Search
 
 
       
 
What Would Your Forefathers Say? Minimize
 
July 20, 2007
The Sovereign Society Offshore A-Letter 

 

Friday, July 20, 2007
Vol. 9 No. 172
In Today's Letter:
Comment: What Would Your Forefathers Say?
Wealth: The Las Vegas of the Orient is on a Roll
Bonus Wealth: The Most Undervalued Currencies in the World
What Would Your Forefathers Say?

Today's comment is by John Pugsley, our Chairman and best-selling author of many books on financial and personal freedom.

Dear A-Letter Reader,

As Congress grabbed center stage this week with a theatrical all-night session to push for an end to the Iraq war, a far bigger question lay submerged and ignored beneath the rhetoric.

It's the issue that the founding fathers of the country believed they had settled when they created the nation 231 years ago.

Is the United States of America a republic, as the founders intended, a democracy, as so many of the founding fathers feared it would become, or an empire, which they all abhorred?

It's question that will define the future of America, for future generations.

To the founders, only one form of government would work. Thomas Jefferson wrote: "The republican is the only form of government which is not eternally at open or secret war with the rights of mankind."

But they were not so naïve as to think it would necessarily last. When the Constitutional Convention of 1787 ended, Benjamin Franklin was asked, "Well, Doctor, what have we got, a republic or a monarchy?" Franklin responded, "A republic, if you can keep it."



Did You Know Our Founders Hated Democracy?

Sadly, if our forefathers were here today they would be forced to concede that their republic did not survive. Nor would they be pleased that the United States supposedly morphed into a democracy.

Franklin had no love for democracy, quipping, "Democracy is two wolves and a lamb voting on what to have for lunch." John Adams, second President of the U.S., opined that a democracy would be doomed: "Remember, democracy never lasts long. It soon wastes, exhausts, and murders itself. There never was a democracy yet that didn't commit suicide."

Perhaps what we have left today is the corpse of a democracy that appears to live, but has already been murdered. It's arguable that the hoped-for American republic passed through the democratic phase and has reached the worst point of all: empire.

To many of the founders, that would be the worst of all. "An empire is a despotism," wrote Adams, "and an emperor is a despot, bound by no law or limitation but his own will."

Does the designation of empire fit today's America, and is George W. Bush a fledgling despot?

Hail to the Emperor, I Mean "Chief"

By definition, an empire is a domain comprised of regions locally ruled by governors (or client kings) in the name of an emperor or empress, which rule is imposed, at least partially, by force.

George Bush would be the first to deny he is a despot, or that he's pursuing imperial ambition. Before being elected to his first term as President, he dismissed any idea that the U.S. should engage in empire building.

"One way for us to be viewed as the ugly American is for us to go around the world saying we do it this way, so should you. I think the United States must be... confident of our values but humble in the way we treat nations who are trying to figure out their own course." - George W. Bush, Second Presidential Debate, October 11, 2000

Former Secretary of Defense Donald Rumsfeld was more emphatic when the Bush Administration was accused of imperialism: "We don't seek empires. We're not imperialistic. We never have been."

Evidence of Empire Building - Even Before 9/11

The evidence contradicts them. Around the world, the American government has a presence reminiscent of the British or Roman Empires at their zeniths.

According to the Department of Defense's figures, there are currently some 255,000 U.S. military personnel stationed on 725 bases in 153 foreign countries.

Nor is it just the War on Terrorism that has created this juggernaut. The worldwide American military presence was only marginally less before the September 11, 2001 attack.

If George Washington were here today, what would he think about over 250,000 American troops in bases stretching from Central America, through Europe and the Middle East all the way through Asia, and on into the Pacific?

Doubtless, he and our other forefathers would be despondent over the course American has taken. In his Farewell Address, Washington warned pointedly against foreign entanglements.

John Quincy Adams's argued that it is not America's destiny "to go abroad in search of monsters to destroy." If America ever pursued such a policy, he said, she would inevitably make herself the "dictatress of the world."

Take a Lesson from Past Fallen Empires

Any country pursues the path of foreign intervention risks losing its finest young men and women in other people's wars, ends up losing more power then if it had never embarked on empire, and ultimately bankrupts itself.

Remember Rome. Remember Germany. Remember the Soviet Union.

"Experience hath shewn," wrote Jefferson in 1788, "that even under the best forms [of government] those entrusted with power have, in time, and by slow operations, perverted it into tyranny."

Human nature guarantees that power corrupts. Even when the founders do their best to limit the power handed to those running that government, the gradual evolution of government is always toward a larger and larger, more intrusive state.

Until a new set of Founding Fathers arrives on earth, and discovers a system of government in which some individuals are not given power over the lives and fortunes of others, there is one rational course of action for us as individuals.

 To survive and be secure, we must engineer our lives, as best we are able, to keep ourselves, our families, and our assets out of the reach of empire...

JOHN PUGSLEY, Chairman

P.S. The central goal of The Sovereign Society is to help you achieve individual sovereignty over yourself and your assets even while living in a world of empire builders. You can engineer your portfolios and assets to stay as far away from the world's empires as legally possible. Click here for a good place to start.

Advertisement

Are You Ready to Get the Government Off Your Back Once and for All?

