I’m an attorney, not an economist, but the economy is top on my radar screen. This is a time to divide and conquer, if it is possible to survive. I have talked to some of the “big time” economists. In fact, I hosted a dinner last night for one of the world renowned consultants to governments and banks. We discussed the economy on a pretty high scale for a couple of hours. The take home message is we have a mess and NOBODY KNOWS how to fix it or what will happen. (I’m sure that’s news to you. Anyone with half a brain has figured that out already.)

How can the law help you survive? I often talk about the analogy with legal pockets. If you have all your money in your purse or wallet, and you get picked, your money is all gone. If you have taken some of your money out of your wallet and put it in your front pocket, then if you get your wallet picked, you don’t lose everything. You can create legal pockets, and with the economy in the toilet, it is more important than ever for you to start creating the pockets.

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Asset protection freaks are always asking me if they should, or telling me that they did, put their house in a corporation or Limited Liability Company (LLC). This is a big mistake. They have confused the purpose of asset protection using a company shield, whether it’s a corporation or LLC shield.

Company structures are creations of congress. They are intended to protect the shareholders (investors) and the managers from personal liability if something goes wrong with the company. The object is to encourage people to take the risks associated with running a business and financing companies. Congress didn’t pass the laws associated with companies for personal “asset protection.” The company only protects against acts done in the pursuit of the business’ activities.

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