Do as you are told, or else!

We that invest in precious metals—we who have withdrawn parts of our retirement accounts, or dedicated funds that we would have spent on consumer frivolities—we did not follow the rules. We have been critical thinkers, considering the reasons for our economic woes, concluding that the economy is not reparable under the current system.

Believing this now, we have taken action, investing in commodities that will survive an inevitable collapse so that we might be able to rebuild our lives in a new economy. But we did not follow the rules -- we did not spend more and go deeper in debt  while our savings were tucked away on Wall Street in IRA accounts. So we have been “yellow-trucked!”

I took a logic class in 1978 titled “Forms of Thought,” taught by Dr. Williams, a mathematician for whom I had great respect, because he passed me in Algebra when I could barely solve a quadratic equation and forgot a week later. The first day of class he pulled out a book by a major philosopher (Julian Jaynes) and announced to us that he had identified no fewer than 28 errors in logic in this significant book. I was mesmerized from that day on! I swore to myself that I would master this mathematical system of logic, complete with its own symbols. I figured that I could listen to someone’s argument, convert it to mathematical logic, spot the weakness, then know exactly what to say to refute that argument. I would have the power of that yellow truck. How cool is that!

But it did not work out that way. I struggled to translate real-time arguments into logic symbols then back into English. I was literally learning another language. So I gave up … besides, the school only offered one class in logic. But in retrospect, it sounds like I had a class in “critical thinking” before the term was made popular in colleges. Certainly critical thinking was not an explicit “learning outcome” to the college then, but has anything really changed? Logic classes are electives, as are argumentation and debate classes.

Today, universities say that we teach critical thinking, but do we really teach it? I think not! Instead we are taught to follow the rules. In academia, the education professors have stepped into a void and claimed expertise in Critical Thinking. Rather than teaching a mathematical system of logic, or teaching good argumentation principles, they have created an entire matrix of concepts that describe their view of critical thinking. Consider these definitions:

In 1940, Sumner defined it as “the examination and test of propositions of any kind which are offered for acceptance, in order to find out whether they correspond to reality or not.” *

More recently (2014) the definition has been expanded to “the intellectually disciplined process of actively and skillfully conceptualizing, applying, analyzing, synthesizing, and/or evaluating information gathered from, or generated by, observation, experience, reflection, reasoning, or communication, as a guide to belief and action.”  

The revised definition is clearly inspired by Bloom’s Taxonomy—a handy diagram that helps teachers map out the process of learning. Within that new definition they posit 5 concepts as working hand in hand with 5 more to achieve a dual purpose of belief and action. But I claim the description of the process is getting mucked up with too many variables and nearly impossible for the human mind to keep at its fingertips if one finds themselves in a public debate—or even a published debate. I like the first definition much better.

This difference is profound: The 1940 definition tested propositions. The 2014 definition conceptualizes/evaluates information.

Essentially "critical thinking" shifted from the examination of major premises to the minor ones. We no longer ask if “all men are mortal” in college, rather we ask if “Socrates was really a man.” In economics, we do not debate where or not Keynes was right, we discuss how to set manage interest rates to achieve the desired level of inflation based on government metrics. No longer do we test propositions to see if they conform to reality. Instead, now we follow a method of getting from A to B by using a prescribed process. We teach students to follow a set of rules about how we determine what knowledge is. If you don’t follow this method, you don’t pass certain classes and you don’t get a degree. You will remain “uneducated.”

I contend that while university people talk a whole bunch about critical thinking, there really is very little teaching and practice in critical thinking that happens for bachelor’s level students. (It changes at the graduate level, but really, how many people read academic journals exploring and debating theory after college?)  I benefited most from my research methods and statistics classes. And truth be told, research methods did not make much sense until after I learned statistics. But I am not sure I would have grasped the importance of stats without first getting mired in research methods--kind of a chicken-egg deal. The light went on for me, but then again, I was that weird student. Today, we specialize in narrow fields, focusing on specific theories and data, but not being taught to synchronize knowledge and ideas from various fields. How much do research chemists developing genetic variants learn about propaganda methods their employers use on the public? The disconnect is startling. People take classes to pass them and check them off their list.

