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PureBytes Links
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If you look at item #4 you will see the complexity of what is
involved in operating an offshore company.
John
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>> "Offshore & Privacy Secrets, April 14, 2000" <<
Published by OPC International
http://offshoreprofit.com
================================================================
CONTENTS
[1] Welcome!
[2] Feedback
[3] Microsoft vs the State
[4] Offshore Strategies
[5] NewsBriefs
[6] OPC Diary
[7] Quote of the Week
================================================================
[1] Welcome!
================================================================
Welcome to another issue!
This week we have feedback on the "market" vs "political" democ-
cracy article and second citizenships; an article exploring the
difference between political and economic power; answers to
readers' questions on offshore strategies - and the usual roundup
of global news of interest.
Always feel free to circulate this entire newsletter amongst
your friends and colleagues.
Enjoy the read - and, as always...
Live free!
Robert Smith
OPC International
http://offshoreprofit.com
================================================================
[2] Feedback
================================================================
Commenting on the article about political vs market democracy,
we received this from a reader:
"Interesting thought. But just exactly WHO or WHAT AGENCY will
mint/coin/financially back that DOLLAR? Who has the authority
to dictate the value of that dollar? How are dollars to be
obtained? At what rate of exchange? How would that dollar be
treated on the open WORLD market?
Seems to me a Utopian dream. Without a governing body overseeing
the fiscal aspects of its society, then WHOM does that respons-
ibility fall? Who determines? It all falls back onto the POLITICAL
SYSTEM being involved....no matter what! Without a representative
authority to oversee things, there can be NO standardization of
values. Interstate commerce would be impossible, let alone world
trade. Anarchy does NOT solve the very problem you fighting...it
exacerbates it!"
COMMENT
The above thinking is a common fallacy - the belief that some
"authority" must run the money system - and that only a govern-
ment can do it.
The subject is too big to cover here, as there are a number of
ways things could be run a lot better. I'll just look at a couple
of possibilities.
Paper (fiat) money originated as receipts for real money, ie
gold or silver. You could always exchange your paper receipt for
the real thing. And at that time, such paper receipts were issued
by private companies (not governments).
One simple improvement would be gold-backed money again. Such
a system would NOT require any government involvement whatever.
Gold stands in the market as a commodity of measurable value, and
would be able to be exchanged and used as money (even using digital
equivalents as "receipts").
However, I don't believe gold is the optimum money - but personally
generated "credit", based on your own productive capacity.
How would this work? Think of it as an IOU. If you purchased
something - and paid with an IOU, then you would have literally
created money based on your own capacity to fulfill the promise.
In this case, a promise to deliver equal value, on demand, in the
future.
The more productive you are, the more money you can "create".
In other words, a money system that is based on the productive
capacity of its participants. And all this could be ideally
accounted for digitally - with the assistance of private "banking"
corporations.
On the same subject we got this:
"In response to the article on true democracy I would like to
point you to the multicracy site:
http://www.geocities.com/Athens/Marble/3339
It's basically quite similar to 'vote with your money', but with
a slightly different twist."
And another comment on the same article:
"On the matter of majority being RIGHT, I simply cannot believe
the 'stupidity' of some readers, and would abandon commenting.
There are, however, in our history, many examples where ONLY one
person was right, while the rest of the world was wrong! And
this is not uncommon! It usually resides within the scientific
community, where 'thinkers' are objective enough to go 'counter'
flow of received ideas (or brainwashing) and think for themselves.
What would the world be today if Galileo did not stand for his
idea that the Earth was round, and NOT the center of the Universe?
It would take pages of samples of this One against the Whole
(what's that for a minority!) to show you that the world actually
progresses only when the very idea of majority rule (or mob rule
as you put it) is put back into question! [snipped]
And one more for good measure:
"Although I read, with much interest, and agree with most every-
thing you say and print I have found myself a bit concerned about
a few. One of these things is something someone, I think, men-
tioned in the latest edition of the newsletter concerning voting
with our dollars.
