Real Estate

Why Foreign Real Estate is a Grand Slam

Posted by Nick Giambruno

on Wednesday, 4 February 2015 16:18

Screen Shot 2015-02-04 at 7.48.27 AMA grand slam in baseball, as many of you know, is a home run that is hit when the bases are loaded, in turn scoring four runs. It is the most potent move possible in a single play.

In a similar sense, obtaining real estate in a foreign country is an international diversification grand slam – it can accomplish four key goals all at once:

1. Move Savings/Wealth Abroad

Owning foreign real estate moves your savings and wealth offshore and therefore outside of the immediate reach of your home government. Unlike an intangible financial account, it is highly unlikely for your foreign real estate to be seized at the drop of a hat by your home country, without a literal act of war.

2. Create Other Internationalization Options

In most cases, owning foreign real estate in a country provides a valid justification for you to open a financial account in that foreign country (whereas you may not have been able to before). Obtaining real estate in a foreign country usually gives you some sort of residency, sometimes a shortened path to citizenship, and in the case of one particular country, immediate citizenship and a coveted second passport with visa-free travel to over 100 countries, including the Schengen Area (26 European countries). Owning foreign real estate provides you with a second home, potentially a place to retire, and an emergency “bolt-hole” that you could, in an instant, always escape to in case of trouble in your home country.

3. Portfolio Diversification

Foreign real estate is a tangible hard asset that has diversification benefits for a traditional portfolio of stocks, bonds, precious metals, etc. It has the potential for capital appreciation as well as the ability to generate cash in-flows in a foreign currency from rental income.

4. Privacy and Tax Benefits

Owning foreign real estate is one of the very few ways that Americans can legally keep some of their wealth abroad while retaining their financial privacy. If the foreign real estate is held directly in your name (i.e., not in a trust, LLC, real estate fund, partnership, etc.) it is not reportable (although any rental income must be reported). Additionally, certain expenses related to searching for, purchasing, and maintaining foreign real estate are tax deductible for Americans. As always, be sure to consult your tax professional.

Of course there are downsides to investing in foreign real estate, including the amount of paperwork usually required, its illiquidity, carrying costs, and country/market specific risks, among others. However, when those risks are weighed with the benefits above, it should be clear that owning foreign real estate is one of the best ways you can diversify your political risk.

Be sure to get the free IM Communiqué so that you have the latest on the best foreign real estate options.

One expert on foreign real estate whom we’d highly recommend is none other than Doug Casey, the original International Man. Doug’s been to over 175 countries and invested in real estate in a number them. He wrote a thick and detailed chapter on foreign real estate, including his favorite markets, for our Going Global publication, which is a must-read for those interested in this extremely important topic.

 

The article was originally published at internationalman.com.

Apparently You Can’t Just Surrender In a Currency War

Posted by John Rubino - DollarCollapse.com

on Wednesday, 4 February 2015 16:15

UnknownTwo weeks ago Switzerland abruptly decided that it couldn’t keep buying billions of euros every month just to maintain a somewhat arbitrary peg with that currency. It stopped trying, allowed the Swiss franc to trade according to market forces, and watched it soar.

At the time there was some question about whether an export-centric economy like Switzerland could handle a soaring currency’s impact on its major industries. In other words, is it even possible to surrender in a currency war?

This week we got an answer. At least for Switzerland, it is not possible. From Bloomberg:

Switzerland Rejoins Currency Wars

Two weeks after Switzerland stunned currency traders by abandoning the franc’s peg to the euro, it seems that the central bank is quietly getting back in the market. With central banks from Denmark to Singapore to Canada easing monetary policy in recent weeks, the Swiss authorities face an even bigger battle trying to restrain their strengthening currency.

The Schweiz am Sonntag newspaper said during the weekend that the Swiss National Bank is now targeting a corridor rate for the franc of 1.05 to 1.10 per euro, compared with the 1.20 level it abandoned Jan. 15. The bank is declining to comment; but if it is trying to keep the franc from becoming stronger than that level against the euro, it seems to be struggling to drive the currency into the desired range:

The aftershocks of the peg abandonment, which triggered squeals of horror from Swiss exporters, are still rumbling through the nation’s economy. Figures released yesterday showed that a benchmark index of manufacturing activity slumped to 48.2 in January, down from 53.6 a month earlier and undershooting economists’ expectations for a 50.6 reading. A number below 50 signals contraction, and every component from order pipelines to stocks of goods to employment declined. The manufacturing survey was taken just after the currency defense was abandoned, according to Martina von Terzi, an economist at Unicredit in Munich. She expects the Swiss economy to grow by just 0.1 percent this year, with quarter-on-quarter contractions of 0.7 percent in the first three months and 0.3 percent in the second. So it’s clear why Switzerland doesn’t want an appreciating currency to trash its economy.