Even Bloom’s taxonomy has been revised. They added “creativity” to the top of that pyramid, suggesting that when you follow the steps of learning up the pyramid, you will become a creative person. Hmmm…. My kids were pretty creative at a very early age, as are all kids. Something doesn’t add up here. Actually, education has been roundly criticized for squelching creativity from young people. According to Rich Hess, “A legacy of statutes, contracts, rules, and regulations … stifles creative problem-solving… and has yielded a culture of timidity….”   But simply adding creativity to the pyramid doesn’t solve the problem Hess describes. And in the view of other experts, that is not where creativity comes from anyway. This video lecture by Elizabeth Gilbertis worth a watch (20 minutes) if you are interested in creativity


I think George Carlin was right. “They don’t want a population of citizens capable of critical thinking!” They want good factory workers, soldiers, and generally people who do what they are told to do. Critical thinking is dangerous!

So we don’t teach critical thinking, even though people like me, and even though dedicated professors in Education departments all agree that we must. Currently, the ability to teach critical thinking and the methods of doing it are mired in academic over-complication. If you have learned to reason, critique and discover truth, (and most of you have) I’ll bet you learned it on your own, in spite of our educational system.

But, we have hope if you wish to learn or sharpen your abilities.

There is a very simple method of mastering the techniques of critical thinking, of training the mind to analyze, critique, create,  support or attack certain propositions. “There is nothing new under the sun,” said a wise man. So why reinvent the wheel with this cumbersome system of "critical thinking," which is accurate, but difficult to employ, when we already have an elegant, simple, effective, tried and true system at our fingertips.

The method to achieve what we call critical thinking today was called “Invention” by the ancient Athenians. It was at the heart of training in “Rhetoric” if you were an aspiring Greek youth. I didn’t learn this system until I studied Aristotle in graduate school. How I wish I had learned about rhetoric at age 12 or so as they did back then!

The "critical thinking" part of their rhetoric curriculum was developed in Syracuse around 500 BCE and practiced for two centuries in courts and assemblies before it was finally codified by Aristotle.  The system of “Topical Logics” enables one to critique and invent arguments that support propositions—usually propositions for action, rather than just finding truth (the Greeks were all about action). In fact, this is how the brain naturally reasons! It is hard-wired into us, thus learning the system in its entirety is easy and comfortable. But this system does not rely on the mathematical symbolism I was taught in college. Rather, Aristotle uses word formulas that are easy to memorize. The system is a list of 28 logic formulas and about a dozen recognized logical fallacies. Each could be expressed symbolically, but it is so much easier to recognize and recall a word formula in your native language. Every Athenian and Roman youth memorized all these formulas. The beauty of his system is its linguistic nature that merges nicely with any language and allows a person to pick apart or create arguments, in real–time debate, much like a martial arts expert has mastered numerous scripted, yet flexible, offensive and defensive moves to be called upon as needed, in the blink of an eye, for more effective argumentation.

You really don’t want to argue with someone who has mastered this system. You will most likely lose, even if you are right, unless… you are equally proficient in that same system. Really, that is your only chance. My rhetoric mentor said that if you can master just 5 of these formulas, you will be a most excellent debater.

You can see the whole system here: On Rhetoric by Aristotle

Topical logics is contained in Book 2, Parts 22, 23, & 24. But you cannot just read it. You have to practice it. Apply these “lines of argument” to any policy issue you can and see what creative ideas you come up with to support or refute various courses of action. It was all Greek to me, at first. But one day the light came on as I realized that I could consider an issue, take either side, pro or con, and then search for solid reasons to support or reject a proposal by playing around with these “word formulas.” For example, if we consider whether or not the central planners should keep centrally planning our economy, formula number one immediately suggests a response: “One line of positive proof is based upon consideration of the opposite of the thing in question. Observe whether that opposite has the opposite quality.” Just a bit of thought produces the following argument against central planners:

"Since with central planning our nation has become indebted beyond the ability to repay, suffers from inflation, and is harmed by asset bubbles, only without central planning might we achieve economic stability." From here any of us could provide several example of the failures of central planning and discuss the economic growth and stability prior to 1913.

