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Sovereign Man Notes from the Field Date: July 22, 2011 Reporting From: Split, Croatia

In Business/Political Trends Worldwide, currency, Expatriation, Government, History, personal and business, Sovereign Man, Taxes, Travel on July 22, 2011 at 3:36 pm

Sovereign Man

Notes from the Field

Date: July 22, 2011
Reporting From: Split, Croatia

Over the last few weeks I’ve gotten away from our usual tradition of having a weekly Q&A session, so I’m going to get right to it today.

First, Constanza asks, “Simon, you were writing recently about ‘international diversification.‘ Can you explain a bit more about this?”

Sure. It’s becoming obvious that there are massive problems in the developed world– ballooning debts, stagnating economies, soaring inflation, high unemployment, food and energy shortages, rising crime, increased regulation, diminished civil liberties, etc.

These problems aren’t going away just because some politicians pull an accounting stunt or deny that they exist.  These problems are real, and thinking individuals need to realize that the consequences of inaction are only going to get worse.

Most people will unfortunately do nothing and wait for a political solution. Their faith in their elected leaders will unfortunately be rewarded with a front-row seat to witness the final erosion of their country.

Others will take the approach of trying to change the system. Relying on the democratic process certainly seems like a noble cause, but remember that democracy is really just two wolves and a lamb deciding what to have for dinner.

International diversification is the cornerstone of my own ethos– it involves looking overseas to protect you interests and seek new opportunities. If your home, your work, your family’s safety, your savings, your healthcare, and your entire livelihood are tied to one crumbling country, you are exposed to substantial risk.

Diversifying internationally can drastically reduce this risk. It might mean finding more stable sources of income overseas, better stores of value for your savings, stronger markets to invest in, safer places for your family to live, more cost effective places to obtain healthcare, more secure places to store gold, etc.

I’m not suggesting that everyone should get on a plane tomorrow and leave home… though for some people who have reached their breaking points, this is the ultimate solution. What I am suggesting is that people stop limiting themselves to a single country that’s in decline, and begin to consider the wider world.

On that note, Alvinium asks, “Simon, you recently wrote that owning agricultural land is a great hedge against rising food prices. What about the FDA, USDA, and other agencies that are stepping up their efforts to make it a crime to grow one’s own organic food?”

Easy. I think people in the US should consider buying property overseas where there is no FDA or USDA to stop them from reducing their ‘agflation’ risk.

A few months ago in an issue of Sovereign Man: Confidential, I interviewed Joel Salatin of Polyface Farms; Joel was featured in the documentary Food, Inc., and he has decades of personal anecdotes in dealing with various agencies, many of which are chronicled in his book ‘Everything I Want to Do is Illegal.

He told me one recent story about a school in California that grows its own carrots. The children pick the carrots and wash them before eating, but the local Health Department came in and said that the children are not allowed to wash and eat those carrots without a Food Handlers’ license.

It sounds like a sick joke, but the system definitely favors the big ag companies at the expense of individuals. To me, you can try to fight the system, or simply go somewhere else where you are free to do what you want.

Chile is the place that I’ve chosen for our resilient community exactly for this reason. In the future, I don’t think there will be too many things more important than a steady, healthy, independent food supply… and I’m not willing to take the risk of having some government agency dictate what I can/can’t do.

Last, Elai asks, “Simon, a lot of people blast Ben Bernanke, but given the tools that he has at his disposal, what can he do to improve the economy?

Think about it like this– even in the most basic economics classes, students learn that price controls just don’t work. Electricity is a great example– many governments (Argentina for instance) fix retail electricity prices at artificially low levels. This creates excess demand, often causing major power shortages.

Suppose the government announced that iPads would now cost $1. Everyone would rush out immediately to buy one, and as there would no longer be a profit incentive for Apple to continue manufacturing them, an iPad shortage would quickly ensue.

Simply put, price fixing creates terrible distortions in the marketplace that lead to shortages or gross misallocations of resources.

Now, consider that interest rates are essentially the price of money– the price which a willing borrower agrees to pay a willing lender in exchange for a specified amount of capital.

If we can agree that price controls are a bad idea, why does it seem like a good idea to give one man nearly sole control to set the price of money? This is absolutely the one price that shouldn’t be controlled above all else!

The price of money affects everything in an economy— savings, spending, investment, foreign exchange rates… the price of money has the most far-reaching implications, and yet our financial system leaves setting this price to the serially erroneous prognostications of a single individual rather than the market.

Bernanke’s role is to control the price of money, and it’s a role that should not exist. The issue isn’t what he can do to improve the economy… but that he has any function in the economy whatsoever!

Until tomorrow,
Simon Black
Senior Editor, SovereignMan.com 


This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Thanksgiving, a cherished Holiday, or one that may not be cherished soon??……..Admin/capecoralblogger

In Business/Political Trends Worldwide, Constitution of The United States, Expatriation, History, Political, Political parties, Sovereign Man, Taxes, Travel on July 21, 2011 at 7:47 pm

THIS MAY NOT BE AS FAR FETCHED AS SOME MIGHT SAY

—–Original Message—Sent: Thu, Jul 21, 2011 12:58 pm by a unknown blogger.
Subject: Thanksgiving 2022

“Winston, come into the dining room, it’s time to eat,” Julia yelled to her
husband.
“In a minute, honey, it’s a tie score,” he answered.Actually Winston wasn’t very interested in the traditional holiday football
game between Detroit and Washington .Ever since the government passed the
Civility in Sports Statute of 2017, outlawing tackle football for its
“unseemly violence” and the “bad example it sets for the rest of the world”,
Winston was far less of a football fan than he used to be.Two-hand touch wasn’t nearly as exciting. Yet it wasn’t the game that
Winston was uninterested in.
It was more the thought of eating another Tofu Turkey . Even though it was
the best type of VeggieMeat available after the government revised the
American Anti-Obesity Act of 2018, adding fowl to the list of
federally-forbidden foods, (which already included potatoes, cranberry
sauce, and mincemeat pie), it wasn’t anything like real turkey.And ever since the government officially changed the name of “Thanksgiving
Day” to “A National Day of Atonement” in 2020, to officially acknowledge the
Pilgrims’ historically brutal treatment of Native Americans, the holiday had
lost a lot of its luster.

Eating in the dining room was also a bit daunting. The unearthly gleam of
government-mandated fluorescent light bulbs made the Tofu Turkey look even
weirder than it actually was, and the room was always cold.

Ever since Congress passed the Power Conservation Act of 2016, mandating all
thermostats – which were monitored and controlled by the electric company –
be kept at 68 degrees, every room on the north side of the house was barely
tolerable throughout the entire winter.

Still, it was good getting together with family. Or at least most of the
family.

Winston missed his mother, who passed on in October, when she had used up
her legal allotment of life-saving medical treatment.

He had had many heated conversations with the Regional Health Consortium,
spawned when the private insurance market finally went bankrupt, and
everyone was forced into the government health care program.

And though he demanded she be kept on her treatment, it was a futile effort.

“The RHC’s resources are limited”, explained the government bureaucrat
Winston spoke with on the
phone. “Your mother received all the benefits to which she was entitled. I’m
sorry for your loss.”

Ed couldn’t make it either. He had forgotten to plug in his electric car
last night, the only kind available after the Anti-Fossil Fuel Bill of 2021
outlawed the use of the combustion engines – for everyone but government
officials.

The fifty mile round trip was about ten miles too far, and Ed didn’t want to
spend a frosty night on the road somewhere between here and there.

Thankfully, Winston’s brother, John, and his wife were flying in.

Winston made sure that the dining room chairs had extra cushions for the
occasion.

No one complained more than John about the pain of sitting down so soon
after the government-mandated cavity searches at airports, which severely
aggravated his hemorrhoids.

Ever since a terrorist successfully smuggled a cavity bomb onto a jetliner,
the TSA told Americans the added “inconvenience” was an “absolute necessity”
in order to stay “one step ahead of the terrorists.”

Winston’s own body had grown accustomed to such probing ever since the
government expanded their scope to just about anywhere a crowd gathered, via
Anti-Profiling Act of 2022.

That law made it a crime to single out any group or individual for “unequal
scrutiny,” even when probable cause was involved.

Thus, cavity searches at malls, train stations, bus depots, etc., etc., had
become almost routine.
Almost.

The Supreme Court is reviewing the statute, but most Americans expect a
Court composed of six progressives and three conservatives to leave the law
intact.

“A living Constitution is extremely flexible”, said the Court’s eldest
member, Elena Kagan. ” Europe has had laws like this one for years. We
should learn from their example”, she added.

Winston’s thoughts turned to his own children.  He got along fairly well
with his 12-year-old daughter, Brittany, mostly because she ignored him.
Winston had long ago surrendered to the idea that she could text anyone at
any time, even during Atonement Dinner.

Their only real confrontation had occurred when he limited her to 50,000
texts a month, explaining that was all he could afford.

She whined for a week, but got over it.

His 16-year-old son, Jason, was another matter altogether. Perhaps it was
the constant bombarding he got in public school that global warming, the
bird flu, terrorism, or any of a number of other calamities were “just
around the corner”, but Jason had developed a kind of nihilistic attitude
that ranged between simmering surliness and outright hostility.

It didn’t help that Jason had reported his father to the police for smoking
a cigarette in the house, an act made criminal by the Smoking Control
Statute of 2018, which outlawed smoking anywhere within 500 feet of another
human being.

Winston paid the $5,000 fine, which might have been considered excessive
before the American dollar became virtually worthless as a result of QE13.

The latest round of quantitative easing the federal government initiated
was, once again, to “spur economic growth.”

This time, they promised to push unemployment below its years-long rate of
18%, but Winston was not particularly hopeful.

Yet the family had a lot for which to be thankful, Winston thought, before
remembering it was a Day of Atonement.

At least, he had his memories.

He felt a twinge of sadness when he realized his children would never know
what life was like in the Good Old Days, long before government promises to
make life “fair for everyone” realized their full potential.

Winston, like so many of his fellow Americans, never realized how much
things could change when they didn’t happen all at once, but little by
little, so people could get used to them.

He wondered what might have happened if the public had stood up while there
was still time, maybe back around 2011 , when all the real nonsense began.

“Maybe we wouldn’t be where we are today if we’d just said ‘enough is
enough’ when we had the chance,” he thought.

Maybe so, Winston. Maybe so.

Sovereign Man Notes from the Field Date: July 21, 2011 Reporting From: Split, Croatia

In Business, Business/Political Trends Worldwide, Continental Travel, currency, Expatriation, Food and Staples, Government, History, Money and Finances, Offshore accounts, Opportunity, Personal, Sovereign Man, Taxes, Travel on July 21, 2011 at 7:42 pm

Sovereign Man

Notes from the Field

Date: July 21, 2011
Reporting From: Split, Croatia

Print. Lie. Borrow. Deceive. Deny. These are a the principal tenants of the Greek restructuring plan that were released today from Brussels… it’s as if EU policymakers put it together after shaking a Magic 8-ball.

The whole world knows that Greece is bankrupt and has been living bailout to bailout for over a year. Deep in debt and devoid of cash, the country has completely forsaken its sovereignty in exchange for becoming a ward of the European Union; Prime Minister George Papandreou is now a hapless stooge awaiting instructions from Germany.

It’s ironic that the Greek proposal released today calls for a ‘Marshall Plan’ of investment across Europe… given that the last time Greece was being controlled by Germany was during the country’s occupation by Nazi forces after being vanquished by Hitler’s 12th Army in April 1941.

And so, with limited debate and even less fanfare, Europe has just officially signed on to destroy its own currency. Utterly worthless, quasi-defaulted Greek debt will become perfectly acceptable collateral, much in the same way that the US Federal Reserve took every scrap of toxic paper it could find off banks in 2008 and 2009.

Given the favorable market reaction, European politicians must be feeling pretty proud of themselves. The euro is up. The stock market is up. Oil is up. Well, never mind about oil, they’ll blame that on evil speculators… just like food prices.

And the proposal is so deliberately vague, they can go back home and tell constituents whatever they want. Angela Merkel can tell German voters that the French are paying for it, and Sarkozy and tell French voters that the Germans are paying for it. Win, win!

The European sovereign default SOP has just been set. When Spain, Italy, Portugal, and Ireland’s time of insolvency arrives, it will be handled just like this: Print. Lie. Borrow. Deceive. Deny.

Every day it becomes more and more obvious that the financial system as we know it is breaking down. The United States and European monetary union, whose currencies comprise nearly the entirety of the world’s fiat reserves, have both signed up to debase their currencies as rapidly as possible.

This is going to kick inflation up another notch as anyone holding on to Greek debt is going to trade out of it as quickly as possible. All that money has to go somewhere… and it’s a sure bet that a lot of it will feed rising commodities price (which translates into more inflation).

If you haven’t found a safe haven for your savings yet, it’s time to start. Now. No more excuses. A few you could consider:

Swiss franc, Norwegian krone, Singapore dollar, Chilean peso: These four currencies are generally regarded as safer, stronger, and managed by less obtuse central banks. In a world of fiat, these are among the least worst of the bunch.

Unidad de Fomento (UF): This is a special unit of account used in Chile that was set up during the hyperinflation days of the 1960s. The UF is designed to keep pace with inflation and it’s possible to establish a bank account denominated in UF in Chile. I’ll be telling SMC members how to do that in an upcoming issue.

Agricultural Property: Nothing hedges your risk against rising food prices like being able to produce your own food. This idea underpins the concept for the resilient community we’re planning in South America.

Precious Metals: Portable, divisible, durable, and scarce, precious metals are the classic hedge against rising prices. Gold and silver aren’t going to go up in a straight line, and gold in particular is due for a correction, but in a world ruled by an economic magic 8-ball, it’s a much safer store of value than a government IOU.

High quality equities: If my only two options are Apple stock and a bank account earning 0% interest, I’m going with Steve Jobs. The chief problem with equities is that the more money that central banks print, the more money flows into equities… pushing valuations up to dizzying (and unsustainable) levels.

Firearms and ammunition: Weapons and ammo serve a dual purpose of providing better home security, as well as a reasonable store of value. Unfortunately, they can also serve a third purpose– putting you on some government agency’s radar.

This list is by no means exhaustive… but if you have the majority of your savings just sitting there wasting away, it’s time to act.

Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com

This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: July 20, 2011 Reporting From: Split, Croatia…..”Take Heed America” added by Admin/floridabusinessportals.com

In Business, Business/Political Trends Worldwide, Continental Travel, Expatriation, Government, History, Interesting places, Money and Finances, Offshore accounts, Opportunity, Personal, Sovereign Man, Taxes, Travel on July 20, 2011 at 8:06 pm

Sovereign Man Notes from the Field

Date: July 20, 2011

Reporting From: Split, Croatia

Bruce Lee, a long-time hero of mine, died 38-years ago today, and in tribute to his intellect and philosophy, I wanted to blow the dust off an old quote of his that seems quite prescient:

“Those who are unaware they are walking in darkness will never seek the light.”

Each day it becomes increasingly obvious that there are essentially two kinds of people in this world– those who are unaware that they walk in the darkness, completely oblivious to the real dangers in the world, versus those who understand reality and seek the truth. The former group comprises the vast majority of society.

This is your voting electorate and mainstream media audience, and they’ll buy every bit of propaganda that’s sent their way… whether it’s support for the war(s), ruinous economic programs, child molesting TSA policies, or just plain old fear and hate. In its latest effort to spread fear and hate, the Ministry of Love, also known as the Department of Homeland Security, has produced an Orwellian new video intended to encourage Americans to rat each other out.

If you’re not in a place to watch the video right now, I’ll summarize briefly. First of all, it’s one of the most pathetic attempts at filmmaking in the history of motion picture; the average shampoo commercial has better acting and production quality… and is much more subtle in its message.

In the world of Homeland Security, terrorists all drive unmarked full-size vans, wear hooded sweatshirts, and deposit backpacks in conspicuous public places. They might as well have had a cackling James Bond villain twirling his moustache in the corner.

At its core, the video is filled with scenes of ordinary citizens spying on each other and alerting the authorities to their compatriots’ suspicious deeds. In my favorite scene, a woman calls the police after snooping over the shoulder of a young man typing away on his smartphone. Naturally, it’s all for the common good… for everyone’s safety and security. In fact, everyone shares in this responsibility according to DHS, so we should all be on our toes to rat each other out at the first sign of suspicious activity.