Having retired once with a bloody nose, however, it isn’t clear why the Swiss central bank thinks it can rejoin the fray without taking another beating. Maybe it hopes that the currency traders who lost millions of dollars when the peg was dropped won’t dare to speculate again on the franc. Maybe it considers 1.05 francs per euro defensible in a way that the old peg of 1.20 wasn’t. Maybe it anticipates less pressure now that the European Central Bank has finally conceded to the need for quantitative easing.

Bloomberg nails the two main points here. First, allowing one’s currency to soar is the same thing as importing the rest of the world’s deflation. As a consequence, your exports plunge, manufacturing slows, the economy dips into recession and leaders get tossed out in the next election.

Second, keeping a currency weak enough to be “stable” in an aggressively devaluing world depends, in part, on the markets believing that you’ll follow through. Everyone is pretty certain that the eurozone and Japan, for instance, are going to flood the world with their currencies in 2015, regardless of the consequences. But the Swiss, having burned foreign exchange traders big-time just two weeks ago, have a lot less inflationary credibility. So now, as they try to maintain their new peg (calling it a “corridor” doesn’t change the reality of the policy), foreign exchange traders are happily buying up all the new francs that the Swiss National Bank creates, assuming the same pressures that caused the last surrender will cause the next one. They’re probably right, making the franc a really good bet for another 20% pop in the year ahead.

So now the question becomes, once you’ve tried to surrender in a currency war, is it possible to rejoin the fray? We’ll see. Either way, the Swiss are earning their own chapter in future economics textbooks.

US$ weakness was the order of the day

Posted by Andrew McGuire - Agility Forex

on Wednesday, 4 February 2015 16:10

The USD weakened versus most pairs yesterday and there was a general increase in risk appetite across asset classes.The brighter outlook may have been attributed to a less confrontational  tone being portrayed by Greek officials as relates to its debt negotiations. A cut in the required reserve requirement by the Peoples Bank of China on the back of tighter liquidity conditions follows on the back of a surprise interest rate cut by the Reserve Bank of Australia earlier in the week.Surprisingly,after a very volatile session which saw new lows in the Australian dollar,it managed to finish higher than before the rate cut. UK and European PMI data and retail sales data released today,were generally positive and supported  the recent strength in the EUR & GBP. This morning brings ADP employment report in the US and PMI release in the US & Canada.

Strength in crude prices and general USD weakness supported a very strong performance in the Canadian dollar which traded as low as 1.2352 yesterday. With crude weaker by 3% this morning the loonie is under some pressure.

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  1. Gold is off to a great start this year. Please  click here now. That’s the daily gold chart, and it looks superb.
  2. The strongly bullish technical action reflects the positive fundamentals of the gargantuan Chinese and Indian jewellery markets. Those two nations are the main price drivers of the “gold bull era”. 
  3. Gold is also attempting to stage an early morning breakout from a small drifting rectangle pattern, which is good news. The “Queen of Metals” tends to have strong rallies following the release of the monthly US Employment Situation report. The next one is scheduled for Friday morning, at about 8:30AM.
  4. Gold tends to be a bit soft going into the release of each jobs report, so this morning’s breakout should not be regarded as absolutely definitive. There could be a bit more softness over the next few days, before a fresh intermediate trend higher gets underway.
  5. Regardless, the target of the large ascending triangle in play is the $1350 – $1375 area. 
  6. While India and China are the main drivers of the gold bull era, holdings of Western ETFs have started to rise. That’s adding some “spice” to the bull era.
  7. Please  click here now. That’s a snapshot of the SPDR fund holdings (GLD-NYSE). The fund began the year holding about 700 tons. It now has about 766.
  8. As 2014 began, I predicted that gold would rally strongly on the taper, stunning the bank economists, and then trade roughly sideways, for the rest of the year. I also suggested that SPDR fund holdings would decline from the 800 tons area, to about 700. 
  9. That’s almost exactly what happened. For 2015, I see a gradual rise in SPDR fund holdings, probably to about 900 tons. Value-oriented institutions will likely replace action-oriented hedge funds, as the main ETF buyers.
  10. I see much more gold-positive news coming out of both China and India in 2015. If India chops the import duties in the upcoming budget (roughly scheduled for February 28), there’s a good chance that gold stages steady price advances against the dollar, during every single calendar month of this year.
  11. Many readers have noticed that the price of gold tends to be stable in the early evening when China and India dominate the trading. Then, at about 3AM New York time, as Asia goes quiet, gold often sells off, and sometimes quite violently.
  12. Asian trading is jewellery-oriented, so the price action tends to be generally very calm, often with a mild upwards price bias. In contrast, Western trading tends to revolve around anything but jewellery. 