Those of us who would defend truth (aka, conspiracy theories) need to be more proficient in the art of rhetoric than the sophists, liars, and incompetent bloggers who would ridicule us. We need to learn which arguments and evidence are most effective, for a particular hearer. We must learn to defend our actions; and not only that, but to persuade our loved ones to take actions to secure their own well-being after a collapse.

Aristotle provided the means. All we have to do is study and practice.

The heart of critical thinking—the ability to analyze arguments, to create arguments, to refute arguments—no longer thrives in the general curriculum in colleges. But you can master it by studying the art of rhetoric, using a system that was perfected for two centuries, then practiced for two thousand years, if not in free societies, then kept alive by creative writers until it could be practiced in legislatures again. This is what we do here every day. Lately, members have been better about refraining from derision, focusing on evidence and arguments. Creative and Critical thinking abounds here. And it’s a good thing, because we all have loved ones who need to be persuaded and we have our own decisions to make about the future.

* Sumner, W. G. (1940). Folkways: A Study of the Sociological Importance of Usages, Manners, Customs, Mores, and Morals, New York: Ginn and Co., pp. 632, 633.


So It Goes's picture

Cool Truck

It's a cool truck - they should bring one of these to the monster truck jams.

Dyna mo hum's picture



metalsbyamile's picture

Should get to third base

with my holdings shortly.

Dr Jerome, what a piece of literary work. I need to re-read this and contemplate it all.

Thanks for challenging us to think and rethink.

"You really do not want to argue with someone who has mastered this system. You will most likely lose, even if you are right, "

I have been their  many a time.

tyberious's picture

Another Excellent Piece

Dr. J.!

Nick Elway's picture

Uncle Sam Says

transplanted baby's picture


Fantastic article, How to think. Carlin said it. We are already told what to think. Thank goodness for turdville.

metalsbyamile's picture

At least we have full employment looking forward

2014 05 22 2699bab7 large

Karankawa's picture

Great Take. Thank You Dr Jerome

Paul Craig Roberts update.

atarangi's picture

Who is Jack Schitt?

For some time many of us have wondered just who is Jack Schitt?

We find ourselves at a loss when someone says, 'You don't know Jack Schitt!'

Well, thanks to my genealogy efforts, you can now respond in an intellectual way.

Jack Schitt is the only son of Awe Schitt. Awe Schitt, the fertilizer magnate, married O. Schitt, the owner of Needeep N. Schitt, Inc. They had one son, Jack.

In turn, Jack Schitt married Noe Schitt. The deeply religious couple produced six children: Holie Schitt, Giva Schitt, Fulla Schitt, Bull Schitt, and the twins Deep Schitt and Dip Schitt.

Against her parents' objections, Deep Schitt married Dumb Schitt, a high school dropout. After being married 15 years, Jack and Noe Schitt divorced. Noe Schitt later married Ted Sherlock, and because her kids were living with them, she wanted to keep her previous name. She was then known as Noe Schitt Sherlock.

Meanwhile, Dip Schitt married Loda Schitt, and they produced a son with a rather nervous disposition named Chicken Schitt. Two of the other six children, Fulla Schitt and Giva Schitt, were inseparable throughout childhood and subsequently married the Happens brothers in a dual ceremony. The wedding announcement in the newspaper announced the Schitt-Happens nuptials.

The Schitt-Happens children were Dawg, Byrd, and Horse. Bull Schitt, the prodigal son, left home to tour the world. He recently returned from Italy with his new Italian bride, Pisa Schitt.

Now when someone says, 'You don't know Jack Schitt,' you can correct them.

