Surviving and Thriving in Times of Coronavirus
What will remain after this crisis? And will we be able to get there?
By Peter Macfarlane
The crisis in which we find ourselves is quite unlike anything most of us have ever experienced. The only valid comparison I can think of are those of us who have lived in war zones.
But I believe this article will also be unlike anything you’ve read so far on this topic. Its focus is not the news itself, but about what you need to do to protect your health and wealth – starting now and going forward. It is aimed at people who live “offshore” – whether physically, as a state of mind, or simply as an aspiration. Offshore is a place with high personal freedoms and low taxes.
Some people are saying the preppers’ time has come. But I believe preppers’ fears are outdated. Survival in future crises won’t depend on hoarding toilet paper, canned food or even cash. It will depend more on having the right government papers, the right neighbours and the right asset protection strategies, as you will read in this article.
At some point, I expect things to return to ‘normality’. I’m a natural optimist and the situation in China, that suddenly has “no new cases”, gives us reason for optimism that the pandemic could be over pretty quickly. I may, of course, be wrong – and political leaders around the world certainly seem to be digging in for the long term.
I’m not sure how long vast swathes of the world can live under a state of fear and lockdown – but things are changing day by day and may well get worse before they get better.
What I can guarantee you is that the ‘new normal’ that we will be returning to eventually, will be very different from the normality we are accustomed to.
Even a month or two ago, if I had told you that most flights around the world would be grounded, would you have believed me? That martial law (albeit by another name) would be imposed in many first world countries? That borders between European Union countries, even state borders within EU countries, would be closed?
The New Normal – Positive and Negative
Overnight, some people will be a lot richer – and some, especially many small business owners, will sadly lose everything.
The system will be different – better in some respects. We will all have a completely different outlook on Black Swan type events, having survived one first-hand. On the positive side, I think an old-fashioned sense of community and family life is being restored, and the effects of the economic slowdown (stop) on the environment will be positive: allowing us to breathe cleaner air and eat healthier food.
However, in times of panic, people willingly give up civil rights. It is highly unlikely they will get most of them back again. And huge masses of the global population, including many people filled with bitterness and jealousy, now know that it really is within the realms of possibility to have governments implement extreme measures on the population in general.
We’ve lived through not just a few “Chinese” pandemics (tipping our caps to the fact that Hong Kong was British at the time of the Hong Kong Flu) but also the Middle Eastern Respiratory Syndrome, the Mexican swine flu and now the Chinese Wuhan Coronavirus. If we’ve studied history we also know about Spanish flu and maybe even the Antonine Plague.
What will come along next? It really doesn’t matter if it’s the Hogwarts Virus, the Vanuatu Parrot Flu or the Malagasy Mad Sheep Syndrome – be prepared to hear the calls: “Politicians acted too slowly with Covid-19 and thousands of people died. This time we need a faster, stronger reaction!”
This, dear reader, is the basis of the new normal.
Taking Stock of the Situation
It’s well established that there is a virulent virus that has spread worldwide and people are dying from it. Human life is more valuable than anything else and we should do everything within our powers to preserve it. Seriously extreme precautions are called for at this time. The fewer people who fall ill, the greater chance our community health systems have to help those who really need it.
On the other hand, we need to face the fact that death is part of life. I have no idea where to acquire reliable statistics on deaths from regular flu worldwide, or even deaths from coronavirus, since most cases have likely never been tested nor diagnosed. However, it is generally agreed that far more people have died already this year and every year from regular flu than from coronavirus. Most people also agree that the symptoms of coronavirus are mild in most cases – similar to a flu.
There is plenty of evidence that suggests the coronavirus is really not so bad after all. One of the more credible pieces of such evidence, to have come out in the last few days, is a study from Italy, which purports to show that 99% of those who died from coronavirus already had other illnesses.
I’m not a medicine man but I can read statistics. I fully agree that even one preventable death must be avoided, but it’s a fact that difficult decisions are sometimes necessary and the best strategy does not come from panic reactions. Complete lockdowns can cause many other health problems – for example, affecting people with mental health issues, or scaling back ‘routine’ healthcare that might also have negative effects over the long term.
I am not, to be clear, advocating for any particular course of action in treating the current pandemic. No, this article is not about that. I am just advocating for rational thought and a clear understanding of facts.
