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It's Official - America Now Enforces Capital Controls

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  • #16
    Re: It's Official - America Now Enforces Capital Controls

    Sometimes in the name of 'factual' reporting and discussion here, the common sense gets lost. I don't care what is this called, I care what it means.

    What does this mean for a middle-class person, say having 100K in BV, or sending 5K to family overseas? Has anyone thought of implications for someone with 9-5 job and who's not studying charts every day and using a language of what amounts to fire-babble?

    Some practicality please? Big words are great in the heads of people whose profession is to deal with them, but it also distances them from from the rest of us. Earth calling Jupiter!

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    • #17
      Re: It's Official - America Now Enforces Capital Controls

      good point

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      • #18
        Re: It's Official - America Now Enforces Capital Controls

        Is BV a foreign nonfinancial entity or a foreign financial institution?

        Stoel Rives LLP:
        Provisions Affecting Foreign Activities of U.S. Businesses:

        New Tax and Withholding Regime. The HIRE Act imposes a 30% tax, withheld at the source, on certain payments to foreign financial institutions and certain other foreign nonfinancial entities. The types of payments subject to this new tax are: (1) U.S.-source fixed or determinable annual or periodic ("FDAP") income (e.g., interest, dividends, rents, and royalties); (2) gross proceeds from the sale of property that produces interest and dividend income; and (3) interest on deposits with a foreign branch of a U.S. commercial bank. Foreign financial institutions generally can avoid being subject to this withholding tax by entering into an agreement with the IRS that, among other provisions, generally would require the foreign financial institution to provide information about "U.S. accounts." Subject to certain exceptions, an account constitutes a U.S. account if it is owned by a U.S. person or by a foreign entity in which a U.S. person owns, directly or indirectly, more than 10% of the interests. Other foreign nonfinancial entities generally can avoid being subject to this withholding tax by providing the withholding agent (generally, the person making the payment) with either (1) certification that no U.S. person owns, directly or indirectly, more than 10% of the interests in the entity or (2) the name, address, and taxpayer identification number of each U.S. person that owns, directly or indirectly, more than 10% of the interests in the entity. The withholding tax regime does not apply to certain foreign nonfinancial entities, including publicly traded foreign corporations. The new withholding tax regime generally is effective starting in 2013.

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        • #19
          Re: It's Official - America Now Enforces Capital Controls

          Originally posted by babbittd View Post
          Is BV a foreign nonfinancial entity or a foreign financial institution?
          From the <a href="http://www.bullionvault.com/">BullionVault</a> website:
          BullionVault is owned by Galmarley Limited [name origin], which is company number 4943684 registered in Great Britain.

          As at October 2008 the company had 47 shareholders. For a modest fee you can obtain a full and formal shareholder list, updated annually, from Companies House on http://www.companieshouse.gov.uk.

          Galmarley's offices are in West London (UK) and we welcome callers by appointment. Our contact details are here.
          I don't pretend to understand the legalese, but it sounds like a British company to me.
          Most folks are good; a few aren't.

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          • #20
            Re: It's Official - America Now Enforces Capital Controls

            Originally posted by ViC78 View Post
            This article has prompted hysteria in the blogosphere. I was hoping to see this posted here and the reaction of the iTulip management to this article. Seeing the response has re-affirmed my faith in iTulip stewardship. This was a litmus test for me to separate the phonies from the truly knowledgeable. ZeroHedge is too steeped in conspiracy and hysteria to be of any worthwhile use, S/N ratio is way too high.

            Thanks for the clarifications, FRED.
            With zerohedge screaming "wolf" at the top of their lungs every 5 minutes how will people know when there is really something to worry about. You hit the nail on the head with regards to the kind of readers that sort of sensationalism attracts.

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            • #21
              It's Official: America's Capital Controls can be overridden ...

              It's Official: America's Capital Controls can be overridden ... by one simple idea.

              Immigration or permanent residency.

              So long as the USD holds some value (that is to say as long as hyperinflation has not totally destroyed the USD) most nations can create a non-enforcement clause of USD Capitol Controls in their own regulatory framework with the principals that

              -- So long as the person is seeking permanent residency
              -- So long as the person is seeking future citizenship

              the Capitol Controls rule can be totally overlooked and completely ignored.

              American resident and passport holding persons may have to fill out paperwork (with their non-US bank, or non-US bank regulator) stating that the money is for future immigration purposes, but that is it.

              No nation will want to willingly punish Americans (or any other nationality for that matter) that move their USD into the local currency into local (non-US finance system) banks.

              The US is in a long term total decline as a world power, so I don't see how the US itself is going to enforce these Capitol Control rules.

              You can either hold Mesopotamia and Afghanistan, or you can enforce Capitol Controls -- but you cannot do both.

              Like with Sir Roderick Spode (the 7th Earl of Sidcup) -- you can either be a fanatical right wing amateur dictator (and a member of the House of Lords) ... or you can design ladies undergarments. It must be one or the other. Not both. Before Spode inherited the title of Earl of Sidcup from his uncle, he made a living as the "founder and proprietor of the emporium in Bond Street known as Eulalie Soeurs", a famed designer of ladies' lingerie.

              There is an old American habit -- perhaps dating back to Andrew Jackson's time (but it could even predate this) that the US economy has been [and always will be] designed from the ground up to allow people to make themselves rich and then get up and leave with all their [acquired] wealth without any questions ever being asked. This is a habit that has been in place since 1650, and I do not see it changing.

              This is a classical 'money on the land' issue of a totally corrupt and collapsing empire.

              These Capitol Controls are not a real problem [in the short or long run] as there are always more and deeper loopholes that can always be found, even for common people. The US is a failed state that exists in a state of lawlessness -- and classically failed states obsess over enforcing exceptions as much as they obsess over not enforcing any real law.

              The sum total of US finance sector regulation has always been designed to have loopholes that can be taken advantage of by those that can find them.
              Last edited by billstew; 04-17-10, 05:37 AM. Reason: content

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