Apparently this is yet another obligation that comes with citizenship. For the majority of people who watch this video, their chests will swell with pride in the knowledge that they now have a role to play in their country’s security. These are the folks walking around in the darkness, unaware. You can’t talk to them about things like personal liberty as they’ll just regurgitate the propaganda they’ve been spoon fed since birth. These are the same folks who take their shoes off at the airport and proclaim, “Whatever it takes to keep us safe,” or “I have nothing to hide!”

Truthfully, real criminals aren’t back alley types, but rather the policymakers who spread fear and paranoia in the name of justice. They cloak their crimes in good deeds while building a brainwashed class of future Thought Police. If Orwell had written a prequel to 1984, this would all be part of it. It seems the boiling frog is getting just a bit warmer..

. Until tomorrow, Simon Black Senior Editor, SovereignMan.com

SIMON FINDS NUMBERED ACCOUNTS FOR DEPOSITS AS SMALL AS $8,000 Not yet a Sovereign Man: Confidential subscriber? This edition could have been a double issue. Here’s what you’re missing in what may be the best month yet: * This country may be a small country wedged in between two European powerhouses, but it checks just about every box for Simon. Hint…it’s NOT Switzerland. From safety, lightning-fast Internet, low taxes and minimal government intervention, this country should be on the top of your list for places to visit. Simon shares where to stay and how to fly in and out. For a land-locked location, it may be one of his favorites! * Simon proves this country isn’t just a tourist spot. He’ll show you how to get residency for an relatively small investment . Find his contact to get it done quickly. He also highlights the most difficult documentation requirement and how to be sure you have it covered. * Privacy in offshore banking? YES, this stable, European country still has private, numbered accounts AND will do business with US Citizens. Simon will share the different banks and even has negotiated a discount for Sovereign Man: Confidential members. You won’t want to miss this. * Ever-opportunistic, Simon will give some easy entrepreneurship opportunities in an emerging frontier, Kosovo. These options are the equivalent of “selling shovels to gold miners”. * Mark Nestmann also returns to go further in depth for those interested in expatriation with an honest assessment of the worst-case scenario. * Tim Staermose also offers his actionable insight from his most recent China trip. You need to have an understanding of the social and financial implications of the coming bust. To learn more about SMC and get access to the archive, click here for more information.


This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: July 5, 2011

In Business, Business/Political Trends Worldwide, Continental Travel, Expatriation, Money and Finances, Political, Political parties, Taxes, Travel on July 5, 2011 at 1:07 pm

Sovereign Man

Notes from the Field

Date: July 5, 2011
Reporting From: Sofia, Bulgaria

Do you remember those days, 25+ years ago, when the Olympic games were an extension of the Cold War? We heard stories about these Soviet athletes who were groomed, practically from birth, to become champion athletes, taken from their families at a young age to live and train nonstop for the glory of the Communist Party.

Bulgarians historically excelled at summer sports like boxing, wrestling, track & field, and rowing, and today I worked out at a gym that used to house the country’s up-and-coming athletes during Soviet rule.  It’s in a neighborhood of old Soviet-era apartment buildings, all built in that concrete shoebox style that defined Communist architecture.

Such neighborhoods are a constant reminder of the days when they allowed their society to descend into a totalitarian police state. A lot of Bulgarians I’ve encountered seem embarrassed by these Communist remains, brushing the entire period off as ‘experiments in socialism.’

They’re looking to the future now, and they’re cautiously optimistic.

When you survey the various countries in the former Soviet bloc, it’s a truly mixed bag. East Germany, for example, enjoys a lavish economy after being successfully reunited over 20-years ago thanks to an incredible amount of aid and support from the West.

Slovakia has spent the last two decades creating a manufacturing powerhouse for the rest of Europe, and its citizens today enjoy a much higher standard of living than before.

Estonia built a very successful knowledge and services economy by establishing a limited, low-tax, business-friendly government. When Mart Laar took over as Prime Minister after Estonia’s independence in the 1990s, the only economic text he had ever read was Milton Friedman’s Free to Choose. It’s fortunate for his country that it wasn’t Keynes.

Belarus descended even further into totalitarianism; Aleksandr Lukashenko, the country’s first democratically elected president since the fall of the Soviet Union, has remained in power ever since, effectively seizing dictatorial control over every aspect of the economy and society.

Ukraine continues to vacillate between revolution, corrupt cronyism, and economic collapse… yet the country still has a lot of potential thanks to its resource wealth and talented young work force.

Bulgaria, from where I write this letter, is an interesting case. As the poorest member of the EU, there is a lot of opportunity at face value. Labor is dirt cheap. Property is dirt cheap. Living costs are a joke. English is widely spoken and is, in fact, more prevalent than Russian in the capital city.

More importantly, the government is finally beginning to privatize some of its state-owned companies, as well as make some business-friendly decisions related to taxes.

Now, this is not a part of the world where tax compliance is particularly strong. The immediate post-Soviet years turned the entire region into a veritable Deadwood, and devoid of any functioning tax authority, people got used to dealing in all cash and keeping 100% of their earnings.

Several governments, including Russia, Ukraine, and Bulgaria, have tried to make compliance easy by slashing tax rates. At just a 10% flat rate for corporate, individual, and capital gains, and just 5% on dividends, taxes in Bulgaria are now so low that some people might actually pay.

For foreigners, it’s a boon. Bulgaria has an extensive network of tax treaties with countries acrossWestern Europe, Canada, and the United States which ensure foreign-owned Bulgarian companies are only subject to the 10% rate.  Using this ‘tax rate arbitrage,’ multinationals keep a large part of their earnings offshore in lower tax jurisdictions.

At present, a number of multinationals have set up overseas headquarters and manufacturing facilities in Ireland to take advantage of that country’s low tax rate of 12.5%.  Given Ireland’s pending bankruptcy, however, the government is under pressure to raise this rate… and I expect that this will drive a number of companies to move operations to Bulgaria.

