Geo Politics

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The new world order is coming to an end.

Are you ready?

Here’s the bottom line., The united states will dominate the world for the next century, without the need for NATO to offset the Soviet block. Breton woods is dead  NATO is dead. The new world order is dead. The EU is dead. They don’t realize it yet,  it they are.

As the number one producer of oil & energy, the U.S. has no need or interest in keeping the New World Order in place. We well along pulling our troops and our Navy back home. Already we are calling for Europe & the Middle East to protect themselves and the trade routes they use.  All we need in the way of international trade are are available from our NAFTA neighbors. We don’t need anyone going forward by ourselves.

The outlook for China & Russia doesn’t look so good. Both have demographic issues that will be difficult to overcome.  China will inevitably will collapse into a Balkanized form of their former selves. Without access to cheap energy, the ability to protect their shipping and to hold their far flung nation together, China will soon wither away into a former shadow of themselves.

Due to changing demographics, Russia will soon be unable to mount an army large enough to protect their far flung borders. Inevitably they will lose land to Turkey, Poland & Germany. Their border with all three are indefensible. They will still be a nuclear power, but what good are  nuke’s when the fighting is street to street?

    • U.S has secure borders immune to invasion
    • energy – shale – largest reserves in world – cheapest production costs besides Saudi Arabia, best talent,
    • navigable waterways
    • midwest is the largest farmland area in the world
    • drained by the largest navigable river system in the world
    • largest & strongest navy in the world by far
    • best educated talent in the world
    • best education system
    • breton woods is dead
    • nato is dead
    • old world order is dead

The U.S.’ sudden rise to dominance as the world leader in oil & oil exports is leading to the demise of NATO.  Nor does U.S. any longer have any need or interest in policing the Middle East.  This comes just as European countries start challenging U.S. positions world wide. That probably won’t work out well. It will probably lead to the end of NATO & the New World Order.

The New World Order worked like this. The U.S. protected Europe, Israel & Saudi Arabia and kept the Sea Lanes open in exchange in exchange for resisting Russia and the Communist Block. The Communist Block fell decades. Only open shipping lanes for shipments of oil to the U.S. kept the New World Order together.  Now that the U.S. rise to the top energy exporter in the world, the U.S. has no need for the New World Order.  for not falling into the communist block  & to protect US access to raw materials  We didn’t want anything from them. We just expected them to behave. Today, under the leadership of Germany & Merkel, the European Union & the old World Order appears to be shattering.

The old world order

The new world order

China problems in the transition

Russia problems in the transition

Russia & China. Ultimately, both countries will fade away. In their place Turkey, Japan, UK & Poland will arise. But no country in Europe will ever be dominant. The landscape makes European companies too vulnerable to invasion. Island nations are the safest, and therefore most likely to be world powers

“Geopolitics is ultimately the study of the balance between options and limitations. A country’s geography determines in large part what vulnerabilities it faces and what tools it holds. Countries with flat tracks of land—think Poland or Russia—find building infrastructure easier and so become rich faster, but also find themselves on the receiving end of invasions. This necessitates substantial standing armies, but the very act of attempting to gain a bit of security automatically triggers angst and paranoia in the neighbors. Countries with navigable rivers—France and Argentina being premier examples—start the game with some “infrastructure” already baked in. Such ease of internal transport not only makes these countries socially unified, wealthy, and cosmopolitan, but also more than a touch self-important. They show a distressing habit of becoming overimpressed with themselves—and so tend to overreach. Island nations enjoy security—think the United States, the United Kingdom and Japan—in part because of the physical separation from rivals, but also because they have no choice but to develop navies that help them keep others away from their shores. Armed with such tools, they find themselves actively meddling in the affairs of countries not just within arm’s reach, but half a world away.” Peter Ziehan, The Absent Superpower.

The middle of this map is why the United States is the global superpower, and will remain so long beyond the lives of your grandchildren. The Greater Midwest is the largest and most productive piece of arable land on the planet, out-producing the next two put together. But as important as that sounds (and is!) that’s really the side show. The real deal is the Greater Mississippi River system that perfectly overlays the Midwest. The first rule of geopolitics is that transport matters. Moving things by water is easy—so easy that today the cost of transporting goods by water is one-twelfth that of moving them by road. The Greater Mississippi system has more than 12,000 miles of interconnected waterways—more than the rest of the world put together. So long as this is true, the United States can move goods and grains and people about its system at a cost that seems laughably low compared to the internal transport costs of most countries.

