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Crises come in many different shapes and sizes. As we’ve seen recently, some are natural disasters, while others are man made. While we might not know what they will be, or when they will occur, you can avoid many of man made personal and financial disasters, if you plan ahead properly. In the meantime, beware of the information war, and what you hear.
Our newsletter today is about...........
Information Wars & Man Made Disasters
As many of our long time readers know, I travel frequently. In past months, I was in Queensland, Australia where the devastating floods unrelentlessly hit hard across a wide region; flood waters in many places were rooftop deep, and covered a land mass the size of Germany and France, combined. Then only weeks later I found myself stuck in a blizzard with traffic at a complete standstill in the middle of the North American Rocky Mountains, in 2 to 4 feet deep snow, desperately trying to catch a plane 100 miles away.
After I finally caught my flight, I arrived in New Zealand the day before an earthquake destroyed the second largest city – along with the lives of many - in a small country with a population of only 4 million. Only recently I departed Japan before a disaster of unprecedented proportions unfolded. I am thankful that I had no travel plans to the Middle East in recent weeks.
I'm convinced that the old Chinese proverb "May you live in interesting times" is a curse. Some boredom would be OK about now.
Natural disasters can be difficult to avoid, and human nature draws our focus to the present. During the past week the massive earthquake and tsunami in Japan created fear that it would result in a potential widespread nuclear disaster; Saudi Arabia and Iran sent troops into Bahrain to quell civil unrest; Yemen is taking steps to evict foreign media as protests have swelled; all of which follows on the heels of large scale protests, demonstrations - and in one case a civil war with U.S. involvement - in Tunisia, Egypt, Libya, and elsewhere.
We frequently look for simple cause and effect in devastating world events while trying to learn about the issues. But a real advantage lies in understanding the broader perspective. In order to get this deeper understanding, you need to hire a team of on-the-ground geopolitical experts, or make a commitment to scour through many alternative global news sources comparing the reporting of events, and then questioning their legitimacy and biases. Watching, reading, or listening about current events from different perspectives is an amazing way of obtaining a better perspective of what’s really happening around us today, and understanding the big picture.
When I launch my browser each morning, and sip my first cup of Java, I begin with global news sources such as RT News (Moscow), CCTV News (China), Al Jazeera (Middle East), New Zealand Herald (South Pacific), and of course good ole Bloomberg (USA). From my desk I watch and listen to news sources from BBC UK, Sky News Australia, RT News, CNN International and Fox News. I also read several different old fashioned daily international newspapers, and receive what seems like an endless number of daily, weekly and monthly newsletters and commentaries. I’m curious, and I like to understand how things work.
No, I’m not a news junkie, but I enjoy skimming over and looking at the different perspectives of important events unfolding across the globe, and then pay particular attention to the key issues that affect our world. All done and said, none of this makes me an expert on anything, but it certainly provides a better perspective of the world than someone handicapped with myopic vision.
Sometimes it feels really good to blame the media for the insane manner used to increase ratings by attempting to entertain us through fear mongering over often irrelevant details. But we may be the real source of the problem as we attempt to absorb the sheer endless volume of useless "news." I recently heard someone compare the news media to rubber necking a car crash on the roadway as we drove by in a traffic jam, and even though there's nothing useful to see, it’s still nearly impossible not to look.
What makes great television are images that create emotions of fear, sympathy, shock, or anger. When we are caught up in the moment of tragedy, we feel like we are part of the event. But when there is a lack of images or media coverage, real tragedies and significant events that affect our world can also go unnoticed.
For example, in 2005 an earthquake in Kasmir, Pakistan killed more than 75,000 people. While world media covered the tragedy, it’s nothing like the coverage we see in Japan today due to their technology. And in 2008 a Cyclone hit Myanmar and more than 138,000 people were killed. The government there severely restricts media coverage, and only small tidbits of the aftermath went reported; and even that quickly died down with limited images. And in Sichuan, Western China an earthquake killed 68,000 people in 2008, but that too received little coverage due to the lack of available technology and government restrictions on coverage in that part of the world.
Unfortunately, which tragedy gets widespread media coverage depends greatly on whether cameras are around. When cameras or journalists don’t pick up the events, they often go unnoticed, even though the tragedy can be much more severe.
Certainly not to play down the events of Japan and the huge suffering so many are experiencing, but that tragedy is receiving so much more attention because the images make for better television, more viewers, higher ratings, and ultimately an increase in paid sponsors. The death toll could likely climb to 18,000 deaths, but the bottom line is that the images significantly affects the amount of coverage and the media's bottom line.
In particular, the U.S. domestic news stations try to outdo one another with hyperbole and sensationalism of even small, ordinary events. Even the mundane becomes Breaking News, or a Special Report, and of course exclusive coverage of something new just in. Like a drug or pornography addict, it takes a bigger dosage to get off or make an impact. With so many 24/7 news medias competing for higher ratings today, each report must compete to get your attention to keep you tuned in, or risk that you tune out.
I hate to say it, but the American local news media sources are the worse of the bunch with excessive hyperbole and sensationalism, and by a large margin.
Just one recent example brings to mind how global media sources covered how the Japanese were initially maintaining control of the nuclear reactor core, how courageous local men and woman were acting heroically to save lives, and even over-exposing themselves to excessive radiation, tirelessly placing others before self. But at the same time American news sources and their talking heads screamed at us across the screen nothing but doom and gloom, how the Japanese were failing to take necessary steps to control the problems, and how Americans were ultimately going to become exposed to excessive radiation as a result.
To keep the above in perspective, this coverage was in the very early days before the nuclear power plant even became a more serious problem, and international monitoring teams reported no radiation health hazards except at the sites, nonetheless, the American news teams arrived on the scene to exercise their journalistic literary license. This distinction is more than a different perspective, as it is nothing more than one more example of fear mongering to sell air time, all at a cost of a huge emotional impact on misinformed American viewers.
A U.S. news source headline read: Gas masks, emergency kits and space blankets: Hysteria in U.S. as thousands of Americans panic-buy radiation protection and drugs.
Even the U.S. Surgeon General, Regina Benjamin, warned Americans to 'be prepared' for harmful radiation from Japan to hit the West Coast of America. sold 250,000 potassium iodide pills, while Anbex received three orders a minute instead of per week. Packs of 14 pills that usually cost $9.99 changing hands on and eBay sold for $250 to $400. And even specialty manufacturer begged people not to place any more orders after it sold out of radiation detection gadgets.
In America there was a surge in purchases of gas masks and emergency survival kits including food, water and space blankets reported. Stocks of the tablets that aim to stop radiation poisoning the thyroid gland were running low and customers missing out were said to be crying or terrified. Anbex president Alan Morris said the firm was getting three orders per minute for the $10 iOSAT packages - compared to the normal rate of three per week. “Those who don't get it are crying,” he told the Wall Street Journal, “They're terrified.”
In the meantime, real-time radiation map of U.S. shows levels are currently within normal ranges. President Obama appeared on national television to remind Americans that there was no danger of harmful Japan nuclear fallout reaching the U.S. He called for calm.
Even the World Health Organization (WTO) added to its website that potassium iodide pills are not "radiation antidotes". The WTO says they don't protect against external radiation or against any other radioactive substances, apart from radioactive iodine. They may also cause medical complications, for some individuals such as those with poorly functioning kidneys. Therefore, taking potassium iodide should be started only when there is a clear public health recommendation to do so.

