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Porter Stansberrys

Investment Advisory

The Four Investment Assets You Do NOTHave to Report to the U.S. Government

January 2011


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The Four Investment Assets You Do NOTHave to Report to the U.S. Government

By Porter Stansberry and the S&A research team

Things may seem OK on the surface in America right now.

Sure, the markets have been a wild ride... and the economic news sounds bad... But by and large, theneighborhood you woke up in today feels a lot like it always did.

Your friends still tool around in the same kinds of cars they always did... You and your wife still go fordinner and a movie when you can find a babysitter... And you still go over to your neighbors house onSaturday to drink a couple beers and watch the game on their big-screen TV...

But I can tell you with near certainty that the next few years are going to be a major shock for mostpeople in this country.

The debts our country has rung up are coming due... and we cant afford them anymore... Literally, wecannot afford the interest payments on our national debt.

Were on the cusp of a disaster...

It will result in the biggest government encroachment in our countrys history. Its coming hard... andfast. And most people are going to be totally unprepared for the consequences.

Im talking about much higher taxes... currency controls (I predict in less than two years you will notbe able to move any money out of the country)... and the loss of personal freedoms we have taken forgranted for more than 100 years.

The only good news in this is that its not too late for you to do something about it.

Thats why Ive been encouraging everyone I know to take a few simple steps now to protect yourmoney and your family.

And thats what Im going to show you how to do in this report... Its the No. 1 thing you need to doto protect and grow your wealth.

OurAtlas ShruggedRisk

I never thought Id cite Peggy Noonan in one of my reports. In my mind, she is a hack political writer,completely out of touch with whats happening in the real world the world outside the Washington D.C.beltway. But recently... she wrote this in the Wall Street Journal:


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The biggest threat to America right now is not government spending, huge deficits, foreign own-ership of our debt, world terrorism, two wars, potential epidemics or nuts with nukes.

The biggest long-term threat is that people are becoming and have become disheartened, that thiscondition is reaching critical mass, and that it afflicts most broadly and deeply those members of

the American leadership class who are not in Washington, most especially those in business.Ive been writing about this risk I call it the Atlas Shruggedrisk for months...

Most people dont understand how dangerous a narrow tax base is, especially when those few heavilytaxed people have the means to exit. Right now, were running deficits approaching $2 trillion annually. Wecan get away with this kind of fiscal behavior for a little while because we control the worlds reserve curren-cy (at least for now) and the world thinks of America as a law-and-order place, where people pay their taxes.

Unfortunately for our creditors, only about 1% of Americans pay around 40% of all income taxes. Thereare roughly 100 million U.S. households, which means about 1 million people are currently paying for about40% of all the income tax receipts. That doesnt count the big contributions these folks make to the tax base

as a whole their corporate taxes, their sales taxes, the payroll taxes they pay on their employees, etc.

Now... what if this 1% these million people decided they dont need a big income anymore? Orwhat if they decided theyd rather live somewhere else... some place where the weather is always perfect...where a great bottle of wine costs $5... where a steak dinner (grass-fed beef, no hormones) costs $10?

Well, several of my friends went to Cafayate, Argentina, in 2005 looking for a place to build our ver-sion of Gaults Gulch. You couldnt find a more beautiful place: Cafayate sits in the middle of an enormous,high desert valley, about 7,000 feet up in the Andes mountains. Its high enough and close enough to theequator that the weather is essentially the same year round. And its perfect highs in the 80s, lows in the40s each night. No humidity. My friends built a small luxury hotel overlooking a crystal blue pool. They

planted a vineyard that stretches out beneath a vista of 15,000-foot mountains. (The climate and the dry,rocky soil are perfect for planting high-quality grapes and making super-premium wines.)

This is easily one of my favorite three or four places in the world. It is also a very, very safe place. Its asmall community thats literally at the end of the road. Even a nuclear holocaust wouldnt change lifearound here very much.

