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Thursday, July 22, 2010

The Creating Wealth Show,

By Jason Hartman.

Jason Hartman discusses some of the disadvantages of investing in gold.
Despite the crowd of investors clamoring to join this gold rush redux, Jason is not a fan. In fact, he likens buying precious metals with investing in insurance since neither meets his standards of a true investment, although they are touted as such. If you want evidence, consider that insurance companies turn around and invest your premiums in real estate.
Few would argue that gold and silver are essentially money. Thus, precious metals are equivalent to savings or wealth stores, not investments, and they are vulnerable to the weaknesses inherent in currency. Paper money is also referred to as "fiat" currency, meaning its value is conferred by authority; that is, it is only secured by a pledge. Furthermore, Jason predicts that "Money is in for a long-term loss in value," prone to inflation and subsequent devaluation – similar to what happens with your investment in insurance.
This discussion is prompted by an addition to Jason's list of disqualifiers that make gold and precious metals a bad investment, bringing the total to 7 reasons:
1. In contrast to property investment, there is no financing, thus no leveraging to allow you to build wealth.
2. In contrast to tax deferment opportunities, there is no tax advantage.
3. In contrast to real estate rental, there is no income potential.
4. Your investment is subject to confiscation; arguments that collectible coins are immune from seizure are flawed since there is no guarantee this protection won't ever change.
5. Precious metals are prone to manipulation by those motivated to suppress their value in order to boost paper money.
6. The myth of superior gold liquidity. This argument fails on a couple counts. Proponents tout the facility of buying and selling gold, but there are hidden costs in offers of guaranteed buy-back of gold purchases. When you are ready to liquidate your investment, you'll be penalized with a 1.5% premium for melt-down value, on top of shipping & handling plus insurance expenses. Real estate actually benefits from its lack of liquidity because combined with higher transaction costs, this equates to lower volatility. In contrast, the low transaction costs and high liquidity claimed for precious metals are a perfect formula for greater volatility.
7. If gold does go up in value, the gain is nominal rather than an actual increase in buying power. This is because when gold appreciates it typically coincides with a devaluation for paper money. Moreover, those gold profits are taxable, in contrast with the "most tax-favored" status enjoyed by real estate investment. By exploiting the 1031 tax-deferred exchange it is possible to trade up tax-free with property for a lifetime. Even if the dollar depreciates, your asset appreciates with inflation and you will have locked in a long-term loan that you repay "for free".

Real Estate in Brazil

Investment Prospects Booming

Economic facts and figures from Brazil are improving in leaps and bounds and not a week goes by without yet another positive addition to Brazil’s economic track record. 
This is all excellent news for those planning investment in Brazil, particularly property investors who can rest assured that their property investment in Brazil is one of the best.
So-called ‘green shoots’ are sprouting worldwide on the global economic scene, but in almost every country these shoots are small and there’s no confirmation that they will actually see full growth. However, for those investing in Brazil there are now so many green shoots that growth predictions for 2010 are upgraded on a weekly basis and it seems highly likely that Moody’s will raise its credit rating for Brazil in early autumn.
Speaking at the Brazilian-American Chamber of Commerce in New York recently, the President of Brazil’s Central Bank, Henrique de Campos Meirelles unveiled an impressive package of positive economic data. Meirelles reported that the latest weekly survey among market experts put Brazil’s expected GDP growth for 2010 at 4% based on the latest economic figures. The same survey carried out just three weeks earlier had cited GDP growth at 3.5%. According to Meirelles, the prediction of 4% growth is “not too optimistic at this point”.
In his presentation, Meirelles presented data from several economic areas including fiscal, industrial and social. Among the impressive fiscal data are Brazil’s record international reserves. These currently stand at US$214.8 billion, a historic high and proof that even in the face of global recession, Brazil is still accumulating reserves. Brazil is successfully containing its fiscal deficit, which is expected to reach 3.2% of GDP this year. The deficit for the G20 nations this year is forecast to reach 8.1% with the deficit for the G20 developed countries at 10.2%. Deficit figures for Brazil next year are even better – just 1.3% of the country’s GDP – while G20 developed countries will still be burdened with an 8.7% deficit.
Foreign direct investment (FDI) continues to grow in Brazil and Meirelles reported an investment of US$41 billion in FDI over the last 12 months. Car manufacturing and sales in Brazil are both on a high and the recent increases in car production and sales have brought the industry back to levels seen in early 2008.
Brazil has a fast-expanding middle class (now 53.2% of the population) and part of its economic resilience comes from the dynamic domestic demand. Real earnings in Brazil increased by 3.4% year-on-year in June 2009 and as a result of this higher purchasing power, consumer confidence is steadily growing. Year-on-year retail sales grew by 10.2% in June this year proving that Brazilians really do have more to spend. Credit is also on the increase and this includes mortgages for Brazilian real estate. Mortgage lending by the Caixa Economica Federal increased by 90% during the first half of this year.
Many analysts believe that Brazil may already have emerged from the global recession and come out on the other side. Recent economic figures would seem to back this up. With Moody’s set to raise Brazil’s investment rating based on the country’s “demonstrated resilience to shocks”, Brazil is currently firmly established as one of the best places in the world for investment.

Friday, July 16, 2010


ubi bene ibi patria

If you are thinking of obtaining another citizenship - for any reason - you might want to choose your new country carefully.

There are many "companies" on the internet that offer assistance with acquisition of citizenship in various countries. In many cases, these "citizenship programs" are based on personal connections in state departments of rather underdeveloped countries; with 8 - 10 000 USD you can easily obtain a passport in more than 70 countries. Unfortunately, these passports are normally "cancelled blanks" - the issuing authority regularly cancels (annuls) passports due to orthographic mistakes, or inaccurate handling (many countries still issue hand-written passports). This is how it works: you pay 20 000 USD to a "provider"; they pay 8 000 USD to their contact in the country "X", usually directly in the passport issuing authority, such as Police; this contact cancels a perfectly valid passport blank and fills it in with the information needed. The customer is told that the 20 000 dollars are "invested" into the country's economy, and the citizenship is granted under a special "investment-based" program. In third-world countries, these things are usually very hard to check.

The customer is usually pleased with the passport - which turns out to be absolutely useless at the very first border crossing. If you try to contact the "company" that provided you with the passport, your emails will bounce back, and the phone will sound disconnected.

All you get is a false passport - not even a real passport - and certainly not a new citizenship.

The fact is, it is indeed possible to obtain an extra passport LEGALLY. You just have to make sure that two conditions are satisfied:

1. The whole process is described in a published Law. You might think that it is difficult to obtain the citizenship laws of say, Suriname, but it is not impossible; moreover, if the laws of a country are VERY difficult to consult, it might be a sign for you that your choice of country is a bit extreme, and you should probably consider a more "mainstream" jurisdiction.

2. Your citizenship is confirmed by a Citizenship Grant Certificate (it could have different names in different countries), NOT by the passport. The certificate's authenticity can be confirmed by the Embassy of the country in question. If there's no diplomatic representation in your country, FedEx a notarized copy to the nearest embassy abroad.

Every year, ExtraPassport? issues an "Acquisition of Citizenship" handbook, which lists, on 208 pages, the procedures of obtaining citizenship in over 170 countries. We list legal basis (names and numbers of citizenship laws), criteria for naturalization, regulations, and matters concerning loss of citizenship and dual / multiple citizenship.

Before you pay anybody to provide you with a new citizenship, check if the procedure described by your provider is listed in our Handbook. Remember, if it is not in the Laws of the country in question, then it is NOT legal, in other words, a fraud.

More informations at: