Wealth creation vs control?

The apocryphal Chinese proverb, “May you live in an interesting age”, describes the current international financial environment – from the US FATCA to the various “me too” versions being hastily put forward by European governments, the world’s financial plumbing is being reworked.

 

Night of the Living Dead

In many ways, some of our states are like General Motors before its bankruptcy, suffering from falling revenue, borrowing money to cover operating expenses and operating under crushing legacy health and pension liabilities. 

Simplicity is the ultimate sophistication

Crystal ball gazing is precarious at the best of times, but especially so in the current world economic environment. This does not stop people predicting the timing of the global economic recovery.

The growing threat of wealth taxation

We need a tax system which asks the billionaire class to pay its fair share of taxes and which reduces the obscene degree of wealth inequality in America.

 

Whither the Cayman Dollar?

The Swiss franc, the currency of a country that has a few things in common with the Cayman Islands, shot up from $1.082 (USD/CHF) on 5 April of this year to $1.375 on 10 August, an increase of 27 per cent in four months.

Three lessons for financial regulators from 1970s price control

In the early 1970s, there was no euro, Greece could print as many drachmas as it wanted, and the notion of a common European fiscal policy would have been dismissed as sheer fantasy by all but the most ardent proponents of a “United States of Europe”.

 

Entering a year of uncertainty and opportunity

The year 2009 delivered a surprisingly strong recovery as equity markets rebounded from the historic financial crisis seen in the second half 2008. The remarkable levels of government investment into the global financial system seem to have rescued the world’s economy from a potential disaster that could have taken decades to recover from.  

Natural resources and finance

Unfortunately, many jurisdictions rich in natural resource deposits are poor in rule of law.   

 

Is Cayman committing economic suicide?

 The proposed tax, since dropped, would have been a 10 per cent payroll tax on expatriates making more than $36,000 per year. Cayman had never had a direct income tax, and officials have always previously insisted that Cayman would never have one.  

The way forward for anti-corruption measures

OFCs need to exert more influence toward the global adoption of cost-effective anti-corruption measures.

A future of wealth confiscation?

Warren Buffett famously explained to his shareholders in 2004 that investors “should try to be fearful when others are greedy and greedy when others are fearful". 

 

The future of the Cayman financial industry

If the Cayman financial industry were faced with extinction or only the potential of a diminished role, we would not bother providing you with the third edition of the Cayman Financial Review, which you are now reading. Cayman can continue to grow as a financial centre, provided both the new government and the financial industry do more to protect it from the financial imperialism of foreign governments, and provided the private sector – with the support of government – develops new products and continues to improve existing financial services.

The best defence is a good offence

Both the US Congress and most of Europe took vacations at the end of the summer, bringing a temporary respite in most of the efforts by the American government, EU, OECD and many European governments; although American efforts to breach Swiss banking secrecy continued despite the August heat. Nonetheless, when congressmen and senators stagger back this fall from their mauling at the hands of constituents angry over soaring deficits and the proposed health care ‘reforms’, the proposed Stop Tax Haven Abuse Act, anti-offshore budget provisions...

The future of financial regulation: Dark clouds on the horizon

 Consider the following recent comments by key regulators in the United Kingdom and the United States and a likely one from France:  

 

How offshore financial centres will save countries

The great curse of democracies is that eventually a majority of the people become addicted to and demand ever more government benefits that cannot be funded by the diminishing numbers of taxpayers or through borrowing.

 

The view from 1963

The global financial crisis, Cayman’s struggles to balance its budget, the sequential financial meltdowns among Europe’s PIIGS, and the turmoil in the Middle East’s impact on energy prices (let alone the question of whether countries like Egypt will end up better off or not) could all make one gloomy about the future. 

The case for offshore

The world’s financial infrastructure remains in flux. The United States’ FATCA, Britain’s “son of FATCA,” France’s “mini-FATCA,” the dozens of intergovernmental agreements (IGAs) being entered into by governments around the world with the U.S., and calls by many EU member states for IGA-like agreements of their own are changing the rules of international financial transactions.

 

Long attention span needed

A popular TV show in the early nineties was “Short Attention Span Theater”. The title itself neatly parodied the growing culture of clips and sound bites to convey both news and entertainment and, sadly, this trend has continued. One result is that today many people obtain nearly all their financial information from television and internet sources, which deal with complex economic issues in a thirty second burst or a couple of pithy headlines.

Converging economic crime

At age 19 there was no doubt in my mind that I did not want a career in criminal law. I chose the much more objective (and enjoyable) commercial law. So much for that!   

 

There is good news

The last couple of years have left people in a depressed mood. But if one looks at the world as a glass half full rather than half empty, there is reason for optimism. The fact is the world economy is growing and in some important places, China, India, Brazil, Egypt, Turkey, Indonesia, Chile, etc, at very substantial rates.
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