Your Post-Brexit wishes

Fred wrote:

fluffy2560 wrote:

If you are looking to spend elsewhere, then sure. Swings and roundabouts.

Dude, I've just got rid of my house in the UK so the bank account is looking fat at the moment.
If the exchange rate goes to silly and a bit, the chunk in my local bank will be bigger than it otherwise would have been,
As I'm pretty sure the people that matter will see how strong the UK will be without the EU millstone around its neck, I fully expect to be in the money.

My wish is to have a bigger sack of cash.

When they voted for Brexit, the Pound went tits up, so when Brexit does happen I doubt it will get any better. If anything it could get worse.

SimCityAT wrote:

Fred wrote:

fluffy2560 wrote:

If you are looking to spend elsewhere, then sure. Swings and roundabouts.

Dude, I've just got rid of my house in the UK so the bank account is looking fat at the moment.
If the exchange rate goes to silly and a bit, the chunk in my local bank will be bigger than it otherwise would have been,
As I'm pretty sure the people that matter will see how strong the UK will be without the EU millstone around its neck, I fully expect to be in the money.

My wish is to have a bigger sack of cash.

When they voted for Brexit, the Pound went tits up, so when Brexit does happen I doubt it will get any better. If anything it could get worse.

Yes, sure, but it meant that exports were up big time.  Good for employment but since UK is an importer, everything got more expensive.   Was OK if earning foreign currency.  Mind you I reckon VAT will be going down in the UK.  EU has minimum VAT.

Imagine if Hungary went it alone.  It'd crash even worse and Putin doesn't have the dosh to bail out Hungary Soviet style.  Be interesting to see how the Iran sanctions will affect  the Russians as I believe they are in Iran with their nuclear stuff.  Link to the Russian Paks nuclear plant upgrade here.  Presumably dollar financing.

SimCityAT wrote:

My wish is to have a bigger sack of cash.

Sure, but what you are essentially doing is engaging in currency speculation. To do that successfully you usually need to have a huge amount of money to make tiny margins on the arbitrage; from any outsider's point of view what you are doing is indistinguishable from gambling. As with any good, a currency is worth exactly what someone will pay for it, and it isn't worth anything else.

There's nothing wrong with gambling but I wouldn't bet my house on it. One can to an extent reduce one's exposure to currency fluctuations by paying for stuff in the currency you get paid in, especially if you can agree a fixed future rate. While you might then "lose" imaginary future money (i.e. it would have been cheaper in the future were you to have paid in another currency), you have the benefit of turning a variable cost into a fixed cost, reducing risk.

Which essentially is what it is about. I am very risk-averse and don't really like gambling on futures, which is what you essentially are doing. I'd prefer to pay, for example, a fixed over-estimated amount each month for my utilities, even though I am in a sense worse off because I could have invested the extra somewhere else for some interest. It really comes down to your risk aversion/risk tolerance. If everyone believed that an exchange rate would go in a certain direction, it would already be there (the market would "clear" at that spot price RIGHT NOW).

And for a relatively small amount of money like the cost of a house, you're still going to be paying quite a lot in exchange rate and transfer fees. I couldn't avoid it but I tried to reduce that exposure, but you're entitled to your view of course, that's why rates change minute-by-minute, a price is really just an opinion.

SimCityAT wrote:

Putin doesn't have the dosh to bail out Hungary Soviet style.  Be interesting to see how the Iran sanctions will affect  the Russians as I believe they are in Iran with their nuclear stuff.  Link to the Russian Paks nuclear plant upgrade here.  Presumably dollar financing.

So where did Russia get the dollars from? Leaving aside counterfeiting or that the US gave them a backhander, they bought them somehow from the Federal Reserve, e.g. by exporting goods and services to the US directly or indirectly. Now, a government can insure itself from the strength or weakness of its currency by holding foreign reserves, pretty much all central banks do it. But attempting to buy one's own currency with foreign currency reserves almost always just results in a crash, because people tend to spot that very large trades can only be done by something as big as a central bank, which just puts more pressure on...

