from Sovereign Man:
Capital controls are the ultimate ‘smoking gun’ to evidence the complete collapse of an insolvent government.
Only the most desperate governments have to restrict the free-flow of capital across their borders. And once they hit, you know the endgame is near.
Capital controls can take a variety of forms… often as blunt as preventing outgoing international bank transfers (Iceland, 2008), or forbidding citizens to purchase foreign currency (Argentina, 2013).
Capital controls can also be more subtle. India’s government recently hit the panic button, and in an effort to stem capital flight from the country, they cranked up import duties on gold bullion to 10%.
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