Introduction: Ron Holland is a contributing editor to several newsletters dealing with political and investing topics and author of several books, including Escape the Pension Trap. Originally from North Carolina, Ron lived in Geneva from 2003 to 2004 and divided his time between the US and Europe until 2012 when he moved to Toronto. Ron has developed and introduced several innovative investment products to investors in the US, including the first Swiss-franc denominated variable annuity portfolio licensed in the US. In his writing and conference presentations, Ron emphatically advocates global investment diversification into foreign currencies and non-US markets as essential for protection from the US government's growing debt. Holland is particularly concerned about the vulnerability of retirement funds in the US, and consults to leading financial solutions providers seeking to provide viable options for citizens seeking protection. Ron's latest book is Restoring Our American Legacy.
Daily Bell: How are things?
Ron Holland: Well, I'm on the beach in the Caribbean today as I respond to the interview questions so for me, personally, like the Zac Brown Band sings in their hit song, "Toes", "I got my toes in the water, *ss in the sand not a worry in the world, a cold beer in my hand. Life is good today, life is good today."
But I fear the economic future, especially for Americans, is an entirely different story. Actually, earlier this week an event took place of paradigm shift proportions that will likely destroy the dollar as the world reserve currency over the coming decade.
Of course, it was not covered by the mainstream media and even missed by much of the alternative media but this historic Russia/China gas deal totally outside the dollar is the beginning of the end for the petrodollar system. ZeroHedge did publish an article explaining this deal that I would recommend for anyone wanting a more thorough understanding, entitled "Russia and China Finally Sign Historic $500 Billion 'Holy Grail' Gas Deal." Over time this will translate into a dramatically lower standard of living in America along with at least a 50% depreciation in the dollar.
I fear the long-term catastrophic financial impact on the US dollar and your wealth will dwarf anything that has happened during most of our lifetimes. You can expect violence, property destruction and the end of all civil liberties and constitutional protections for a long period of time.
When world reserve currencies are replaced and major empires die, it is not the end of the world but history shows it will be the end of the world we've known for much of our life in the United States. I believe America will bounce back and the situation will not be permanent but it will be severe for those who have not prepared in advance.
Washington's response will be much higher taxes and placing a financial iron curtain around America to keep your assets available for confiscation should the need arise. This includes a future emergency wealth tax plus possible gold and retirement plan asset confiscation or forced investment into a future collapsing Treasury market. But with crisis and disruption also comes opportunity for those aware of what is happening, both bad and good.
Remember the old adage, "Invest where there is blood in the streets"? Well, the dollar collapse will not be a quick event and it will ebb and flow depending on many factors but I'm sure America will have blood in the streets and the only question is severity and duration.
Hence the reason I'm down here in beautiful Ambergris Caye, Belize on the beach with a beer. But contrary to the song lyrics, this trip is not about pretty señoritas or tequila and I can't play the guitar, nor will I "roll me a big fat one" today – though on that note, I do believe cannabis legalization for medical and recreational use will likely be the biggest positive equity market story of the coming decade.
Actually, I'm down here searching for an offshore escape hatch for Americans because the new Russia/China Axis is the biggest negative dollar and financial event for the United States at least since the Great Depression. I've found several excellent locations in Central and South America as well as domestically while doing research for my new book, Safe Haven, that will be out very soon.
Belize tops my list for beach-based, second home, safe-haven communities at prices 40% lower than most Caribbean islands. Colombia, in South America, is also an interesting situation. Click here for more information specifically on Belize where I'm visiting today.
Email me at rholland [at] eastnet.ch for a complimentary copy of the new book when available and complete guide for safe-haven opportunities to escape what is coming.
Daily Bell: You're a skilled financial observer of the international and domestic scene. We'd like your insights in this interview. Tell us about FATCA and the impact this is going to have on US citizens living overseas.
Ron Holland: First, this will impact US citizens remaining in the US even more than those living offshore. This draconian global overreach of federal power and authority has been labeled as an attempt to catch "tax evaders."
Although it will generate miniscule amounts of taxes owed by Americans here and abroad who have failed to report foreign income and accounts, the real purpose is far more threatening. After all, Washington has already killed financial privacy globally and what's more paperwork when the NSA watches every aspect of life around the world?
First, a desperate federal government wants to generate massive revenues from foreign banks that compete with domestic financial institutions through penalties and litigation.
Second, the additional filing requirements and confiscatory penalties against American citizens are designed to dissuade Americans from investing outside the dollar and American institutions in foreign jurisdictions.
Third, the goal of the excessive costs and burdensome paperwork on foreign institutions seeks to force them to curtail dealing with American clients.