Given the country’s low tax rates, cheap minimum wage of just $185/month, and business-friendly policies, Bulgaria is a reasonable alternative for companies that want to stay within the EU’s customs union. Bulgaria is, after all, an EU member… though they likely fabricated their financial statements to gain entry in the same way that Greece did.

Simply put, Ireland’s decline will be Bulgaria’s gain, and the influx of foreign investment will be of great benefit to this economy and asset prices.

Meanwhile, entrepreneurs and investors looking to capitalize on offshore tax treaty advantages, cheap talent, and a cost effective European base may want to consider Bulgaria for their needs.


Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com 

Sovereign Man Notes from the Field Date: June 24, 2011 Reporting From: London, England

In Business, Business/Political Trends Worldwide, Expatriation, Government, History, Interesting places, Money and Finances, Offshore accounts, Personal, Political, Political parties, Taxes, Travel on June 27, 2011 at 12:18 pm

Sovereign Man

Notes from the Field

Date: June 24, 2011
Reporting From: London, England

A few days ago, I met with a brilliant young geneticist who has been able to devise a unique, cost efficient way to test for the presence of particular genes.

He wants to offer a service to test for CCR5-delta 32, a particular mutation of a gene found in Northern Europeans (and those of Northern European descent) that has shown resistance to Smallpox, HIV, and West Nile virus.

Among people in high risk groups for such infections, demand for getting test is strong, and his method has been able to reduce the cost of testing by up to 90% with no increase in error rate.

Rather let the idea fester in academia for the next several years, he’s decided to go into business… and I’m considering making an investment in the venture.

Another entrepreneur I met with has a website that sells electronic cigarettes in the UK. If you haven’t heard of this, it’s a device that looks, feels, and tastes like a cigarette, but produces water vapor instead of smoke.

It also gives the user complete control over the amount of nicotine s/he wants to ingest, making it a great tool for people who want to gradually wean themselves off the chemical.

This particular entrepreneur noted that a large number of Brits who currently smoke are trying to quit. The British economy is weak, and faced with declining income, Brits are cutting spending wherever they can, especially expensive habits like smoking.

Even in this weak economy, he is doing brisk business and sales are growing.

I’m telling you these short stories because I want to address an important point: even in dismal economic conditions, opportunities abound as long as you can still find a way to create value. These are just two examples.

On to this week’s questions. First, KC asks, “Simon, at a recent conference I asked a famous expat personality about buying and storing gold in the southern cone of South America (Chile, Argentina, or Uruguay). He and his associates could not provide specifics and suggested that I ask you. Any thoughts?”

Of the countries you mention, Chile is the best option for buying gold. In downtown Santiago, some of the money exchange houses (casas de cambio) display placards with “moneda de oro” (gold coins). Because they sell informally, they are not required to collect any VAT, and premiums can be as little as 1% over spot price.

There is no set figure, so it’s best to shop around from place to place and negotiate your own deal.

Private storage options in Chile are limited, though, and it’s difficult to open a safety deposit box at a bank without residency.

Of the other countries, Fort Box in Punta del Este, Uruguay is a good storage option but if you travel to Uruguay you have to declare any gold that you bring in. As for buying in Uruguay, I saw several Indumex locations that had inventory to sell when I was in the country recently, though prices are much higher than Chile.

I wouldn’t trust Argentina for either buying or storing; the government is just too crazy, and asset seizure is a distinct possibility there.

Next, Rob asks, “As far as Chile and all the positives you have brought to light, how would you address the recent volcanic eruption?”

I’ve addressed natural disasters in Chile a few times, and it’s not something that I want to be cavalier about… but the truth is that the safest place to be when a Chilean volcano erupts is in Chile. Argentina is screwed, but Chile moves along without a wince.

This is because the prevailing Pacific winds generally blow from west to east, towards Argentina. In fact, most of the post-eruption ashfall photos that were circulated in the press a few weeks ago were actually from Argentina.

There are a handful of tiny villages in Chile that are settled at the foot of some volcanoes, and a few of these were evacuated in case of lava flow.

Last, L.T. writes “I am a subscriber to Tim Staermose’s 4th Pillar service. My US-based broker will not allow me to buy one of his recent recommendations because it’s an online gaming company. Do you have any suggestions?”

Yes. Take your money and your business elsewhere. What an absolute farce.

Will your broker let you buy Philip Morris? A weapons manufacturer? Casino stock? Booze purveyor? Things must be loopier than I thought in the financial system if brokers have to approve your orders.

If I were in your shoes, I’d look offshore to a broker that works for YOU, not the other way around.

I’ve made a number of recommendations in Sovereign Man: Confidential, and Tim has done the same in his 4th Pillar service… which, if I may brag, delivered yet another winner to its subscribers this morning, closing out a low-risk, 13.6% gain in just 30-days with the successful takeover of Territory Resources (ASX:TTY).

Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com
This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: April 22, 2011 Reporting From: Santa Cruz de la Sierra, Bolivia

In Business, Business/Political Trends Worldwide, Expatriation, Government, Money and Finances, Offshore accounts, Opportunity, Taxes, Travel on April 22, 2011 at 4:40 pm

Sovereign Man
Notes from the Field
Date: April 22, 2011
Reporting From: Santa Cruz de la Sierra, Bolivia

Fortune smiles upon Santa Cruz. With abundant natural gas reserves that generate immense wealth for the local economy, some of the best weather in South America, and more beauty queens per square block than anywhere else on the planet, Santa Cruz should indeed a fantastic place to be.

Enter Evo Morales, Bolivia’s socialist president.