The other very interesting fact to take into consideration is why the virus seems to be attacking certain countries more than others. I think this is something we will be hearing a lot more about over the coming weeks.
Being a Politician in Times of Coronavirus
Here’s an extract from one of the most widely read articles on the internet at the moment aimed at politicians and business leaders:
The coronavirus is coming to you.
It’s coming at an exponential speed: gradually, and then suddenly.
It’s a matter of days. Maybe a week or two.
When it does, your healthcare system will be overwhelmed.
Your fellow citizens will be treated in the hallways.
Exhausted healthcare workers will break down. Some will die.
They will have to decide which patient gets the oxygen and which one dies.
The only way to prevent this is social distancing today. Not tomorrow. Today.
That means keeping as many people home as possible, starting now.
As a politician, community leader or business leader, you have the power and the responsibility to prevent this.
I totally do get it – this is not a thing our leaders want to gamble with.
… and the Political Consequences
There have been politicians from all sides of the spectrum who have argued against lockdowns: for example Boris Johnson in the UK, then Bolsonaro in Brazil and AMLO in Mexico, from different extremes of the political spectrum. Even Trump did nothing until pressure from Fox News to “seal the border” became too much. All of these leaders have faced enormous criticism and have now broadly decided to go with the flow. Whilst the pandemic has become very politicized at many levels, it is definitely not a traditional left versus right kind of politics. Neither is it nationalist versus globalist.
Would it be right to describe this as a “new world order”? I cannot say. One thing for sure though, is that the vast majority of the public supports lockdown measures and in places where lockdown is not fully implemented yet, in the UK and USA for example, people are asking for more.
It is interesting, without going too far down the route of conspiracy theories, to reflect on the timing of the pandemic politically.
If you remember shortly before the virus began in Wuhan, one of the major issues in the news was the protests in Hong Kong. Mainland Chinese citizens were also beginning to question certain aspects of state surveillance. Now, all that is forgotten. Maya Wang, a China Human Rights Researcher quoted in The Guardian, euphemistically talks about “mission creep.”
In Europe, a so-called “renationalization” of politics has been going on for a few years, triggered perhaps by Brexit and the refugee crisis. Angela Merkel, known as the biggest champion of European integration, effectively rejected Macron’s call for a unified European reaction.
There is certainly a message here about the future of the European Union, though time will tell what it is. Throughout the financial crisis of 2008 people were talking about the collapse of the Euro and the European Union and I correctly predicted that the EU and the single currency would stay strong. Since then Brexit has come and almost gone, and ironically in the last few weeks the European mainland has been a lot stricter in closing borders than the UK. We need to be thinking about the role of the European Union in future and we cannot be sure the Schengen agreement will continue to exist.
Perhaps the most important point of all, though, is that coronavirus is the economic reset the world has been waiting for for the last two decades. There are vast transfers of wealth happening right now, and unprecedented amounts of money are being “printed.” Whilst the number of deaths grabs more headlines, there is a steady stream of news articles about trillions of dollars and euros in emergency rescue packages. The UK government is offering to pay 80% of the wages of most parts of the British population indefinitely. Needless to say, this is completely unprecedented.
The economic collapse is happening right now. It has its roots in the last 20+ years, and it will get a lot worse. Very, very conveniently for governments, it will not be seen as their fault. It is all because of the virus!
Freedom of Movement
Freedom of movement is one of the most cherished freedoms of PT-minded people. We have become very accustomed to easy international travel at low cost. The PT mindset has always been to pick and choose between multiple flags: if you don’t like the government in one country, vote with your feet by moving to another.
The idea that sealing borders will control the virus is probably flawed. Even if we look back at the Spanish flu of 1918, when the world was much less mobile, the pandemic still travelled right around the world leaving few corners untouched.
Nonetheless, from one week to the next, many airlines have been grounded and airports closed. Even having a private plane doesn’t help much if governments close the borders.
When the new normal arrives, many planes will still be grounded as the airlines will be bankrupt.
Land borders have also been restricted – even in Europe, where freedom of movement has been a particular cornerstone of public policy for generations. And even within countries.
Whilst travel might be the last thing on your mind right now, you should consider that in the new normal, borders will not return to the way they were overnight, if at all. Just as the response to the virus has differed widely between countries, so it will continue. Some countries might decide they rather like leaving entry restrictions as they are. At the very least, we can expect 6-12 months of disruption – maybe more.
