July 1—The Collapse of the Dollar?

Passed by Congress in 2010, FATCA is designed — using a controversial dragnet-like method — to catch those Americans thought to be evading taxes by hiding their wealth in foreign bank accounts. The way FATCA does this is by requiring that all non-U.S. financial institutions pass along detailed information about American account holders, or potentially face steep penalties.

But casting such a wide net is producing unintended consequences for some Americans who faithfully pay their taxes from afar.

Banks around the world are suddenly rejecting Americans as clients or customers, because they don't want the reporting and bureaucratic hassles, plus the potential exposure to draconian penalties. Non-Americans are pulling their assets out of U.S. banks. I get emails every day from American expats who say they are facing all kinds of problems bringing their long-standing foreign-based banking life into compliance with this new law. Some of them say they're getting ready to renounce their citizenship. Over the years I've had accounts with banks in England, Japan, Malaysia, China, and now Australia when living or working in those places, and I'm wondering what I have to worry about to make sure the remaining ones "comply."

"I have always filed my U.S. taxes just as I am supposed to," says Brian Dublin, 47, an American businessman now based in Zug, Switzerland, who has lived overseas for many years, including stints in Russia.

"However, as a result of FATCA, in the past year I have been kicked out of a Swiss bank that said, 'Hey, we love you, but we won't work with Americans.' I have also been kicked out of a Swiss pension fund. They told me they don't want any Americans in the fund. They don't want to work on behalf of the IRS," he says.

"And on top of that, I spend many hours and many dollars each year filing U.S. taxes when I sometimes turn out to have zero liability for that year because I have paid a lot of tax somewhere else," Dublin adds.

Dublin, a New York City native, says he will be eligible for Swiss nationality in the next few years and that if the situation has not dramatically changed he will give serious consideration to renouncing his U.S. citizenship.

Writing in the New American, Alex Newman argued the more dire side of FATCA, speculating that it could potentially result in a large-scale movement by foreign investors to pull out of U.S. assets and markets:
One of the underreported but major risks to the U.S. economy stemming from FATCA is the potential for wide-scale disinvestment from the United States by foreign institutions seeking to avoid the IRS, penalties, and huge compliance costs. In fact, countless analysts and financial giants have said the 30-percent FATCA "withholding tax' represents a powerful incentive to get out of U.S. markets entirely. The implications for the stock market, bonds, the dollar, and more could be monumental.

Estimates suggest there is currently more than $21 trillion of foreign capital invested in American assets and markets, with about $10 trillion of that in the stock market. However, that could change as FATCA enforcement begins later this year — possibly quickly. The Japanese Bankers Association, the European Banking Federation, the Institute of International Bankers, and others, for example, have all openly warned in recent years that some of their members could decide to ditch U.S. assets and markets in response to FATCA.

Luxembourg Bankers' Association CEO Jean-Jacques Rommes, speaking to Democrats Abroad, warned that the best way for banks to lower compliance risks was simply to reduce the amount of American assets they hold. "In other words, divest from the US market, in general," he explained, as summarized by the Luxembourg Bankers' Association.

Multiple reports have suggested that small and medium-sized firms, unable to bear the compliance costs or the crippling withholding taxes, would be especially likely to ditch American markets. "On the institutional side, the cost of becoming FATCA compliant may be prohibitive for some foreign institutions, and therefore they will divest from their American holdings," explained Douglas Goldstein, author of The Expatriate's Guide to Handling Money and Taxes and director of Profile Investment Services Ltd. Indeed, compliance costs borne by the private sector are expected to dwarf the amount of additional U.S. tax revenue — perhaps by hundreds of times.

Goldstein explained: "Faced with the choice between paying to implement the new rules or divesting from U.S.-based assets, smaller foreign banks that can't afford to shoulder these costs may choose the latter," Goldstein added. "After all, there are plenty of promising new markets in which to invest."
http://www.snopes.com/politics/conspiracy/hr2847.asp



Snopes Last updated: 14 April 2014

Sources:

Fallows, James. "Fatca: The Menace You'll Hear About in 2012." The Atlantic. 31 December 2011.
Graffy, Colleen. "How to Lose Friends, Citizens and Influence." The Wall Street Journal. 17 July 2013.
Hjelmgaard, Kim. "Americans Abroad Find Citizenship Too Taxing to Keep." USA Today. 8 March 2014.
Newman, Alex. "The Dark Road: The Worst Tax Law You've Never Heard About." The New American. 8 April 2014.

The World Bank is boldly proclaiming that extreme food shortages and subsequent food riots will take place in the near future largely due to the rapid increase in food prices.

In their recent report, only released a few days ago, the World Bank cites the disturbing fact that there have been 51 food riots in 37 countries in recent memory due to high food prices and the further escalation of food prices has no end in sight. The World Bank further speculates that the present state of food prices could lead to political instability and this is the kind of stuff that wars are made of. And what is the number one cause of rising food prices according to the World Bank?

It is the increasing demand (see attached PDF) for food from a growing population inside of China. The future military implications should be self-evident.
http://whatreallyhappened.com/content/world-nine-meals-widespread-revolution