After his election in 2006, Morales helped pushed a new constitution through national referendum, that, among other things, restricted private land ownership and declared all natural resources to be the exclusive dominion of the Bolivian people (managed by the state, of course).

Morales took off on a nationalization binge, taking over assets owned by France’s GDF Suez, UK’s Rurelec, Italy’s Telecom Italia, Spain’s Repsol YPF, Brazil’s Petrobras, France’s Total, Switzerland’s Glencore, and a host of other international resource companies.

Each time this happens, Morales declares a major victory for the Bolivian people, promising to redistribute the wealth and improve everyone’s quality of life.

There’s just one problem with this model: Politicians make terrible CEOs.

They excel at destroying productive capacity, not creating value. They have absolutely no idea how to run companies or manage assets, so even if the goal is to redistribute profits among the people, they don’t know how to generate profits to begin with!

If they’re lucky enough to make any money at all, they first line their pockets with cash and then sprinkle the remaining crumbs among their constituents.

Over time, the assets get neglected. No money is allocated for development, maintenance, and exploration… until one day, all they’re left with are dry holes in the ground.

This is already happening in Bolivia, which ironically just sent a major delegation to the recent PDAC mining mega-conference in Toronto to lobby for new foreign investment.

These people must crazy– first they steal all the foreigners’ assets, then come back to the table and ask them for more money?

It’s easy to chuckle about the goings-on in Bolivia and think ‘that could never happen here.’ But fact is, it can happen everywhere, even in your home country. Politicians only know how to confiscate wealth, not create it… and the more desperate they become, the more they’ll take.

On that note, let’s start this week’s questions with MEH, who asks, “Simon, where can I find information about moving an IRA or other retirement savings overseas, if possible?”

If you’re a US taxpayer with an IRA, one of the best decisions you could ever make is to move it overseas. The country is going further and further into debt, and they’re running out of options fast.

The $5+ trillion sitting in managed retirement accounts is too irresistible for politicians. Just like Evo Morales, they want to take over private assets and manage them ‘for the benefit of the people.’

What a bunch of baloney.

The best vehicle to move retirement accounts offshore, away from the politicians’ control, is called an Open Opportunity IRA. You can also do a lot of really interesting things– buy gold, buy foreign property, and really boost your investment returns. You can read more about this here.

Next, Dr. Adel asks, “Simon- I am a surgeon practicing in LA. I’m tired of Los Angles and the deteriorating medical system in the States. I’m looking for a place to relocate and Paraguay sounds like it may be a good place. Is there is a need for a foreign doctors in Paraguay?”

Definitely. The nice thing about the healthcare industry is that it’s in high demand everywhere in the world. Paraguay does have a need for more qualified physicians, and the certification hurdles are much, much lower than in other countries that I’ve seen.

The other advantage is that there is a loophole in Paraguay’s residency procedure that streamlines the process for foreign professionals who commit to working in Paraguay. You could be on your way to second citizenship in no time.

Last, Norman asks, “Simon, regarding the recent article about learning new skills, what do you think are the most critical languages to learn in the 21st century? I imagine Mandarin is one, Spanish is probably another (especially in the USA), are there any others?”

True, conventional wisdom will say Mandarin, Russian, Portuguese, and Spanish. Any of these would make a fine choice. Remember, though, the idea is to be able to add value internationally. It’s one thing to recognize that there is a lot of wealth in Russia, Brazil, and China… but think about where the action will be.

In resource-rich southeastern African nations like Tanzania, Rwanda, Mozambique, and Kenya, they speak Swahili (which is a really beautiful language, by the way). In Sudan, they speak Arabic. In Kazakhstan, they speak Kazakh (and Russian). In Mongolia, they speak Mongolian.

These may all prove to be exceptionally useful as well, particularly if you’re aiming to be a go-to facilitator on the ground.

Have a great weekend.

Simon Black
Senior Editor, SovereignMan.com

This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: April 21, 2011 Reporting From: Asuncion, Paraguay

In Business, Continental Travel, Expatriation, Money and Finances, Opportunity, personal and business, Travel on April 21, 2011 at 1:55 pm

Sovereign Man
Notes from the Field
Date: April 21, 2011
Reporting From: Asuncion, Paraguay

A friend of mine here in Asuncion owns one of the leading investment firms in town. We were having drinks at my hotel the other evening talking about events around the world and thinking about what might happen next.

At one point he told me, “You know, I really feel like the decline of the dollar is going to cause a lot of problems in the world– rising prices, currency imbalances, social unrest… I feel very safe here in Paraguay though because we have everything we need: food, water, and energy.”

He’s right. Paraguay, usually overlooked, really does have just about everything that it needs. There is so much land here available for livestock or crop production, and the country sits atop one of the world’s greatest freshwater aquifers.

Meanwhile, businesses are feverishly growing alternative fuel crops, and Paraguay also boasts the largest hydroelectric facility in the world with an annual capacity of roughly 90 TWh; they use only a tiny fraction and export more than 85% to neighboring Brazil.

Paraguay’s economy has benefitted from rising commodity prices and overall regional growth… and despite the government’s occasional left-leaning saber-rattling on behalf of the rural poor, politicians generally tend to stay out of the way.

Paraguay’s tax burden (as a percentage of GDP) is among the lowest in the world at around 12%, the same as Hong Kong. It’s 28% in the US and averages 35% among OECD members. For this reason, Paraguay is a mini tax haven… but not on anyone’s radar.

Paraguay’s individual income tax (first established in 2010, then temporarily suspended) is only 10%; it affects only the higher income earners, and it only applies to income sourced within Paraguay, not worldwide income.

