Do You Have a Realistic Asset Protection Plan?

Two weeks ago to the day I received a call from a friend of mine in the US.  Dave runs a motorcycle performance shop in North Carolina and called me to chat about business.  In the conversation he mentioned that he would be in Milan, Italy the next week and wondered if I was available.

Four days later I was on a flight to Milan and going to the EICMA International Motorcycle Exhibition with Dave and a few of his local Italian friends.  I won’t bore you with the details, but last week was a well deserved break filled with great Italian food, motorcycles, and supermodels.  We even managed to talk a little business.

I hope you enjoyed last week’s interview with Paul Rosenberg.  This was certainly different than my normal routine, but after reading his book, I just knew he was a perfect fit for this audience. 

Paul is one of the most intriguing men I have ever spoken to and leads a life that most of us only dream about.  If you missed last week’s newsletter titled “A Free Man’s Perspective”, you can find it on the website here.

Speaking of websites, we are in the process of updating the website and should be finished in the next few days.  For any of you that have visited the site, you certainly know it was very cutting edge….in 1997.

Aside from the old school look and feel of the site, it didn’t fully reflect what our firm does for clients.  Quite frankly it was too cumbersome to easily update, therefore it just didn’t happen.  I guess being busy is good, but in hindsight the website was allowed to suffer.  Lesson learned.

Now on to some useful information.  Many of you may have noticed that this week has been very interesting in the global debt markets (or at least those of you that actually care about that sort of thing).

Italy has now crossed an important threshold – the 10 year Italian bond yield exceeded the critically important 7% mark.  Many consider this to be the point of no return for European debt.  This is the point where Ireland and Greece started begging for their ECB handouts.

If you are unfamiliar with bonds, the price and yield are inversely related.  In other words, if the price of the bond goes down, the yield goes up, and vice-versa.  This week the Italian 10 year bond yield went dramatically higher (bond prices went down) signaling a lack of trust in the Italian government’s ability to maintain sound fiscal policy.

This puts Italy in a long line of European countries that had to go with hat in hand looking for a bailout to keep the Ponzi scheme….I mean government alive.  The big difference here is that Italy is significantly larger than any of the other PIIGS.

According to the IMF, Greece’s 2010 GDP was just over $300B ranking it as the 32^nd largest country in the world.  Italy’s 2010 GDP was just over $2T ranking it as 8^th largest or nearly 7 times the size of Greece.  Italy’s debt to GDP ratio is now over 120%.  This is completely unsustainable.  It is also likely to be the death nail in the EU coffin.

Folks, wake up to reality.  Nearly every major government in the world is dead broke.  The US debt to GDP ratio now stands at about 100%.  Japan is over 200%.  Debt has been the fuel of the last few decades and we are now running on fumes.

Many of you will read this and think, “Bobby’s a nutcase.  The world has had problems before, but we always pull through.”  Many of you will fire off an email demanding to be unsubscribed from the list because I am unpatriotic or disrespectful of the Obamessiah.  (FYI, you can unsubscribe yourself at the bottom).

Hopefully though, many of you will realize that you need to do something about it.  You need to develop your own ‘escape hatch’ giving you the right to work, live and play without fear and apprehension of what the political ruling class will do next to rob you of your freedom.

Your ‘escape hatch’ will vary depending on your own set of circumstances, but generally it involves creating a veil of privacy around you and your assets.  This is what many call the multiple flag strategy, or geo-arbitrage.

This can be as simple as setting up an offshore LLC and bank account to conduct your business and holding physical gold or silver as an inflation hedge.  Real estate investors may want to consider using a combination of land trusts and LLC’s, as discussed in my article ‘Protect Your Assets Like the Uber-Rich’.

No matter what your situation requires, it is important to create your own ‘escape hatch’ before it’s too late.  Our firm can help you with many of the strategies from residency and citizenship, US and offshore company formation, land trusts, living trusts, asset protection trusts, offshore banking, internet privacy and more.  Contact us today to schedule your free 30 minute consultation.