course, it remains quite unclear just how much “wealth” is left anywhere under the conditions of extreme overshoot, and equally unclear where a Pigman should go to escape the oncoming Capital Controls likely to spring up everywhere.

The carefree life of Simon Black jetting around the world First Class, holding multiple passports and not paying Taxes in ANY jusrisdiction is coming to a close here, but Simon doesn’t want to see this end. He really doesn’t want to farm the 1100 Acres he bought in Chile, and if he HAS to move there permanently he likely hopes Da Chilean Goobermint will recognize his Title and will allow him to run his Estate as a Feudal Kingdom, hiring poor Chilean Peasants to plow HIS land.

The Capital Controls are coming, and every Pigman website from Zero Hedge to the Daily Capitalist will complain about them and tell you how horrible they are. They sure are horrible…for PIGMEN! They can’t go and jump ship with all the MONEY when the Titanic goes down.

RE

 

It starts: the government’s plan to steal your money
Simon Black on June 12, 2012

June 12, 2012
New York City

There are consequences to being flat broke.

There are consequences to investing any level of confidence in a financial system underpinned by debt and the creation of paper currency.

There are consequences for ignoring reality and pretending that everything is normal.

This is one of them: European officials yesterday flat out admitted that they were discussing rolling out a series of harsh capital controls across the continent, including bank withdrawal limits and closing down Europe’s borderless Schengen area.

Some of these measures have already been implemented sporadically; customers of Italian bank BNI, for example, were all frozen out of their accounts starting May 31st upon the recommendation and approval of Italy’s bank regulator. No ATM withdrawls, no bill payments, nothing. Just locked out overnight.

In Greece, the government has taken to simply pulling funds directly out of its citizens’ bank accounts; anyone suspected of being a tax cheat (with a very loose interpretation in the sole discretion of the government) is being releived of their funds without so much as administrative notification.

It’s no wonder why, according to the Greek daily paper Kathimerini, over $125 million per day is fleeing the Greek banking system.

European political leaders aim to put a tourniquet on this wound in the worst possible way.

So what are capital controls?

Simply, capital controls are policies which restrict the free flow of capital into, out of, through, and within a nation’s borders. They can take a variety of forms, including:

– Setting a fixed amount for bank withdrawals, or suspending them altogether
– Forcing citizens or banks to hold government debt
– Curtailing or suspending international bank transfers
– Curtailing or suspending foreign exchange transactions
– Criminalizing the purchase and ownership of precious metals
– Fixing an official exchange rate and criminalizing market-based transactions

Establishing capital controls is one of the worst forms of theft that a government can impose. It traps people’s hard earned savings and their future income within a nation’s borders.

This trapped pool of capital allows the government to transfer wealth from the people to their own coffers through excessive taxation or rampant inflation… both of which soon follow.

The thing about capital controls is that they’re like airine baggage fees; ultimately, all governments want to do it, they’re just waiting on the first guy to impose them so that they can shrug their shoulders, stick it to the people, and blame ‘industry standards’.

Moreover, capital controls were a normal part of the global economic landscape for most of the 20th century, right up to the 1970s. It’s been a long time coming for governments to return to that model.

Since the inception of this letter, it has been a constant theme for us to talk about the increasing threat of capital controls. Your money, your savings, your livelihood are all under attack by insolvent governments, and it’s critical to take steps to reduce your exposure.

When European financial leaders all openly admit that they’re making plans to establish continent-wide capital controls, it really begs the question– what additional warning sign does one need?

The dominos have already started falling. Iceland. Ireland. Greece. Spain. Portugal. Italy. Cyprus. Soon even France and the rest of Europe. And it will come to the United States as well. There are over 15 trillion reasons why.

So what are the most critical steps to take now?

1) Buy precious metals and store in a secure jurisdiction.

Holding gold and silver overseas is a great way to (a) ensure your savings is protected against inflation, and (b) ensure that your precious metals cannot be confiscated in the event that gold ownership is criminalized in your home country.

I strongly recommend Singapore, Hong Kong, and Abu Dhabi as three potential safe jurisdictions for your gold and silver.

2) Open a foreign bank account.

For funds that need to be maintained within the financial system (as opposed to precious metals), make sure you have a safe home for your money abroad in a safe, well-capitalized bank.

3) Have a place to go overseas

Economic turmoil brought on by governments stealing people’s savings generally goes not bode well for social stability. If things get hairy, you’ll want to have a place to wait it out. And you don’t want to be deciding on the location while you’re packing your bags.