Cities like Baltimore, Chicago, Kansas City, Minneapolis/ St. Paul, Memphis, Mobile, New Orleans, New York, Philadelphia, Pittsburgh, Sacramento, San Francisco, St. Louis and so on, owe not just their existence but also much of their wealth to the cheapness of water transport. All also are, to varying degrees, financial centers. All that cargo throughput requires back-end support in inventorying, repackaging, buying and selling, which in turn requires a 24-hour-a-day ability to process goods and money. As such, cities rooted in water transport almost without exception also have a strong local banking culture. Since those banks were formed to service pre-existing economic needs rather than (geo) political ambitions, American banks also tend to be more measured in their borrowing and lending policies than banks created to serve the needs of the state, such as their peer institutions in Japan, China, Germany, or Greece. Put simply, American banks are independent institutions who see money as an economic good, while many of their foreign peers are little more than tools of state policy. That makes the foreign crowd far better at directing resources to achieve political goals such as maximum employment or infrastructure development or funding the government’s deficit, but the American system is far better at achieving long-term economic stability—ergo it is the United States that holds the title of the world’s financial superpower. Of course waterways aren’t responsible for moving all U.S. goods. In fact, the proportion of water-transported stuff in the United States has been dropping steadily for over a century. The first limiter on American maritime transport is politics. In 1920 Congress passed the Jones Act, which barred any ship from plying the American waterways that was not American-built, American-owned, American-captained, and American-crewed. The idea was to keep America’s maritime jobs with Americans and ensure the United States maintained a strong merchant marine, but like most protectionist measures, it had unwanted side effects. The cost of water transport tripled, shipping shifted wholesale for rail and road (which were no longer so much more expensive than water transport), lower demand for vessels prompted America’s shipyards to fall into disrepair, and nearly a century later most Americans are not even aware that water played (and still plays) such a central role in their country’s success. Washington and the state capitals also lost sight of this fact. America’s maritime infrastructure has been creeping into decay for decades—the average age of the locks is more than 60 years, with many now well over a century old and in need of wholesale replacement. 1

Peter Ziehan

George Friedman, Stratfor

 

 

 

Intellectual Assets

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Intellectual Assets

Recognize & protect your intangible assets.

Hold all your intangible assets such as trademarks, patent rights, domain names, web sites, company name, trade name, trade secrets, etc. in an LLC. .  Never lose track of them. Renew them when it’s time. Identify each of them and assign them a value. License them to your operating company.

By quietly transferring trademarks, patent rights and other intangible assets to offshore or out-of-state companies, global businesses can cut their tax bills dramatically.

Most privately owned businesses don’t even know what intangible assets they own. If you ask them, they will inevitably leave some out. Every business should inventory all their intellectual assets. if they aren’t documented, document them. Assign a market value to them.

Recognize & protect all your physical assets

Hold all your physical assets such as building, cars, equipment, inventory in a different LLC. Lease them or sell them to you operating company whenever that’s necessary. Like the first LLC, that LLC will never be allowed to do anything that will get it sued. But if your operating company gets sued, all your assets will be safe.

Why.

Consider this possibility. Your operating company gets sued and you lose a multi-million dollar lawsuit. The next day, you close down that company and incorporate another operating company with a generic name. Then you license all the intangible assets to them, including the business name and start conducting business like nothing happened.

Because, believe it or not, nothing did.

The best business structure for the chaotic, tumultuous 21st Century is a combination of multiple companies, each serving a particular purpose. Intangible assets, such as patents, copyrights, trade secrets, digital properties & web domains, should be put in an a single purpose LLC where they’ll be safe from lawsuits, and licensed to the operating company.

Here it is.

We protect your business and your vital business assets through business restructuring and intellectual property rights. This approach has the ability to preserve your business and all its vital assets through serious threats to survival.

The Act that made it all possible.

“Today, President Obama signed the Defend Trade Secrets Act of 2016 (“DTSA”) into law, bringing trade secrets alongside trademarks, copyrights and patents as intellectual property rights protected under federal law.” May 23, 2016.

A client tested this in a court of law, and it works.

CFO Services

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Depend on experienced, high-level professionals to provide the financial insights you need to meet the challenges you face.

An Ellis, experienced CFOs, executives, accountants & tax professionals performing administrative, accounting & payroll functions can help owners, management, and board members solve financial management & operational issues by providing unique guidance and advice.

We provide all the back room services you need; as well as advice, explanations & recommendations.