     

  13. There is some good news in play now, for those investors who believe gold should trade in a more stable manner, with a steady upside bias to the price action.
  14. To view that news, please  click here now. The entrance of Chinese banks into the LBMA price-discovery process is very good news, and should bring needed stability to the global gold market.
  15. Gold is arguably already fundamentally stronger and more stable now, than at any point of time in world history, and silver looks even better.

     

  16. Please  click here now. That’s the silver chart. I’ve used 8 hour bars, to add fine detail to the price action.
  17. A beautiful inverse head and shoulders bottom pattern is in play. The neckline is sloping. Rather than single price points, I use target ranges for all patterns with sloping necklines. 
  18. If you want to know why I do that, send me an Email to stewart@gracelandupdates.com and I’ll send you a brief explanation about setting head & shoulders pattern targets. Thank-you.
  19. My target range for silver is the $20 – $22 area. From the $14.25 area lows, a move to just the lower end of the target range would be a gain of about 40%!
  20. Please  click here now. That’s the GDX chart, using 3 hour bars. 
  21. From a technical standpoint, that chart is “drop-dead gorgeous”. A bullish double bottom pattern has morphed into an even more bullish double-headed inverse head and shoulders bottom, with a target zone of $25.50 – $28!
  22. A chop in the Indian import duties will add tremendous legitimacy to gold stocks ownership. Here’s why: Conservative institutional money managers like stability and consistency. Huge amounts of gold currently move through the mafia-controlled black markets of India. That’s not an environment that is attractive to mainstream money managers.
  23. A sizable and permanent chop in the duties will dramatically reduce the role of the mafia in the world’s largest and most inelastic gold market. Also, falling oil prices have reduced the cost of producing gold, for most gold mining companies. 
  24. With lower costs on the supply side, and a free and legal market on the demand side, I expect Western institutional money managers will be steady buyers of the highest quality gold stocks, all through the next three quarters of the 2015 calendar year. That should produce nicely higher prices for the entire sector. Thanks for your time!

Feb 3, 2015
Stewart Thomson
Graceland Updates
website: www.gracelandupdates.com
email for questions: stewart@gracelandupdates.com 
email to request the free reports: freereports@gracelandupdates.com

Tuesday Feb 3, 2015
Special Offer for Money Talks readers: Send an email to freereports@gracelandupdates.comand I’ll send you my free “Gold Stock ETF Targets!” report. I cover all the main senior and junior gold stock ETFs, with surprising buy and sell target price areas to take action!

Stewart Thomson is a retired Merrill Lynch broker. Stewart writes the Graceland Updates daily between 4am-7am. They are sent out around 8am. The newsletter is attractively priced and the format is a unique numbered point form; giving clarity to each point and saving valuable reading time.

Risks, Disclaimers, Legal
Stewart Thomson is no longer an investment advisor. The information provided by Stewart and Graceland Updates is for general information purposes only. Before taking any action on any investment, it is imperative that you consult with multiple properly licensed, experienced and qualifed investment advisors and get numerous opinions before taking any action. Your minimum risk on any investment in the world is 100% loss of all your money. You may be taking or preparing to take leveraged positions in investments and not know it, exposing yourself to unlimited risks. This is highly concerning if you are an invetor in any derivatives products. There is an approx $700 trillion OTC Derivatives Iceberg with a tiny portion written off officially. The bottom line:

Richard Russell – What To Do When The Financial Hurricane Strikes

Posted by Richard Russell

on Tuesday, 3 February 2015 15:06

As the world continues to digest breaking news out of Greece, today the Godfather of newsletter writers, 90-year old Richard Russell, covers everything from World War II, to God, gold, peace of mind and what to do in a hurricane……continue reading HERE

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