Sovereign Man

Today’s podcast talks about the obvious, looming threats to your retirement security, and the structures you can build to do something about it. I’ve also put together a free report about safeguarding your IRA; it’s a scaled down version of a premium report that I sent to our Sovereign Man: Confidential members recently, but it contains a lot of valuable information. You can download it here: https://s3.amazonaws.com/sm-cdn/blackpapers/IRA+Report-free.pdf

January 22, 2015 Santiago, Chile You probably know Jim Rickards as the author of two incredibly insightful books on finance and global geopolitics: Currency Wars and The Death of Money. Jim worked on Wall Street for 35 years and has an intimate understanding of how global finance and the monetary system work. He knows and regularly talks with key policymakers at the Fed Board of Governors and US Treasury, and he testifies before Congress on financial matters. Bottom line, he’s an extremely respected person in the world of finance. Not some tin-foil hat, gloom and doom guy. When he speaks, every sensible person should listen. I have an excellent relationship with Jim, and we talk often. He’s also going to be one of the speakers at our investment event in a few months. We talked again this morning and I found the information and insights he was giving so valuable that I asked him if I could share them with you. To which he happily agreed, so I hit the record button. The stuff he shared is truly remarkable. We talk about the US economy and its fundamentals, the Fed (“The Fed has the worst models. I’m not joking, they have the worst forecasting record of all time. Over the past five years they have been consistently wrong, by orders of magnitude.”) and what they’re most likely to do (or not do). He discusses how the economy is really on a knife’s edge right now as the great battle—between natural forces that are pushing for deflation and central banks and governments that are pushing for inflation—plays out. He shares his advice on what investors are supposed to do in this environment (hint: prepare for both and hold real assets). We talk about oil prices and how the fallout from oil’s drop is likely to wipe out a significant part of the $10 trillion debt market related to oil. If the default rate hits only 10%, this means a trillion dollars is on the line. More than in the sub-prime crisis a few years ago. Jim also gives an exact number of what the price of oil is likely to hover around in the medium term and why (hint: it’s all about Saudi Arabia vs. the shale industry). He also talks about gold and how its perception is starting to change (it’s being treated as money and not as a commodity)—and much more. It’s a conversation packed with so much valuable information that it’s impossible to recap it all here—I strongly encourage you to give it a listen: http://www.sovereignman.com/investing/powerful-investment-wisdom-from-jim-rickards-the-economy-is-on-a-knifes-edge-2-15997/ The crucial takeaway here is that there are so many different and competing forces at play. And while it might all seem fine and dandy, especially in the US, people shouldn’t be lulled into a false sense of security by the temporary respite. Sure, the dollar is strong against other fiat currencies at the moment, the stock markets are at all time highs, and the headline unemployment number is lower than it used to be—but rational people understand major risks just beneath the surface and have a plan B.

Last night’s State of the Union address had one conspicuous omission, and it’s huge. It’s bigger than all the wars, it’s bigger than the stock market, it’s bigger than the government, it’s bigger than the wages of all the people in America, it’s bigger than the economy. It’s bigger than America itself. And it seems incredibly strange to me that the President of the United States failed to mention it even once (nor was it mentioned in the Republican response). In today's podcast we discuss what this omission was, why it's so dangerous, and what it means for the direction the US is choosing to go.

Family is the most natural thing in the universe. And it's literally why (and how) we're all here. As we're closing out the end of the year, I wanted to take some time to talk about this in today's podcast... probably the most gut-wrenching I've done so far. There are a lot of surprises in this one, so I definitely encourage you to listen. In many ways, this community of ours, the readers and members at Sovereign Man, has become somewhat of an extended family for me. And it has been my utmost privilege to join you and write this letter for the past 5+ years. With that, I'd like to wish you the happiest of holidays and a most prosperous and healthy 2015.