    • Financial strategy
    • Short & long term forecasting
    • Financial systems strategy & design
    • Budgeting
    • Projections
    • Facilitating & supporting financial reporting
    • Raising capital
    • Interim CFO services
    • Cash flow analysis & restructuring
    • Renegotiating vendor contracts
    • Restructuring client contracts
    • Ensuring pricing is aligned with company & industry trends
    • Analyzing commission structures
    • Supply chain management
    • Attributing costs to revenues
    • Accounting & bookkeeping
    • Payroll
    • Financial Statement
    • Bill pay
    • Collections
    • Data driven management
    • Capture & interpret critical operating data
    • CFO service
    • Streamline & simplify
    • Cash management
    • Remote office
    • Management financial statements
    • Compiled financial statements

Tax Controversy

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Getting Audited

We may be the least audited firm in the country

A convergence of global forces has resulted in a substantial increase in the number and size of tax audits, assessments, and disputes with revenue authorities locally, nationally & worldwide. Virtually no area of tax enforcement has escaped this phenomenon, which includes direct taxes, indirect taxes, penalties, fees & direct  taxes (e.g., VAT and GST, domestic and international) , as well as specialist areas such as customs, tax fraud, and white collar tax issues. This new situation places a premium on audit and dispute prevention techniques because local, national & multinational companies are under constant competitive pressure to structure business operations effectively and efficiently. Larger companies need to develop coordinated approaches to audits and disputes, adopt preventative measures (such as pre-filing rulings and enhanced relationships with certain revenue authorities), and leverage both traditional and new alternative dispute resolution techniques in order to achieve the best possible results.

Knock on wood, we don’t get audited much. We may be the least audited firm in the country. We’ve never had a bad outcome on audit. The last audit we had, there were no changes.

If and when you get an audit letter, send it to us and we will handle the entire audit. We may allow the IRS to have an initial interview with you, but that’s it. After that, we won’t allow any contact between you & the IRS. We’ll keep you in the loop and pass on any settlement offers they may make. This approach has always worked well for us and our clients. It’s still the best approach.

 

Tax Strategy

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Tax Strategy

We cut tax to the legal minimum.

We save more than we cost. Easily measured concrete results. Every dollar we save drops straight to the bottom line as another dollar of cash, profits, working capital & competitive advantage created out of thin air.

Our Approach to Taxation

Our approach to tax involves digging deep into the code on one hand, and on the other hand, stepping back and determining the theory & scope of the U.S. tax system: code, court cases, revenue rulings etc., and finally developing a comprehensive system to take maximum advantage of what is legal, while avoiding what is not legal. I have spent four decades doing that, since my days at AA&Co.  it has served me, my firm & my clients well.

Tax Strategy

98% of  businesses pay more tax than the law requires.  We will cut your tax to the legal minimum using the strategies listed below.

  1. Tax strategy
  2. Business restructuring
  3. Intellectual asset strategy
  4. Interstate tax strategy
  5. International tax strategy

Track Record

We have a national reputation for tax avoidance. We’ve cut tax in a meaningful way for 98% of our clients. Every dollar we save drops straight to the bottom line as another dollar of cash, working capital, profits & competitive advantage created out of thin air.

Qualifications

  1. Intellect: Mensa. Genius IQ.
  2. Exponential Experience: 4 decades pertinent experience.
  3. Expertise: I rank in the top 1% on professional performance.
  4. Intuition. Highly intuitive.
  5. Jump started the digital revolution. See below.

Our firm

We are among the first of a new breed of  professional firm: a virtual firm with high level competence & our home in the cloud, little to no geographic footprint with both an office based workforce & a distributed workforce. Cell phones, the internet, email, intranets, Skype, Zoom & other on-line services make it possible to conduct business world-wide as a fully professional firm operating everywhere like a local firm.

Judge Learned Hand Famous Quote

“Anyone may so arrange his affairs so that his taxes shall be as low as possible. He is not bound to choose that pattern which best pays the treasury. There is not even a patriotic duty to increase one’s taxes … Over and over again the Courts have said that there is nothing sinister in so arranging affairs as to keep taxes as low as possible. Everyone does it, rich and poor alike and all do right, for nobody owes any public duty to pay more than the law demands.” (Judge Learned Hand)

The problem: The Definitive Study of Human Performance.

 

Business Services

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    • Business Services
    • Bookkeeping
    • Accounting
    • Payroll
    • Data driven management
    • Capture & interpret critical operating data
    • CFO service
    • Streamline & simplify
    • Cash management
    • Remote office
    • Management financial statements
    • Compiled financial statements

Whatever you need operating and running smoothly.

