This controversial proposal was buried inside other legislation: Senate Bill 1813 to “reauthorize Federal-aid highway and highway safety construction programs, and for other purposes”.

As an addition to authorizing appropriations for federal transportation and infrastructure programs, “MAP-21″, (Moving Ahead for Progress in the 21st Century Act) includes a provision that would allow for the “revocation or denial” of a passport for anyone with “tax delinquencies” or “certain unpaid taxes”. Specific language requiring a taxpayer to be charged with tax evasion or any other crime in order to have their passport revoked or limited does not appear, only that a notice of levy or lien has been filed for the IRS.

The US already has an official “Passport Denial Program” in place, which not too many people know about. This on is for parents with child-support arrears.  Part of the Federal Offset Program, the “Passport Denial Program” is designed to help states enforce delinquent child support obligations. The program results the denial of a US passport for noncustodial parents certified by a state as having arrears exceeding US $2,500.

We feel this is another terrible development that attacks personal liberty and the presumption of innocence. Let it be known that we at Do Business In Panama do not favor tax evasion or deadbeat dads, most of us know someone who has legitimate financial disputes during divorce proceedings, and/ or  who have differences of opinion with the IRS. Disputes like this were decided through due legal process in the old days. The say-so of a bureaucrat to deny someone a basic liberty – the freedom of travel, is the result of these passport denial laws. Any procedures to dispute such an arbitrary decision in a court of law are very unclear and would require retaining a lawyer which costs thousands of dollars. This leaves the potential for official abuse. The Constitution of the United States never thought of tax inspectors with no legal background filling the roles of judge and jury.

Other countries like the UK and Australia generally think of and follow in the footsteps of where the US leads. The only real way of protecting yourself from taxation of worldwide income is to acquire a legal second or third citizenship. And it is imperative to do this before it is too late!

Do Business In Panama is your reliable source and specialist for up to date information on second and third passport programs, including economic citizenship programs like the St. Kitts and Nevis program, the Dominica second citizenship program, and the passport by residence systems in Latiin America.

Panama Pushes Technology

Government efforts to use technology and lure investors spur boom.

BY ERIC SABO

PANAMA CITY – Panama seeks to remainLatin America’s technology leader by expanding Internet use and drawing in companies to transform the capital into a logistics hub.

The Central American nation replaced Uruguayas having the highest technology level in the region, fueled by a surge of Internet users and computer sales, according to the sixth annualLatin Technology Index from Latin Business Chronicle.

Internet penetration in Panama was up 43 percent and personal computer sales jumped 21 percent, the data show. The index uses 2010 technology data from the International Telecommunications Union, Computer Industry Almanac and the Santiago Chamber of Commerce and population data from the International Monetary Fund and the Population Reference Bureau.

Eduardo Jaen, who heads Panama’s National Authority for Government Innovation, attributes the rise to government support for Internet access and success at luring new businesses into the modern capital. More than 60 corporations, including tech giants Dell and 3M, shifted regional headquarters to Panama since a tax exemption law was passed in 2007.

“There’s a broad array of companies that have decided to position themselves here and use Panama as a hub,” Jean says. “We intend be ahead of Uruguay for years to come.”

President Ricardo Martinelli has made “closing the digital gap” a key priority of his administration. Having established hundreds of free Internet hot spots around the country, the government will start offering discount loans to help workers buy a computer. About 21 percent of Panamanians currently have at least one computer at home, according to 2010 census data.

Martinelli’s administration began offering free computers and Internet access in schools, which helped movePanama up one notch on a separate technology index comprised by the World Economic Forum.

Even so, much of the Internet growth is driven by multinational corporations and small start-ups that move toPanama because of lower tax rates and cheaper operating costs.

Panama eased requirements for starting a business in 2007, and some 35,000 individuals and legal entities have since registered as a Panamanian company online, according to government figures. Among those are a growing number of young American web developers and movie production crews that are demanding faster Internet.