I know I'm stating the obvious for some, but it has become clear that the media - particularly the U.S. media - overreacts and exaggerates events, and is rarely a reliable source of information.

Of recent, recall how the media scared the bejeepers out of everyone over swine flu, how it overreacted to the Toyota car problems, the exploding iPhones, TSA pat downs, and Wikileaks founder Julian Assange. The U.S. press has clearly overacted to Japan's nuclear reactors, but now Fox News' Glenn Beck - looking for someone else to fault - blames George Soros for the overreaction and propaganda on the nuclear power threat, even as the all-clear bell is sounded, and we can stop worrying about the Japanese power plants. It appears that the media - especially in the U.S. - overreacts to just about everything.

And bigger problems result from the misinformation campaigns out of the U.S media. For example, sound arguments can now be made that the media actually contributed to the past obsession with real estate and ultimately contributed to the credit crunch, and the financial crisis. And too, that as a result of excessive media coverage and overreaction, the U.S. government then overreacted to the global financial crisis, and is now again overreacting with new excessive regulation. No doubt, much of the media information about the financial crisis was very wrong, but it sold more media print and airtime.

Those of us in the offshore professions are well aware that the media hyperbole over offshore banking and foreign activities has resulted in unnecessary and unjustified public misinformation, and even a negative stigma in the industry; and that in turn has ultimately led to excessive government regulation. The media coverage is so bad and misinformed regarding offshore activities that many international companies are forced to not only address this media problem, but also develop strategies and implement planning to deal with the unfortunate media created myths.