Crock O. Schitt

atarangi's picture

Dear Abby,

My husband is a liar and a cheat. He has cheated on me from the beginning, and, when I  confront him, he denies everything. What's worse, everyone knows that he cheats on me. It is so humiliating. Also, since he lost his job, he hasn't even looked for a new one. All he does all day is smoke cigars, cruise around and bullshit with his buddies while I have to work to pay the bills. Since our daughter went away to college then got married he doesn't even pretend to like me and hints that I may be a lesbian. What should I do?

Signed: Clueless

Dear Clueless:
Grow up and dump him. Good grief, woman. You don't need him anymore. You're a United States Senator from New York. Act like one.

Spartacus Rex's picture

@ aratangi: Schitt & Fiat Ferraris

Lady: Do you drink?
Man: Yes
Lady: How much a day?
Man: Three 6 packs
Lady: How much per 6 pack
Man: about $10.00
Lady: And how long have you been drinking?
Man: 15 years
Lady: So 1 6 pack cost $10.00 and you have 3 packs a day which puts your spending each month at $900. In one year, it would be $10,800 correct?
Man: Correct
Lady: If in 1 year you spend $10,800 not accounting for inflation, the past 15 years puts your spending at $162,000 correct?
Man: Correct
Lady: Do you know that if you hadn't drank, that money could have been put in a step-up interest savings account and after accounting for compound interest for the past 15 years, you could have now bought a Ferrari?
Man: Do you drink?
Lady: No
Man: Where's your F*n  Ferrari then?

Spartacus Rex's picture

How To Beat "Obama Care"

A man suffered a serious heart attack while shopping in a store. The store
clerks called 911 when they saw him collapse to the floor. The paramedics
rushed the man to the nearest hospital where he had emergency open heart
bypass surgery.

He awakened from the surgery to find himself in the care of nuns at the
Catholic Hospital he was taken to. A nun was seated next to his bed holding
a clip board loaded with several forms, and a pen. She asked him how he was
going to pay for his treatment.

"Do you have health insurance?" she asked.

He replied in a raspy voice, "No health insurance."

The nun asked, "Do you have money in the bank?"

He replied, "No money in the bank."

"Do you have a relative who could help you with the payments?" asked the
irritated nun.

He said, "I only have a spinster sister, and she is a nun."

The nun became agitated and announced loudly, "Nuns are not spinsters! Nuns
are married to God."

The patient replied, "Perfect. Send the bill to my brother-in-law."

Spartacus Rex's picture

Oh, oh...

Over five thousands years ago, Moses said to the children of Israel, "Pick up your shovels, mount your asses and camels, and I will lead you to the Promised Land."

Nearly 75 years ago, (when Welfare was introduced) Roosevelt said, "Lay down your shovels, sit on your asses, and light up a Camel, this is the Promised Land."

Today, Congress has stolen your shovel, taxed your asses, raised the price of Camels, and mortgaged the Promised Land!

I was so depressed last night thinking about health care plans, the economy, the wars, lost jobs, savings, Social Security, retirement funds, etc. I called a suicide hotline. I had to press 1 for English. I was connected to a call center in Pakistan. I told them I was suicidal. They got excited and asked if I could drive a truck...

Folks, we're screwed...

Spartacus Rex's picture

Stand & Deliver...

Bob was in trouble. He forgot his wedding anniversary. His wife was
really pissed.

She told him "Tomorrow morning, I expect to find a gift in the driveway that goes from 0 to 200 in 6 seconds AND IT BETTER BE THERE !!"

The next morning he got up early and left for work. When his wife woke up, she looked out the window and sure enough there was a box gift-wrapped in the middle of the driveway.

Confused, the wife put on her robe and ran out to the driveway, brought the box back in the house.

She opened it and found a brand new bathroom scale.