In more than a century, there has been practically ZERO evolution in banking. It’s the same con game, the same trickery as it’s always been. Few people actually realize this. The banking propaganda is so deep that no one ever questions the financial sanctity of his/her bank. We walk into these ornate buildings with fancy cornerstones that show off how old the bank is. They conjure images of conservative men in suits scrutinizing every transaction and safeguarding customers’ capital. They try to make us feel safe by telling us that everything is ‘insured by the government’. But it turns out that most of this is just myth. According to its own financial statements, the US government, which ultimately guarantees the whole banking system, is itself insolvent. The central bank that presides over the banking system is borderline insolvent, again, according to its own financial statements. And as for the banks themselves, many of them are poorly capitalized and highly illiquid. JP Morgan and Citi, for example, both maintain fledgling cash reserves that are as little as 3% of total customer deposits. This isn’t exactly conservative. Bottom line—you should not assume that your bank is safe. Let the data tell the truth. The numbers speak volumes. In today’s podcast I’ll show you how to evaluate the safety of your bank as your financial custodian. It’s an incredibly important topic that everyone should pay attention to.

In 1913, the US was the largest creditor in the world. One century later and the US is in so much debt that there is only one way out: default. Join me in today's video podcast as we examine the US government's own data, and come to a sobering realization.

More than two centuries ago, the brand new US government was deeply in debt and starved of revenue sources to pay back their bondholders. So they did what all governments do in that position: they created a new tax. They targeted whiskey simply because it was far and away the most popular drink in America. It was so popular that it was even used as a medium of exchange and a store of value. You could pass a bottle of the stuff to somebody as a payment for debt owed, and farmers would often turn their excess crop into whiskey as a way to store value for the future. Whiskey is what people had, what people used, and what people wanted. Therefore it was whiskey that was taxed. This was a dangerous move, as the American-made drink had risen to popularity during the Revolution, giving it a flavor of patriotism and rebellion—which is why the citizens of Western Pennsylvania weren’t going to take this lying down. So to enforce their tax law, the new government did so at the point of a gun. Going against all the principles that people had just fought for in the Revolution. It was the first time in US history that this happened, but it certainly would not be the last. You can learn more about this in today’s podcast as we discuss where this is going and what bankrupt governments are going to tax next.

“Taxes are what we pay for civilized society.” The famous quote by US Supreme Court Justice Oliver Wendell Holmes Jr. is inscribed above the entrance to the headquarters of the Internal Revenue Service. Most people don’t have a clue what he meant, or in what context the statement was made. They simply parrot it around to justify the state’s racketeering behavior. The logic is as twisted as saying “war is the price we pay for peace” or “debt is the price we pay for recovery.” They’re all logical fallacies, and assertions backed by zero objective evidence. There’s not much that’s civilized about confiscating people’s assets at gunpoint and spending it on bombs, drones, and wars. In fact, taxes in the United States are not even a civil matter-- they're an entirely criminal matter. As nearly every tax communication duly informs us, you can be thrown in jail for failing to file a form. This is not how a ‘civilized society’ conducts itself. At the time when Justice Holmes wrote that statement, the average tax rate in the Land of the Free was 3.5%. Today they keep raising taxes, and they keep printing money, because they’ve built an unsustainable system that depends on debt, overconsumption, and war in order to maintain itself. Everyone knows it can’t last. And to change the system, they put their confidence in the electoral system. As President Obama himself has said on numerous occasions, “Don’t boo. Vote.” The truth is that voting is a complete waste of time. The “change” is always hollow; the new guy almost invariably comes an incarnation of the last guy. US government debt now stands at nearly $18 trillion, and they’re borrowing money just to pay interest on the money they’ve already borrowed. They blow through almost 100% of their tax revenue just by paying interest and mandatory entitlements like Medicare. They could literally eliminate almost the entirety of government and still not be able to balance the budget. Of course, no politician is ever going to admit that or act accordingly. So does it really matter who is piloting the Hindenburg? The far more powerful way to vote is with your actions. This, and the whole context behind justice Oliver Wendell Holmes’ statement (it’s rather revealing, really), is what we cover in today’s podcast.

