QUESTION: Hey Martin
You always say that us in Europe better get our money out while we still can.
I know that you recommend bank account in US but that isn’t always so easy.
As some kind of alternative, what do you think about storing some gold in Asia ( Hong Kong, Singapore etc.)
I am no gold bull and I understand that you take the risk of gold still going under 1000 dollars but in the long game you always say that the tangible asset survive.
mainly I like this option because it’s easy to set up, relatively cheap and I don’t have to report it.
If you could find the time to give me the possible down sides in this and that way keep me from doing a big and costly mistake I would really appreciate that.
ANSWER: What you have to keep in mind is timing. Many people like to refer to the Great Depression as their guide. Keep in mind we were on a gold standard so the rise in the dollar meant a rise in gold. As the Sovereign Debt Crisis hit in 1931, first the capital fled to the dollar. Then when the dollar was the last one standing, pressure on the dollar began as people assumed the US would default like everyone else. That did not happen, but FDR devalued the dollar relative to gold moving it from $20.67 to $35.
There are already 13 nations in default of their national debts. If interest rates go up 1%, we will see another almost 30 join the default list. Take interest rates up 2.5%, and the list will soar to probably 100 nations in default.
The first crack in the world monetary system will ONLY be caused by a strong dollar – not a weaker one. First, you get the dollar rally, then you get the dollar collapse. So keep this in mind. If you buy gold and then see a decline, will you panic and sell the bottom, which is typical? That becomes the game.
There are other places to have dollar accounts. But the USA is not part of the reporting system back to Europe. Most other places are. The USA has become the new tax haven for the world – not American unfortunately.