I’ve read a few blogs that say Paraguay does not have an income tax. This is simply incorrect… one of the many inaccuracies I’ve been seeing lately from new monkey see, monkey do expat sites.

The Internet is both a blessing and a curse… and this is the curse– massive factual inaccuracies. The digital world has created a wiki-reality: if enough people believe it, then it must be true.

Internationalization is a rising trend and a lot of new ‘experts’ are jumping on the bandwagon. Unfortunately, this is leading to a lot of misinformation that gets recycled over and over across the blogosphere like a series of rip-off infomercials.

Here’s the truth– establishing a second residency overseas is a great idea; it ensures that you have a place to go should you ever need to leave your home country, and it can even lead to an eventual second passport. Note: “second residency” doesn’t necessarily mean that you have to spend time there.

Places like Paraguay are ideally suited for a second residency. Why? Because of the country’s political stability, energy and agricultural sustainability, low tax environment, and straightforward immigration procedure.

Make no mistake, though, there is an immigration procedure. Some people seem to think that you just show up, put some money in the bank, and apply for a passport. This is utter nonsense, and I always get a chuckle when I read such advice from people who obviously have little experience in the country.

I wrote about this at length in February’s premium letter and even flew one of my local Paraguay contacts to our recent offshore workshop in Panama. Needless to say, he was a popular guy at the event and has been quite busy in the past few weeks assisting many of our subscribers with their own residency here.

In the interest of accuracy and hopefully stopping the spread of misinformation, I’d like to provide a short summary of Paraguay’s immigration procedure:

1) Obtain necessary documents from your home country, including a clean police report, birth certificate, marriage/divorce certificates as applicable. All need to be certified by the Paraguayan consulate that oversees the document’s issuing jurisdiction.

You’ll also need to provide a bank reference letter, and, depending on your passport (US and Canadian), a tourist visa to Paraguay.

2) Travel to Asuncion and submit your application in person. Among other things, this requires establishing a local bank account with at least $5,500. Local bank rates are currently around 4% in USD, up to 12% in local currency. You’ll also need a medical screening and various other requirements on the ground.

3) The permanent residency application takes up to 4-months to be approved, though it can be much less if you use a well-connected facilitator.

4) After three years as a permanent resident, you are entitled to apply for naturalization.

Clearly there are a lot more details and many situations that must be reviewed on a case-by-case basis. For example, do you hold a different citizenship as your country of birth? Do you require proof of funds? These may impact the situation.

As with most things, immigration procedure in Paraguay is all about who you know. The right contacts in Paraguay really streamline (NOT circumvent) the process.

Naturally, everyone pretends to be well connected. I can’t tell you how many places I’ve been where people claim to have an ‘in’ with the President.

Just like relying on misinformation, working with the wrong people is a surefire way to lose money… or worse… get caught up in some illicit forgery or bribery scandal. It’s simply not worth it.

Trusted contacts are worth their weight in silver.

Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com

This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: April 20, 2011 Reporting From: Asuncion, Paraguay

In Business, Expatriation, Money and Finances, Offshore accounts, Opportunity, Travel on April 20, 2011 at 2:58 pm

Sovereign Man
Notes from the Field
Date: April 20, 2011
Reporting From: Asuncion, Paraguay

My friend Arthur Tyde in the Philippines once quipped over dinner, “Manila is what Hong Kong would look like if it were turned over to the Mexicans…” I’ve always chuckle when I think about that.

If I may impose on the analogy, I would describe Paraguay as what Arkansas would look like if it were turned over to the Philippines: part tax haven, part agricultural powerhouse, in a better fiscal position than its peers, slightly underdeveloped, cheap, and lots of potential.

Nobody really knows anything about Paraguay. Ask your neighbors, they’ll probably think it’s in Africa.

The first thing you should know about Paraguay is that the country is the size of California. It looks tiny on a map– probably because it’s surrounded by Bolivia (the size of Alaska), Argentina (the size of Mexico and Central America), and Brazil (the size of the United States)– but there is a LOT of land here.

That is exactly what’s attracting companies like Monsanto, Philip Morris, Cargill, etc… cheap farmland. Staple exports from Paraguay include cotton, soy, tobacco, coffee, sugarcane, corn, beans, peanuts… you name it.

In northwestern Paraguay is the ‘Chaco’ region. It’s no man’s land. You might get water, you might not. You might get roads, you might not. You might get title, you might not. But boy is it cheap… You can pick up hundreds of acres for just a few thousand dollars, and they’re happy to take US dollars.

(as an aside, I find this incredible because Paraguay’s currency, the guarani, has appreciated 25% against the dollar over the course of the year… and it’s data points like this that make me believe that the financial system as we know it absolutely has to reset…)

Chaco property is typically used for cattle operations, though there are now several fuel crop candidates like Jatropha (used in producing biodiesel) that are showing tremendous resilience.

The other interesting thing about the Chaco is that Paraguay actually fought a war with Bolivia over the region. Early in the 20th century, locals were convinced that there was oil underneath the brush land. There wasn’t. 100,000 people died fighting for grazing land.

The valuable agricultural land in Paraguay is in the east of the country. Why? Because that’s where the water is.

The Guarani Aquifer is among the largest underground water resources in the world with roughly 10 QUADRILLION gallons (10 million billion) under the earth. The aquifer supplies Paraguay, Brazil, Argentina, and Uruguay with the most vital of all natural resources.

By comparison, however, land in Eastern Paraguay is much cheaper than its regional neighbors. It’s expensive by local standards, but I have yet to see anything for more than $1 per square meter (roughly $4,000 per acre), and most of what I’ve looked at is in the neighborhood of $0.15 to $.40 per square meter ($600 to $1600 per acre).