Roman Kogan, who runs Internet service provider PaNetma, says that his business has grown 150 percent from last year.

“You can get cheap Internet anywhere, but you can’t run a business if it’s slow or unreliable,” says Kogan, whose company offers connection speeds up to twice as fast as Cable Onda and Cable & Wireless, Panama’s two largest providers.

He blames a lack of competition for Internet costs that are higher in Panama than in the United States.

“It’s about 20 times more expensive to get a signal connection from Miami to Panama than it is from Californiato Japan,” Kogan says.

Still, Panama’s Internet rates are competitive with other Latin American countries and many find they can save money while running a successful business out of the endless sky rise buildings that pop up in Panama City.

“The Internet here is quite reliable and fast enough,” says Jesse Schoberg, who moved his web development company, LJ Host, from Madison, Wisconsin to Panama in 2009. Rent, food and basic living expenses are all less than in his home state.

Meanwhile, wireless networks connected by BlackBerries and iPhones allow him to keep working on remote beaches and in the mountains, he added.

“You have the perfect storm for Internet entrepreneurs who want a high quality of life,” says Schoberg.

Internet penetration and computer sales are expected to climb as Panama’s economic growth outpaces the region. Backed by an expansion of the Panama Canal, finance officials predict at least 9 percent growth this year.

The boom has caused an envious problem: too many companies are understaffed. While unemployment hovers above 9 percent in the U.S., Panama’s is 5.4 percent, leaving banks and other industries that rely on technology without enough workers. Officials say they are looking at ways to attract foreign skilled labor, which should propel further Internet use and computer sales.

While Panama’s Internet is up to speed now, the basic tech infrastructure needs improvement to handle more online traffic, said Mario Ernesto of Solusoft, a Panama-based company that is advising the government how to convert paper records to digital formats.

It will need to improve fast. Martinelli is investing heavily in construction to fuel growth, more companies are moving in, and hotels including the Trump Ocean Club and Hard Rock are opening their doors to tourists who want to check email.

“We are advancing,” says Jean of Panama’s technology agency. “The government is committed to growth.”

© Copyright Latin Business Chronicle

By David Galland, Casey Research

Tune into CNBC or click onto any of the dozens of mainstream financial news sites, and you’ll find an endless array of opinions on the latest wiggle in equity, bond and commodities markets. As often as not, you’ll find those opinions nestled side by side with authoritative analysis on the outlook for the economy, complete with the author’s carefully studied judgment on the best way forward.

Lost in all the noise, however, is any recognition that the US monetary system – and by extension, that of much of the developed world – may very well be on the verge of collapse. Falling back on metaphor, while the world’s many financial experts and economists sit around arguing about the direction of the ship of state, most are missing the point that the ship has already hit an iceberg and is taking on water fast.

Yet if you were to raise your hand to ask 99% of the financial intelligentsia whether we might be on the verge of a failure of the dollar-based world monetary system, the response would be thinly veiled derision. Because, as we all know, such a thing is unimaginable!

Think again.

Monetary Madness

Honestly describing the current monetary system of the United States in just a few words, you could do far worse than stating that it is “money from nothing, cash ex nihilo.”

That’s because for the last 40 years – since Nixon canceled the dollar’s gold convertibility in 1971 – the global monetary system has been based on nothing more tangible than politicians’ promises not to print too much.

Unconstrained, the politicians used the gift of being able to create money out of nothing to launch a parade of politically popular programs, each employing fresh brigades of bureaucrats, with no regard to affordability.

Such programs invariably surged during political campaigns and on downward slopes in the business cycle when politicians hearing the cries of the constituency to “do something” tossed any concern about balancing budgets out the window of expediency. After all, the power to print up the funds for debt service whenever needed makes moot any concern over deficit spending.

Former VP Cheney, who fashions himself a fiscal conservative, let the mask drop when, in 2002, he stated that “Reagan proved deficits don’t matter.”

