I have an aversion to conspiracy theories. It has little to do with whether they’re true. Indeed, some things we now consider common knowledge were once conspiracy theories. It has everything to do with the obstacles they create and political reform they undermine. The murky notion that President Obama is some sort of secret-Kenyan-Muslim-communist is a [...]
"Prior to its $130 billion social-spending spree, Saudi Arabia needed oil prices somewhere north of $70 to balance the kingdom’s budget, according to the International Monetary Fund. Now the per-barrel cost is reportedly approaching $100. Russia needs something close to $120. Social costs also play a similarly large role in Bahrain, Kuwait, Venezuela, Iran and elsewhere, where oil revenue accounts for up to 90% of domestic income. The United Arab Emirates, for instance, needs oil prices in the $85 range to balance a budget larded with social programs. Tiny Bahrain needs about $119." Continue reading →
"Since the Lehman crisis, the Fed has been purchasing Treasuries and Agencies at a $500bn per year pace. This flow, which is equivalent to around 3.5% of US GDP, has offset more than a third of the government deficit since the end of 2008. In other words, QE purchases meant that the QE-adjusted government deficit has averaged 5.8% of GDP since the end of 2008 instead of 9.3% for the actual government deficit. This week’s Fed announcement means that this QE flow will double from a $500bn pace currently to $1tr. Coupled with a projection of a lower government deficit next year, to around 6% of GDP, this means that QE will offset almost all of next year’s government deficit." Continue reading →
"Like Scrooge McDuck or the dragon Smaug in J. R. R. Tolkien's The Hobbit, Germans are gathering vast quantities of gold - a study showed that the average German owns close to €6,000 worth of the shiny metal. Even though Europe's largest economy has weathered the world economic crisis relatively well, Germans have still been extra jittery about their savings, a study by the Steinbeis Research Center for Financial Services in Berlin revealed. Around 32 percent of the gold owned in Germany in the form of bars and coins was accumulated since the financial and economic crises began, the study concluded." Continue reading →
"Without knowledge of how much gold is leaving, it is impossible to calculate the value of the trade. But airport security forms that cover the last two weeks of October indicate about 560 pounds, worth about $14 million, were carried by hand out of Afghanistan during that period. That is a princely sum in one of the world’s 10 poorest countries. But it is perhaps a measure of the current state of affairs in Afghanistan that seemingly no one — not Afghan bank regulators, not American investigators of illicit financing, not European economic experts — found it particularly surprising that gold appears to have joined bank notes in the skies over Afghanistan." Continue reading →
"Today the Belgian foreign minister gave an interview to the centre-right newspaper Le Figaro, where critics of the socialist president François Hollande are made to feel comfortable. On the French government’s desire to renegotiate tax collection between the two governments, the gentlest possible No Way: 'We’re ready to examine many things, as long as the superior principle of free circulation of people, goods and services within the EU is respected. But if this is about recognizing some French power to tax people who live in Belgium, that’s a whole other matter. Every European country must accept that its citizens decide to live elsewhere.'" Continue reading →
"Some of the reporting requirements defy any level of reasonable logic. A US citizen, stay-at-home mother for instance, who likely has no income and is signed onto her non-US citizen husband’s accounts, is required to report HIS bank account numbers, balances and so on. I doubt any US Homelander would be willing to do the same if living in the US, married to a foreigner with a government who demanded the same, or else be prepared to lose a considerable portion of savings, retirement plans, etc. Now FATCA promises to be even more punishing." Continue reading →
"France’s leading actor Gerard Depardieu said on Sunday he was giving up his French passport after being 'insulted' by the prime minister calling him 'pathetic' for becoming a tax exile in Belgium. In an open letter to Prime Minister Jean-Marc Ayrault, the 63-year-old 'Cyrano de Bergerac' and 'Green Card' star said he had been treated unfairly after years of supporting France and paying millions of euros in taxes. Depardieu has joined some of France’s wealthiest business figures in Belgium following moves by President Francois Hollande’s Socialist government to tax annual incomes above one million euros ($1.3 million) at 75 percent." Continue reading →
"On the table in today’s political debate is the concept of raising taxes on some, or even all Americans (should the fiscal cliff kick in). If this bothers you, here are eleven countries that you would (hopefully) never, ever have to worry about paying an income tax in." Continue reading →
"By setting up in Luxembourg, and channelling sales through its units there, the world's biggest online retailer could minimise corporate taxes. It was a move with big financial consequences. Amazon's Luxembourg arrangements have deprived European governments of hundreds of millions of dollars in tax that it might otherwise have owed, as reported in European newspapers. But a Reuters examination of accounts filed by 25 Amazon units in six countries shows how they also allowed the company to avoid paying more tax in the United States, where the company is based." Continue reading →