Many people are getting a taste of working from home for the first time, and like what they see. Companies and governments are seeing that they really can save a lot of money on office space by introducing teleworking on a permanent basis. I see this as a positive effect. But it may mean less demand for physically open borders in the future. In any case, the demand for open borders usually comes from business, not the general populace.
When Two Passports are Not Enough
I’m a big proponent of holding multiple citizenships and passports, and in the past I have been critical of people who see “visa free travel” as the main advantage of particular passports. Multiple passports are useful in multiple situations – but times of crisis are when a passport could literally mean the difference between life and death! A second or third passport is the ultimate “Plan B.”
Visa-free travel to the Schengen area in Europe has long been the litmus test for citizenship-by-investment programmes such as those of the Eastern Caribbean and Vanuatu. For now, all that is over – as I write, even EU citizens do not have visa-free travel within the EU!
The new normal we are already seeing is that citizens will be allowed into their country of citizenship – if they can get there. Long-term permanent residents are typically also being allowed to return home, whereas tourist arrivals are barred from entry.
I personally learned that lesson the hard way last week. I wanted to travel to Panama and they had closed the borders to all but Panamanians and permanent residents. Even though I have a home in Panama and travel there often, it has always been so easy to enter – 180 days visa-free entry just for showing my passport at the border – that I just never bothered to obtain the resident card. Big Mistake! Now I can’t go home. (Fortunately the story has a happy ending as I have a few other homes around the world)
In your emergency planning, you first need to know where you want to get to – more on that below. Forget about having visa-free travel to where you want to go – or even a Schengen visa. Your best chance to be allowed in, when a future Black Swan event occurs, is to have either a passport or a residence permit from the exact country you want to travel to. It’s worth noting that remote islands are going to be the most inaccessible places.
Where Will Your Emergency Safe Haven Hideout Be?
This is a difficult one. Since we don’t know the exact nature of a future crisis, it is hard to predict where you will be safe. The only prudent solution I can see is to diversify risk by keeping multiple bases in different jurisdictions, if your situation allows it.
For the moment, food supplies around the world seem to be holding up. Depending on how long emergency measures last, this might not go on forever. If food supplies falter, a rural area is clearly the best place to be. If the worst comes to the worst at least you can produce your own food and barter with other food producers in the vicinity.
On the other hand, you might need access to high quality medical care. For that, a rural area might not be ideal. If you are basically healthy, your attitude might have been like mine – that good care (or at least specialist medical evacuation) is available anywhere as long as you can pay for it. Therefore, a good worldwide health insurance policy – or a wad of cash and credit cards in the worst case that your insurance is not accepted – was all you needed. Consider, though, that local citizens and residents are likely to receive preference for limited healthcare resources, even over people with more money – and, frankly, that is how it should be.
Good internet connections are also something you should look at. If you run a business, you need to be prepping for your business too. Good continuity plans can help you keep things ticking over.
Then there is the “blood in the streets” factor to consider. Whilst we will all want to be far removed from physical violence, different people have greater or lesser tolerance for instability around them. For example, would you rather live under lockdown in Monaco or Andorra, or would you prefer Buenos Aires or Panama City? In the former options you will be in a very conformist society, with limited freedoms, but you are less likely to see looting or violence.
In Panama, protestors have been blocking highways out of the city, trying to stop people escaping to the countryside, over fears that the city people are virus carriers. In Germany, the police have been stopping people leaving the city of Hamburg to go to their weekend houses in nearby Schleswig-Holstein. This stuff I find scary: I know many people who live in cities but have a nearby country retreat they plan to escape to if the city becomes unbearable. Now we see first hand: if a city is in lock-down, this strategy won’t work.
Another valuable lesson is not to hesitate. Usually there are warning signs of a few days or even weeks. Even when I saw Italy go on lockdown, I for one did not expect the rest of Europe to follow. Now we know it is possible, let’s be prepared for anything. If you need to get out of town to go somewhere safer, do so while you still can.
Physical or Virtual Immigration?
Up until now, many of the government-sponsored residence and citizenship by investment programmes have required little time in the country. Portugal, for example, requires seven days of residence per year under its Golden Visa programme. Most of the Caribbean jurisdictions don’t even require a visit.