Any attempt to fix currency rates (e.g. Bretton-Woods) is doomed to failure because people will just trade in something more valuable than the currency, or will trade it privately (illegally) at the market rate instead of the pegged rate. Things like devaluation or "quantitive easing" (i.e. printing money) don't help, because it just makes all the money worth less. This was Russia's problem with the collapse of the USSR, because it found thirteen other countries on its doorstep with ruble printing presses, and to buy anything worthwhile you had to trade in dollars (or other "hard" i.e. exchangeable currency).

It is why the Hungarian peszgo failed when you had take your wheelbarrow full of local banknotes to the bread queue, and if you hadn't a wheelbarrow it was impossible to borrow enough money to buy or make one. It is why the first US dollar failed ("not worth a Continental"). It is why the Gold Standard failed; the idea that gold has some fixed value is false.

Floating exchange rates are a minute-to-minute update on what everyone collectively thinks about everyone else's currency and, by extension, their economy. And since everyone is always wrong, all they can hope to do is sell the currency they have to a Greater Fool.

SimonTrew wrote:

SimCityAT wrote:

Putin doesn't have the dosh to bail out Hungary Soviet style.  Be interesting to see how the Iran sanctions will affect  the Russians as I believe they are in Iran with their nuclear stuff.  Link to the Russian Paks nuclear plant upgrade here.  Presumably dollar financing.

So where did Russia get the dollars from? Leaving aside counterfeiting or that the US gave them a backhander, they bought them somehow from the Federal Reserve, e.g. by exporting goods and services to the US directly or indirectly. Now, a government can insure itself from the strength or weakness of its currency by holding foreign reserves, pretty much all central banks do it. But attempting to buy one's own currency with foreign currency reserves almost always just results in a crash, because people tend to spot that very large trades can only be done by something as big as a central bank, which just puts more pressure on...

Russians USD earnings will probably be from oil.  They don't have to get them from the USA.  They could get them from someone else.  Not that easy.  It doesn't have  to be "in cash".

One thing people do not normally know is that all USD transfers go via the USA and appear in the US Treasury lists so are traceable for sanctions enforcement.   There's no way around that.  USD correspondent banks are always in the USA, regardless where the initiators and recipients are.   

So unless they physically transport cash (and a million bucks is pallet sized, despite what they show you on TV/movies), you need large containers of money to pay up billions in USD (biggest note $100).   On the other hand, they could use EUR or use Yen or similar reserve currency and therefore not involve the USA in the actual transfer.  I expect them to use EUR electronically. Physically it's easier with EUR (biggest note EUR 500, bigger value, less volume than $500).     

BUT, and it's a big but, all the main banks have operations in the USA and the USA will extend the sanctions extraterritoriality to those banks and businesses as well, even if they use EUR.  The only option is for those banks to pull out of the USA and hold no assets there.  They'd think of that as being quite extreme.  It's not that difficult to get around it. 

Just trade oil and layer it through other countries - send Iranian oil to say North Korea, refine it into petrol, export it through various places to the Plutonia Republic, receive uranium ore in exchange. No USD involved directly.  DPRK is a dab hand at this stuff. 

So when they want to pay for the Paks power station, maybe they could pay in diamonds, platinum, oil or something like that which is more usefully sanctions liquid than USD.   Then Putin can trade with Iran and not give a damn. I expect he doesn't give a damn anyway.

SimonTrew wrote:

SimCityAT wrote:

Putin doesn't have the dosh to bail out Hungary Soviet style.  Be interesting to see how the Iran sanctions will affect  the Russians as I believe they are in Iran with their nuclear stuff.  Link to the Russian Paks nuclear plant upgrade here.  Presumably dollar financing.

So where did Russia get the dollars from? Leaving aside counterfeiting or that the US gave them a backhander, they bought them somehow from the Federal Reserve, e.g. by exporting goods and services to the US directly or indirectly. Now, a government can insure itself from the strength or weakness of its currency by holding foreign reserves, pretty much all central banks do it. But attempting to buy one's own currency with foreign currency reserves almost always just results in a crash, because people tend to spot that very large trades can only be done by something as big as a central bank, which just puts more pressure on...

