For the last week, eyes across the nation have been focused on Hurricane Gustav and its frightening potential. But even as we breathe a sigh of relief at the now “tropical depression” Gustav, new dangers emerge on the horizon in the form of Hanna, Ike and Josephine.
But the activity in the tropics only serves to distract Americans from the real threat; the ‘perfect storm’ brewing in the U.S. financial system.
It is a financial storm the likes of which we’ve never seen. And weathering this storm will take preparations that you may not have considered in the past.
Specifically, I’m talking about offshore banking.
Drowning in Trillions of Debt
As of April 2008, the total U.S. federal debt was approximately US$9.5 trillion.
That figures out to be US$31,600 for every man, woman and child in America. When you add in unfunded obligations of programs such as Medicaid, Social Security, Medicare, etc. this debt figure rises to a total of US$59.1 trillion.
In 2007, the U.S. public debt was 36.9% of our Gross Domestic Product while the total debt figured out to be 65.5% of GDP. Those numbers place the once mighty USA in line with third world countries that are also in hock up to their eyeballs.
If you want to get the whole picture of where America stands economically, check out the documentary film “I.O.U.S.A.” It’s an eye-opening experience.
What you’ll find is a country drowning in debt at both personal and government levels… and ample reason to be concerned about the solidity of our once-trusted financial institutions.
Is Your Bank Safe?
If you have been paying even scant attention to the news, you know about the housing mortgage crisis, the bank failures, the investment houses, banks and mortgage companies writing off billions of dollars.
Last Friday officials closed the 10th commercial bank this year. It was a small bank in Georgia with US$1.1 billion in assets. The problem? You guessed it, rising loan defaults. The FDIC now has 117 banks on its danger list that could fail. The probability of a large number of these banks actually failing is quite large.
As most depositors know, the basic insurance limit on U.S. bank deposits is US$100,000 in a single bank. If you know the rules well, however, it is possible for a single person to extend that coverage to more than US$500,000 at one bank. This can be done by utilizing multiple account ownership categories (private, commercial, business, investment) since the US$100,000 insurance limit applies by account category and per account holder.
My colleague, David Newman, Market Analyst for The Sovereign Society, explored the role of the FDIC in an excellent article, “Who Really “Insures” the FDIC?”
By all means, as David suggests, make sure your savings are in a domestic American bank that has maximum FDIC insurance coverage. And make sure you understand FDIC rules so you get maximum coverage.
But if you want to diversify your liquid assets internationally…if you want maximum financial privacy (the kind you can no longer find in the United States)…and if you want to enjoy the equivalent of FDIC insurance in other major economies…then you should consider the option of offshore banking today.
Not Just for the Rich Anymore
Not too long ago, only the wealthiest investors could benefit from having an offshore bank account. Only the richest of the rich could afford the fees and legal advice associated with going offshore.
Now, after dramatic changes in international banking and communications, even a modest offshore account can be your quick, inexpensive entry into the world of foreign investment opportunities.
Although the IRS tries to discourage offshore banking, having an offshore account is fully legal and can help you build financial structures to increase your wealth legally and protect your assets.
An offshore bank account is also a highly effective and economic way to achieve your legitimate financial goals – and many offshore banks are a lot more financially secure than some American banks these days.
Aside from safety, a foreign bank account can be employed as an integral tool in an aggressive offshore wealth building strategy.
Offshore banking is also a big business worldwide. Recent estimates calculate that as much as US$5 trillion is stashed in nearly 40 offshore banking havens that impose no taxes. Many of these same havens also guarantee deposits, have less onerous regulations, guarantee privacy, and cater to nonresidents. One third of the entire world’s private wealth is stashed in Switzerland alone!
The Sovereign Society has contacts with a network of leading banks from Switzerland to Singapore, from Panama to Hong Kong. We’ll be pleased to help you shield your assets and increase your privacy and profits – by going offshore. And now – more than ever – is an ideal time to move from idea to action, as that “perfect storm” moves ever closer to the U.S. financial system, and to you.
BOB BA’UMA’N, Legal Counsel