If it is OK for two consenting adults to exchange items which are
now considered illegal, such as drugs. How does that help in the
matter of the robbing, stealing and mugging that goes on to
support these habits. Not to mention the young women who get
hooked on the junk and end up selling their bodies. I know making
it illegal is not the answer, we can already see that does not
work. But how can allowing it to be done freely and out in the
open serve to help?
I personally think it is time to quit with the 'drug warriors',
as one reader called them, and turn it back over to the people.
I for one, and let me say I am a Christian and a Pastor, think
there must be a way to put a stop to all of this. I know myself
Christ is the answer but most of the world is not going to listen
to that so what do we do to protect the innocent?"
COMMENT
Firstly, I should say that the criminal activities of "robbing,
stealing and mugging" - are directly associated with the fact
that drugs ARE presently illegal - thus forcing the natural drug
market underground. Being illegal makes it extremely profitable,
as the price is much higher than it would be in an open, legal
market.
As for how to protect the innocent. Freedom carries risks - and
one of these risks is that people will not always act in their
best interest. However, it is not the business of anyone else
to try and stop such people. Freedom includes the possibility
that individuals will choose to injure themselves. But that
is preferable to trying to create a "controlled" society where
everyone is protected from themselves. As for "minors", well they
are the responsibility of their parents/guardians. And if such
people are not up to the task - then any help must be voluntary.
Commenting on feedback saying that the state is losing the battle
with the Internet, we received this comment:
"I don't know if the 'net HAS won the battle against governments'
as one of your readers comments. Just as banking and finance has
been made so much more efficient with computers and the internet,
so will many government functions be made more 'efficient'. Is
there not a danger that the armies of state employees now freed
from the mundane work of government can now concentrate on policing
and spying on the citizens. The number of state employees doesn't
seem to be dropping to any significant degree."
COMMENT
Yes, it would be premature to draw such a conclusion. However,
I also believe that the state may have the money, but not necess-
arily the brains! As the capitalist system continues to outstrip
the state sector - the very best minds will be drawn to the
private sector (where the money is), and therefore, I'm of the
opinion that the freedom possible because of technology will
remain some steps ahead of the repression possible using the
same tools. And as for the number of state employees dropping,
maybe this will happen when state's tax revenues start to dry up
as a result of the creative financial strategies of an increasing
number of people!!
On the matter of dual citizenship, we received this:
"I am originally from New Zealand and have lived in Australia for
years and am naturalized as an Australian citizen. I hold an
Australian passport and am eligible for a New Zealand one as
well. However the Australian customs require that I enter and
leave Australia on the Australian passport. I can however use the
New Zealand passport for travel into the first country on arrival
and beyond. A word of caution however. It gets real complicated
if you get mixed up and try to leave on a different passport than
the one you came into a country on. In some circumstances it is
possible to hold two passports from the same country at the same
time. This is done for regular business travellers so that
companies can be getting a visa put into a passport while the
owner is away on business on the other passport. Again you have
to watch which passport you travel on. Dual citizenship is also
available to those with British parents or grandparents and as
such they are entitled to hold a British passport."
COMMENT
British passports are only available if your FATHER is British
born. It used to be easier - but not anymore. However, if you
have an Irish mother or father - or grandparents, then you can
apply for an Irish passport.
And, finally, a comment on Echelon:
"Concerning Echelon - It isn't well known that the vast majority
of international/intercontinental telecommunications takes place
via undersea fiber optic cables, not satellites. The monitoring
of these cables could be much more invasive and pervasive than
anything to do with satellites. The NSA is actively seeking ways
to monitor these pipelines of communications. The capacity of
TAT-14, TPC-5, AC-1 and several others is each greater than that
of all satellites functioning today. If you don't believe me, ask
AT&T, MCI, Sprint & Tyco."
Thanks for all your feedback - keep it coming!
================================================================
[3] Microsoft vs the State
================================================================
Last week the press were "braying" over the decision against
Microsoft - "the big bad company getting its come-uppance from
the state".
Now, I have no particular truck with Microsoft - but I do have
something to say about this misguided anti-trust legislation.
