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Charles’ Note: I ran a hedge fund for a while with a partner. We were a small shop, just the two of us. And given that our pay was tied to performance, there were years where the pay was pretty good… and years where I barely got paid at all. 

But one thing that was constant was the regulation. 

The fund traded both securities and commodities futures, so we were subject to two sets of regulators – the SEC (Securities and Exchange Commission) and the NFA (National Futures Association). 

And there were forms… so many forms. 

Annual forms… quarterly forms… special forms that would be triggered under certain conditions… questionnaire forms… long narrative forms!

And likely dozens of other forms that I’ve forgotten about or never realized I was supposed to complete. 

I was audited a few times, which is standard. Every time, it was a week of lost productivity that I’ll never get back. 

I don’t know if any of that made the investing public safer, as there’s still plenty of bad actors out there. But it sure added a lot of man hours and cost to my business.  

And it made the industry less competitive because you know there were plenty of potentially great managers that were overwhelmed by the paperwork and opted to do something else instead. 

Now consider that virtually every other industry is exactly the same. 

Think about the lost growth and productivity that results. 

We’re all a little poorer because of it.

It would have been nice had Trump’s Liberation Day on April 2 liberated us from the dead weight of government rather than from affordable foreign imports. 

Freeport friend and fellow libertarian traveler James Hickman (aka Simon Black) puts it into perspective for us. James is an international investor, entrepreneur, and co-founder of Schiff Sovereign. He uses the experiences from his life and travels to help you achieve more freedom, make more money, keep more of it, and protect it all from bankrupt governments. 

Today, he tells us exactly what the next Liberation Day should look like.

Take it from here, James!

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What “Liberation Day” Could Have Been

By James Hickman, Co-Founder, Schiff Sovereign

On July 9, 1807, after Napoleon’s crushing victory over an entire coalition of European nations, the King of Prussia was forced to sign the Treaty of Tilsit, formally putting an end to the conflict.

The peace treaty was devastating for the Prussians. They were forced to pay heavy tribute and war reparations to France, limit the size of the Prussian army, and hand over roughly 50% of their territory to Napoleon.

Just imagine what it must have been like to be living in Westphalia at the time (one of the regions that was ceded to Napoleon). One day you’re Prussian territory. The next day you’re French (and later an independent kingdom).

Everything changed. And that included the legal system.

Before Napoleon arrived, that area (especially Westphalia, now in modern-day Germany) was part of the decaying Holy Roman Empire, and its legal landscape was a tangled knot of conflicting systems.

There was feudal law, where obligations to lords governed land and labor.

There was Roman civil law, which had been in place since the 15th century, though inconsistently applied.

Ecclesiastical courts handled everything from marriage disputes to moral offenses.

Customary law varied by village and town, with local statutes often passed down orally or compiled in obscure legal codices.

Add to that guild regulations, imperial edicts, and the whims of local princes and bishops, and you had a legal system that was both impossible to navigate, and ripe for abuse.

This was all wiped away.

When Prussia handed over the territory of Westphalia, Napoleon immediately imposed the Napoleonic Code as the law of the land.

The Napoleonic Code, originally drafted in 1804, was radical for its clarity and uniformity. It abolished feudal privileges, standardized property rights, and enshrined the idea of equality before the law.

No more special courts for nobles or clergy. No more confusing tangle of contradictory rules. The code was divided into clear sections – persons, property, acquisition of property, and civil procedure – and it applied to everyone.

For the first time, a Jewish merchant in Kassel and a Lutheran farmer from Göttingen were subject to the same laws, interpreted by the same courts. That was unthinkable under the old regime.

The U.S. is in desperate need of a similar Westphalian reset. The Law of the Land in the United States of America these days is an endless collection of conflicting and often obsolete federal, state, and local laws combined with countless court rulings and precedents, plus enough rules and regulations to fill a football stadium.

Plus the code of regulations grows by around 80,000 pages each year, so the monster only becomes larger.

It shouldn’t take being conquered or vanquished by war to have your legal code pruned of dead limbs.

In fact I heard a very smart guy on a podcast some years ago talking about how every law in the U.S. should have a sunset clause so that it’s automatically abolished in, say, 5-10 years.

Bad laws will expire without any further action from Congress. Necessary ones will be updated and refreshed.

That “very smart guy” happened to be Elon Musk. And I imagine that was exactly the type of reform he had in mind when he bank-rolled Donald Trump’s presidential campaign… and it’s exactly what “Liberation Day” should have been.

Not across the board tariffs on staunch allies. Not bazillion-gajillion percent tariffs on China.

They should have liberated Americans from the 200,000+ page Code of Federal Regulations… many of which serve no purpose other than to frustrate commerce and productivity.

Bizarrely, for politicians who claim to care about “small business” and “the working class,” most of these rules hit small businesses and workers the hardest because they don’t have the resources (unlike big companies) to navigate Byzantine regulatory codes.

They’ve made it extremely difficult (to downright impossible, depending on the industry) to start a productive business. Good luck starting a restaurant in the state of California. Or a copper mine in the state of Arizona (where one unlucky business has been in permitting for 20+ years!)

The government doesn’t need to centrally plan anything. They just need to get rid of regulatory obstacles that make it more difficult for Americans to be more productive. And this is essential to saving the country from its $2 trillion annual deficits, and $36 trillion national debt.

You don’t need a PhD in economics to understand this problem. Quite simply, the U.S. economy needs to grow faster than the debt. That isn’t happening right now.

These days, the debt is growing by more than 5.5% annually, far outpacing economic growth. So saving the country’s finances means that GDP needs to grow by at least 5.5%, and ideally much more.

And while that sounds like an unrealistic goal, it’s totally achievable. With all the talent and investment capital in the U.S., along with AI, robotic automation, and nuclear power on the horizon, the U.S. should be able to grow at 7%+ per year.

That could have happened if Liberation Day had actually liberated Americans from job-killing laws and productivity-constraining regulations.

I have said many times in the past that America’s problems are still technically fixable, but that the narrow window of opportunity is rapidly closing.

It’s beyond frustrating to see these problems continue to grow worse. And it’s becoming harder every day to imagine a scenario where we don’t end up with a currency crisis or major inflation down the road.

I still hold out hope that sanity prevails… that, even if at the last minute, the U.S. government summons the courage and clarity to do the right thing for America once and for all, and avoid the worst outcome.

But as we used to say in the military, hope is not a course of action. That’s why it makes so much sense to have a Plan B.

Regards,

James Hickman

Co-Founder, Schiff Sovereign