"Who Gets Hurt And Who Is Spared"

Robert Prechter:

At some point during a financial crisis, money flows typically become a political issue. You should keep a sharp eye on political trends in your home country. In severe economic times, governments have been known to ban foreign investment, demand capital repatriation, outlaw money transfers abroad, close banks, freeze bank accounts, restrict or seize private pensions, raise taxes, fix prices and impose currency exchange values. They have been known to use force to change the course of who gets hurt and who is spared, which means that the prudent are punished and the thriftless are rewarded, reversing the result from what it would be according to who deserves to be spared or get hurt. In extreme cases, such as when authoritarians assume power, they simply appropriate or take de facto control of your property. You cannot anticipate every possible law, regulation or political event that will be implemented to thwart your attempt at safety, liquidity and solvency. This is why you must plan ahead and pay attention. As you do, think about these issues so that when political forces troll for victims, you are legally outside the scope of the dragnet.

For those who understand the big-picture intersection of monetary policy, statism, and the exigencies of a system in which all of Wall Street is explicitly and permanently backstopped, preparation and protection -- and that means a mix of national borders as well as assets -- should be paramount right now. When and how the state will try to prevent savers from protecting themselves is another issue. More soon.