Tag Archive | "mass media"

International Gold Review


This international gold review is a followup to yesterday’s message about maintaining control over your wealth.

Jyske Global Asset Management just changed its gold position so we should take a new look at gold.

Most major governments have deficits in their budget.  This forces them to borrow or print money that is not backed by productivity.  When this happens long term, the purchasing power of  money created in this way, loses purchasing power.

Any form of exchange must possess five qualities to be considered real money that will store value and purchasing power.  These five values that money must be are durable, divisible, portable, desirable and rare.

When a government creates a currency with no production to back it, then that currency loses its rarity and its purchasing power falls.

Gold is one long term way to combat the risk of a falling currency.

Gold is real money because it has all five qualities of real money.

Make no mistake… when it is rare… paper money is better money than gold… because it is more divisible and portable.   Electronic money available in a credit card is even better… the most portable and divisible of all… IF THE CURRENCY MAINTAINS ITS RARITY.

Regretfully for the dollar, euro, yen and many other major currencies, this has not been the case…  so gold still has a place in our portfolios.  Gold as a commodity fits the five standards best of all and for thousands of years has been used as a form of money.

In a moment we’ll look at what might happen to the price of gold in the months ahead.

First, because many readers have asked about bringing gold into Ecuador, I checked with out attorney Andres Cordova in Quito.  Here is his reply: Dear Gary:  After reviewing applicable legislation, we’ve found that there is no restriction on the introduction of gold or coins to Ecuador.

The introduction of such, however, does carry a tariff that is to be charged in accordance to weight or monetary amount. Furthermore, there’d need to be a customs filing in which the gold presentation is to be declared, such as ingots, jewelry, dust, etc. Furthermore, an explanation of where does such gold / coins come from needs to be consigned in such form. If gold is brought with the traveler, then such must be specified in the customs form that each passenger gets before landing in Ecuador.

Gold and coins would pay a tariff of 0.5% and 12% VAT.  However, if we could know exactly what the person intends on bringing to Ecuador we can better review applicable taxes and tariffs. Best regards,  Andres

For those that want physical gold in Ecuador, there is gold mining in Ecuador and are gold dealers. I do not know any  personally. But there are many places with signs that they buy gold. I am researching this and will post a password protected message for our Ecuador Living subscribers.  You can subscribe to Ecuador Living so you’ll receive this report when it is published.

There are three other ways to hold gold than in bullion and coins. These alternatives are less expensive than bullion and avoid the hassle and dangers of carry heavy, valuable precious metals on your person and across borders.  Plus they avoid this Ecuador tax.  We’ll review these options after we examine what might happen to gold’s price in the days ahead.

This article is from the Asset Strategies Alert:

When gold breached the $1,000/oz mark in February of 2008, the mass media were full of reports of unprecedented coin demand and long wait times for bullion buyers. You couldn’t open the paper without seeing a piece about the gold rush.

Although the press has now set gold aside for hotter stories, I can tell you demand for gold coins continues at unprecedented levels worldwide, and production is still struggling to keep up. Take a look at these recent reports:

Sales of the Austrian Philharmonic gold coin soared 544% in the first two months of 2009 (vs. the same period the year before), with production at the country’s mint running quadruple its usual volume.

The demand for Krugerrands is at its highest level since 1986. The South African refinery recently doubled production of blank gold coins to 20,000 ounces per week.

China, now the fastest-growing market for gold, saw 2008 sales (measured in dollars) rise by 50% over the year before – and total sales in January 2009 were one billion yuan (US$146 million), 30% more than all of last year.

The U.S. Mint sold 193,500 one-ounce gold Eagles in the first seven weeks of 2009 – equaling the number shipped in all of 2007 and about matching the first half of 2008.
Russia’s Sberbank says it has “never seen such strong demand for investment coins.”

Swiss banks just reported they are running out of secure storage space for gold bullion held by investors and institutions in their vaults.

I have worked with Michael Checkan at Asset Strategies International, Inc. for many decades and any time I think of gold, I think of him.

Michael’s firm offers one of the the three gold alternatives… Precious Metals Certificate Programs.

Precious metals can be purchased and stored on your behalf through the Perth Mint Certificate Program.  This program offers storage for gold, silver, and platinum at the Perth Mint in Western Australia. This is the only government guaranteed precious metals program in the world… fully backed by the government of Western Australia, and has operated continuously from the same location for over 100 years.

This is an easy and low cost way to hold metals overseas.  You can learn more about these certificates from Asset Strategies with a toll-free call 1-800-831-0007 or 301-881-8600 or visit their website www.assetstrategies.com.

See an interview with Thomas Fischer of Jyske Global Asset Management and Rich Checkan of Asset Strategies here.

