The IMF Talks About The Big C

Recent events have made it very clear that America is incapable of making the necessary reforms to avoid its looming debt/currency crisis. Avoiding making the tough reforms now will only make the reforms  more severe when they are forced upon the nation and the world in the not-too-distant future. These severe reforms will involve a lot of pain to the vast majority of Americans and citizens throughout the world who will be forced to partake in them because they are unaware of what is going on and as a result have not prepared for what is coming. Wealth confiscation will be one of the required reforms or tools to deal with this crisis.

The ground is being prepared by various governments and the IMF--the epitome of free markets supporters, said sarcastically -- for wealth confiscation in America and in the rest of the world. In America, wealth was confiscated during the Great Depression and recently there has been talk and preparation for confiscating retirement accounts and laying the foundation for bail-ins; and in the rest of the world you have plenty of recent examples of wealth confiscation in Argentina, Cyprus, and Poland. Additionally, you have a plethora of examples in history where bankrupt governments have confiscated the wealth of their citizens.


The IMF is aware of the economic situation the world finds itself in and the inevitable need for wealth confiscation and massive tax increases. As Forbes magazine points out, the IMF recently:

The International Monetary Fund (IMF) quietly dropped a bomb in its October Fiscal Monitor Report. Titled “Taxing Times,” the report paints a dire picture for advanced economies with high debts that fail to aggressively “mobilize domestic revenue.” It goes on to build a case for drastic measures and recommends a series of escalating income and consumption tax increases culminating in the direct confiscation of assets. 

The sharp deterioration of the public finances in many countries has revived interest in a “capital levy”— a one-off tax on private wealth—as an exceptional measure to restore debt sustainability. The appeal is that such a tax, if it is implemented before avoidance is possible and there is a belief that it will never be repeated, does not distort behavior (and may be seen by some as fair). … The conditions for success are strong, but also need to be weighed against the risks of the alternatives, which include repudiating public debt or inflating it away. … The tax rates needed to bring down public debt to precrisis levels, moreover, are sizable: reducing debt ratios to end-2007 levels would require (for a sample of 15 euro area countries) a tax rate of about 10 percent on households with positive net wealth. (page 49)

You can read the report here. At pg. 40 the IMF laments the fact that wealth is mobile and then it talks about the need to tax wealth differently according to how mobile it is: 

The modern history of recurrent wealth taxes, however, is not encouraging. Relief and exemptions—for land, for instance, and family-owned businesses—creep in, creating avoidance opportunities, as do ferociously complex aspects of the legalities (in dealing with trusts, for instance). Financial wealth is mobile, and so, ultimately, are people—generating tax competition that largely explains the erosion of these taxes. There may be a case for taxing different forms of wealth differently according to their mobility—meaning a higher rate on nonfinancial wealth (largely real estate) than financial. In fact, it appears that both forms of wealth are quite large (Figure 23) and, perhaps surprisingly, that nonfinancial assets are very important for the very wealthy (Table 13). Substantial progress likely requires enhanced international cooperation to make it harder for the very well-off to evade taxation by placing funds elsewhere and simply failing to report as their own tax authorities in principle require"  pg. 40

The report is revealing and provides a glimpse of what to expect in the not-too-distant future. What does this mean for you? If you don't educate yourself and plan accordingly, you can expect to loose a significant portion of your savings, retirement, and other assets through direct confiscation and/or indirect confiscation through currency debasement and inflation. History provides a detailed map of what to expect regarding wealth confiscation. The writing in on the wall.