Right on the Money: Doug Casey on Economics, Investing, and the Ways of the Real World with Louis James

Chapter 15

Doug Casey on Protecting Your Cash

August 26, 2009

Louis: Doug, we talked last week about getting assets out of your home country, especially the United States, where to take them and what to do with them. In so doing, you touched on the inevitability of currency controls just ahead, especially for Americans. Can you tell us more about that?

Doug: Yes, I’m quite serious about what I said about “the grim reality of impending currency controls.” As the global economy continues to deteriorate, governments will have to appear to be “doing something.” It’s going to become very fashionable to institute some sort of foreign exchange control.

Why might that be? Because obviously, people who are taking their money out of the country are unpatriotic.

L: Those bastards.

D: That’s right. Jingoistic Americans naturally, but stupidly, see taking money out of the country as being unpatriotic. They don’t understand that it’s mainly those prudent people who will be able to supply the capital to rebuild a devastated economy later. Besides, getting money abroad is obviously something that only rich people would do, and of course, it’s time to eat the rich, as well. For those two reasons, there won’t be much resistance to controls. And the state gets to appear to be “doing something.”

And when they do, more people—at least those with any sense—will get scared and really try to get their money out, which will exacerbate the run to the exits. The bottom line is that if you want to get ...