Stop Waiting for the Storms to Pass

Today's comment is by Erika Nolan, Founding Publisher and Managing Director of The Sovereign Society.

Dear A-Letter Reader,

With all of the financial and economic strains of late, people are tired of wondering when this storm will pass. It seems like just when we accept one disaster like the U.S. housing collapse and credit write-downs, another storm appears on the horizon. High oil prices, a weaker U.S. dollar, rising inflation...and now basic food supplies are critically low and causing surging prices.

But, life isn't about waiting for the storms to pass; it's about learning to dance in the rain.

It's a wonderful ability that I'm working hard to master. Your personal outlook goes a long way when it comes to success and security (by the way, I'm reading a superb new e-letter written by a friend of mine, Alex Green, where he shares thoughts and insight on life's most important lessons. www.spiritualwealth.com/siup/signup.html).

We can't change the gloomy economic picture but we can determine how we react to it.

The Power of Positive Action

I bet you're the type of person who has mastered any number of obstacles in your life. You rise to challenges and even revel in the bumps along the road to victory. That's how you've gotten to where you are in life. And that's why you're looking for the unique opportunities that most others will never find.

But sometimes it's easy to get caught up in the general malaise of the market and overall economy. But there's a way out.

Over the last 10 years, I've traveled to over 28 countries, sifting through the best - and worst - wealth opportunities. Along my journey, I've built up a network of skilled professionals who cover every aspect of the investment and asset protection world. These are highly reputable, independent and innovative thinkers. And over the past decade of working with them, I've learned there's always a silver lining somewhere regardless of how bleak the horizon may look.

33 Silver Linings, 4 Days

In three weeks, these wealth entrepreneurs will join me in Panama for our Total Wealth Symposium. I'm happy to say this is will be a banner event. More experts than ever before have accepted our invitation to this Symposium - and now we literally have a packed bill of financial talent.

From May 14 - 17, each of these experts will bring you their most up-to-the-moment ideas. You'll find out not only how to beat this credit crunch, but how to secure your estate plan, supercharge your retirement plan and shield your assets for decades.

I've been in touch with several of these experts again this week. We've been strategizing about some of today's most remarkable financial tactics that have gone almost completely unnoticed. These innovative ideas will give you unlimited opportunities during the current financial downpour. I'll let you in on what we've discussed so far...and I'll give you a sneak peak at the first draft of this year's agenda.

An Insider's Look at Real Financial Insights

Robert Vrijhof, a Swiss Manager who's supervised the world's elite portfolios for decades...Rob has one of the most creative ways to invest in foreign currencies - through AAA bonds that pay 8% yields - and give you complete protection from the dropping stock markets.

From Thomas Fischer, Andrew Griebl, and other banking experts in safe, secure regions around the globe, you'll hear the simplest ways to bank in countries that have managed to evade the sub-prime debacle.

Marc Sola and Colin Bowen, two of the world's leading authorities on 5-star annuities, will tell you how to legally and privately invest in ANY investment on the planet. Plus, how to use this unique vehicle to defer taxes for decades.

Larry Grossman, known among Sovereign Society members as "the offshore retirement guy" has a special strategy that lets you build a retirement portfolio with guaranteed returns - even if the markets continue to tank.

Derek Sambrook, Panama's leading "go-to guy" for trusts, will give you three different ways to set up your own quick and easy estate plan that could save your heirs on estate taxes.

And then of course, we'll have our Sovereign Society gurus on hand including Mike Burnick, Eric Roseman, Jack Crooks, Bob Bauman and Mark Nestmann who will bring their most unique ideas as well.

Take a moment to think about how adding just two to three revolutionary wealth-building ideas to your portfolio could radically improve your financial legacy. Imagine the peace of mind. Remember, we can't stop the current financial storms. You can't force a stock market rally, a new housing boom or the dollar to rise. So, take advantage of the wealth strategies that will allow you to dance in the rain.

In Wealth & Prosperity,

ERIKA NOLAN, Publisher
The Sovereign Society

P.S. You shouldn't leave your wealth in the hands of Lady Luck...and you don't need to believe in karma just to survive the market turbulence. Join me for our Total Wealth Symposium in Panama May 14-17, 2008. This four day event is the most surefire way to capture the safest wealth strategies to accelerate profits in 2008 and beyond. This annual event always sells out and this year will be no exception. Please call Amita in our Delray Beach office today at 866-584-4096 to secure your place at the event I believe will transform your financial future. Or click here to reserve your spot now.

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Is Wall Street's "Top-Cop" Involved in a
Sub-prime Cover Up?

The ongoing sub-prime credit crunch is far from over. As my colleague Eric Roseman pointed out in an article on Wednesday, the prime-indicator that signaled the crisis is flashing red again...this time in several economies overseas.

