An excellent description of where the wealth is hidden off shore and why:
http://www.prospectmagazine.co.uk/features/worlds-hidden-wealth-tax-haven-panama-papers-mossack-fonseca
Laundering money takes out the dirt. It takes out the connection to how it was obtained...illegally. It hides the source. There are many more reasons to hide the source besides illegal....things like drugs, human trafficing, theft. Hard theft like bank robbing. Soft theft like bank robbing as an inside job with a briefcase. There are all kinds of reasons to disconnect money from where it came from or who it belongs to. Forensic accountants can do detective work to figure it out but they are working against equally skilled accountants to hide the clues. Often the clues are in plain sight but hidden behind the protection of the law.
It is all about money in an account. To whom does all this money matter? The beneficial owner. Money is a social object. It matters to people and their social institutions to which people claim ownership or are stakeholders in claims to money in account.
The intent of structures to hide wealth is to hide wealth. Duh! That is the purpose of the design. Wealth being money or its representation in a form of a thing with associated value. To hide the object called money/wealth first as a number in an account known only to the beneficial account holder and to hide the processes by which the money enters or leaves the account.
It is all about money! Duh! Duh? What's "Duh"? Looks like a derisive term to express the stupidity of something needing to be explained that everybody knows is written on the wall. To me there is a deeper meaning: The object of the word is not the thing written on the wall that the subject called "everybody" should see. The meaning is this: What is written on the wall is the subject of the sentence. The object of the sentence is those that cannot see, read nor understand the writing on the wall. The operator? The verb that connects the relationship? Failure to connect the meaning. That is a strange thing to call a verb. It is really the absence of a verb. There is no connecting word. The connecting word is hidden. The money is there, in an account like a horse with no name. No connection to a name. No action to connect it.
The solution?
Open global accounting ledgers with three absolute element identities:
Account Number ID
Account Owner ID
Account Transaction ID
Duh! What the Duh for?
Its a Block Chain, stupid!
All hidden at the micro level. Meaning the discrete secret micro level. Secret to the relationship of any of the ID number association to a beneficial owner/transactor.
However, at the macro level the data structure is all open to being mined to discover probable cause to access micro level true identities and transactions. It is not a new model. It is the NSA total information model. At least in theory. The only difference is that NSA looks at the Micro level to discover probable cause. A situation of working from the bottom up rather than the top down.
Discovery of evasion can and should be done from the macro data mining level to develop information sufficient for probable cause to do micro level investigations. The monetary system has to be designed to accomplish that.
That is the digital money monetary system that I propose in this blog built on blockchain.
Every citizen and/or money transacting entity must be associated to an registered account to transact with digital money. A requirement for registration is mandatory information data elements.
All transactions with digital money are identified by a transaction number and associated required information such as date/time/location from one account to another.
"Money" is defined as digital currency uniquely identified independent object entity with a value of one at the granular unit level existing in a data base. Each unit of money has a direct relationship to an account and therefore its owner. In the account money is expressed as an aggregate amount. The aggregate amount always equals the sum total of unit value discretely identified digital dollars in the aggregate money account. The aggregate digital money account is by definition equal to the National Debt but the name of the account is changed to the National Money Account.
The National Money Account links all unit digital dollars to all accounts, equals the aggregate dollar value of all accounts. All accounts are linked to all transactions of National Money among accounts.
All of this macro level Monetary System structure is Open Ledger and Open Source coded in an anonymized encrypted system. The National Accounting Agency has keys to the encryption to investigate with the legal system approval of probable cause to discover criminal activity of any kind related to the National Monetary System.
The USA having all the might and right in this world dictates that this system be used by the entire world.
Since the USA is dominated by money interests this will never happen therefore China does it for the good of The People's Republic and creates this "Real Money" System that also happens to be debt free but can be used in debt applications in a debt finance system.
Official coin of the realm Money as a medium of exchange currency can be a highly defined object thing. Defined by precise assigned attributes and methods by which it operates. The nature of Money is a conceptual social thing. At the macro level of all money it is a persistent thing. Just like human beings as a collective species are persistent. But at the micro level of a single person they come into and go out of physical existence. If there is any pre or post state of being it does not matter in terms of the physical world. At the individual level, a single person is like a unit of money. Born into existence, lives for a while then goes out of existence. It is a debt base life life span. Absolutely true for money. Chosen by some believers to be true about our mortal selves and they structure their lives on that complex belief.
Simple observation suggests that the most persistent things, physical or conceptual are the best macro/micro level objects upon which to build structures. Physical or social. Subject to evolutionary/revolutionary change to perpetuate or terminate depending on micro level choices of object attributes and methods.
What is the best object structure for a conceptual thing called money? I would think it is persistence at both the micro and macro level. Born once and exists as an object for a long, long time. Until there is no functional need or reason to exist. Like our natural language. More or less.