But worse yet, high-tax governments like the U.S. have actually instigated media campaigns with the direct intention to blur the line between legal tax minimization and criminal tax evasion, and incorrectly associate offshore business with criminality and money laundering.

No doubt, the media forms our opinion - rightly or wrongly - on just about everything. And no doubt, since it's in our nature to overact, the media and our governments use this to their advantage to an art form to generate emotional responses, sell media time, and to generate support for new government policies, programs, and taxes.

Importantly, how we respond to the hype, is up to us. That is the part we control.  And keeping ourselves better informed is a first step in deciding how we respond to the hype, if at all.

Avoid the Herd Mentality
When I was growing up we were told stories of how the Russians and Chinese told lies and fed propaganda to its citizens, and how that was a terrible thing. I was also told that we lived in a free democratic society in America and that couldn’t possibly happen at home. Sad to say, today, I rarely believe much of what I hear or see from American media, or from the U.S. government, unless I can verify it from foreign sources. President Reagan frequently used a term dealing with the Soviet Union, "doveryai, no proveryai", which literally translated means “trust, but verify.” Today this seems to apply to U.S. information sources. 
Ever wonder why you don’t widely see some of the above global news sources on American cable or television? It’s because the foreign news sources are from “foreigners” and they might offer you a different perspective about the world that the U.S. government doesn’t want you to know about. It is clear that Al Jazeera (Middle East) and RT News (Moscow) are not welcome in America, and have struggled to obtain a U.S. audience. I believe Americans are grown up enough to make their own choice whether the journalist coverage is reasonable and balanced, if given the opportunity.
Truth be told, these foreign news sources are considered the “enemy” in America, and the American government believes it’s at war with these enemies. Secretary of State Hillary Clinton declared this past week that the U.S. is losing the Information War against these global medias, and argued before a Senate Committee hearing that President Obama needs more of your tax dollars because - as she claims - the U.S. needs more money to pump out more information around the world. 
More money for more U.S. government propaganda? If the U.S. news perspective is important for the rest of the world to hear, then what’s wrong with a balanced perspective from other news sources from around the world for Americans to hear? Or am I being naive? Is it possible that the average American is incapable of making an informed, reasoned decision like the rest of the world? Or would a better informed America be an inconvenience for the government in trying to sell to its citizens that it is acting in their best interest?