Business Services consist of all the backroom administrative services that are essential for every business. We take care of you so you can devote 100% of your time to growing your business and carving your mark on the universe.

Did you know that the data of 25% of U.S. companies is believed to be inaccurate?

We have a reputation for excellent, responsive client service, and for handling all the accounting, payroll & administrative aspects of relatively large companies, including large startups. Startups, especially large startups, move fast and break things that get in their way. They are unique challenges, and we have mastered them.

Doing administrative services poorly can be the kiss of death. We know companies that failed because they did not do a good job of handling administrative functions. We had a client that came to us too late to save them, but they could have easily been saved had they come to us a year earlier. Don’t wait until it’s too late.

 

Tax Avoidance

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  • 200 million private businesses pay more tax than the law requires.
  • The Global 500 pay less tax at lower rates than private businesses.

We cut tax to the legal minimum.

Here’s the problem.

A study we commissioned shows that

We save more than we cost. Easily measured concrete results. Every dollar we save drops straight to the bottom line as another dollar of cash, profits, working capital & competitive advantage created out of thin air.

Ideally, preparing tax returns is not a methodical, meticulous process. Most people think it is; most preparers do it that way; but it’s actually very intricate, more like playing chess than playing checkers. If you’re going to do it right, you will be continually moving all the component parts around until you find the low tax solution. Something like a giant shell game.

Few tax professionals look for it, so most never find it.

If you get preparation right, the next step is tax strategy.

including international, federal & state tax returns.

  • 1040 personal tax return
  • 1065 partnership tax return
  • 1065 LLC tax return
  • 1120S S Corp. tax return
  • 1120 C Corp tax return
  • 990 Non-profit tax returns
  • Tax strategy
  • All State tax returns
  • All Federal tax returns
  • International tax returns
  • Tax controversy
  • Tax audit
  • Timely Preparation
  • Tax Planning
  • Penalty abatement
  • Avoid penalties
  • Secure Web Portal

International Tax

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International tax advantages

if you are doing business internationally, the clouds part & multiple opportunities to save money in international taxes comes shining through. Apple saved billions with its international tax strategies  as did Caterpillar, Google & other global companies.

    • We mix & match 200 countries with different tax rates for overall tax savings. We do the same thing multinationals do.
    • We explore tax saving opportunities provided by differences in tax rates among 200 countries. This is a virtual smorgasbord.
    • There are a wide variety of tax rates & methodologies among nations that can be mined for tax savings.
    • We explore maneuverability opportunities related to international commerce.

Immigration

We are experts at helping businesses immigrate into the U.S.where they have to deal with a more complex tax environment. No other country has the complexity of 50 different state income taxes. Plus sales tax is an oddity in the world, but each state, city & various special taxing districts in the United States can levy sales tax on a sale. This is easily handled, but it can be daunting to a foreign company not expecting the complexity.

International

Some global 5000’s including Apple from what i’ve read, mix & match various countries to establish tax residence in, based on their national income tax rate. I’m sure that’s true. That’s smart.

International trade is the exchange of capital, goods, and services across international borders or territories. In most countries, such trade represents a significant share of gross domestic product (GDP). In international tax strategies, we take advantage of tax rate differentials among 171 countries to cut income tax to the legal minimum. There are a wide variety of tax rates among nations & other jurisdictions that can be mined for substantial tax savings.

Apple: Best Company in the World?

International taxation can become a massive competitive advantage. Consider Apple. See our blog post. Steve Jobs returned to Apple in 1997 with the company on the brink of bankruptcy. He laid off 2/3 of the staff and cut cut costs to save Apple. From then until 2011, 14 years later, they were continually profitable until Apple became the most valuable company in the world. They have continued profitable and most valuable company until this day. Apple even became the first trillion dollar company for a bit in 2018.

How did Apple achieve that? Their great products were part of the answer. But another part, perhaps even more important part, was Apple’s tax strategies, Their most significant tax strategies, The Double Irish with a Dutch Sandwich, produced billions in tax savings in the 14 years before becoming the most valuable company in the world. Without those billions, Apple would never have become most valuable company.

Are you immigrating to the US?

We help foreign companies immigrate to the US. Turmoil in other countries, notably South Africa, combined with our current tax atmosphere is making the US look very appealing. Especially if they are doing business internationally. US taxation from sales tax to state Income tax and Federal income tax leaves them shaking their heads. Many don’t have an international tax strategy in place either. These companies can save a tremendous amount of headaches and taxes by using Ellis to navigate US tax issues. If you refer them to us, we will take good care of them. And in the process you can increase your influence as a trusted adviser or savvy businessman.