Any attempt to fix currency rates (e.g. Bretton-Woods) is doomed to failure because people will just trade in something more valuable than the currency, or will trade it privately (illegally) at the market rate instead of the pegged rate. Things like devaluation or "quantitive easing" (i.e. printing money) don't help, because it just makes all the money worth less. This was Russia's problem with the collapse of the USSR, because it found thirteen other countries on its doorstep with ruble printing presses, and to buy anything worthwhile you had to trade in dollars (or other "hard" i.e. exchangeable currency).

It is why the Hungarian peszgo failed when you had take your wheelbarrow full of local banknotes to the bread queue, and if you hadn't a wheelbarrow it was impossible to borrow enough money to buy or make one. It is why the first US dollar failed ("not worth a Continental"). It is why the Gold Standard failed; the idea that gold has some fixed value is false.

Floating exchange rates are a minute-to-minute update on what everyone collectively thinks about everyone else's currency and, by extension, their economy. And since everyone is always wrong, all they can hope to do is sell the currency they have to a Greater Fool.

If you are to use the quote feature, use it correctly.

SimCityAT wrote:

SimonTrew wrote:

SimCityAT wrote:

Putin doesn't have the dosh to bail out Hungary Soviet style....

If you are to use the quote feature, use it correctly.

Sorry about that (I misattributed the innermost quote to SimCityAT instead of fluffy5680 when paring it down.) I work on a very small screen so hadn 't seen the Preview button, and I cocked it up this time. Sorry again.

SimonTrew wrote:

SimCityAT wrote:

SimonTrew wrote:

If you are to use the quote feature, use it correctly.

Sorry about that (I misattributed the innermost quote to SimCityAT instead of fluffy5680 when paring it down.) I work on a very small screen so hadn 't seen the Preview button, and I cocked it up this time. Sorry again.

Oi! Less of the Fluffy5680! 

We look down on those Fluffy5680s. What have they ever done for us? Splitters.

We're the People's Front of Fluffy2560. 

(which is a completely different kettle of cats).

fluffy2560 wrote:

SimonTrew wrote:

SimCityAT wrote:

If you are to use the quote feature, use it correctly.

Sorry about that (I misattributed the innermost quote to SimCityAT instead of fluffy5680

Oi! Less of the Fluffy5680!

Okay, so I misattributed the misattribution. Crucify me.

fluffy2560 wrote:

One thing people do not normally know is that all USD transfers go via the USA and appear in the US Treasury lists so are traceable for sanctions enforcement.

There is a good  reason people do not normally know that, and that is because it is bollox.

The missus works in cross-European subsidiary of a well-known US car manufacturer on its banking arm, which trades primarily in dollars and euros. So being a bit curious, I asked her. To nobody's surprise, all the books and transactions are double entry in local currency and dollars. She audits those books across Europe. The individual transactions from MichiganMotorCompanyFinanceZrt  do not get reported to the US Treasury under SarbainsOxley or anything else.

Very large currency transactions, probably. alltransactions, no.

SimonTrew wrote:

fluffy2560 wrote:

One thing people do not normally know is that all USD transfers go via the USA and appear in the US Treasury lists so are traceable for sanctions enforcement.

There is a good  reason people do not normally know that, and that is because it is bollox.

The missus works in cross-European subsidiary of a well-known US car manufacturer on its banking arm, which trades primarily in dollars and euros. So being a bit curious, I asked her. To nobody's surprise, all the books and transactions are double entry in local currency and dollars. She audits those books across Europe. The individual transactions from MichiganMotorCompanyFinanceZrt  do not get reported to the US Treasury under SarbainsOxley or anything else.

Very large currency transactions, probably. alltransactions, no.

Yes, Sarbanes Oxley, but it's not that, it's the other one - forgotten the name. 

It's not bollocks and auditors are not bankers. Auditors only see the end results on accounts held locally.    In this process, you are not in the right part of the chain. Ask her where the accounts are actually and ultimately settled.  Saying Erste Bank or K&H Bank is not enough.  Where are their USD amounts actually held (right back to the beginning and I don't mean cash)?   