Washington is attempting to create a Soviet-style ironclad financial iron curtain around America to keep all private wealth except for favored corporations and big-monied insiders in the US and subject to confiscation when necessary to meet revenue needs.
Actually, American investors should be legally following all the myriad reporting and disclosure rules and moving their assets and wealth out of the US today where it is at growing political risk.
They should be storing their gold outside of the US where it is subject to future confiscation even in domestic private storage facilities or bank safe deposit boxes. Also, they should be cashing in retirement plans and IRAs and paying whatever taxes and penalties are owed, making these funds private investments.
Otherwise, in a future dollar and Treasury debt crisis as the dollar sinks these funds will likely be forced into a collapsing Treasury bond market as retirement monies become the absolute buyer of last resort.
Daily Bell: Is the US really going to be able to bring banks in line around the world?
Ron Holland: Yes, to a large degree, as banks and bankers are seldom courageous and always willing to sell out their customers in order to keep the revenues and management fees rolling in. Foreign banking institutions will comply in the short run until it becomes apparent that the dollar and financial industry in the US is going down for the count.
Daily Bell: Why is it necessary? Does the US need the revenue that much? It seems like that's just an excuse to justify a continued and expanding overreach.
Ron Holland: The US government really does need the revenue but this is all about protecting the financial establishment. This is also a training exercise for the sheeple – i.e., people – who like being dominated. I consider Washington sort of an aging and ugly dominatrix with whips, chains, guns and tasers with millions of followers.
Surveys show almost half our population lives off the government. These people, and I use the term loosely, want to be dominated, live as slaves in servitude and suffer constant humiliation and abuse in exchange for a government job or living on the dole.
So it's just a training exercise with minimal revenue to teach us ignorant serf's discipline, domination and how to respond to the master. Think of it as just another opportunity to learn how to become the "new American serf," just like going through the TSA garbage at the airport, which does nothing to protect either America or airline passengers.
Daily Bell: Increasingly, the US seems to want to extend its financial domination worldwide. Is this a symptom of a larger pattern?
Ron Holland: America is a global empire and it serves as the main enforcement arm of the powerful central banking cartel and big business elites who do run the world as sort of a global plantation. Their goal is indeed continued financial domination worldwide but Russia, China, Iran and many of the BRIC countries have had enough and they are circling like vultures ready to strike when we can no longer defend ourselves.
Daily Bell: Is it possible that there is a plan to sink the US economy and then to promote a more international currency in place of the dollar?
Ron Holland: It is possible but I'm not convinced, as the financial elites would prefer the status quo as long as they can maintain control – though they know the petrodollar days are numbered. They must have another controlled political and economic system when the dollar debt democracy scam is totally discredited.
Remember, in 1918 the monarchies of Europe were totally discredited after the horrors, death and destruction of World War One and this is when "democracy" – what Jefferson correctly labeled "mob rule" – was touted as the solution. Of course, this too failed resulting in the rise of communism and fascism. Real limited government and free markets will never be implemented because this would limit the control of powerful elites and central banking.
Daily Bell: Is the petrodollar dying? We think it is – along with Saudi Arabia and the Middle East generally.
Ron Holland: America is the global enforcer for the central-banking franchise, our soldiers are the cannon fodder and our bureaucrats are the storm troopers. Yes, it began to die this week when China and Russia announced that those two nations had just signed a deal to bypass the dollar in global energy trade. Since Nixon closed the gold window in 1971 world trade in oil has been in dollars – often referred to as the petrodollar scam – and this was enforced by the military might of the USA.
The Russia/China gas deal, as well as Russia's dumping Treasuries and buying gold, ultimately means the dollar will be toast. The 50 percent of the population who are unproductive will want what you have and this is why I'm looking for a second home and emergency escape hatch outside of the US.
Daily Bell: Where exactly do taxes go? Is it necessary for the US leviathan to collect taxes? Couldn't the Fed print all the money necessary?
Ron Holland: Taxes go to meet the difference between what the politicians borrow, i.e., the national debt, and what they spend for special corporate interest welfare and the people-programs necessary to buy votes to win elections. No, the Fed could not print all the money necessary, at least not for long. The result would be a hyperinflation similar to what destroyed Germany and brought Hitler and National Socialism to power. Hitler supplemented the inherent work ethic and organization of the German people with wealth and property stolen from the Jews and other so-called political enemies. Soon enough we will well understand what this was like.
I fear every productive American with savings, retirement plans, a home and real estate will be treated like the Jews in Germany were treated when labeled as enemies of the state. Why pick on a single group when you can confiscate from everyone with savings and property except for maybe the very wealthy 1%.