Bob has been missing since Friday.

atarangi's picture

Bob tackles climate change

First_hybrid_snowblower_1  Bob was last seen heading away from home on his new Snow Blower. His wife just want's him to know -  -   " Bob we love you please come back home".

atarangi's picture

Breaking news

Bob has apparently been sighted on his Snow Blower at 'Cajun Liquor' 500 miles from home.                                                                                                                                          Drive_through_customer_of_the_day  Bob was heard to comment,   -     -   "I'm done blowin snow"

silver66's picture

Thank you for another exceptional article

I have told my children for years " He who frames the argument wins the debate"

This has been sent to all the Jr Silver66's and is going to be printed out and given to friends I care about


Safety Dan's picture

Great Gold & Silver Info

People’s Bank of China Will Take Down Global Gold Price Manipulation

by D. Collins 
The China Money Report

picture-412.jpgGold has been flowing East for a decade. When the West wakes up to the fact that their gold is gone, they will no longer have sound money with which to back a currency. The world has only been off a gold standard since 1971 and every currency collapse in history has used precious metals to backstop the regimes new currency. In the U.S. that will not be possible in the future, we have bet the farm on fiat currency. Currency debasement has been tried time and time again since civilisation started using money. It has failed every time…perhaps this time it will work?

Continue Reading at…

Canvest Panelists Favor Physical Silver

by Charlotte McLeod 
Silver Investing News

fortune-cookie-300x199.jpgThe Canadian Investor Conference, held from June 1 to 2 in Vancouver, featured a number of interesting panels, but for silver bugs, the sure standout was the Gold & Silver panel.

Featuring Mike Maloney of, Dundee Capital Markets’ Chantelle Schieven, Peter Spina of and and Ed Steer of GATA and Casey Research, the 30-minute session revealed just how appealing silver — specifically, physical silver — is to industry heavyweights.

Physical silver first came to the fore with moderator Rob Levy’s initial question: why are gold and silver attractive investments? Spina responded that with both metals currently going through a period of consolidation, “it is an incredible opportunity [to buy] metals at a great discount, especially silver.”

Continue Reading at…

When Money Printing Runs Wild

by Clif Droke, Gold Strategies Review 
Gold Seek

clif_droke.jpgSince the advent of the quantitative easing (QE), the Fed’s unprecedented attempt at reversing the impact of the credit crisis, many long-held beliefs and assumptions have been demolished. One of the most sacred assumptions on the part of investors and economists alike is that central bank money printing always eventually leads to inflation. Yet six years have passed since the Fed first embarked on its historic attempt at reversing the effects of the credit crash and alas, no signs of inflation are on the horizon.

Quantitative easing has increased the stock of money in economies of the U.S., the U.K. and Japan by nearly $4 trillion in recent years. The success of this coordinated monetary policy response to global deflation was an undeniable success; since 2009 the U.S. economy has been in recovery mode while other major economies have had varying degrees of recovery.

Continue Reading at…

Safety Dan's picture

Dr Copper has been a bit sick

Dr Copper has been a bit sick in his forecasts of late. Wondering why? Dr.Copper Pumped-And-Dumped On China's Schizophrenic Economic Data


China has used copper as collateral for large transactions/contracts and that the $3 price level means trouble for China.

According to the world copper fact book - World annual copper production of 20 million tons, 14% is North American demand, or 2.8 million tons of which 30% is used on building construction, (commercial and residential),or 900,000 tons generously attributing 50% of that demand to residential. That equates 450,000 tons, or roughly 2.5% of World annual production.

See pages 27, 32, 33, 34, 37 & 47. Historical price, type of usage by region are provided.  Makes me think of peak copper sometime in the not so distant future. 

More Copper info at International Copper Study Group$COPPER&p=D&yr=0&mn=10&dy=21&id=p53874254412&a=331544124&listNum=12

Safety Dan's picture

Renminbi clearing bank to

Renminbi clearing bank to open in London

A Yuan clearing bank will be officially appointed in the United Kingdom in June, said Mark Boleat, policy chairman for the City of London Corp, in an exclusive interview with China Daily.

"There will be a clearing bank in London. In due course, there will be an announcement," Boleat said on Friday.

The news will be an endorsement for London's efforts to become an offshore Yuan center. Other European financial centers in the race to become a Yuan center include Frankfurt, Paris, Switzerland and Luxembourg.