Those words were echoed just a few weeks ago, when both former Fed Chairman Alan Greenspan and Obama economic advisor Larry Summers, in separate interviews, said almost the same, paraphrased as, “There is no chance of the US defaulting on its bonds, not when our government can borrow dollars and print new dollars to meet any future obligations.”

Of course, Greenspan and Summers were referring to an overt default – of just not paying – and not to a covert default engineered by inflation. Unfortunately, like virtually all of the power elite, both miss the point that the mountain of debt that has been heaped up since 1971 is fast reaching the point of collapsing like a too-big tailings pile and taking the monetary system down with it.

Importantly, the debt shown in this chart whistles past the government’s unfunded liabilities, in particular for the Social Security and Medicare systems. Adding those would more than triple the US government’s acknowledged obligations – to over $60 trillion.

Given the role the US dollar plays as the world’s de facto reserve currency – with all major commodities priced in dollars, and dollars forming the bulk of reserves held by foreign central banks – the dismal shape of the US monetary system spells trouble for the global monetary system.

Making matters worse, following the lead of the United States, governments around the world long ago adopted similar fiat monetary systems. You can see the deficit contagion in this next chart. It is worth noting that the dire condition of the United States now leaves it in the same muddy wallow as Europe’s desperate PIIGS.

In a recent article in The Telegraph, Ambrose Evans-Pritchard referenced a paper out of the BIS that paints the picture using appropriately stark terms.

Stephen Cecchetti and his team at the Bank for International Settlements have written the definitive paper rebutting the pied pipers of ever-escalating credit.

“The debt problems facing advanced economies are even worse than we thought.”

The basic facts are that combined debt in the rich club has risen from 165pc of GDP thirty years ago to 310pc today, led by Japan at 456pc and Portugal at 363pc.

“Debt is rising to points that are above anything we have seen, except during major wars. Public debt ratios are currently on an explosive path in a number of countries. These countries will need to implement drastic policy changes. Stabilization might not be enough.”

Viewing the situation from another perspective, we turn to the work of Carmen Reinhart and Ken Rogoff, who studied the factors contributing to 29 past sovereign defaults. They found that default or debt restructuring occurred, on average, when external debt reached 73% of gross national product (GNP) and 239% of exports. Using the Reinhart/Rogoff findings, Casey Research Chief Economist Bud Conrad prepared the following chart showing that the US government is already far along on the path to bankruptcy.

It’s hard to argue against the contention that the situation is, to be polite, precarious. Given that the obligations of the US government, as well as most of the world’s other large economies, are now impossible to repay and that their reserves are just IOUs backed by nothing, the stage is set for a highly disruptive but entirely necessary do-over of the fiat monetary system.

“Preposterous!” say the lords of finance and masters of all.

Is it?

Of course, these very same mavens completely missed the looming housing crash and the depth and duration of the subsequent crisis – a crisis that is still far from over. In other words, listen to them at your peril, because in our view it’s essential in calibrating your financial affairs to understand that, if history is any guide, we are now well down the road to a collapse in the monetary system.

In fact, over its relatively short history, the US monetary system has come unglued time and time again thanks to politically expedient attempts to interfere with the workings of a free market in order to reward constituents or kick the can on the economic problems of the day down the road.

Thus it is our contention that while the mainstream media focus on the daily gyrations of equity markets or the futile political charade that is Washington, they overlook powerful tectonic rumblings indicating the world’s prevailing monetary system is about to fracture.

A Brief Timeline of US Monetary System Failures

Here’s a brief history of past disruptions here in the United States. Importantly, with the US dollar now the de facto reserve currency of the world, this time around it’s global.

1861 – When the Civil War begins, the dollar is convertible into gold and silver.

1862 – Congress passes the Legal Tender Act and authorizes the issuance of non-redeemable “Greenback” currency. Convertibility into gold and silver is suspended for all US currency.