Daily Bell: There are those who claim the US is actually a corporation and that citizens in this modern era are actually assets of this huge corporation. Is it possible that extending tax laws around the world is a way of more formally emphasizing this relationship?
Ron Holland: I have heard this explanation and scenario for years and, frankly, who cares? It's like the question: Are the IRS and the income tax constitutional or legal? What does legality in a corrupt system really mean where those in power and dominating the rest of us have their guns pointed at our wives and children and a taser ready to go should we shuffle too slowly. Extending American tax laws on a global basis is simply a way to steal more wealth from private individuals and more fines and penalties from offshore competitor financial institutions.
Daily Bell: What about expats generally? Would you suggest that people stop going abroad because Homeland Security, the IRS, etc. are making travel more and more onerous?
Ron Holland: To the contrary, I think people should travel more internationally and see the world rather than remain in the US, blinded by propaganda on the right from Fox News or on the left by MSNBC, CNN and all the establishment press. If you travel a lot you learn that people almost everywhere, regardless of wealth, standard of living or their government, are usually quite nice and helpful when treated with respect and kindness.
Would it have been prudent to have recommended to the Jews in Nazi Germany in the 1930s to stay at home rather than move or travel abroad? How well would that have worked out?
Many people say it can't happen here. Hell, if you read history you know this kind of stuff can happen anywhere and the stage is set for it to happen here. Remember, tyranny isn't abnormal for most of the world; what is unusual is the degree of freedom and liberties we formerly enjoyed in the US thanks to our founding fathers.
Daily Bell: We've speculated that there are two classes of travelers emerging: those with security clearance and those without. Is it possible at some point in the future that those without such clearance will find traveling so difficult that they will effectively be "grounded"?
Ron Holland: No, they will not be "grounded" because travel abroad is difficult. They will be prohibited from leaving because they might owe taxes or fines, or think to themselves why leave if you can't take your wealth and family etc.? I see the distinct possibility of one's wealth, person and family held hostage during a crisis situation unless you pay them what they demand for your escape.
Daily Bell: Moving money around also seems to be becoming more problematic. Aren't big banks refusing to wire funds to certain classes of customers?
Ron Holland: Yes, and this is only the beginning. One more real or black-ops directed terror attack and America will make the old Soviet "Iron Curtain" in eastern Europe look like the Hong Kong free-trade zone compared to the US. Everything – all wealth, retirement plans looted – will be locked up.
Again, it is important to remember that as the dollar falls in the future and there is a global run out of the dollar and US Treasury obligations our politicians will want to use much of our wealth to either remain in power or secure their escape therefore exchange controls and blocked accounts will be ordered when necessary.
Daily Bell: What's the point, do you think? Is the US just desperate to hold onto funds and doesn't want to see outflows? Or is it a control mechanism generally?
Ron Holland: Everything is all about the money and control. They want it all to remain in power and control and they must steal it from working, productive Americans to remain in power. It's as simple as that.
Daily Bell: Let's talk about Cyprus and the bank bail-in. People who placed money in banks ended up losing much of that money to make banks whole, as we understand it. Is that sort of practice coming to the US?
Ron Holland: Yes. Bank accounts will be locked up by presidential executive order just as surely as Roosevelt stole private gold in 1933. These one-time wealth taxes and account freezes will be popular all across the indebted Western countries, not just in the United States. The only guarantee on this new form of theft is it will not be a one-time occurrence but repeated over and over again by desperate politicians and bankrupt governments.
Daily Bell: Are US banks in good shape? What does it mean for a bank to be in good shape these days? For that matter, what is a bank these days? We see it mostly as an extension of central banking, just a distribution point.
Ron Holland: You are totally correct. Private banks are just an extension of the central-banking franchise or cartel but are both a distribution and receiving point. I assume most banks are not in good financial condition but private citizens and even financial experts will never know the real situation until it is too late.
The elites very much fear bank runs so think back to the last crisis when banks and brokerage firms were merged, closed and changed all over one long weekend. It will be the same in a future crisis.
Daily Bell: The Fed keeps distributing currency through its big money center banks, however. And that money keeps finding its way into expensive real estate and increasingly expensive stocks. Meanwhile, the Fed is paying the banks not to lend, basically. Why the manipulation? Is it possible that the Fed doesn't want a full-fledged recovery?
Ron Holland: Their ultimate goal is to create wealth and a sense of well being for the wealthiest 1% of the population. They are buying off this tiny percentage of our population because they have the power while they make the rest of us poorer and take what we have earned.