Here at home, Uncle Sam is doing his level-headed best to simply sweep this crisis under the rug. In fact, regulators have even gone so far as to hush-up an investigation into the demise of Bear Stearns. Shocked? Don't be...

Back in January, I described how Wall Street pressures U.S. credit-rating agencies to keep their investment grade seals of approval. That's how we ended up with hundreds of billions in sub-prime debt and other sordid asset-backed securities in the market in the first place.

But Washington's attempt to cover-up this mess goes even further...straight to the top of the Securities Exchange Commission.

The SEC is responsible for regulating securities firms, and bringing enforcement actions when necessary. But it seems America's "top-cop" abruptly ended an enforcement case into activities at Bear Stearns - just months before the firm imploded in March.

So you have to wonder: What did the SEC know about Bear Stearns, if they knew Bear's fate, why did they do nothing?

As far back as 2005 - in the heyday of the sub-prime lending craze - the SEC "said it planned to recommend that Bear Stearns be charged for the way it priced and valued about US$63 million of CDOs," according to the Wall Street Journal.

These are the now toxic collateralized debt obligations that Bear Stearns and other Wall Street firms happily churned out in record numbers during the boom. Aided and abetted with triple-A credit ratings from the big agencies to make them more saleable, Wall Street pawned-off these toxic securities to investors globally.

So far, big banks and brokerage firms have collectively suffered losses of more than US$300 billion (and still counting) in the credit market bust that followed. Most of these losses and asset write-offs are due to CDOs. And today, many of these CDOs are trading at just a fraction of the value that Bear Stearns and others originally sold them for.

Since the SECs investigation into Bear Stearns activity apparently began way back in 2005, you'd think they would have dug up enough sub-prime dirt to bring an enforcement action. But last December, the SEC apparently "pulled back" from this investigation without bringing any formal charges. Three months later, with Bear Stearns practically bankrupt, it was sold off to J.P. Morgan at a fire-sale price.

It turns out that Congress got wind of the Bear Stearns probe. Now they're curious. They want to know why the SEC prematurely scuttled its investigation. According to the story, "In an April 2 letter, Sen. Charles Grassley, an Iowa Republican, requested information from the SEC into the circumstances surrounding the dropped case."

Citing "confidentiality" the SEC has so far refused to share details with Congress. However, taxpayers are now on the hook for US$29 billion worth of Bear Stearns assets that the Federal Reserve was kind enough to "guarantee" as part of the fire sale to J.P. Morgan. So with taxpayer's money on the line, I think Congress deserves an explanation.

What does the SEC have to hide anyway? Bear Stearns is now practically dead and buried. Are there details of Wall Street's sub-prime shenanigans that the SEC doesn't want investors to find out about? Inquiring minds want to know...

MIKE BURNICK, Senior Editor & Global Markets Analyst

Think Inflation is Bad Now?
Just Wait Until this Radical Proposal Takes Effect

With scarcely a whisper in the press, the U.S. Customs and Border Protection agency (CBP) has proposed regulations that could lead to huge tax increases on just about everything imported into the United States.

Naturally, importers don't really pay this tax...they merely pass the increased costs onto consumers, in the form of higher prices. In other words, higher taxes for them mean you're paying more.

The proposed regulation would eliminate the so-called "first-sale rule." Under the rule, the value of imported goods is based on the value of the first sale of many sales involving multiple parties. This happens when a foreign manufacturer sells their wares to a foreign distributor who then resells the goods to U.S. buyers. For example, say a Thai company sold their brand of TVs to Wal-Mart. Then Wal-Mart would resell these TVs to their U.S.-based customers. For customs purposes, the value of all the TVs would be the same as the first TV that Wal-Mart planned to sell.

This system has worked for a long time. But now the CDP wants to change this value to the sale price between the distributor and the U.S. buyer. In other words, they want to change it to the last sale. Naturally, this price is significantly closer to the retail value of whatever goods are eventually sold. And that translates into much higher import duties.

Blame the World Trade Organization (WTO) for this ridiculous proposal. Its "Technical Committee on Customs Valuation" chose last sale over first sale, most likely to appease governments reluctant to join the WTO for fear of decreased customs' duties. And the CDP says it's only doing what it's supposed to do under U.S. treaty obligations.

Apparently, it's not enough that Americans are already paying much higher prices for imported oil and for all goods or services affected by skyrocketing oil prices. It's not enough that the collapse of the U.S. dollar has resulted in much higher prices for all imported goods. If these rules become effective, count on much higher prices for imported clothing, shoes and baggage, among other goods.

Fortunately, these rules won't take effect without a fight. More than 90 business and trade groups have petitioned the CDP to scrap or modify the proposal. If they're unable to bring the CDP around to their thinking, this dispute could end up in court.

One thing's for sure: We don't need more inflation in the U.S. economy. The CDP proposal is the wrong suggestion at the wrong time.

MARK NESTMANN, Privacy Expert &
President of The Nestmann Group
www.nestmann.com

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