Money as a highly structured conceptual object in digital form with each single unit of value having a unique identity as a medium of exchange and persisting over indefinite time (debt free because debt is the apoptosis death by design of money) is the single door through which all exchanges using money must pass. Those exchanges pervade our existence as users of Money. We may all want to live forever but it is a fact of life that we don't. We can't live without money but money as a macro/micro conceptual thing created by us to serve us can live forever at the discrete unit level, unlike each of us.
The existence of uniquely identified unit digital dollar and the exact transactions in which they are utilized as a medium of documented exchange between two entities that are also uniquely identified are the simplest of all possible conceptual structures for a digital monetary system.
Three components of a monetary system operating system. Each exactly defined by attributes and methods and state of their class in an ownership relation. Users of the monetary system are Buyer and Seller a relationship is implemented by Transactions. Buyer/Seller is a variable state change of User.
If all transactions in the digital monetary system pass through the single mandatory door of a transaction between Buyer and Seller and are related by a block chain history and real time verified state and status applicable to each component establishing the validity over time of all three components in an open public ledger displaying macro level operation but protecting private level operation unless that private level operation is contrary to total system rules and regulations then;
We have a Monetary Operating System. As in any digital operating systems dysfunction detection and correction is a system design process.
Things that should not be hidden cannot be hidden. No system sin is unseen at the macro level that cannot be corrected at the micro level.
That is, I think a sound basis for a Monetary Operating System. It would resolve the functional failure of the current system. John Merryman presents that here in discussion:
http://www.nakedcapitalism.com/2016/05/links-51416.html#comment-2596691
John is a self proclaimed crackpot too.
John says:
Followed by reader comments.
So what do we do with a theoretical grand and glorious Monetary Operating System to serve ourselves in the problem domain of making decisions regarding the allocation of resources??????
The Operating System is one thing. The Application Programs that run upon it are another.
Note that Watt4Bob weighs in later in the discussion following John's comment. Not surprising to me.
Bob concludes this about the application of our current money system for allocation of resources:
"It’s an obvious race to the bottom, and we’re making remarkable progress on that front."
I think it is an race to the bottom where the bottom is the point of revolution or no return. It is so blatantly obvious that the destination of the race is written on the wall as well as the solution to the problem domain of managing our society through a Monetary System using the design and technology of the Information Age. The masters of our dominant political financial systems do not want an efficient Monetary Operating System. The one we have is just fine for the few........
As long as it lasts. That is not long because it is not conceptually structured on persistent precisely identified objects and their designed methods in accordance with fundamental object oriented rules that are time tested because they apply to the nature world as well as our conceptual human structures.
The Monetary Operating System serves a higher level Social Operating System.
What is the magnitude of the single doorway through which all transactions in dollars passes? That doorway is our National Debt. About $14 trillion. The National Debt is equal to National Savings. All of our currency is debt based. If the National Debt was paid off there would be no Money Currency. There would be things that are "Near Money" quickly converted to Currency but if there is not Currency what kind of money is Near Money? Hmmm....it is complex.
Another way to look at it: If all this buying and selling of stuff was frozen at an instant of time then the "Big Aggregate Bank Account" of money used to buy an sell stuff would equal the National Debt. Forget about paper money. It is only 3% circulating in the USA Money. Big bucks but insignificant in the big scheme of things but high turnover cash in the pocket. Simply make all money transactions digital and it is eliminated.
Make every single money transaction go through the single door of a national digital currency as the basis of the monetary system and support that currency by simply saying it exists, debt free as a public utility with a small fee for maintenance and use of something whose source is free because it is declared to be a self evident truth of existence by declaring it exists.
Register every entity using money. Everyone uses money. Every business uses money. Identify who they are, where they are as individuals and for a business what kind of a business they are and who are the beneficial owners and their Monetary System User Identification Account Numbers.
Identify every single one of the 14 trillion dollars in our collective piggy bank that is spent amongst ourselves with a unique ID number (IPV6). Each dollar always knows its single owner account number. As aggregate amount per transaction money in an owner account is spent/received the owner of the related unit digital dollars in the National Piggy Bank server Vault at Fort Knox is changed accordingly. The total of $14 trillion identified uniquely and individually at the $1 level in the National Aggregate Piggy Bank always equals the sum total of $14 held in all user accounts (user entity granular level Piggy Bank).
National Piggy Bank, Money Transactions, and User Entity Piggy Bank Accounts are are on a Block Chain encrypted Information System.
All on a public ledger anonymized to protect private information, if required by law, but open to lawful investigation of personal information based on probable cause.
So we have this problem in a societal and economic sense, where those in charge see themselves as more efficient(therefore deserving of the compensation) than everything else, yet the overall effect is that we are being sucked into the vortex of a societal/economic/military blackhole. Yet any attempt to stop this needs some other system and it also requires efficiency and finds itself competing for the same ultimate goals as the initial system.
There are ways to break this down, but they will only work after the system implodes under its own contradictions.
Just a thought for the morning."