I hear all of the propaganda against the oligarch friends of Putin in Russia. These wealthy few keep Putin in power and he does in general represent their interests but at least he loves his country and wants the best for his nation. America and other countries in the West also have our "secret oligarchs" and wealthy families that run the show.
Governments have always been run this way – lip service for the poor and under-privileged, false democracy for the masses but in the real world, only the powerful elites have any real political power. This has been the case for thousands of years and it will not change.
Daily Bell: Is it possible that those behind the Fed actually want new asset bubbles and new stock bubbles?
Ron Holland: Of course it's possible, and this is how they make their profits and pay off their supporters and fellow travellers. The average investor is conditioned to buy at the top and sell at the bottom while the insiders make the money. Again, there is nothing new with this scenario. The insiders always get the inside information and this combined with high frequency trading by a few favored institutions allow those in the know to make fantastic profits at the expense of regular investors.
Daily Bell: Isn't there plenty of oil in the world? Isn't energy scarcity manipulated? As you just discussed, Russia and China just met to further reinforce non-dollar denominated financial transactions. Is this a sign of things to come?
Ron Holland: First, I agree there is plenty of oil and natural gas in the world but much of it is in the wrong places. Hence, nations have shipping lanes to protect and pipelines to build and defend. This is why Syria and the Ukraine have been such flashpoints in the last few years.
Forget the propaganda about bringing democracy or overthrowing evil criminal governments. Heck, all governments are criminal to a degree. Remember, everything is all about the money – or in this case, pipelines.
Frankly, the Obama administration has managed through incompetence and John Kerry to create an alliance, both economic and military, between Russia and China because of our aggressive actions against both countries. We are engaging in so-called "economic sanctions," which are actually considered an act of war.
In return, without fanfare or threats they will together eventually sink the dollar and end the petrodollar system that has made America rich. It is happening together right before our eyes, as I mentioned earlier.
I have suggested that over the next decade the American dollar will lose at a minimum 50% of its value versus the coming gold backed Russian/Chinese alternative and the Swiss franc. Imagine the situation for the average American when their paycheck buys 50% less than in earlier years.
Daily Bell: Should people begin to get their assets out of dollars? If so, put them into what?
Ron Holland: They should already have a large percentage out of the dollar. I like gold, foreign securities, unique startup situations and IPOs and even mining stocks, although I'm not convinced mining shares will do well because there are now so many other precious metal alternatives.
As I said earlier, I believe big money will likely be made by early investors into the exciting new cannabis startups and IPOs. But diversify any investment in this area among a number of companies because many will fail and only a few will do well. Once again, although there are real medical benefits from cannabis use, the government policy change is primarily because they need the revenue at all levels of government.
Daily Bell: Is the time coming when there will be an interior dollar and an exterior dollar, where internal dollars will be devalued while overseas dollars will hold their value?
Ron Holland: No, I don't think so. Dollars everywhere will suffer the same fate. Many years ago when I used to visit the Third World – Egypt in particular – the beggars used to say, "dollar, dollar, dollar." Now they say, "euro, euro, euro." Soon they will be clamoring for the coming Russia/China gold and energy backed currency.
Daily Bell: And what about people living overseas? Should they be thinking of giving up their citizenships or at least getting new passports?
Ron Holland: At a minimum they should be getting foreign residency or retirement status, alternative passports etc. I personally think it is too late for Americans to be renouncing their citizenship. What good is it to give up your citizenship when they take most of your wealth and harass you whenever you re-enter the US? I have heard so many horror stories regarding this.
Daily Bell: Are people in the US increasingly in danger of fedgov confiscation of assets? It seems as if regulatory agencies have gone rogue under this administration. They are being armed like mini-armies and passing clearly unconstitutional regulations in some cases. Is fedgov out of control? Why?
Ron Holland: Yes. As I said earlier, it's already a done deal. They will do this in the future during a real or contrived crisis.
Daily Bell: Why all these scandals – Benghazi, the IRS versus the Tea Party, Fast and Furious? And why is Eric Holder declining to examine any of them? Is this sort of inaction making it clear that there are two standards of justice in the US?
Ron Holland: I disagree with that thinking. There aren't two standards of justice in the US today; there is simply no justice. Eric Holder is just protecting his friends and powerful interests and for others who oppose the system, of course they are targets of opportunity.
America is a prison regime and we have a larger percentage of our citizens in jail than any other country in the world. Most of those jailed are there for petty crimes and minor offenses that shouldn't even be illegal in the first place.
The legal industry has profited from this business, the prison lobby has done the same and seizures and confiscations together with payoffs and graft have made many in law enforcement very wealthy. This gravy train of corruption by those who should have been protecting the public is only ending for cannabis, for example, because local, state and federal governments need the revenue more today than do the special interests.
