PLP Advisors, LLC

Financial Advisor Looks at Asset Seizures

Op-ed piece sparks radio host's interest.


Grand Rapids, MI -- (SBWIRE) -- 05/09/2013 -- In today's world it is difficult to stay abreast of everything that is happening financially. Dennis Tubbergen, a financial advisor, author, radio show host and CEO of PLP Advisors, LLC can be counted on to give a hand when it comes to understanding the latest events in U.S. and world economics.

Whether people enjoy his weekly newsletter at or his blog at, Tubbergen is dedicated to sharing his viewpoints and opinions. On April 30, 2013 his blog was titled Forbes: Cyprus Style Seizure Could Happen Here.

"Forbes magazine recently published an Op-Ed piece written by Steve Forbes," began Tubbergen. "It discusses the likelihood of a Cyprus-style asset seizure taking place in the U.S."

Tubbergen quotes below from the March 25, 2013 Forbes piece.

Don't put it past our politicians to try it in a financial emergency. The breaking of contracts by the U.S. government, unfortunately, has happened before, and what's underway in Cyprus shows that feckless politicos will continue to try such things.

In 1933-34, amid the depths of the Great Depression, the U.S. government seized the American people's gold holdings. From that point, until 1975, it was illegal for Americans to own gold, other than in some forms of jewelry or collectors' coins. In the panic of the Depression years the courts upheld this unconstitutional confiscation. Yes, people received dollars in return for their holdings of the yellow metal, but the dollar itself was formally devalued by 40%. Moreover, the U.S. government abrogated private commercial contracts containing the so-called gold clause, which allowed creditors to receive payments in either dollars or gold.

In the early 1970s President Richard Nixon annulled contracts selling soybeans to Japan. This was done for domestic political reasons: U.S. soybean buyers had been complaining about the high prices, and Nixon felt keeping the product here would mollify them. Of course, the real reason that the prices of soybeans and other agricultural commodities were rising was that Nixon and the Federal Reserve were deliberately undermining the value of the U.S. Dollar. (Japan responded by investing in Brazil, which became one of our major soybean competitors.)

In 2009 the Obama Administration pushed through a brazenly political restructuring of bankrupt General Motors and Chrysler, and huge payoffs were made to the United Auto Workers, a pro-Obama union, at the expense of bondholders. Banks signed off on the deal because they had no choice -- their survival depended on the whims of Washington. Once again the courts turned their backs on this patently unconstitutional exercise.

There have been rumblings from some revenue-hungry Democrats about finding ways to tap into individuals' retirement accounts. Several years ago Argentina nationalized the private pension plans of its populace, and recently Cyprus has been talking about taking similar action. One can already hear our politicians' rationale: "Most of the money in 401(k)s is pretax dollars and grows tax free, depriving the government of needed revenue. Why not integrate them with Social Security and then means-test the benefits?"

Money market funds? There's growing regulatory pressure for the funds to no longer price their products at $1 a share. In today's distrustful enviroment fluctuations here will fuel fears. Moreover, the feds may well be tempted to take some of this cash as "temporary" reserves, or insurance fees.

"While I am not forecasting such an event, I think a rational person cannot rule it out, either," states Tubbergen.

According to Tubbergen, the recent proposal in the budget that would limit the level of assets one could have in a retirement account at $3,000,000 is potentially a first step in this direction. While the vast majority of IRA owners ignore such news as not applying to them, they shouldn't.

"Massive changes rarely occur overnight," notes Tubbergen. "Politically speaking, they can't. Instead, massive change is accomplished through a series of incremental changes or as a response to a 'catastrophe.'"

In Tubbergen's book, Economic Consequences, he discusses the fact that hearings have taken place titled "Lifetime Income Options for Retirement Plans." These hearings were held on September 14 and 15, 2010 and were similar to hearings held in 2008 on the same topic.

"One of the ideas discussed during these hearings was the concept of developing a Treasury Retirement Bond," explains Tubbergen. "These specially-designed bonds would be worth more than the assets in the retirement accounts that would be replaced, making the process more tolerable for investors."

Tubbergen's bottom line here?

"Although all this is purely speculation, it brings an important point to light," he concludes. "While many investors diversify their investments from an asset perspective, few diversify from a tax perspective. In my view, that could ultimately be a mistake."

To read the blog in its entirety go to and select his April 30, 2013 entry.

Tubbergen’s syndicated radio show can be heard on metro Michigan stations WTKG 1230 AM and WOOD Newsradio1300 AM and 106.9 FM.

About Dennis Tubbergen
Dennis Tubbergen has been in the financial industry for over 25 years and has his corporate offices in Grand Rapids, Michigan. Tubbergen is CEO of PLP Advisors, LLC and has an online blog that can be read at To view Tubbergen’s latest Moving Markets? newsletter, go to

The opinions expressed herein are those of the writer and not necessarily those of USA Wealth Management, LLC. This update may contain forward-looking statements, including, but not limited to, statements as to future events that involve various risks and uncertainties. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause actual events or results to differ materially from those that were forecasted. Therefore, no forecast should be construed as a guarantee. Prior to making any investment decision, individuals should consult a professional to determine the risks, costs, benefits and fees associated with a particular investment. Information obtained from third party resources is believed to be reliable but the accuracy cannot be guaranteed.