Doug: Stating that the US is turning into a police state when you started this conversation was quite accurate. You can see more and more videos spreading over the Internet, not just of police brutality, but demonstrating the militarization and federalization of police, who are being inculcated with both disdain for and paranoia about ordinary citizens.
In the old days, if you were stopped for speeding, the peace officer was polite — you could get out of your car, meet the cop on neutral ground, and chat with him. You didn’t have a serious problem unless you were obviously drunk or combative. Now, you don’t dare make a move. You better keep your hands in plain sight on the steering wheel and be ready for a Breathalyzer test without probable cause. The law enforcement officer will stand behind you with his hand on his gun. And you’re the one who’d better be polite.
L: There has been a polar reversal. The cops used to address citizens as “sir” or “ma’am.” Now, the correct response in a traffic stop is: “Yes, sir! I would love to inspect the bottom of your boot, sir!”
Doug: [Laughs] That’s right. My friend Marc Victor gives out magnetized business cards. People ask, “Why?” He answers that it’s so clients can put them on the bottom of their cars or refrigerators, so they can see it when the cops throw them to the ground.
L: Marc’s a good man. There’s a handy video on Marc’s website, offering advice on what to do if you’re pulled over by the police in a traffic stop.
Doug: A good public service announcement. At any rate, I think there’s no question that the US has turned the corner on every basis: politically, socially, morally, and now, economically…
L: Okay, but, Doug, you said that in 1979 too. The question is, how do we know when the door is going to close?
Doug: [Laughs.] Well, sometimes I feel a little like the boy who cried wolf. But Roman writers like Tacitus and Sallust saw where Rome was going before it got completely out of control. Should they have said nothing, for fear of being too early? Here in the US, it should have gone over the edge back in the 1980s, but we got lucky. There was still a lot of forward momentum, which can last for decades when you’re speaking of civilizations. There was the computer productivity boom. The Soviet Union collapsed, China liberalized, and Communism was discredited everywhere except on US college campuses. The end of the Cold War opened up vast areas of the world to the global market. And most surprising of all, Volcker tightened up the money supply and interest rates went high, causing people to save money and stop borrowing to consume.
L: That’s not happening this time.
Doug: No. We got lucky back then. Since the ’90s we’ve had a long and totally phony, debt-driven boom that’s now come to an end. I feel very confident that there’s no way out this time. There are huge distortions and misallocations of capital that have been cranked into the system for two decades. And not just in the US this time, but in Europe, China, Japan, and elsewhere.
The US is very clearly on the decline. The fact that in spite of bankrupting military expenditures to no gain for the American people, those in power are talking overtly and aggressively about attacking more countries — Iran and Pakistan in particular — is extremely grave. The fact that they attacked Libya — which, incidentally, is going to turn into a total disaster, a civil war that will last for years — shows it’s not stopping. Sure, Obama brought troops home from Iraq — another disaster that’s going to remain a disaster for years to come — but at the same time he put a company of combat troops in Uganda, of all places and Marines in Australia, to provoke the Chinese.
Back home, I’ve read reports that people are being stopped for carrying gold coins out of the US, in Houston in particular. Now we have authorization of the military to detain US citizens, on US soil, with no trail, and indefinitely, on the verge of becoming law. And Predator Drones have been used to hunt down farmers on their own ranches.
I could go on and on. This is not like spotting early signs of decay in America’s expansionist wars of the 19th century or things getting worse with FDR. Most people can’t see it with all the noise and confusion, but we’ve reached the edge of the precipice.
L: Don’t worry about exactly where the edge is, just assume it’s there and take appropriate action?
Doug: Yes. It really is there. It’s a clear and present danger. But most Americans are as oblivious as most Germans were in the ’30s. In fact, most of them support what’s going on, just as most Germans supported their government in the ’30s and ’40s.
L: So… don’t worry about figuring out exactly when the gates will shut. Assume they are shutting now?