As recently as 15 years ago, you wouldnt have found a single American here its just too far out. (Ittook me 23 hours of constant travel to get here yesterday, and thats the fastest Ive made the trip.) Buttechnology is allowing lots of folks to come here without losing touch with their businesses, investments,and families. And so the areas advantages its incredible beauty, fantastic climate, friendly and educated

people, etc. have begun to outweigh the disadvantages of distance.

Ive written about these efforts over the years. Most people thought the idea was crazy. But this fall, Igave a speech at the grand opening of La Estancia de Cafayate where more than 150 lots have beensold, where a golf course has been built, and where a beautiful clubhouse now stands. I shared the podi-um with Doug Casey, Rick Rule, and Bill Bonner the three most successful and influential businessmenI know well...

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And 270 other people nearly all Americans will join us. I dont know if all 270 folks here are in the1%... But its a safe bet most of them are significant taxpayers. These are the wealthy folks Peggy Noonan isafraid will stop paying their taxes. And shes right. Thats why many of them are here. Theyre looking for aplace to escape, where the government will leave them alone... where they are safe... and where they are free.

The Time to Protect Yourself Is NowMaybe youre content to think heavy taxes arent your problem... That if a few rich folks feel the pinch,

well... whats it to you?

If thats what you think... youre wrong.

As my friend and colleague Dr. David Eifrig recently wrote:

Without belaboring the point, its unimaginable that the U.S. can pay off its debts in our life-times... But heres the catch its going to try... Or rather pretend to try. And the only way to do

that is to tax the beejeezus out of anyone with a few assets to his name.Look, this is not a problem just for the wealthy. This is for anyone with a lifetime of savings.Under the current path, everyone who has something will be forced to give it up to those whodont have anything. And worse, well be forced to give it to those too lazy to work for anything. Idont know about you, but first and foremost, I want to decide whom my money goes to. I dontwant some bureaucrat in D.C. telling me how kind I have to be.

The way to protect yourself from runaway government thievery is to diversify your assets off shore... tomove some portion of your wealth out of the country, somewhere safe.

And the time to protect yourself is now... Before the government restricts the flow of currency in

and out of the country... Before it outlaws your ability to move you and your assets around... Before itstarts confiscating things like gold. (Dont laugh FDR did it.)

I realize pulling up stakes and heading to the Andes isnt realistic for everyone. But that doesnt meanyoure trapped, that you have to accept whatever the government has in store...

I and several of the editors at Stansberry & Associates have been researching how to do this legally forsome time. (Legally is critical... Remember, were talking about this because we dontwant to jeopardizeour freedom.)

Recently, Dr. Eifrig prepared a report for his Retirement Millionairesubscribers detailing a few key steps

you can take without uprooting yourself. Its some of the most sensible, nuts-and-bolts advice Ive read onthe subject. Im republishing his research in this report because I think everyone with a few assets to protectshould take these four steps... at least.

And last, before we get started, you need one other piece of advice: Keep this to yourself. All of Dr.Eifrigs tips are perfectly legal. But as he says, that doesnt mean the government wantsyou to do thesethings... To the contrary, if too many people start talking about these things and taking the steps below, the

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government could easily change the rules.

TIP No. 1: Open a Foreign Bank Account Soon

If you open up a foreign financial account with less than $10,000,you do not have to report the assets.This comes under the Foreign Bank and Financial

Authority (FBAR) regulations, and the IRS states youonly have to report if:

You have financial interest in, signature authori-ty, or other authority over one or more accountsin a foreign country, and

The aggregate value of all foreign financialaccounts exceeds $10,000 at any time during thecalendar year.

If you keep more than $10,000 in total overseas,you must report it or risk fines and jail time. (A mere50% of your assets and up to five years in prison, if ajudge decides the oversight was willful.)

Be careful about interest-earning accounts, too. Lets say you put $9,990 in an account in January andyou earn enough interest to take you over $10,000 by yearend. Well, guess what? Now, you must report theassets and the income.

One more secret: Nothing prevents your spouse and other family members from doing the same. Afamily of six could keep about $59,000 in accounts overseas and not need to report it. Again, this is all

legal and a great way to diversify your portfolio around the world.