1863 – National Banking Act authorizes the chartering of banks by the federal government.

1865 – A 10% tax is levied on the issuance of bank notes by state-chartered banks, effectively ending that practice.

1879 – The US Treasury resumes redeeming dollars for gold and silver.

1900 – Passage of the Gold Standard Act, adopting the gold standard by the United States and demonetizing silver.

Specifically, the act provided for “…the dollar consisting of twenty-five and eight-tenths grains (1.67 g) of gold nine-tenths fine, as established by section thirty-five hundred and eleven of the Revised Statutes of the United States, shall be the standard unit of value, and all forms of money issued or coined by the United States shall be maintained at a parity of value with this standard…”

But 33 years later, to gain the power to inflate the currency and collect the profit from doing so…

1933 – By executive order, Franklin Roosevelt prohibits the private ownership of gold. Congress passes the Gold Reserve Act, which enacts Roosevelt’s executive order, abrogates all gold clauses in all contracts public or private, past or future (which cancels the convertibility of Federal Reserve notes into gold), though it confirms the convertibility of US Treasury notes held by foreigners into gold. Eleven years later, the US government takes its show on the road…

1944 – Bretton Woods system adopted with signature countries agreeing to tie the exchange rates of their currencies to the US dollar, which itself is linked to a fixed price of gold. Foreign trading partners retained the right to swap dollars for gold, imposing a de facto restraint on printing more dollars. For all intents and purposes, the US dollar becomes the world’s reserve currency. But 27 years later…

1971 – Nixon abruptly closes the “gold window,” unilaterally reneging on the Treasury’s  promise to allow foreign governments to redeem dollars for gold. Bretton Woods collapses. With no remaining tie to a tangible, the dollar is reduced to a paper token. The transition to a global fiat monetary system is complete.

Until 40 years go by and the inevitable consequences of giving politicians free rein over money creation become untenable…

Present day – Sovereign debt crisis. Desperate, debt-laden governments around the globe – the bulk of their reserves composed of fiat US dollars and euros at risk of going up in smoke –  turn to the only thing they know, printing more money and issuing yet more debt. The global monetary system cracks and heads toward failure with no workable alternative on the horizon.

Governments, corporations and investors alike are caught unprepared in the downward spiral of failing fiat currencies and are wiped out by a combination of frantic currency debasements, higher taxation, exchange controls and worse. Social unrest spreads, with the public paradoxically demanding that governments do more, not less.

That’s because all the world’s major currencies are at risk, simultaneously, as the issuers engage in a dangerous race to the bottom. As the monetary system moves inexorably toward terminal debasement and collapse, the results will be catastrophic for the unprepared.

Importantly, while the list of historical attempts to re-jigger the US monetary system have, to this point, more or less succeeded in kicking the can a bit further down the road, the sheer scale of today’s government obligations has driven us into a box canyon, with no way out. As the government’s debt and spending obligations are mathematically impossible to resolve, it is now a certainty that a lot of people are going to wake up one morning to the reality that they are a lot poorer than they thought.

Fortunately for those now paying attention, the collapse of a monetary system doesn’t happen in a flash. It is a progression, like the spiral of water down a drain. Thus, while no one can predict exactly when the downward spiral will accelerate out of control, there is still time to prepare.

Dark though the lens may be, this is the lens through which we here at Casey Research view all our investments. Simply, being right or wrong about your investment decisions in the years just ahead will be insignificant if the currencies underpinning those investments shrivel to just a fraction of their current values.

The dismal state of the US economy and out-of-control government spending affects every American’s life and wealth. In our free online event, The American Debt Crisis – How Big? How Bad? How to Protect Yourself, five Casey Research experts were joined by guests John Mauldin, Mike Maloney and Lew Rockwell to discuss the potential for a breakdown in the monetary system, and specific ways to protect and build your assets. Watch the video now.