An official clearing bank facilitates efficient clearing of offshore Renminbi transactions, achieved through the appointed bank's direct cooperation with the People's Bank of China, the country's central bank.


Bollocks's picture

More shocking charts from brotherjohnf

Check these out surprise

Safety Dan's picture

China, Gold, The United

China, Gold, The United States & Horrific Consequences

We have no way of integrating energy systems across states.  We are basically just hoping right now.  I hate to say this because I love this country.  Compare what we are doing with what China is doing.  China has put up as much of a modern 'smart grid' as the United States has in its total grid.  China is crushing the United States in smart grid technology.

As I told you last week, when the French company was contracted to put up a new plant that would supply 7 percent of British electricity -- a massive plant -- the French company had to turn to China ask for help because they were not capable of doing it on their own.  They did not choose the United States -- they chose the Chinese.

-Warning, King World News Article.

ancientmoney's picture

Critical thinking . . . simplified . . .

Many here practice our own versions of critical thinking:

1. Assume whatever you are told is a lie; especially anything from a politician's lips or from a MSM outlet.

2. Follow the money; those who receive gains likely wrote the story.

3. The legal system is intentionally complex so that the elite might interpret for their own; steer clear of it.

Safety Dan's picture

Gold Mining Processes Evaluated & More

Casey Research: Three big myths about mining and the environment

For many countries, gold mining accounts for a significant share of exports. As an example, gold merchandise comprised 36% of Tanzanian and 26% of Ghana and Papua New Guinea’s exports in 2012. Below, you see a more comprehensive picture of gold exports by 15 major gold-producing countries.


DBean's picture

Very Nice Essay...

Dr.J...Thank you!...wonderful piece of writing to chew on.  Printing out your 108 page Aristotle "On Rhetoric" reference as I type..

Maryann's picture

Dr J...

I second DBean!  I feel smarter just reading your essays. laugh

Seriously, your insights on critical thinking are a perfect fit for the mission of this site!

ancientmoney's picture

Critically think about the War on Terror . . .

This whole charade shouldn’t be called “The War on Terror.”  It is actually all about keeping the citizenry terrified.  The government loves keeping you in a state of fear so that then they can do anything they want to the little sheep.  It should be called “The War on Freedom.”  Your freedom.

The state governmental machine seeks to protect itself from its own people.

Blankone's picture


Thanks all you guys for the great chuckles this morning...You made my day....

Blankone's picture


Now, if I could only remember the punch lines to pass them on...

metalsbyamile's picture

Ignore at your own peril

It’s no secret that governments strapped for cash commonly turn to plundering retirement savings. They are a juicy, irresistible, low-hanging fruit.

In recent years, it’s happened in some form in Argentina, Poland, Portugal, and Hungary, just to name a few countries. The truth is that it could happen in any country drowning in debt and financial troubles—the US included.

It’s usually accomplished by forcibly converting retirement assets into government bonds under the guise of helping people manage their risk.

I’m From the Government and I’m Here to Help

Anytime any government claims that it wants to help you manage your retirement savings, I believe the best course of action is to run as far away as you possibly can. Taking your IRA offshore and out of reach is the only way to really protect yourself—more on that in a moment.

Earlier this year, Obama announced the myRA program, which ostensibly helps people save for retirement (though it offers no benefits over existing options).

In case you missed it, an earlier article I wrote spells it all out. It’s a must-read and can be found here.

In short, Obama’s myRA program was the opening shot in the undeclared war on your retirement savings.

And I believe an eyebrow-raising ruling in the US Tax Court is the second shot.

New Risks for IRA Owners

The recent decision in the case of Bobrow v. Commissioner places new limits on a maneuver known as an IRA rollover.

A rollover is used to move your retirement funds to a new account without taxes or penalties if certain conditions are met.