What you are missing is that it's the BANKS that do the reporting, not FredAndErnie Inc.  The account holder never sees this activity and neither do accountants or auditors.  All banks have USD accounts held at a US bank most usually in NY - Mellon Bank, Chase Manhattan etc.  Some banks may outsource this to another bank with more extensive relations. When they settle their correspondent accounts it's between themselves in USD. It's always via the USA and as these banks are located in the USA, it gets reported to the US Treasury.   

No-one outside of the banking sector sees this but it's how it gets reported and believe me, people do get picked up on it, even small fry.

fluffy2560 wrote:

What you are missing is that it's the BANKS that do the reporting, not FredAndErnie Inc.

Exactly. You beat me to it.

fluffy2560 wrote:

The account holder never sees this activity and neither do accountants or auditors.

One of my banks in Hungary once sent me a letter saying they received a request from the USA about my accounts in Hungary. I was not surprised about the request I was surprised my bank told me about it.

The USA has a lot of financial muscle, and has long arms. Even brought down the oldest Swiss bank with such inquiries.

klsallee wrote:

fluffy2560 wrote:

What you are missing is that it's the BANKS that do the reporting, not FredAndErnie Inc.

Exactly. You beat me to it.

fluffy2560 wrote:

The account holder never sees this activity and neither do accountants or auditors.

One of my banks in Hungary once sent me a letter saying they received a request from the USA about my accounts in Hungary. I was not surprised about the request I was surprised my bank told me about it.

The USA has a lot of financial muscle, and has long arms. Even brought down the oldest Swiss bank with such inquiries.

Yes, but that FATCA business for US citizens rather than sanctions.  That's more internal anti-money laundering work for the bank in Hungary.   If you'd been under investigation they wouldn't have told you a thing, just suspended services.  The only way to find out is to sue them and therefore have some open evidence in court.  Stupid really. 

Obviously any bank ignoring the USA isn't going to survive very long as all its correspondent banks will run a mile. Tremendous pressure.  Many banks don't want to do business now with US citizens because of it. 

Continuing USA extraterritoriality will be a hot topic soon because of Iran but it's not like we haven't been here before - US Patriot Act and the countering acts elsewhere .   

USA is only really interested in sanctions controls whenever it feels like it.  It's usually a case of "follow the money honey".

SimonTrew wrote:

fluffy2560 wrote:

One thing people do not normally know is that all USD transfers go via the USA and appear in the US Treasury lists so are traceable for sanctions enforcement.

There is a good  reason people do not normally know that, and that is because it is bollox.

The missus works in cross-European subsidiary of a well-known US car manufacturer on its banking arm, which trades primarily in dollars and euros. So being a bit curious, I asked her. To nobody's surprise, all the books and transactions are double entry in local currency and dollars. She audits those books across Europe. The individual transactions from MichiganMotorCompanyFinanceZrt  do not get reported to the US Treasury under SarbainsOxley or anything else.

Very large currency transactions, probably. alltransactions, no.

https://www.euromoney.com/article/b12kj … ng-options

Foreign banks do not have to have banking operations in the US to clear dollar transactions, but whichever bank they use to do so must be a customer of either the private sector-owned Clearing House Interbank Payment System or the Federal Reserve's Fedwire Funds Service.

Essentially, that means all US dollar transactions are subject to US law, even if they're between two other countries and nothing goes near the US, all without reporting anything because the US monitors all US Dollar transactions anyway.
The upshot is, after Brexit, the UK is far better off avoiding US Dollar transactions where possible, something that will improve profitability for all parties concerned - but the US would lose out.

I'll go further, the post-Brexit UK should align with BRICS, avoiding US trade as much as possible, especially when you consider the political situation in the US at the moment.
Regardless of your opinion of the US administration, it is unusually unstable thus not good for business.

Fred wrote:

........
Essentially, that means all US dollar transactions are subject to US law, even if they're between two other countries and nothing goes near the US, all without reporting anything because the US monitors all US Dollar transactions anyway.