These programmes have already been proving politically unpopular. And I think under the ‘new normal’ we will see more political opposition to ‘virtual ‘ residents, but also more people willing to create substance, or put down roots, in their chosen destination country or countries.
I believe the immigration business in future will see less focus on visa-free travel (now that has basically been proven not to work in times of crisis) and more on where you can live a good quality of life, with a decent health system, surrounded by people whose culture and outlook on life you feel comfortable with. We are already seeing this with Portugal, and I think the business start-up visas launched there last year will start to show themselves as very attractive. Portugal is not a perfect place, but in my view it ticks a lot of boxes for a lot of people as a home base.
Talking about putting down roots, I think this crisis will teach people the importance of community. Imagine the difference between fleeing a crisis to a place you’ve never been to before (as millions of refugees are sadly forced to) and fleeing a crisis to a place where you not only hold residency papers, but are friendly with the local people.
The coronavirus is bringing out the best of people in many communities, the way that people work together for the common good in wartime. People are taking care of neighbours and vulnerable members of the community, and finding time to socialize more – even if it is a chat over the fence or a quick phone call to check on senior citizens.
Now is the perfect time to see how communities are coping, and think “would I like to be stuck there during a future crisis?” If you’re not on the ground, you just need to go on social media and start looking at what is going on there. In case you don’t speak the local language, everywhere in the world you will find English-speaking expat groups and they are uniting to help each other out on Facebook, WhatsApp and Twitter as never before. It’s a great way to get a feel for what is going on, and literally make friends in the right places.
Overall, my ideal situation is to have a few bases around the world that I can freely move between in ‘normal’ times, but any of which I would be comfortable being stuck in for an extended period if it became necessary. Living out of Airbnbs is not for me – we need to buy houses and apartments and have some storage space for our things.
Around each base, it’s important to have friends and business contacts. And, as I learned by not being able to visit my Panama base, it’s important to have either local citizenship or a local residence permit!
Cash and the Coronavirus
Cash is affected by the coronavirus. That horrible dirty paper stuff, that we know has had traces of cocaine on it for decades, now has coronavirus on it too. The Chinese government has literally been laundering cash. In Europe and the US people are being told to avoid using cash, to avoid exposing shop staff to cash, and avoid the need for unnecessary trips to the bank.
Some European countries are already well down the route to a cashless society – others, like Germany, have been holding out. This will only increase the pressure worldwide – especially in markets like Europe and North America – to eliminate cash.
It may well be that some currencies will collapse altogether. Or you might just find cash is “invalidated” overnight. If you don’t think it’s possible, just remember – did you think it possible that virtually all air links between the USA and the UK would be cancelled?
Should you then hoard cash, as traditional preppers do? I’m not sure. Gold and silver might be better, as they have been around as stores of value much longer than paper dollars, euros or pounds.
Asset Protection in Times of Coronavirus
I’m not going to say much about asset protection here, as that will be the topic of future, more detailed articles. However, it’s important to stress “expect anything” over the next few months and there are a couple of points you should consider right away, if you haven’t already.
Most places, banks are open and payment systems are still working. The basic economy has to work, so people can get their bailouts and use their plastic cards to buy food.
However, expect more non-essential services to be shut. In Spain, food stores are allowed to stay open under lockdown, but Iberian ham is not considered a necessity, and delicatessens selling only luxury food products have been ordered to close.
In the same way, banks might be kept functioning, but safe deposit boxes, brokerage accounts etc., might not.
Safe deposit services will definitely not be considered essential. Whilst our advice in the past has always been to keep your assets outside the banking system to protect yourself in case of “bank holidays”, it’s clear that private storage facilities may well be forced to close as well. And in case things spiral and looting starts, guess what businesses would be a prime target! I would definitely consider getting everything you possibly can out of safe deposit boxes right now.
Perhaps most scarily, I can see as very likely that cross-border financial services could be shut down at any time, or severely restricted (read: introduction of currency controls). Such controls could be easily justified and supported by the population in the current environment. Be guided accordingly.
Nobody knows what will happen next. It’s important that we all keep observing, and thinking about the consequences of things we see. Above all, keep healthy, and keep following the Q Wealth Report. If you haven’t already signed up to our free email list or followed us on social media, please do! We will be back over the coming weeks with lots of important intelligence to help you protect your health and your wealth.