And if I were Bill Gates - I'd be headed offshore and taking all
my jobs and profits with me!
First, let's get one fact out into the open. No monopoly can
exist without government sanction. Unless consumers are FORCED
to buy Microsoft - because no competition is allowed, then there
is NO monopoly to moan about!
Just because Microsoft "dominates" the software world, in no way
constitutes a monopoly. People have bought Microsoft products
freely (including those who use an alternative operating system
like MacOS) and this global consumer demand is what has made
Microsoft the hugely successful company it is.
No, what we have here, is the state deciding to take on a "comp-
etitor" - a company with financial resources that outstrip those
of many states!
But there is a more fundamental error behind believing Microsoft
to be "guilty" of anti-competitive practices - and that is to
confuse "political" power with "economic" power.
Political power comes out of the barrel of a gun. It is the power
to force you to do something against your will. Whereas, economic
power is the power that money gives you - the power to buy, sell
and make a myriad of choices. But this is NOT the power to force
you to do something against your will.
I don't care how economically successful or powerful Microsoft
is, it still can't FORCE me to buy its products. In the free
market, one is always free to purchase something else.
Now, it's also true, that for a while, one company's product may
enjoy such popularity and success that no one else is prepared
to compete with them. But that does not mean they are legally
prevented from doing so.
Sure, some people moan about Microsoft (usually users of Linux!),
but they are completely misinformed when they wish to use state
power to undermine the profitability of a competitor.
The confusion between political and economic power is very dang-
erous, as it allows people to lump state power and market power
into the same basket. But they are entirely different - and the
difference needs to be understood.
It's also enormous hypocrisy for any state to criticize someone
else for being a "monopoly", when the state itself is the worst
monopoly of all! A monopoly back by guns.
Personally, I believe the state attack on Microsoft is indicative
of something much deeper - that the state perceives market power
as a threat to its own brand of state power, and like any monop-
olist, the state will not stand for any competition!
My only disappointment in all this is the wimpishness of Bill
Gates. If only he'd acted like Howard Roark in Ayn Rand's "The
Fountainhead", and told the state to stuff off - and moved his
business acumen, profits, and opportunities out of reach of the
states' tentacles. Now, that would have been something to cheer
about!
Here was a wonderful opportunity for a businessman to stand up
for his right to create economic values in a free market - to
declare his moral right to do so. Instead we are treated to the
spectacle of appeasement and compromise - a sure "loser" of a
strategy, if ever there was one!
Even more interesting - just when the state is getting into "gear"
over Microsoft's so-called anti-competitive practices, the market
is producing many alternatives to Microsoft's dominance. In other
words, the market is behaving exactly as one would expect. The
huge advantage that Microsoft has had is being challenged by
innovative competitors entering the free market.
My advice to the state - and all state-worshipers, is to butt
out!
================================================================
[4] Offshore Strategies
================================================================
A reader had this question:
"Is it true that by the end of this year the US government is
going to require all offshore brokerage companies that trade in
US securities to report earnings on their US clients? If so,
can this be prevented by having one of your Directors or Officers
in your IBC open the trading account for you?"
I'd be very surprised if this were true - because, as yet, the
USA cannot force an offshore domiciled business to report on the
affairs of its clients - even IF they are US residents. Now, I
know the US government would love to have this power - but it
hasn't happened yet to my knowledge! Of course, it can compel
a US-based brokerage house to report earnings - but that is a
different matter. Either way, operating through a properly struct-
ured IBC, would provide the required degree of protection.
Another reader had two questions:
"I was recently asked by a few wealthy individuals from Japan
that need advice on how to bring their accumulated monies sitting
in the U.S. back into Japan safely. Point of contention is best
method so as not to be hit by the extremely high tax rates imposed
on Japanese citizens by the Japanese Government. I am not sure,
but I was told that the tax rate is around 90%.
Another question asked by another individual is, how to arrange
his contemplated new business in the U.S., whereby he can receive
income here? Or should he establish an offshore account somewhere
outside of the U.S.? My understanding is that foreigners are not
supposed to receive income in the U.S. unless they have a visa."