Biz-Organization

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Business Organization

More than 98% of U.S. businesses are not structured to their best advantage. Most privately owned businesses have only one company.  But Global 500 companies have several, sometimes hundreds, of subsidiaries to achieve all their business goals.

Here’s a list with links to their SEC filing.

    1. Caterpillar
    2. Apple
    3. Google
    4. Proctor & Gamble
    5. General Electric
    6. Amazon
    7. Exxon Mobil

All of those subsidiaries have a purpose. What could you be missing? If they have a purpose, what could you be doing wrong?

Tax

Possibly income tax.

Asset Protection

 

Business Organization

We have organized hundreds (thousands?) of businesses from initial startups, to complex businesses, including a significant number of companies needing to be re-organized to do business in the chaotic 21st century. We create all the companies, recognize the and define the operating relationships. We utilize every entity in the book, but primarily the big 4, partnership, LLC, S corp., C corp.

We are partial to forming companies in Wyoming rather than Delaware or Nevada. Wyoming is a tax free state and charges the lowest fees of any major player in the entity formation world, including Delaware & Nevada. Neither of those states are entirely tax free.

The best kept secret in the world is the Wyoming LLC.  “Wyoming has pioneered a new type of LLC protection that precludes creditors from any legal or equitable remedy other than a charging order against the LLC interest, even as to Single Member LLC’s. The charging order is the “exclusive remedy.”  Other remedies, including foreclosure and a “court order for directions, accounts and inquiries” are not available and may not be ordered by a court.  This new LLC protection law means that you do not have to have 2 or more members in the LLC to get the charging order protection!” Call me to talk before disregarding it all together.

Business Re-organization

“Restructuring is the corporate management term for the act of reorganizing the legal, ownership, operational, or other structures of a company for the purpose of making it more profitable, or better organized for its present needs.” (Wikipedia.)

To meet their full potential, 99% of successful businesses restructure at some point. It’a almost impossible to avoid. The structure selected at founding is seldom adequate for a thriving business.

Caterpillar is a good example. They regularly re-organize. I can’t help but wonder if more businesses would be more successful if they followed the Caterpillar example. This is not the first time Caterpillar as restructured.

GE is also restructuring. This isn’t their only bite at the apple, but this reorg may determine GE’s future.

An Example

Within the last month a client’s business was hit with a nuisance suit. They mounted a defense, which was just a knee jerk reaction.  When they told me about it, I told the principals since their vital business assets were in another company, the company owned nothing worth incurring a lot of legal fees to defend. I advised them talk to their attorney about abandoning the company. He agreed.  Problem solved. But had they been doing business under their previous structure, they would have been if for a long and expensive lawsuit.

 

Interstate Tax

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Lots of  interstate businesses fail to take advantage of tax saving opportunities.

We explore all tax savings opportunities by mixing and matching tax rates among 50 states. Historically, we have saved income tax for 100% of our  our interstate clients. When that happens, sometimes the tax savings are enormous.

Interstate

Interstate trade is the exchange of capital, goods, and services across state borders. In the U.S, such trade represents a significant share of gross domestic product (GDP). In interstate tax strategies, we take advantage of tax rate & regulatory differentials among 50 states, counties, cities and other tax & regulatory jurisdictions to cut income & sales tax to the legal minimum.

Some global 5000’s including Apple from what i’ve read, mix & match various states to establish nexus in, based on their state income tax rate. I’m sure that’s true. They could do a better job of it, because most of them pay substantial state tax to California, the state with the worst tax.

Business Services

  • Data driven management
  • Capture & interpret critical operating data
  • CFO service
  • Streamline and simplify
  • Bookkeeping
  • Accounting
  • Payroll
  • Cash management
  • Remote office
  • Management financial statements
  • Compiled financial statements

Advisory Services

  • Spinoffs
  • Mergers
  • Combinations
  • Dispositions
  • Liquidations
  • Scaling
  • Convertible notes
  • Stock grants
  • Stock options
  • Start-up consulting.
  • Guidance on crucial issues
  • Immigrate your foreign business
  • Monthly Bookkeeping Services
  • Monthly or Quarterly P&L’s
  • Unlimited Discussion of Accounting and Business-related Questions
  • Disruption consulting
  • Corporate structures
  • Ownership structures
  • High Stakes Controversy