As an example, I’ve picked up an 1100-acre farm in central Chile that won’t skip a beat when the financial system implodes. The sovereign debt bubble does not affect whether or not my trees will bear fruit or my vegetables will grow.

Knarf plays the Doomer Blues

https://image.freepik.com/free-icon/musical-notes-symbols_318-29778.jpg

Support the Diner
Search the Diner
Surveys & Podcasts

NEW SURVEY

Renewable Energy

VISIT AND FOLLOW US ON DINER SOUNDCLOUD

" As a daily reader of all of the doomsday blogs, e.g. the Diner, Nature Bats Last, Zerohedge, Scribbler, etc… I must say that I most look forward to your “off the microphone” rants. Your analysis, insights, and conclusions are always logical, well supported, and clearly articulated – a trifecta not frequently achieved."- Joe D
Archives
Global Diners

View Full Diner Stats

Global Population Stats

Enter a Country Name for full Population & Demographic Statistics

Lake Mead Watch

http://si.wsj.net/public/resources/images/NA-BX686_LakeMe_G_20130816175615.jpg

loading

Inside the Diner

Quote from: edpell on Today at 10:06:55 AMIn response to the depraved Indian film maker. Women need to be armed with both open carry and concealed carry hand guns. Self defense needs to be part of the basic public school...

Quote from: Surly1 on Today at 02:51:32 AMQuote from: moniker on December 07, 2019, 03:33:47 PMQuote from: K-Dog on December 07, 2019, 06:16:14 AMThis is why we are into doo...

In response to the depraved Indian film maker. Women need to be armed with both open carry and concealed carry hand guns. Self defense needs to be part of the basic public school education. 

Quote from: azozeo on December 07, 2019, 03:15:55 PMLet's throw in a professional scientific "Indigenous" opinon....David Lonebear ...

Locals say visitor numbers have dried up along with the falls.For decades Victoria Falls has drawn millions of holidaymakers to Zimbabwe and Zambia to watch southern Africa's Zam...

Recent Facebook Posts

No recent Facebook posts to show

Diner Twitter feed

Knarf’s Knewz

Quote from: edpell on Today at 10:06:55 AMIn respo [...]

In response to the depraved Indian film maker. Wom [...]

Locals say visitor numbers have dried up along wit [...]

Train and metro strikes enter fourth day as prime [...]

Hundreds of thousands snaked their way through t.. [...]

Diner Newz Feeds
  • Surly
  • Agelbert
  • Knarf
  • Golden Oxen
  • Frostbite Falls

Doomstead Diner Daily December 8The Diner Daily is [...]

Doomstead Diner Daily December 7The Diner Daily is [...]

[img width=600]https://scontent.forf1-2.fna.fbcdn. [...]

Quote from: azozeo on December 05, 2019, 12:18:35 [...]

Quote from: UnhingedBecauseLucid on March 18, 2019 [...]

CleanTechnicaSupport CleanTechnica’s work via dona [...]

QuoteThe FACT that the current incredibly STUPID e [...]

Quote from: edpell on Today at 10:06:55 AMIn respo [...]

In response to the depraved Indian film maker. Wom [...]

Locals say visitor numbers have dried up along wit [...]

Train and metro strikes enter fourth day as prime [...]

Hundreds of thousands snaked their way through t.. [...]

Scientists have unlocked the power of gold atoms b [...]

Quote from: azozeo on August 14, 2019, 10:41:33 AM [...]

Wisconsin Bill Would Remove Barrier to Using Gold, [...]

Under extreme conditions, gold rearranges its atom [...]

The cost of gold futures on the Comex exchange inc [...]

OK, I gave it to myself.    Guaranteed FREE Shippi [...]

The remission is OVAH!  The Cancer is BACK!  I got [...]

1 week, even 2 here in Alaska is total BULLSHIT! Y [...]

Now UP on GEI!  REposted on 01 December 2019A Worl [...]

Alternate Perspectives
  • Two Ice Floes
  • Jumping Jack Flash
  • From Filmers to Farmers

Missing In Action By Cognitive Dissonance     As a very young pup, whenever I was overdue and not ho [...]

Politicians’ Privilege By Cognitive Dissonance     Imagine for a moment you work for a small or medi [...]

Shaking the August Stick By Cognitive Dissonance     Sometime towards the end of the third or fourth [...]

Empire in Decline - Propaganda and the American Myth By Cognitive Dissonance     “Oh, what a tangled [...]