One bank with which you can easily open an account online no visit required. The bank is CayeInternational Bank Limited (CIBL) in Belize.

Youve probably never heard of CIBL, and thats because foreign banks are not allowed to advertise inthe U.S. the same way domestic banks can. But trust me when I tell you Caye Bank is safer than most U.S.banks. You see, Belize mandates its banks maintain 24% capital liquidity versus the 3%-5% in the U.S. Inother words, your bank in Belize has cash to cover 24% of the demand deposits it carries. They dont makebanks much more liquid than this.

The only drawback is CIBL charges monthly service fees for checking and savings ($8-$12.50 depend-ing on your balances). On the other hand, most Canadian banks charge tiny fees or none at all.

If youre interested in Caye Bank and need help setting things up, contact Joy Flowers at:[email protected] or go to the website at www.cayebank.bz. Just DONT tell them I sent you! And forthat matter, dont tell anyone else.

Alternately, if you want to avoid the big fees. You can look to open an account with a Canadian bank.The drawback here is youll have to physically visit Canada.

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Anyone contemplating wealth preservation andinternational diversification must understandtwo U.S. government concepts: income tax andreportable assets. If you hold assets offshore,some are reportable to the government andsome are not. And if you make income whileoverseas, it is all reportable, although some of itis exempt (the first $87,600 a year plus a$14,000 housing allowance). In our tips below,weve listed ways to legally avoid both reportingassets and paying income taxes while yourassets are overseas.


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Jeff Winn at International Assets Advisory (800-432-4402; www.iaac.com).

Howard Goldstein at Key Investment Group (877-539-1004; www.keywp.com).

To read more about the ZKB gold ETF, please read S&As The Gold Investors Bible and refer to thechapter title Finally, Precious Metals ETFs I Can Safely Recommend.

If youre considering moving some assets overseas, the four methods above are relatively simple ways tocontrol wealth without drawing much attention to yourself. At a very minimum, you can open an accountin a friendly nearby country to get started protecting and diversifying your assets.

As I said, it is critical you dont talk to anybody about what youre doing. If word about these four tipsgets out too fast, you can be sure Congress will try to shut them down. The country is already in debt tothe tune of $140,000 a person... youd be foolish not to protect your stash right now. But dont tell yourfriends and dont tell the government either...

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Stansberry & Associates Investment Research is committed to providing our readers with the very best in independent financial analysis. Our subscribers are our highest priorityand we welcome any comments or suggestions that you might have. Please e-mail us your feedback: [email protected]. This e-mail is for editorial feedback only.It is not for customer service. For customer service questions, please use the following e-mail address: [email protected]. We look forward to your feedback and

questions. However, the law prohibits us from giving individual and personal investment advice. We are unable to respond to emails and phone calls requesting that type of infor-mation.

Copyright 2010 Stansberry & Associates Investment Research. All Rights Reserved. Protected by copyright laws of the United States and international treaties. This newsletter, e-letter, or promotional material may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on theworld wide web) , in whole or in part, is strictly prohibited without the express written permission of Stansberry & Associates Investment Research, LLC. 1217 Saint Paul Street,Baltimore MD 21202.

Any brokers mentioned herein constitute a partial list of available brokers and is for your information only. S&A does not recommend or endorse any brokers, dealers or invest-ment advisors.

LEGAL DISCLAIMER: This work is based on SEC filings, current events, interviews, corporate press releases and what we've learned as financial journalists. It may contain errorsand you shouldn't make any investment decision based solely on what you read here. It's your money and your responsibility. Stansberry and Associates Investment Researchexpressly forbids its writers from having a financial interest in any security they recommend to our subscribers. And all Stansberry & Associates Investment Research (andaffiliated companies) employees and agents must wait 24 hours after an initial trade recommendation is published on the Internet, or 72 hours after a direct mail publication issent, before acting on that recommendation.


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Porter Stansberrys Investment Advisory

1217 St. Paul StreetBaltimore, MD 21202

1-888-261-2693350R030321

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201011PSI Report NoReport