First of all, any monies remitted from the US into Japan, will
need to be accounted for - although I can't verify whether the
top marginal tax rate in Japan is as high as 90%. If I were such
a person, I would seriously consider keeping my money OUT of
Japan. If they need funds for a specific purpose, maybe they
could obtain such funding via an offshore entity - without having
to repatriate the funds personally. Either way, it is a complex
question, and one that would require a lot more information to
give a useful answer.
On the second point - about foreigners receiving income in the
US, unless they have a visa. As stated, this has to be wrong.
Certainly, foreigners can receive income while in the US. What
they can't do is "work" without a work visa/permit/green card.
However, income can be derived from many sources apart from work,
like investment returns, remittances etc.
Finally, a reader asks this:
"I am still very confused about what is, and what is not, a
controlled foreign corporation or CFC (US tax law) - can you
explain please?"
The rules defining a CFC can be found in the tax code sections
951-964 - but like all state-mandated codes, they are not written
with clarity in mind!
The issue is that a CFC must be reported - its activities, income
etc, whereas, a non-CFC may not be required to file anything at
all to the IRS.
If you formed an IBC, where it was owned equally by 11 or more
unrelated people - meaning that no one person owned 10% or more
of the stock - and its income was at least 30% derived from busi-
ness activities, rather than investments - and as long as more
than 50% of its assets were business related (not investments),
then you would not have to make any report of its activities.
Keep in mind that the ownership of the "no more than 10%" of
stock - refers to both direct and "indirect" (ie bearer shares).
As you can see, it is a complicated process to ensure that your
IBC is NOT a CFC - but it's worth getting it right, so that you
have no legal obligation to be filing returns.
================================================================
[5] NewsBriefs
================================================================
Mendel unlocks "The Prisoner" for Universal - By Charles Lyons
and Dave McNary
HOLLYWOOD (Variety) - In his first major assignment at Universal
since moving his production shingle from Disney last September,
Barry Mendel ("The Sixth Sense") has committed to produce "The
Prisoner" with Oscar-winning scribe Chris McQuarrie ("The Usual
Suspects") set to pen the screenplay.
Director Simon West ("The General's Daughter") is still attached
to take the helm of the picture, based on the 1960s cult British
TV series ''The Prisoner'' created by Patrick McGoohan.
McGoohan, who starred in the original series, will serve as the
project's executive producer along with West.
Allegorical, controversial and even surreal, the television
series was about a man who found himself trapped in a village
where everyone has a number but no name. It addressed such themes
as the individual and society, the philosophical nature of freedom,
the concentration and abuse of power, and the destructive worship
of progress.
Though McGoohan wrote a script in 1996, Mendel, McQuarrie and
West have elected to return to the source material rather than
the earlier screenplay. [snipped]
http://dailynews.yahoo.com/h/nm/20000405/en/film-prisoner_1.html
----------------------------------------------------------------
If you're Australian - and want to get rid of the new GST, you
may be interested in this:
http://www.ozscan.net.au/mandate/index.htm
----------------------------------------------------------------
Some interesting commentary on the Microsoft case:
http://www.mises.org/
----------------------------------------------------------------
Plundering the New Economy - by Peter Topolewski
Who says governments aren't forward looking? US state and federal
politicians recently mustered all their brain power to gaze into
the future. Like the Wicked Witch of the West spotting sweet but
oh so powerful Dorothy in the crystal ball, the politicians
recoiled in horror. They watched today's innocent looking "e-
tailers" grow into tomorrow's monsters.
Surely they will eat away all the precious retail sales tax
revenue, they cried. But what to do?
Tax 'em they shrieked, tax 'em!
Read the rest at:
http://www.zolatimes.com/V4.14/internet_government.html
----------------------------------------------------------------
SEC Proposal Would Search Web and Invade Privacy
EPIC ALERT - http://www.epic.org
Controversy has recently arisen around a Securities and Exchange
Commission (SEC) plan to use webcrawlers to search the Internet
for potential securities fraud. Many have found the plan to be
an overreaction that invades privacy and could chill free speech.