And to stop overpaying your taxes?...And to pocket investment profits of 200%, 640%, 900% -- or even more? Then, keep reading - because we're about to reveal to you the inside, money multiplying secrets of how YOU can... Click below to learn more.

LINK: http://www.web-purchases.com/190SFORD/E190H735/
Wealth/Investments

 The Las Vegas of the Orient is on a Roll

As I wrote in yesterday's comment, the new gambling Mecca of the Orient - Macau - is on an absolute tear this year. Las Vegas Casino Mogul Steve Wynn called this city the "safest bet on earth."

From its humble beginnings as a Portugese colony and sleepy fishing village, Macau has come a long way baby. Over thirty years ago Stanley Ho, who Forbes magazine ranks as one of the richest men in Asia, was granted the exclusive concession to begin transforming the island into a gambling meca.

When the Chinese took control several years ago, the decided to spruce up Macau and model it more after Las Vegas - a true international gaming AND entertainment destination. Since then, some of Vegas' leading developers have invested in new properties here, and today Macau is booming.

Macau's first quarter 2007 casino revenues shattered records at HK$17.87 billion (US$3.3 billion). Table game revenues jumped 32% to HK$5.49 billion, while the take from slots jumped 72% in the first quarter alone, to HK$732 million.

Recently, Playboy Enterprises (PLA) announced plans for a 40,000 square foot "entertainment" complex. When it's finished, it will be Asia's first Playboy Club since the Manila location closed in 1991. Gambling in Macau's Playboy Club may be a bit...distracting, given the ever present bunny-suited cocktail waitresses, but no doubt management is counting on that!

Las Vegas Sands Corp (LVS) plans to open its 10.5 million square foot Venetian Macao Resort - which reportedly will have twice the retail shopping space as the huge Las Vegas Venetian. Kirk Kerkorian's MGM Mirage (MGM) and Sir Richard Branson of Virgin Group fame are considering big investments in Macau.

For his part, Steve Wynn is sold on Macau's potential as the safest bet on Earth. In 2009, Wynn Resorts Ltd. (WYNN) plans to open an all-new US$1 billion 600-room casino resort. For those thinking of investing in Macau's booming casino industry, several of the firms that either have entertainment properties up and running in Macau, or should soon be in operation there, are publicly traded companies (see ticker symbols above).

There's even a way to bet on Macau (aside from being at the tables that is) alongside Stanley Ho, one of Asia's most astute investors, through his Hong Kong listed holding company. Place your bets folks!

MIKE BURNICK, Senior Editor & Global Markets Analyst

P.S. Personally, I'm hoping to try my hand at the Macau craps tables when I'm traveling with the Asian Advantage Tour this October. Our VIP list of guests will take a break from the wealth-building and asset protection sessions, for an entire day-trip to this fast-growing Asian playground - better brush up on your blackjack strategy! Click here for more information on how you can join us.

Bonus Wealth

 The Most Undervalued Currencies in the World

Over the last 12 months, my colleague Jack Crooks and I have staunchly agreed that Asia's currencies are hugely undervalued. And at some point in the not-too-distant future, the Asian bloc will muster some big gains versus the U.S. dollar and even the euro. The latest foreign exchange reserves statistics in Asia once again confirm this forecast.

Asia's reserves reached a staggering US$3.52 trillion in June, an increase of US$57.7 billion compared to May. These reserves are up from US$2.92 trillion just 12 months ago, according to Dow Jones Newswires . Any way you measure these numbers, they're simply awesome and point to a major revaluation in the future versus most world currencies.

What's even more compelling is how cheap these currencies have become over the last five years versus the almighty euro, British pound and even the Brazilian real, one of the top-performing global currencies since 2003.

In stark contrast, Asia's currencies have declined vis-à-vis all three currencies over the last several years and are absolutely cheap when measured against not just against the U.S. dollar, but versus most currencies in Europe and parts of Latin America.

The cheapest of these regional units remains the Japanese yen, a principle funding currency for the carry-trade since this global economic expansion began in late 2002.

Japanese Yen Remains Massively Oversold - and in Perfect Position for a Breakout!

The yen is still trading at an all-time low versus the euro - massively oversold versus the European single currency and trading at a 20-year versus a basket of major currencies. At some point, the yen will commence a historical rally that will simultaneously flush out the carry-trade.

In my book, investors looking to hedge their portfolios from market chaos might want to buy yen as portfolio insurance. When this trend reverses, it will yield enormous profits as most other financial assets decline at the same time.

For more ways to play these dynamite currencies, please check out Jack Crooks' lead article in the August issue of The Sovereign Individual , which will be available online this weekend. 

ERIC ROSEMAN, Investment Director

Advertisement

The Industrial Age's Last Shout: End it Poor or 10 x Richer!

Industry is about to dive headlong into its last great natural resource binge. Get ready for an era of oil shocks...food shortages...and commodity crunches. Expect a global energy crisis. $200 oil. $2,500 gold. And plenty of bear markets. But also expect a commodity bull market the likes of which the global economy has never before seen. By the end of it, most investments will be shredded. Many people will be a lot poorer. But a select few will be 10-20 times richer. Will you be one of them? Click here for more information.

 
 
 Print