The upshot is, after Brexit, the UK is far better off avoiding US Dollar transactions where possible, something that will improve profitability for all parties concerned - but the US would lose out.

Sort of.  They do monitor on a country basis - the regulator does it which is often the central bank.

All USD transactions go via the USA.  USD has to be credited/debit step by step along the chain. It's somewhat different if it's physically cash. People sometimes find it hard to know the difference between credit on an account and an actual pile of cash.   Transactions in USD all go back to the correspondent banks in the USA for credit/debit regardless and do not necessarily need to be aggregated up.  Credit on an account is more like a commitment.  But the reserves (at the correspondent bank in the USA) backs up that commitment (ignoring assets for the moment).  And those correspondent banks all have reporting to the US government as they have (and must have) their own accounts with the Fed.

Credit card transactions in USD are also reported in the US.

EUR transactions I know less about but I suppose they go via the ECB ultimately for the same kind of thing.

^
The above meaning all non cash USD transactions are subject to US law, making another good reason not to use the Petrodollar.
Post Brexit Europe and the UK would be daft to use it except when absolutely necessary.

Fred wrote:

^
The above meaning all non cash USD transactions are subject to US law, making another good reason not to use the Petrodollar.
Post Brexit Europe and the UK would be daft to use it except when absolutely necessary.

Yes, true but very hard to avoid the US dollar internationally.

I wish i could remember the name of the EU counter to the US Patriot Act.  Was used to nullify the extraterritoriality.   I'll have to look it up.  Some international businesses are really going to be screwed because of Trump's actions - Airbus for example.

I was wondering if this was some wider plan of Trumps.  He's so obtuse, anything could happen.  US cannot probably fight logistically two very large wars at once across half the world.  So he's neutering DPRK by chatting to them while placating the Chinese over the South China Sea and then maybe he's going to use Israel as a proxy to fight with Iran, coming in as a peacemaker at the last minute to support them as the regime collapses.  Shades of Iraq. Then probably we'll have years and years more turmoil in the middle east for years to come with Hezbollah and the Revolutionary Guards fighting a guerrilla action.

Hardly post-Brexit wishes!

Fred wrote:

I'll go further, the post-Brexit UK should align with BRICS

BRICS : Brazil, Russia, India, China, South Africa. Formed as an "alternative" to SWIFT fiscal transactions.

But not exactly the most perceived corruption free, fiscally transparent countries.

SWIFT is designed, in part, to monitor for illicit money transfers. There is no guarantee the BRICS system will as effectively (or honestly). Of course, some people may like that idea.

fluffy2560 wrote:

Many banks don't want to do business now with US citizens because of it.

IMHO, such banks are probably not to be trusted anyway. Surprising how many are probably laundering money and don't want to get caught.

By the way, do you know of any bank in Hungary that refused US citizen accounts because of FATCA? I have banked at three different banks here, and all accept me. So in Hungary, this really is a tempest in a teacup, IMHO.

fluffy2560 wrote:

Continuing USA extraterritoriality will be a hot topic soon

And Russia. And China. And.... etc. We are entering a new "Great Game" era. Troublesome.

klsallee wrote:

Fred wrote:

I'll go further, the post-Brexit UK should align with BRICS

BRICS : Brazil, Russia, India, China, South Africa. Formed as an "alternative" to SWIFT fiscal transactions.

But not exactly the most perceived corruption free, fiscally transparent countries.

SWIFT is designed, in part, to monitor for illicit money transfers. There is no guarantee the BRICS system will as effectively (or honestly). Of course, some people may like that idea.

SWIFT is a communications system, not just for payments in USD.
Using USD doesn't make much sense for many because the buyer and seller have to exchange to USD, then back to their own currency - a bit pointless when neither party use it other than for transactions. Then add the fact your deal comes under US law if you transfer using USD, and it becomes a pain.
BRICS transactions are done using anything you like, even bartering, and no foreign laws to care about.

Fred wrote:

klsallee wrote:

Fred wrote:

I'll go further, the post-Brexit UK should align with BRICS

BRICS : Brazil, Russia, India, China, South Africa. Formed as an "alternative" to SWIFT fiscal transactions.

