Oh so clever, I like it!!!
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Given your dual situation, I’d have seriously considered moving back to Britain. Labour won, yes? At least for the moment. Of course, you still have that anachronism called a “royal family”.
Back to the main topic, I would love to put my liquid assets (and even brokerage) into Switzerland. They have a centuries-old reputation for safekeeping, and not bowing to other governments when pressured. But, and this sounds silly, I really only know about that from the movies. Would I have to show up with my account number, in person, to transact?? That would be impractical from Arizona. If I could do electronic banking, but no other government could touch my funds, that would be ideal.
Retirement accounts likely would be different. And I’m not trying to avoid my tax obligations (I’m not a greedy billionaire). I just want safety when all norms and safety rails are being removed.
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Of course not. Switzerland has world class financial services, especially for wealthy clients resident offshore - at a price, of course. Transactions can be initiated remotely, or you can let a PM manage your assets if that is your preference. Since US FATCA and QI, many (but not all) banks are shying away from onboarding US persons though due to ‚compliance risk‘ (which roughly translates to ‚being crucified to death by US regulators and justice system for the tiniest, even unintentional mistake‘).
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Alas, I’m not wealthy. We have enough that we retired early (due to health scares, not relevant to this discussion). We aren’t extravagant, but we are concerned with US banks when there is discussion of ending FDIC, and further erosion of consumer protections (e.g. US banks have already crashed the economy once in 2008), we want sanity and security. The merging of investment banks with regular banks was a huge mistake.
Could you point me to a poor-man’s Swiss bank or resource? Not really sure where to start.
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I doubt a „retail“ offering exists for US residents (that would combine heightened ‚compliance risk‘ with low fee income) - these are targeted at people resident or at least working in Switzerland.
I could tell tales I’ve heard about the collapse of the famous Swiss Bank “discretion”, but not surprisingly the tales are very long and extremely convoluted. However, after hearing them from multiple descendants of various refugees in Mallorca, including Jews, Nazis, and English traitors, I wanted nothing to do with Swiss Banks or most of their clientele.
The replacement banks for stashing money away from tax authorities and rapacious dictators seems to have be Arabic nations with oil power, and Panama and various tiny island banks, but none of them have the nice Heidi chocolate goats “cover”, all smelling of icky oil, narco sleeze, or extremely faded English snot, instead of finest alpine cheese…. The smell test does matter in banking.
In the mid 1980s some of the nastier members of the Reagan administration (Attorney General Meese, Presidential Counselor Deever, and friends) declared war on the gay rights movement, and began by attempting to destroy the gay publishing business I quietly had majority interests in (most of my partners died of AIDS leaving me last investor standing)(we had created, owned or had list sharing agreements with the other major gay mailing list holders (we were the biggest), and we were the primary protectors of the primary subscriber lists, (my background in digital cryptography was extremely relevant). Those lists were the crux of the gay rights movement.
The Reaganites “persuaded” (that this is possible and even commonplace is the crux notion in this entire post) all of the major USAian banks that had been processing our customer credit card payments to suddenly cut us off. We would have gone cash flow bankrupt within about three weeks (you can imagine the intensity of my conversations with my company treasurer). I was able to arrange, via some Italian American acquaintances in Brooklyn (most significant publishers had to have these acquaintances as “those guys” quietly controlled magazine distribution in much of the USA, and fortunately they found our cash flow reliable and wonderful), for card processing at a Cayman Islands bank for a slight fee. After three months the USA banks tired of being cut out of the game and we returned to almost normal. However, Meese and the sleeziest of his followers (Ashcroft’s most “Christian” agents) spent years afterwards attempting to find a way to use RICO laws to take revenge against me personally).
I do not trust any bank, but must use them, and my favorite internationally is Banca March of Spain. I tend to protect my wealth by holding land rather than securities, partly because land has a heck of a lot more inertia regarding ownership.
Juan March was an extremely complicated mostly fascist power operator (the anarchists and communists also made use of him for a fee) whose amazing career I will not try to summarize.
I think of “we will keep your secrets” banks as scams. The Swiss Banks had the historical clout and political connections to provide some real secrecy up into the modern era, but no more.