Offshore “re-seller” companies, also known as “Offshore Company Mills”

will spam search engines such as Google by putting hundreds, sometimes thousands of keywords into their page titles.

Then, while acting like they know the business, they will take your order and then ‘sell your order’  to a real law firm. This may not seem like a problem at first glance, however, by doing this your attorney-client privilege is lost.

This is a problem.

Without the attorney-client privilege, someone can approach them for your information and they are free to give it. Depending on the party requesting the information, it may be easier to furnish the information than to fight it.

Information in jeopardy resulting from no attorney-client privilege includesyour name, address, phone number, cooperation name, etc…. This destroys any reason for incorporating or banking in a strong privacy jurisdiction like Panama.

We at Do Business In Panama have our own in-house law firm and standard practice is to have our clients send instructions, courier documents and anything else directly to the law office.

http://online.wsj.com/article/SB10001424052748703313304576132170181013248.html?mod=WSJ_hp_mostpop_read

Vice Minister of Trade, Jose Domingo Arias projected that Foreign Direct Investment (FDI) will reach $2 billion in 2011. The FDI in 2010 was $1.7 billion by the third trimester, a 12% increase compared to the same time in 2009. The growth is partly influenced by the investment grade ranking awarded to Panama by Standard & Poors and other such agencies in 2010.

Additionally growth is expected from tourism revenue in 2011.

Tourism in Panama grew 6% in 2010, a considerable increase of 2009 which experienced tourism growth of only 2%, according to Panama’s local daily newspaper La Prensa.

Data collected so far, although not officially released indicates visitors to Panama in 2010 were 1.7 million and will increase to at least 1.9 million in 2011. For the tourism industry along with local business owners and entrepreneurs alike, this is good news.

Panama’s airline, Copa Airlines has helped Panam’s growth as a hub and helped Tocumen International become known as the “Hub of the Americas”.

The tourism authority has been consciously lobbying airlines from around the world to establish flights to Panama.

Qantas, Emirates, Flydubai and All Nipon are Airlines interested in establishing flights to Panama in the near future. Presently direct flights to Panama City are available from Curacao, Madrid and Frankfurt.

In its fifth year of contributing to Panama’s growth, is the expansion of the Panama Canal, which is estimated at $5 billion.

Other projects include a 13-kilometer metro line. The metro line, Panama City’s first will cost $1.3 billion and is currently in the design phase. The projects Environmental Impact Study was on December 15^th of 2010 at Istmo University in Panama City.

Construction of the first line is scheduled to begin later this year, and the entire city is projected to be connected by a network of metro lines by year 2035.

The service is provided via the distribution of cards. A user card may be picked up once arriving at Panama City’s airport from the tourist information center. If the visitor experiences an accident during their visit, they must furnish the card accompanied by their passport to receive care or medical attention if need be.

Covered by this insurance is accidental death up to $20,000, hospitalization, medical expenses up to $7,000 and dental related emergencies up to $2,000. The insurance company providing the policy is Assicuraziono Generali who has a two year contract with the government.

The insurance policy will not cover anything due to neglect, drugs or alcohol, and accidents from extreme sports.

It is modern and affordable. For example an associate of mine was so impressed by the facilities available, he had eye surgery done for 50% of the cost in the States. In Panama, the health care system makes it possible to call your doctor on the weekend, making personal service a fact. Most people never experience such pleasure in their home countries.

Panama may be a small country, however it is full of modern medical facilities including dental clinics, eye doctors and a modern hospital facility within 2 hours from any location. Major modern medical facilities in Panama may be found in David, Coronado, Chitre, Boquete and of course Panama City.

Many of the doctors in Panama have been trained in the U.S., and the hospitals share the same standards as in Canada, Europe the United States. Hospital Punta Pacifica in Panama is the only hospital in Latin America that is affiliated with John’s Hopkins.