But not exactly the most perceived corruption free, fiscally transparent countries.

SWIFT is designed, in part, to monitor for illicit money transfers. There is no guarantee the BRICS system will as effectively (or honestly). Of course, some people may like that idea.

SWIFT is a communications system, not just for payments in USD.
Using USD doesn't make much sense for many because the buyer and seller have to exchange to USD, then back to their own currency - a bit pointless when neither party use it other than for transactions. Then add the fact your deal comes under US law if you transfer using USD, and it becomes a pain.
BRICS transactions are done using anything you like, even bartering, and no foreign laws to care about.

Tell all that to Argentina this morning.  They've called in the IMF.  Peso interest rates at 40% and $5 billion spent on trying to maintain the exchange rate.  And just look at inflation in Venezuela, inflation at 2300% for 2018 (total basket case).  Basically useless for contracting for anything.

Quote from Time Magazine:

"Why does Argentina need help from the IMF?

The Argentine peso has lost a quarter of its value in the last year as investors have lost confidence in the currency. Earlier this week, it hit an all time low of 23.5 pesos to the dollar — compared to around 15.5 pesos/dollar this time last year.

Inflation has hit 25%, the highest rate in Latin America outside economically-stricken Venezuela. Macri's government has been unable to stabilise the currency and bring inflation under control, despite hiking interest rates three times so far this year. So he has made the risky move of turning to the IMF for aid."

The purpose of central banks is to maintain price stability and that's what you get with the USD.  If one prices contracts in USD (or any reserve currency like JPY or EUR) then that's what one gets more or less: price stability.   Pricing in anything else is mega risky.  Look at history - Russia, Zimbabwe, Germany and Hungary (nice article here)

Swift was not  designed for monitoring money transfers.  It was designed for reliability and security and to replace telex.  That's one of its central features - guaranteed secure delivery.   All the rest of the monitoring has come in later because of terrorism, fraud, drug crime and so on.

klsallee wrote:

fluffy2560 wrote:

Many banks don't want to do business now with US citizens because of it.

IMHO, such banks are probably not to be trusted anyway. Surprising how many are probably laundering money and don't want to get caught.

By the way, do you know of any bank in Hungary that refused US citizen accounts because of FATCA? I have banked at three different banks here, and all accept me. So in Hungary, this really is a tempest in a teacup, IMHO.

fluffy2560 wrote:

Continuing USA extraterritoriality will be a hot topic soon

And Russia. And China. And.... etc. We are entering a new "Great Game" era. Troublesome.

No I don't know of HU banks that refuse US citizens but there are banks elsewhere that do (easy to Google it).  It was in the UK and German and other news a while back when FATCA became a thing.

The trouble really is the apparent imperious of the US government.  I cannot put it more pleasantly than that. Anyone in the banking chain will be facilitating as well and could be fined. If they can just cut their risk by dumping the US customers, then that's what they'll do.  If I was running a bank, I'd have done that too.   

I doubt FATCA has made any difference budget wise to the US government.  The UK had similar stuff going on previously and it ended costing more money  to administer than it ever brought in.  People just change their behaviour to avoid.   IRS never anticipated Bitcoin.  D'oh!

What really sticks would stick in people's throats is this presumption of US law outside the US borders - extraterritoriality impinges on sovereignty.   But that's not a new story. 

If there's a flashpoint other than Iran, it'll be the South China Sea.  China has put missiles on their fake islands now.

Fred wrote:

BRICS transactions are done using anything you like, even bartering, and no foreign laws to care about.

Which enables the "Silk Roads" of the world.

fluffy2560 wrote:

klsallee wrote:

By the way, do you know of any bank in Hungary that refused US citizen accounts because of FATCA?

No I don't know of HU banks that refuse US citizens

So, this being the Hungarian forum, the FATCA issue is a not really relevant here.

fluffy2560 wrote:

What really sticks would stick in people's throats is this presumption of US law outside the US borders - extraterritoriality impinges on sovereignty.

It actually doesn't.