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I still have no meaningful answer to your question. I worked my way through law school and Ispouse worked her way through college and post grad education. We spent nearly 40 years accumulating rights to SS benefits, plus one pension and a few $M in investment and bank accounts, all with the assumption that we were participating in a fundamentally safe financial system governed by the rule of law, however imperfect.
Now I am trapped in a deteriorating financial and legal system where the leaders at the very top are above the law. I have no real power to stop them from confiscating the money I spent a lifetime saving if we were to reach that point.
I don’t see direct confiscation as likely at this point. With 70% of our national spending going to SS, Medicare, Medicaid and defense, and repeated votes by the American people for tax cuts no matter the cost, I do see either 1) deep cuts to SS, Medicare and Medicaid, or 2) perpetually growing national debt leading to default.
I can brace for 1) erosion of SS, Medicare and Medicaid - better than most. In extreme circumstances, I could liquefy a fair amount of cash with few tax consequences, use my feet and a mountain bike for local grocery shopping, pay for feed for my daughter’s egg laying hens, etc.
I would be helpless to protect my financial assets from 2) a National default if it were sufficient to wipe out my banks, brokerage firms and fdic insurance. Only the corrupt people at the top would flourish. Think Mussolini 1925.
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It’s time to diversify to other counties. Your fears have real potential to be realized.
IP
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While not liquid, a Swiss life insurance policy would put part of your assets out of the country. It would be denominated in Swiss francs and down the road you can cash it out.
DB2
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Account with a foreign broker, funds invested in non-US securities held at non-US custodians?
Thing is, in those doomsday scenarios, how much would those investments still be worth?
Perhaps foreign real estate values would suffer less, or be of practical use if you are able to move there.
I’d be happy if they just paid the lifetime tax rate on all their income and assets of a teacher or firefighter (i.e., 10% or so.)
To do that, you’d have to 1) eliminate the stepped up cost basis for the estate tax, 2} have them pay the capital gains tax at death, and 3) cut the unlimited amount for charitable donations to maybe 50% of net worth, and make them pay taxes on the balance. (You could still leave everything to charity if you want, but it would be “after-tax” for half of it.)
And I start that taxation regime at $50 or $100 million net worth, not $1 billion.
intercst
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That strikes me as a very good idea. Choose a strong firm.
That’s all fine, and I’d also be happy with changes. But that isn’t what I replied to. I replied to an assertion that taxing billionaires will “stop it”, “it” being our descent into oblivion due to spending a LOT more than we have available each year. The fact is that even if we take 100% of all billionaire income each year, it’ll only cover a small fraction of our overspending. And, heck, even if we take ALL billionaire wealth, it’ll only cover 2, maybe 3, years of the overspending.
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What would be much more useful would be to block billionaires from using their wealth to buy the politics they want, which is almost always a politics that lets them easily skim a whole lot of money via killing off real competition, basic regulation, and rational taxes without obscure tax escape clauses.
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Why not start with a local (US) Swiss affiliate bank such as UBS? They literally have scores of banks in all big cities and many medium sized ones. The management there could probably point you in the right direction if not have some ideas for contacts and methods of initiating transactions.
Pete
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Indeed. I had a Swiss policy for several decades as a hedge against inflation. At any rate, it is like an annuity that you can later cash out (say when you’re living in Ireland or Mozambique).
DB2
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How was it a hedge against inflation? Inflation adjusted annuities are VERY expensive and have always been very expensive. In the end, you pay more for the inflation hedge than it can ever be worth statistically. That’s primarily because the insurance companies have very smart actuaries.
It was hedged per se, but it was denominated in Swiss francs which suffered less inflation than the US dollar.
DB2
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This is true. But it really only worked for a decade or two, notably 2000-2010 and 80-90. I used to travel to Switzerland periodically in the 80s/90s/00s and I fondly remember the days of getting over 1.5 CHF for each of my dollars, and I even got over 2 CHF a few times in the 80s (I think). Now you get under 1 CHF for a dollar! I used to measure based on the coffee price at Migros LOL. But the coffee at Schuh in Interlaken was far better (and probably about 3 times the price, of course).
Yeah, it was only a so-so idea as far as inflation went. However, such a policy would allow Wendy to move money out of the US entirely legally.
DB2