The SEC's plan would utilize webcrawlers to browse and record
statements made in chat rooms, bulletin boards, and web pages
based on undisclosed keywords. In the process of storing publicly
posted statements, the webcrawler would also attempt to collect
personal information to identify posters who often attempt to
maintain their anonymity. While the SEC currently takes these
steps manually in attempts to thwart potential securities fraud,
the automation of the process would potentially extend the reach
of the federal agency into activities that could violate the
Privacy Act of 1974. [snipped]
----------------------------------------------------------------
Getting Snooped On? Too Bad - by Declan McCullagh
TORONTO -- You say you don't like browser cookies? You're not
quite sure if that program you download from the Net is revealing
more about you than it should?
Well, here's something to make you really nervous: In the United
States, it may be illegal to disable software that snoops on you.
[snipped]
http://www.wired.com/news/politics/0,1283,35498,00.html
----------------------------------------------------------------
Would a Global Crisis Make E-Gold Glitter?
That's the idea behind this awkward online currency. But fans use
it for digital transactions -- even in these stable times.
[snipped]
To read this "outside" view, see:
http://www.businessweek.com/cgi-bin/ebiz/ebiz_frame.pl?
url=/ebiz/0004/ep0403.htm
COMMENT
Interesting use of the word "stable". I would have thought that
the times we live in are incredibly unstable!
----------------------------------------------------------------
Luxembourg In The Firing Line Over Banking Secrecy - by Ulrika
Lomas
On the agenda of today's ECOFIN meeting in Brussels will, as
usual, be the thorny withholding tax dossier. Following the UK's
budget last week, Dawn Primarolo, Britain's Paymaster-General,
will be hewing to the 'exchange of information' line.
The EU tax harmonisation package, which has been held up by the
UK's determined resistance to the proposed 20% withholding tax
on bank interest payments, always contained exchange of inform-
ation provisions as an alternative to the withholding tax, but
until recently there seemed little chance of gathering unanimous
agreement on information exchange. [snipped]
http://www.tax-news.com/html/stories/st_withholding_03_04_00.html
================================================================
[6] OPC Diary
================================================================
* e-gold Update
You made it happen! It looks like e-gold got tired of receiving
hundreds of emails from around the world saying...
"Please unfreeze OPC's e-gold account and transfer the gold to
Antiwar.com's account #130325"
By the end of last week, our account was unfrozen. The explan-
ation we received was typical e-gold style:
They claimed that one of our clients had paid us with e-gold
which he had obtained fraudulently, and they wouldn't "have the
time" to sort out whether we (OPC) are an accomplice or merely
the preferred payee of the scamster. Thus they had decided to
unfreeze our account.
And this after more than six weeks of utmost silence! How kind...
Unfortunately they didn't say *which* client it was or how
exactly he had obtained the e-gold... or even how much it was.
Thus we were unable to establish the client's identity and cancel
or revoke his order... let alone verify the truth of this claim!
Like I said last week: Instead of moving offshore and identifying
their clients, e-gold simply treats ALL their clients as potential
criminals - while continuing to offer what is effectively an
anonymous bank account service from WITHIN the US. If there was
ever a recipe for guaranteed disaster, then this must be it!
Until further notice, e-gold remains on our scam warning list.
If you do continue using e-gold, be careful who you receive
payments from, and who you send payments to! It might affect
the status of your account for a VERY long time - thanks to
Big Brother, e-gold style.
In any case, thanks for your assistance. As promised, we have
donated our account balance to a good cause - to Antiwar.com!
================================================================
[7] Quote of the Week
================================================================
"The man who produces while others dispose of his product is a
slave."
Ayn Rand
================================================================
See you next week! Please spread the message and forward this
newsletter in its entirety to related mailing lists, friends,
associates, and Webmasters. !! THANK YOU !!
================================================================
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"Protect your life and assets by going
offshore - the libertarian way."
================================================================
http://offshoreprofit.com
Copyright 2000, OPC International, Inc.
================================================================
_________________________________________________________
Enlighten your in-box. http://www.topica.com/t/15
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