August 25, 2011
Zell am See, Austria
As usual, the CNBC hosts were completely dumbfounded.
Phoning in from Sao Paulo, Brazil, investment guru Marc Faber was a guest on CNBC last week, once again telling the unvarnished truth about the state of the world economy and bankrupt western nations.
This time, Faber had a very clear message: that everyone should own *physical* gold… and what’s more, they should store it outside of the United States:
“I prefer if investors hold physical gold in a safe deposit box, ideally outside the US, in various locations… Switzerland, Singapore, Hong Kong, Australia, Canada… I think it’s important in today’s very uncertain world to diversify, not only the various asset classes… but also the custody of your assets should be in different jurisdictions.”
His hosts couldn’t believe it. -NOT- store in the United States, the bastion of freedom and security??!?! What lunacy!
CNBC: “Uh, so do you thus not trust US banks or US custodians? Do you think they might fail or abscond with the gold?”
Guffaws and incredulous snickers emerge from the hosts.
Faber: “I don’t trust anyone.”
CNBC: “Hmmm. Interesting.”
Completely devoid of anything intelligent to say on the topic of sovereign diversification, they quickly changed the subject to talk about equities… but Faber soon came back to his original point.
Among other things, he mentioned that banks in Asia are FAR more stable and sound than they are in the west for not having invested so heavily in dead weight assets like Greek bonds or US mortgage-backed securities.
I couldn’t agree more.
This is a point I’ve been pounding on from day 1: internationalization, what I frequently call planting multiple flags, is absolutely critical to reducing your risk.
You won’t ever hear about it from the talking heads on state-sponsored media like CNBC. They refuse to look at the real world where America is no longer the center of the financial universe or the safest place to put money.
Truthfully, though, bankrupt nations like the United States pose the greatest risk of all to our prosperity and livelihood, regardless of whether we’re just starting out or have already achieved it.
This is because politicians will stop at nothing to maintain the status quo; the more they try to ‘fix’ things, the worse the situation becomes. They think they can borrow their way out of debt and spend their way out of recession. When these tactics don’t work, they just borrow and spend more.
In recent remarks during an official visit to Japan, Vice President Joe Biden said that China became the world’s second largest economy only because of US troop presence in Asia.
This line of reasoning only makes sense to a politician: China’s growth has nothing to do with its huge population, massive accumulation of savings, burgeoning technology, or culture of productivity… and everything to do with US military installations in South Korea, Japan, and Okinawa.
Such logic truly tests the patience of rational, thinking people, yet it exemplifies the kind of out-of-touch, mindless bureaucrat who is running the country.
Marc Faber has it absolutely right: entrusting the preponderance of your assets to these moronic sociopaths is a foolhardy endeavor. Own physical gold as a hedge against their idiotic fiscal policies, and store it overseas to make sure they can’t get their thieving hands on it.
Here in Austria, there’s a great secure storage facility in Vienna called Das Safe. You can rent a safety deposit box from them completely anonymously, and the box contents are insured for up to $50,000.
This is financial privacy at its finest… and if you want to take Marc Faber’s advice, you should definitely consider Das Safe. As an aside, Austria is also a great place to buy gold; you can purchase the gold ‘Philharmonic’ coin at almost every bank in the country at premiums as low as 3%.
If you’re serious about doing this, you should check out last month’s edition of Sovereign Confidential. I covered a lot of detailed information about moving and storing gold overseas, including specialized contacts and obscure regulations that you need to know about.