Private health insurance is available and accessible in Panama and is considerably less than insurance in the U.S. Doctor’s fees and hospital visits are much more affordable as well. Insurance may not always be necessary  in Panama as many expats choose to go with membership plans available thru the hospitals.

(Reuters) – The world’s wealthiest people have responded to economic worries by buying gold by the bar — and sometimes by the ton — and by moving assets out of the financial system, bankers catering to the very rich said on Monday.

Fears of a double-dip downturn have boosted the appetite for physical bullion as well as for mining company shares and exchange-traded funds, UBS executive Josef Stadler told the Reuters Global Private Banking Summit.

“They don’t only buy ETFs or futures; they buy physical gold,” said Stadler, who runs the Swiss bank’s services for clients with assets of at least $50 million to invest.

UBS is recommending top-tier clients hold 7-10 percent of their assets in precious metals like gold, which is on course for its tenth consecutive yearly gain and traded at around $1,314.50 an ounce on Monday, near the record level reached last week.

“We had a clear example of a couple buying over a ton of gold … and carrying it to another place,” Stadler said. At today’s prices, that shipment would be worth about $42 million.

Julius Baer’s chief investment officer for Asia is also recommending that wealthy investors park some of their assets in gold as a defensive stance following a string of lackluster U.S. data and amid concerns about currency weakness.

“I see gold as an insurance,” Van Anantha-Nageswaran said. “I recommend 10 percent as minimum in portfolios and anything more than that to be used for trading purposes, to respond to short-term over-bought or over-sold signals.”

ULTIMATE BUBBLE?

Billionaire financier George Soros, echoing comments from investment guru Warren Buffett, last month described gold as the “ultimate bubble” because it is costly to dig up and has no real value except its market price.

But a rising price for the precious metal has in itself generated more and more demand from investors looking for a way to hedge against a fresh recession. Gold bears no yield and is uncompetitive in an environment of rising interest rates.

The uneasy outlook for inflation, hard currencies and global growth has triggered a five-fold increase in a physical gold fund launched by Pictet one year ago, the Swiss private bank said.

UBS’s Stadler said the precious metal has become a staple of investors’ portfolios, despite questions about whether it makes for a smart long-term investment.

“If you talk to ultra-high net worth individuals, that level of uncertainty has never been higher in the last two, three, four years,” he said. “If they ask me, ‘Is inflation going up or are we entering a deflationary cycle?,’ I don’t know. But obviously nobody knows.”

Anthony DeChellis, managing director of Credit Suisse’s Americas private banking unit, said at the Reuters summit in New York that clients are more interested in capitalizing on the rise in gold prices than using the precious metal as a safe-harbor investment.

“They’re asking, ‘If it’s a bubble, how far can I ride that bubble,’” he said. “I cannot say we’ve seen a spike in gold interest, but there’s an interest in the phenomenon of it.”

Samir Raslan, Citigroup Inc’s regional head for central, eastern and northern Europe, Africa and Turkey, said clients were not going overboard on gold.

“I wouldn’t say that clients are over-investing. It’s part of an asset allocation, but it’s not something that they are deciding all of a sudden,” he said.

And not all bankers are recommending exposure to gold.

Andreas Wolfer, head of private banking at UniCredit Group, attributed the run-up in the price of gold to frayed investor nerves after the 2008 financial crisis as well as concerns about sovereign debt in the euro zone.

“We have seen it but we have not overweighted it in our asset allocation,” Wolfer told the Reuters summit in Geneva, which has emerged as a major trading hub for precious metals as well as other physical commodities.

“We strongly believe in an asset allocation having a clear and diversified portfolio, which sounds a bit boring but in the end it brings the best returns,” Wolfer said.

(Additional reporting by Kevin Lim in Singapore and Joe Rauch in New York; Editing by Greg Mahlich and John Wallace)

Original Article at: http://www.reuters.com/article/idUSTRE6932NR20101004