Meanderings By Cognitive Dissonance     Tis the Season Silly season is upon us. And I, for one, welc [...]

Event Update For 2019-12-06http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-12-05http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-12-04http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-12-03http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

Event Update For 2019-12-02http://jumpingjackflashhypothesis.blogspot.com/2012/02/jumping-jack-flash-hypothesis-its-gas.htmlThe [...]

With fusion energy perpetually 20 years away we now also perpetually have [fill in the blank] years [...]

My mea culpa for having inadvertently neglected FF2F for so long, and an update on the upcoming post [...]

NYC plans to undertake the swindle of the civilisation by suing the companies that have enabled it t [...]

MbS, the personification of the age-old pre-revolutionary scenario in which an expiring regime attem [...]

Daily Doom Photo

man-watching-tv

Sustainability
  • Peak Surfer
  • SUN
  • Transition Voice

First cut of the Madrid climate summit"“Buying an offset to fly here is absurd. It takes decades for a tree to grow enough to recoup [...]

"The drift towards near-term human extinction must be averted at all costs."I confess. I a [...]

"Since 2005, winters in Mexico have been my Hemingway Machine."  As winter descends upon m [...]

Waterboarding Flounder"Serious oxygen loss between 100 and 600-meter depths is expected to cover 59–80% of the ocean [...]

Of Warnings and their Ripple Effects"We need wooden ships, char-crete buildings, bamboo bicycles, moringa furniture, and hemp cloth [...]

The folks at Windward have been doing great work at living sustainably for many years now.  Part of [...]

 The Daily SUN☼ Building a Better Tomorrow by Sustaining Universal Needs April 3, 2017 Powering Down [...]

Off the keyboard of Bob Montgomery Follow us on Twitter @doomstead666 Friend us on Facebook Publishe [...]

Visit SUN on Facebook Here [...]

What extinction crisis? Believe it or not, there are still climate science deniers out there. And th [...]

My new book, Abolish Oil Now, will talk about why the climate movement has failed and what we can do [...]

A new climate protest movement out of the UK has taken Europe by storm and made governments sit down [...]

The success of Apollo 11 flipped the American public from skeptics to fans. The climate movement nee [...]

Today's movement to abolish fossil fuels can learn from two different paths that the British an [...]

Top Commentariats
  • Our Finite World
  • Economic Undertow

Haven't read it all yet but the section on interest rates is particularly interesting. Past rec [...]

My new post is pretty much done, but I wanted to wait until the end of the weekend to put it up. [...]

I wonder whether this has been fully thought through. If something goes wrong, clearly the whole thi [...]

One of the big questions is, "Do you count all of these things with virtually no value as part [...]

There was no Iranian missile attack. That claim is pure Israeli propaganda, designed to further thei [...]

No by industrialism I meant the broader energy picture. The surplus value labour produces requires c [...]

That was a good piece - not sure that was exactly what Steve was saying about Marx and industrializa [...]

Steve wrote a couple of articles last year, Marx & Debtonomics: https://www.economic-undertow.co [...]

Wait - when did Steve say that about Marx? I must have missed an interesting discussion along the wa [...]

@Ellen, I concur with Steve that Marx understood the problems with capitalism but failed to place th [...]

RE Economics

Going Cashless

Off the keyboard of RE Follow us on Twitter @doomstead666...

Simplifying the Final Countdown

Off the keyboard of RE Follow us on Twitter @doomstead666...

Bond Market Collapse and the Banning of Cash

Off the microphone of RE Follow us on Twitter @doomstead666...

Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

Off the Keyboard of RE Follow us on Twitter @doomstead666...

Kurrency Kollapse: To Print or Not To Print?

Off the microphone of RE Follow us on Twitter @doomstead666...

SWISSIE CAPITULATION!

Off the microphone of RE Follow us on Twitter @doomstead666...

Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

Off the keyboard of RE Follow us on Twitter @doomstead666...

Merry Doomy Christmas

Off the keyboard of RE Follow us on Twitter @doomstead666...

Peak Customers: The Final Liquidation Sale

Off the keyboard of RE Follow us on Twitter @doomstead666...

Collapse Fiction
Useful Links
Technical Journals

Deterministic–stochastic empirical mode decomposition (EMD) is used to obtain low-frequency (n [...]

At the sub-national level, the United Nations Convention to Combat Desertification (UNCCD) proposes [...]

The recent droughts in the American Southwest have led to increasing risks of wildfires, which pose [...]

Follow on our http://www.doomsteaddiner.net/forum/