Doug: That’s right. One should be actively and vigorously looking to expatriate assets, cash, and even one’s self. A prudent person will always be diversified politically and internationally.
L: What about people who have jobs they can’t continue doing from abroad and who need the income?
Doug: They should still prepare, as best they can, to be ready to go on a vacation when things get hot — a vacation from which they might not return for a long time. All that needs happen, with the hysteria that’s building in the US, is for a major terrorist incident — real or imagined — to occur. Homeland Security will lock the country down.
Look, I know it sounds extreme, and the comparison to pre-WWII Germany has been made many times, but it bears repeating. Germany was the most literate, civilized, and even mellow, in some ways, country in Europe. It was much admired all around the world — a nation of shopkeepers, small farmers, and scholars. But the whole character of the place started changing in 1933, and it just got worse and worse. By the end of 1939, if you weren’t out, you were done.
L: [Pauses] Well, not a cheerful thought. Actions to take?
Doug: Things we’ve said before: Set up foreign bank accounts in places you like to travel, while you can. Set up vault arrangements for physical precious metals outside the US. Buy foreign real estate that you’d like to own, because it can’t be forcibly repatriated. Offshore asset protection trusts are a good idea too. Become an International Man. Let me emphasize that US taxpayers should stay within all US laws, because the consequences of breaking them are unbelievably draconian.
Generally, one simply must internationalize one’s assets. The biggest danger investors face, by far, is not market risk — huge as that will be — but political risk. The only way to insulate yourself from such risk is to diversify yourself politically and geographically.
L: Right then… words to the wise. Thanks for your insight.
Doug: You’re welcome.
Doug Casey and Louis Jamesfor The Daily Reckoning
Doug Casey of Casey Research is the author of the best sellers Strategic Investing, Crisis Investing, Crisis Investing for the Rest of the 90's, and most recently, Totally Incorrect. He has lived in seven countries and visited over 100 more. He has appeared on scores of major radio and TV shows and remains an active speculator in the stock, bond, commodity, and real estate markets around the world. In his spare time, Doug engages in competitive shooting and plays polo.
Come see us in Ecuador: http://journeymanjack.com/ Quito is the Capital, right on the Equator, at 9,350 ft. (1.77 miles) above sea level in the heart of the Andes Mountains, where the weather is 50′s in the evening, and 70′s during the day all year round. Valley of Eternal Springtime! Do not hesitate to contact me for your relocation or exploration needs!
“that’s all folks”
Great advice for those with gobs of money. Wish you would address a course of action for those who don’t have enough to leave.
“Great advice for those with gobs of money. Wish you would address a course of action for those who don’t have enough to leave.”
you could hire on as his maid.
probably have to supply your own uniform ….
Doug doesn’t even have a clue WHAT the edge is. And to quote Hunter S. Thompson “the only ones who know where the edge is are the ones that have gone over it.”
The pyramid fashion economy, world number 1 to 2, US to Japan further permeating to their immediate downlines, the 10 most vulnerable states of Europe … All these run on US model capitalist engine … all experience acute engine trobule. Scope of representation tallies up. Karl Marx had speculated centuries ago that capitalism
initially borne sweet fruits but on a projectile to doom. Implementation is the only test of truth.
what the hell are you saying Rusty Fish????
OK. From the economic sum extracted from the anchor capitalist biggies, there is no vocab next to ‘flop’ to describe the flagging ‘scamy’ entrepreneurship. Need not use any precision economic tools to measure or monitor their performances. Debt toll and unemployment alone will humble hustle and bustle of the economic earth. Meanwhile, deterioration goes unabated. However much that has been created may turn to ashes. Karl Marx will therefore honour his words.
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Not really getting your vocab here Rusty!
Looks interesting though if you could elucidate
a little more clearly
As more unprecedented mammoth events unfold, it would be more interesting to depict as it goes along.
Happy new economic year, Wiki.
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