This is an opportunity. Farmland is an inflation hedge that is often described as ‘gold (or silver) with yield’; its prices tend to mirror agricultural commodities, and it generates income from the crops that it produces.

Relative to its peers, though, Paraguayan farmland is substantially cheaper. In one extreme example, a piece of land in Brazil right on the border with Paraguay was selling for roughly $2.50 per square meter. Just over the Parana River in Paraguay, the same type of land was selling for just $0.80 per square meter.

Those unfamiliar with the region may cite political differences, currency fluctuations, or cultural norms. They might even start quoting efficient market hypothesis, claiming that something must surely be wrong with the Paraguayan property.

Tell that to the Brazilians and Argentines who are buying property in Paraguay. Or to the multinationals.

Paraguay is where the value is. As an inflation hedge, this is like buying silver for $15 instead of $45.

Sure, Paraguayan farmland might be more like the lesser-known 3-ruble Saint George the Victorious silver coin from Russia, instead of the more famous American $1 Silver Eagle, but the bullion value is just the same.

I’ll have a lot more information
in an upcoming Sovereign Man: Confidential about how to make lucrative agriculture investments in Paraguay– effectively, how you can buy silver for $15/ounce.

Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com

This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

Sovereign Man Notes from the Field Date: April 4, 2011 Reporting From: Santiago, Chile

In Business, Expatriation, Government, History, Interesting places, Opportunity, renminbi currency, Travel on April 4, 2011 at 7:30 pm

Sovereign Man
Notes from the Field
Date: April 4, 2011
Reporting From: Santiago, Chile

I have a little secret that I’m going to let you in on, it’s one of the ways that I meet people and get networked while traveling internationally. Over time, I’ve found that, if you want to connect with influential insiders, you have to go where influential insiders are.

Country clubs are not my scene… they’re stuffy, formal, and usually take too much time to acquire a membership. Health clubs, on the other hand, are a great place to make contacts. Gyms are partly social by design, a place where people naturally gather and shoot the breeze in between sets, or before/after demonic spinning classes.

It’s also a place where you can interact with people out of their element– the big powerful CEO is just another sweaty fat guy in tight shorts, and it’s much easier to approach and strike up a conversation with him at the gym’s water cooler than trying to work your way onto his office calendar.

Exactly for this reason, I tend to seek out the most expensive gyms in town when I travel… it’s not because I have particularly fancy tastes (I don’t), but because I go where they go.

Here in Santiago, it’s a place called O2 in Las Condes. I get a twofer because it’s part of the W Hotel complex, so I end up mingling with the well-to-do foreigners who come into town.

Yesterday that happened to be members of several of the bands who appeared at this weekend’s Lollapalooza music festival– Flaming Lips, Killers, Jane’s Addiction, etc. You may recall this networking concept of ‘the open door’ from our Network Infiltration Report.**

What I’ve noticed over the last few months, though, is that there is an emerging trend of wealthy foreigners coming to Chile from Asia, specifically mainland China. The two obvious reasons they’re here are copper and lithium, of which Chile has the largest reserves in the world.

Both of these metals are critical for continued production, and companies from China are sending over their purchasing managers to lock up supply.

(I suspect that, in time, the two countries will begin settling their cross-border trade in pesos and renminbi instead of increasingly worthless dollars. In fact, QE3 may be the catalyst which ends the US dollar’s reign as the prime currency for cross-border trade settlement.)

The other reason there are so many Chinese here is that they’re looking for property, specifically farmland. Topsoil is being destroyed at an alarming rate in China, whether due to environmental and weather factors, rapid urban development, or soil depletion.

The agrarian lands in northern and western China are engulfed in a dust bowl that dwarfs the 1930s dust bowl in the United States… and compounding the problem is the country’s growing water crisis.

It’s been no secret that the Chinese have been scooping up cheap resource-rich property and assets across Africa’s corrupt nations. On a risk-adjusted basis, however, Latin America is a much better investment, and the number of boots on the ground here shows that they’re starting to realize that.

Comparatively speaking, Latin America lacks the political risk of Africa. Sure, there are a few left-leaning big mouths down here… but this is a negligible risk for people coming from Beijing. And in terms of price, Latin American property is some of the cheapest in the world.

I’ve written before about property that sells for as little as $25/acre. Certainly, the titles aren’t as crystal clear as what westerners are used to in North America and Europe where records can date back to the 1600s. But for Chinese investors who are used to dealing with gun-toting 13-year olds in Africa, such deals are a sound investment.

Best of all, many countries in Latin America like Uruguay and Argentina still transact property deals in US dollars, so Chinese investors who are sitting on a pile of hot potatoes have a willing seller who will accept their worthless paper for something of value. Bonus.

Here in Chile, I’ve seen land in the remote south of the country for $200 to $2,000 per acre, depending on the size, distance to infrastructure, and carrying capacity. It’s more expensive than in places like Ecuador or Paraguay, but the rule of law is stronger in Chile, and I suspect that the Chinese are willing to pay a bit more for extra protection.

As I am looking for property myself down here, I expect to find out more about what they’re buying, and where… and I’ll report back what I learn.

** Speaking of ‘open doors’ don’t forget about our Atlas 400 information teleconference, tomorrow, Tuesday April 5th at 3:00pm Eastern Time. You can sign up to receive the call-in instructions here.

Until tomorrow,

Simon Black
Senior Editor, SovereignMan.com

This article appears courtesy of SovereignMan.com: Notes From The
Field
, a free newsletter dedicated to individual freedom,
internationalization, asset protection and global finance. For a
complimentary subscription, visit http://www.SovereignMan.com

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