Perhaps the most compelling reason that someone might want to do a rollover is that it allows you to escape the investment straitjacket of a standard retirement account with a big custodian like Prudential, Schwab, Fidelity, or T. Rowe Price. Usually these accounts offer a very limited menu of investment options.

An offshore IRA, on the other hand, can unshackle your retirement savings. It can invest in almost anything anywhere in the world. Whether it’s a rental apartment in New Zealand, a private company in Panama, an offshore bank account in Hong Kong, or physical gold stored in Singapore, your offshore IRA can invest in it.

Another problem with these big custodians is that if the US government were ever to do what many other bankrupt governments have done and forcibly convert retirement assets to government bonds, all they would have to do is simply issue notices to them and Poof!—your account would be frozen, and the holdings would be converted in some proportion to “safer” Treasury securities. For your own good, of course.

However, if your IRA is offshore and some Orwellian-named bill like the Safeguarding Americans Retirement Act is passed, your life savings won’t be on the chopping block.

How will the government convert your retirement savings if it’s in the form of physical gold held in Singapore, or foreign real estate, or an offshore bank account, or any type of offshore asset? The answer is: not very easily, and they probably won’t bother. They’ll likely be focused on the sitting ducks—including the IRAs with the large custodians.

In all likelihood, if you have offshored your IRA, you’ll be grandfathered in and exempt from the new requirements.

So, the biggest benefits in taking your IRA offshore are that doing so:

  1. Puts you in the driver’s seat (not the custodian);
  1. Significantly expands your investment options; and most important
  1. Puts your retirement savings out of the immediate reach of the government.

But in order for you to move your IRA offshore, you’ll likely have to do a rollover to move your funds from your existing custodian (likely one of the large firms) to one that allows you to take your funds abroad (likely a smaller firm).

That’s where the recent court ruling comes in.

In Bobrow v. Commissioner, the court ruled that taxpayers can only do one rollover per 12-month period.

Prior to the ruling, the IRS had long allowed—and officially sanctioned in Publication 590—doing one rollover per IRA in every 12-month period. For example, this meant that if someone had two separate IRAs, they could perform two rollovers each 12-month period.

The new ruling, however, throws this completely out the window despite the fact that it had appeared in IRS guidance. Now you can only have one rollover in a 12-month period, regardless of how many retirement accounts you have.

It’s Not the End, It’s the Beginning

There are three disturbing aspects to this ruling.

First, IRA owners now face new risks. People considering multiple rollovers have to be extremely careful. There’s no margin for error, so be sure you consult with a tax professional. If you don’t do it correctly and your rollover is disallowed by the IRS, you will likely be subjected to an enormous bill of taxes and penalties.

Second, it shows that IRS guidance isn’t worth much. The judge in the case said as much when he declared, “Taxpayers rely on IRS guidance at their own peril.” While this is remarkable, nobody should really be that surprised that the government can and will make up the rules as it goes along.

Third and most importantly, this ruling is another incremental step to the eventual end game—the conversion of retirement assets to Treasuries. This ruling hinders the ability of some people to move their IRAs away from the big custodians, which is a necessary step in taking them offshore. Before any potential conversion to Treasuries, you can be sure that the government will have sealed off all the exits from the big custodians to optimize their harvest. This is a step in that direction.

So I don’t think this is the end. I think it’s the beginning. I fully expect incrementally more severe restrictions on IRAs in the future.

With this ruling and the myRA program, the government clearly has its attention set on retirement savings and slowly chipping away your options, as—not coincidentally—it slides further into debt and bankruptcy.

Given the recent history of governments around the world pilfering the retirement savings of their citizens, the jaw-dropping dismal financial condition of the US government, and the creeping measures directed at retirement assets, it’s absolutely critical for you to offshore your IRA before it’s too late.

But it’s not just a defensive measure. Offshoring your IRA will unlock a whole world of new international investment opportunities that would otherwise be unavailable.

For more on exactly how you can offshore your IRA, I’d suggest you check out our Going Global publication, where we discuss this important diversification strategy in actionable detail.

Until next time,

Nick Giambruno, Senior Editor

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