Daily Bell: Is this an ongoing trend or will the next election make things better? Can politics cure what ails the US?
Ron Holland: While I would vote for Rand Paul should he get the GOP presidential nomination, I would not otherwise waste my time. Both parties are equally corrupted and bought off by special interests. In our present closed two-party monopoly system, individual American citizens can have little impact on what happens at the federal or state level.
The only real solution is to either leave the country personally or promote individual state-by-state secession.
Daily Bell: What about the Tea Party – flash in the pan or an expression of deeply credible dissent?
Ron Holland: It was a flash in the pan and an example of the Stockholm syndrome. Like all movements that threaten those in power, it was simply taken over and redirected by the establishment. Imagine running around waving flags that represent those who oppress you. How dumb is that?
Daily Bell: What should people do now? The stock market seems like it will continue to go up. Perhaps people should make stock market plays of some sort but surely they should hold gold and silver as well?
Ron Holland: Every establishment market in the world from Wall Street to precious metals etc. are all manipulated. The only free markets are new markets that haven't been controlled or screwed yet by powerful insiders. This is why I don't like singular Wall Street products or advice and never base an investment decision on what I watch or CNBC or read in the Wall Street Journal.
Daily Bell: And if one is making a play on the market – maybe through an IPO or private investment – shouldn't one be very conscious of where the market is and where it's going?
Ron Holland: It's really very simple. First, invest in new industries or technologies before they become controlled by the big players on Wall Street. Second, do your own due diligence and invest in something you understand. Third, attempt to find balanced advice and research, though this is difficult.
For example, I own shares in two Cannabis companies and hope to take advantage of the change in public policy both in the United States and internationally. I might have an excellent crystal ball when it comes to current financial events and foreign affairs but I am simply biased towards this new growth industry and the reason I mention it.
Daily Bell: This bull market surely cannot last forever, though it may run longer. How much longer, do you think?
Ron Holland: I think the bull market on Wall Street and the dollar became terminal in the near term on Wednesday with the $400 billion natural gas deal between Russia and China. Still, although the near-term financial impact might be minimal, over the next decade this singular event signals the death of the dollar as the world reserve currency and the end of the petrodollar scam that has governed the world since the end of the Second World War.
Daily Bell: When is it time to begin buying junior mining stocks, as you mentioned previously? They haven't blown off yet but surely they will.
Ron Holland: I'm not sure junior mining stocks will come back for some time and even then, there are so many ways to buy gold and silver today, why should investors even consider this route? Now, if a company would only invest in producing gold-mining operations and only sell what is necessary to cover expenses while retaining the bullion on the balance sheet I would support, invest in and promote such an investment opportunity.
Daily Bell: Any other points you want to make? Publications you want to refer to?
Ron Holland: Not really. Just a reminder that readers should email me at rholland [at] eastnet.ch if they want a copy of my new Safe Haven book when it's published and click here to find out why I'm so high on Belize as a lower cost safe-haven jurisdiction as well as a real estate opportunity.
Daily Bell: Thanks for your time, Ron.
Ron Holland: You're welcome.
We thank Ron Holland for this interview, which is perceptive as usual. He touches all the high – or low – points including an explanation of how the US government can go about attacking banks around the world in order to insist on taxing prerogatives.
We also agrees with us on the increasing difficulty of moving your money and yourself from place to place, especially if you are in the US. And yes, the US is one "incident" away from further draconian measures that will make such movements a good deal more problematic.
He's correct about the stock market as well, and about positioning oneself in startups such as those taking advantage of the growing cannabis industry. Stock markets are going to go down hard at some point, but from our point of view, the Wall Street Party remains in effect and is not yet about to subside.
Perhaps the only place we disagree with Mr. Holland is in the area of the West's coordination around the world. We have a feeling, unfortunate as it is, that China and Russia – the BRICS, really – are not so adversarial to the US as is currently being portrayed by the mainstream media.
To some degree, elites the world over seek increased internationalism, and one way of generating this state of affairs is via a certain degree of polarization that inevitably creates further globalist solutions. Within this context, Putin is perhaps no less international-minded than Barack Obama.
No matter, however. The intentions are not so important as the results. And the results are certainly a diminished dollar and, eventually – perhaps – ever higher prices for commodities including oil and gas.
We also agree entirely with Ron's basic premise: If you live in the US – or in the West generally – try to spread your wealth around. Don't leave it all at home. Seek a second house, another passport, a different country where you can go if your situation in your primary place of residence becomes more difficult and your government more repressive.
Unfortunately, in this era, such considerations are necessary ones that we all would do well to implement.