Back in 2008 a friend of mine handed me a book and said, “This is going to blow your mind.”

I read it (a bit of unsolicited life advice: always read a book someone gives you, go to a restaurant someone recommends to you, etc.).

It was a good read. Entertaining.

Mind wasn’t blown though. Not even close.

After crisscrossing the world for a few years, spending time in world class financial centers and third world backwaters with both the financial dregs elite, see how financial deals really get done, how pies are cut up among the insiders, the revelations in the book weren’t a surprise at all.

My reaction was, that seems about right.

The book was “Wolf of Wall Street.”

It’s since been made into a movie that shocked and offended a lot of people.

Well, after reading up on the “Panama Papers,” it looks like a lot of people are going to see how the politics and finance are much more closely entwined than they ever expected.

How The Sausage Gets Made

I really think this is going to be a big story...to some people at least.

Many regular investors will now get to see a lot about how a lot it all really works as the Panama Papers story unfolds.

It’s going to take some time though.

The reports say there were 11.5 million documents leaked in total.

Most of those documents will be worthless.

A few of those documents, however, are going provide pieces of the puzzle to how politicians, celebrities, and the wealthy really do their deals.

And we already have one great bit of proof there’s some there there thanks to Sigmundur Gunnlaugsson, Iceland’s Prime Minister.

He was recently questioned about his dealings with Panamanian banks.

Now, he’s a politician who is well-trained on dealing with a question like this.

The trained reaction should be to obfuscate, misdirect, outright lie, or just laugh it off as though it’s nothing.

Gunnlaugsson, however, just got up and left (here’s the video).

If that’s not a guilty man’s move, I don’t know what is.

Gunnlaugsson is one of many though. As I write, twelve top elected officials (“leaders” doesn’t seem like an appropriate term here) from Argentina, Saudi Arabia, Ukraine, Sudan, Jordan, Iraq, and many more have been connected to all this.

And judging by the the twitter account of Süddeutschen Zeitung (translated to South Germany Newspaper), which published the Panama Papers over the weekend, there’s more to come.

It simply stated: “Just wait for what’s coming next…

Get Some Popcorn Ready

Of course, I’m searching for some investment implication in all this.

Not coming up with much.

We could say this is going to be big for cyber-security companies.

It sure won’t hurt. But it’s hard to understand how this event will put “#1 concern of Chief Technology Officers” for like five years running any higher on their priority list.

But that’s a bit of a stretch.

Or we could say this is the event that’s going to catalyze those atop the world’s nation states to clean up their act.

We know that’s not going to happen.

It will probably just lead to more more layers between assets, who’s actually in control of them, and more opaque and complicated financial transactions.

It could add some fuel to some rapidly growing fires.

We’ve talked a lot about the problems in Brazil recently. A few of them are connected to this already.

There may be more to come from this for Brazil’s political class. But I’m not going to base an investment decision on just that.

Then again, it sure wouldn’t hurt us by accelerating Brazil’s next down leg.

So until we see more, the best action to take on this is sit back, watch and enjoy.

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