USA laws do not reach out much except in a business sense. Nobody has to do business with the USA if they don't want to. But if they do, they have to follow the rules set by the USA. Same with the EU by the way. I see nothing wrong with that.

As a counter example, when I was still living in the USA, my company had to start collecting EU VAT on Internet purchases because of a change in EU law if I wanted to sell to EU customers. Oh, there were a lot of forum posts from angry American businesses complaining that the EU was impinging on USA sovereignty there too.

It was quite a burden to my company to try to process EU VAT. So I stopped directly processing all sales, dropped my credit card processing (which cost quite a lot to setup by the way) and farmed it all out to resellers. So had to make a lot of costly changes to satisfy EU law. All while still living and operating only in the USA. I could have walked away from all EU business, but that would have been more costly. Running a business at times means making compromises.

In short, it is not just the USA that does these things. And it is easy to point fingers. Hard to remember that when one does, other fingers point back at ones self.

klsallee wrote:

fluffy2560 wrote:

klsallee wrote:

By the way, do you know of any bank in Hungary that refused US citizen accounts because of FATCA?

No I don't know of HU banks that refuse US citizens

So, this being the Hungarian forum, the FATCA issue is a not really relevant here.

fluffy2560 wrote:

What really sticks would stick in people's throats is this presumption of US law outside the US borders - extraterritoriality impinges on sovereignty.

It actually doesn't.

USA laws do not reach out much except in a business sense. Nobody has to do business with the USA if they don't want to. But if they do, they have to follow the rules set by the USA. Same with the EU by the way. I see nothing wrong with that.

As a counter example, when I was still living in the USA, my company had to start collecting EU VAT on Internet purchases because of a change in EU law if I wanted to sell to EU customers. Oh, there were a lot of forum posts from angry American businesses complaining that the EU was impinging on USA sovereignty there too. ....

Yes, it's a very good point but then again the EU isn't a single country and they often have different foreign policies.   Not that I would defend the EU against anything.   

And yes, no-one has to do business with the USA but it's hard to avoid sometimes especially if you are doing business internationally. 

I found that EU VAT thing very invasive myself as it's highly uncompetitive and an irritatingly high workload. I found myself likening it to some kind of Franco-German socialist plot.

I dunno, for Hungary, FATCA has a parallel everywhere else now, it's called CRS (Common Reporting Standards). It's the world equivalent of FATCA.   Hungary was among the first to sign up.

Anyway, not really about Hungary, indeed no.  But it's a bit Brexity.

klsallee wrote:

USA laws do not reach out much except in a business sense. Nobody has to do business with the USA if they don't want to. But if they do, they have to follow the rules set by the USA. Same with the EU by the way. I see nothing wrong with that.

Bit wrong there - This company was dealing between Singapore and Iran, but they copped it under US law.

https://blogs.wsj.com/riskandcompliance … iolations/

A unit of the Singaporean technology company CSE Global agreed to pay $12 million to settle allegations it violated U.S. sanctions on Iran.

CSE TransTel Pte. “willfully and recklessly caused apparent violations of U.S. economic sanctions,” the U.S. Treasury Department said, by engaging in and obfuscating conduct it knew to be prohibited. The company's senior management had knowledge of, and played a role in, the conduct, Treasury alleged in an enforcement notice.

The company couldn't be reached.

CSE TransTel conducted business with multiple Iranian firms to deliver and install telecommunications equipment for several energy projects in Iran and its territorial waters, and at least two of them at the time of the business were identified as being under U.S. sanctions, Treasury said in the settlement agreement it attached with the enforcement note.

Any US dollar transaction comes under US law, thus I have to suggest BRICS is a better way to do business, thus totally avoiding US interference.
If this company had dealt using non USD, they could have happily given the US the finger and said, "Spin on this".
Of course, they could no longer do any other USD transactions, but they can easily be avoided anyway. The one downside being other companies can't do any business with them without being punished by the US.
The best way is for all companies in a position to do so to avoid all US business and USD transactions - saves a lot of headaches.

This applies to post Brexit Britain and Europe just as much as both groups would be better off aliening with BRICS, avoiding the USD whenever possible.