Worse yet, the Information War begins at home in America as the U.S. Department of Education "indoctrinates", not educates, children in the public school system, according to Congressman Ron Paul. "The U.S. Department of Education is a propaganda machine" says Ron Paul, "and the children are intimidated to be conformists." Teaching our children - and adults - to think critically and take into account a broader world perspective would certainly be a good start to acting more think?
Naturally, the U.S. news sources are very American centric. But sad to say, they are also more concerned with morons like Charlie Sheen and his latest rantings, and offer very little about what’s really happening across the globe, except when creating fear across the screen.…think terrorism. Worse yet, the U.S. media sources have been pumping out not much more than tabloid journalism. Mindless junk food dressed up in hyperbole and sensationalism to sell it. Crap on steroids. There, I said it.
Any wonder why the terror de jour 'death by radiation' across America caused people to panic? 
Its been said that men think in herds, and that they go mad in herds, while they only recover their senses slowly, and one by one (Charles Mackay, Extraordinary Popular Delusions and the Madness of Crowds). It’s this same herd mentality that creates economic booms and busts, generated by excessive greed and fear.
But unlike earthquakes, tsunamis and nuclear meltdowns, man made financial disasters can be averted if plans are in place when they occur.
The Need to Plan
Both recent and long term history shows us that economic disasters are not freakish, once-in-a lifetime events. Financial systems are inherently fragile and prone to collapse. Just like today we understand that Japan, New Zealand and the U.S. West Coast are located on the Pacific Ring of Fire prone to earthquakes and tsunamis, a reasonable assumption can be made it’s only a matter of time before the next crisis occurs.  Educated people either take steps to avoid the risk, or accept the possible outcome.
But unlike natural events, man made economic and financial crises occur much more frequently, and can be much more widespread.
In an excellent book Crisis Economics, Nouriel Roubini outlines how large economic collapses are both probable and predictable. Crisis is the norm. Booms are always followed by busts, in varying degrees, and it will always be a function of capitalism. None of the economic models Roubini outlines are hypothetical, and are based upon an excellent view of economic history. And since large crises comes in many shapes and sizes, what works in one situation rarely works in another.
The Global Financial Crisis that started in late 2008 was just one recent financial disaster that destroyed many business models, and ruined the financial and emotional lives of many across the U.S., and around the world. Unfortunately, more financial calamities will occur again in various shapes and sizes, affecting different numbers of individuals. But fortunately, these types of disasters can often be averted….if we plan ahead for them.
Even more difficult to measure – but even more common - are the many independent personal and individual crises that occur to individuals during “normal” economic times. Common are personal and financial disasters, such as business failures, lawsuits, personal and professional disputes, deaths, divorces, and much more.
This means that everyone should have a personal contingency plan – a Plan B – for when a personal crisis occurs. Even more pressing is having a contingency plan for when a large, financial calamity happens, which can be widespread and long lasting.
John Maynard Keynes, a giant in economics, rightfully observed that the world is ruled by little else than by madmen in authority. Which reminds me that even U.S. Federal Reserve Chairman Ben Bernanke appears to have a backup plan for the U.S. Dollar’s demise. Bernanke has taken at least a portion of his nest egg investments offshore and diversified them into foreign bonds in a foreign currency. In fact, his foreign currency holdings form a key element in his investment portfolio.  Does Ben have an exit plan he’s not telling us about?
And too, recently, the State of Utah took a step toward bringing back the gold standard in the U.S. when the State House passed a bill that would recognize gold and silver coins issued by the federal government as legal currency. Under the bill, the coins would not replace the U.S Dollar, but would be used and accepted voluntarily as an alternative. If the bill passes, Utah would become the first of 13 states that have proposed similar measures. The other states are Colorado, Georgia, Montana, Missouri, Indiana, Iowa, New Hampshire, Oklahoma, South Carolina, Tennessee, Vermont and Washington. The Utah legislation was sent to the Senate, where a vote is expected soon.
These are only two recent examples of planning models “just in case” calamity strikes.
Emergency plans are vital not only for businesses and governments but also for families and individuals. This means establishing planning structures and back up plans for when a tragedy strikes at home, whatever the source.
While such planning is critically important for people who live and work in high-risk businesses and professions – or even those who have assets worth protecting - recent events have demonstrated that even people taking on relatively conservative pursuits, considered safe and low-risk, can still be caught unexpectedly in a crisis. Financial – like natural - disasters can and do strike unexpectedly almost anywhere and to anyone, and it’s always important to plan ahead.
Alternative plans, back up plans, and Plan B planning are all part of reducing the risk of loss of assets, livelihoods, and personal wealth. When individuals are generally confronted with a serious risk issue they often shift into panic mode and have limited time to conduct effective planning. Many people simply do not know what to do, or even where to start. Most wander aimlessly and desperately, and end up jumping on the first thing that appears to be a quick fix. Once a threat materializes, damage control is all that remains.
The best time to set up planning strategies is when seas are calm and there are no threats of risk. Having a plan in place gives a person who is in shock or denial and unable to think clearly, a framework to lean on and a path to follow. If a threat has already reared its ugly head, then you may need to move quickly and take decisive action, as long as timely, and within proper legal bounds.
Yes, International Trusts and global diversification are an essential part of planning ahead. Here are a few tips to help you get started. And the Past Articles at our site offer thoughts on other topics that might be of interest to you. Visit to learn more.
Until next time......
David A Tanzer, Esq.
JD, BSc, Ph.D (Hon)
For more information visit or email to David is the author of “How to Legally Protect Your Assets” and “Offshore Living and Investing.”
David A Tanzer & Assoc., PC.

Vail, CO USA:
Tel. (970) 476-6100
Fax (720) 293-2272

Auckland, New Zealand:
Tel. (64) 9 353-1328
Fax (64) 9 353-1328

Brisbane, Australia:
Tel. (61) 7 3319 6999
Fax (61) 7 3319 6999

(Licensed to Practice Law in U.S. States & Federal Courts;
Assoc. Member Auckland, N.Z. District Law Society - Foreign Lawyer; &
Assoc. Member Queensland Law Society, AU - Foreign Lawyer)
The comments herein are not intended to constitute a legal or tax opinion regarding any specific legal or tax issue as additional issues may exist; does not reach a conclusion with respect to any specific legal or tax issue
addressed herein or any additional issues not included; and cannot be used for the purpose of avoiding legal or tax obligations or penalties with respect to issues in or outside the scope of matters discussed herein.
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