October 30, 2014 Santiago, Chile Do you remember all the great economic forecasts that ever came out of the Fed? I don’t either. My favorite one was when 9 months before the Great Recession kicked off, the Fed Chairman, Ben Bernanke, remarked: “The Federal Reserve is currently not forecasting a recession.” We all know of course what happened next. These people have a horrible track record. This is not a dig at anyone personally, it’s just simply a fact of how the system works. So yesterday the Fed, under Chairwoman Janet Yellen, announced that they’re bullish on the economy. That the economy is doing well, so they’re going to stop their asset purchase program a.k.a. Quantitative Easing. First of all, QE should never have happened. It was the single worst policy decision for the US dollar. The Fed expanded its balance sheet by more than a factor of five using QE in only a few years. What effect has it really had? The whole world is starting to ditch the dollar, banks have been recording record profits, US and worldwide debt has surged to astronomical figures, and asset prices across the board have reached record highs. Everything, from house prices, stocks, bond prices and collectibles is simultaneously at all time highs. This is NOT normal. It has enormously benefited those at the very top. Yet for the average people it has largely been destructive by ruining the purchasing power of their dollars. So while it’s good that the Fed is ending its destructive program, the reasons behind it are completely screwed up. Their analysis whether the economy is healthy starts from a wrong premise. We discuss this in today’s podcast. How wealth can’t be conjured out of thin air. How GDP growth figures aren’t important at all. The three factors that really matter to measure wealth on an individual and macro level. And what you can own that will do well in an inflationary OR deflationary environment.

For every crisis that strikes, the government springs up to "save" us. Introducing new bureaucratic agencies or an "Ebola Tsar" as Obama has just done, they are constantly adding to the already over-bloated expanse of government today. But when a real danger happens, they completely fail. Repeatedly. The reality is, we don’t need the government to save us from anything. All the tools and technology that are necessary for society to function without government are there. I invite you to listen to this week's podcast, where I discuss some of the tools that are immediately available to you as you take back your freedom.

People around the world are now being sparked into action, sick and tired of limitations on their freedoms. We have a number of members from our team with boots on the ground in Hong Kong, where people are politely, but fiercely protesting the state. They are not alone. Globally, the system has to change. History shows us that this always happens. World superpowers, the prevailing social contract and the monetary system––none of these can last indefinitely. We are now living in a unique time in history where all three of these systems are on the way out.

The polls in Scotland will close this week on one of the more important elections in recent history... perhaps one of the only elections that actually matters. Rather than a typical vote to see who the captain of the Titanic will be, Scots are deciding whether they want to be free and independent from the UK. I invite you to spend some time with me this afternoon exploring this incredibly important issue in our latest Podcast episode.

Back in 1971, President Nixon made a decision which turned into one of the biggest scams in the world: he cut the last link the US dollar had to gold and the dollar became just another fiat currency. Although this was over 40 years ago, it’s had a ripple effect that’s changed the worldwide economic landscape dramatically. This ripple effect still affects us today. In fact, it’s created a huge opportunity for those who know how to act on it. That opportunity is called the Petrodollar… and I’m very excited about its potential. You’ll learn exactly what the Petrodollar is, as well as how to seize this opportunity in today’s podcast.

True story: On my way to Ethiopia the vestiges of Adolf Hitler screwed me over and caused me to miss two full days of meetings. There's a really important message that comes out of this in today's podcast: Little things from hundreds of years ago still impact us today. Decisions made by people you’ve never heard of and who have been forgotten by the history books still have an impact on the markets, economies, and how we live today. Indeed, what’s happening right now will have a knock-on effect that will affect our children more than it will affect us. This is a hugely important concept to understand if you want to protect and grow your wealth and freedom -- and that of your children.  

As I travel around the world, I’ve had the great fortune to meet some truly outstanding people. And of all the amazing people I’ve met, one of the most important to me has been Tim Price. When Tim talks about investing, I listen. He was first described to me as “one of the few people inside the City of London who gets it”. His investment ethos is second to none, and it’s why he’s ran a successful wealth management firm for the last 25 years. In this podcast, you’ll learn Tim’s insights into gold, value investing, and the tremendous danger of complacency. Enjoy the conversation.