Jyske Global Asset Management (JGAM) agrees that gold is a good asset now.  All of JGAM’s portfolios  were overweight in gold last time I reviewed them. . The low risk portfolio had about 5% in gold…. medium risk about 9% and the high risk portfolios were holding about 15% gold.

However JGAM does not invest in physical gold or even undivided bullion. They invest in the ETFS Physical Gold shares.  This is a share traded mainly on the London Stock Exchange  (code PHAU) but also trades on Deutsche Borse (Xetra), NYSE-Euronext, and Borsa Italiana.

The ETFS Physical Gold provides an easy, simple, cost-efficient and secure way to access the
precious metals market.  This share provides a return equivalent to movements in the
gold spot price less fees because the shares are backed by physical allocated metal held by the
Custodian (HSBC Bank USA N.A.).  All the gold held are good delivery bars.

This is a very practical way to own gold, because you can buy the shares direct from any stock broker.   The shares are transferable or sold in the market.  These shares trade on the stock markets just like an equity and their pricing and tracking operate similar to an Exchange Traded Fund except the share tracks the price of physical gold, not a portfolio of equities.

Here is the five year simulated price of these shares from the fund’s fact sheet.

gold-chart

Other ETfs that invest in physical gold are SPDR Gold Shares (GLD) listed on the New York Stock Exchange  in November of 2004, and traded on NYSE Arca since December 13, 2007, as well as  Singapore Stock Exchange, Tokyo Stock Exchange and the Stock Exchange of Hong Kong.

Here is a chart of the SPDR five year performance.

gold-shares

Another ETF that invests in gold is iShares Comex Trust (IAU).

I have just competed a full gold report for our multi currency subscribers that provides a  third alternative to gold bullion and coins.

In the multi currency gold report, I describe the recent change in JGAMs gold position, the profit they made and how Jyske Bank Private Bank and Jyske Global Asset Management can buy gold alternatives.

You can subscribe to our multi currency service and get this report here.

Deficit spending by the major governments around the world has reduced the integrity of the world’s currency system. All currencies risk losing purchasing power.  Gold long term is one way to combat this risk.

Gary

The greatest asset of all is the ability to earn wherever you live, which brings everlasting wealth.

This is why we offer our course Tangled Web… How to Have an Internet Business.

A clear mind and healthy body are also a vital assets… plus a second language is a powerful diversification tool.

This is why I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November our “Tangled Web… How to Have an Internet Business Course” (offered at $299) free.

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Ecuador Iran Excerpt


A number of readers have asked about Ecuador and Iran so here is an excerpt from our latest Ecuador Living report.

Some of the ideas apply to interaction between radicals in all of the Middle East and the West and how they can affect our wealth, business and investing.

The idea that Iran is a great enemy intent on attacking us is great for selling news, but a bad leader or two does not reflect the entire population.  Many of us in the US did not agree with some of the leaders our the last administration.

IF  Iran is to become more involved in the West and that’s a very big IF, I do not see it being any great deal. The only risk Iran poses is if many people give them a lot more concern then they deserve… as certain leaders in the West gave Saddam Hussein.

I do not claim in any way to be a great global military strategist but that thinking has some support from the thinking of other  who I do think are good at strategic global thought such as… Lee Kwan Yew.

I worked and spent a lot of time in Singapore during the late 1960s and early 1970s so I recall vividly the way Singapore used to be.

Lee Kwan Yew had a lot to do with Singapore emerging from a form of colonialism that included a lot of poverty to one of the wealthiest societies in the world.

This means it is fitting to read some of Lee Kwan Yew’s thinking that could apply to Ecuador and Iran now.

Lee Kuan Yew outlines the risks of relying on the local press succinctly in a 2007 interview with  UPI’s editor at large, Arnaud de Borchgrave.

Q: So what is your recommendation about Iran’s nuclear ambitions?

A: Is it now unstoppable. They are a very old civilization. Unlike the Arabs, apart from Mesopotamia valley, they rank with the Chinese, as history’s two principal civilizations worth talking about. And I think the mullahs and others want to go back to the days of empire.

Q: So should we be talking to them at the highest level, the way Henry Kissinger went to China?

A: (Chuckle) But you haven’t got a Kissinger or a Brzezinski to do that anymore. Where is the successor generation of geopoliticians?

Q: In fact, democracies don’t produce great statesmen anymore. Why?

A: You now have, and I don’t know how long this phase will last, mass media domination, owned by a group of media barons who want constant change for their balance sheets.

Q: So the power of mass media has made it impossible for a great statesman or woman to emerge and last any length of time?

A: I’m not sure. It depends on the nature of the crisis that must be faced. When a real crisis sets in, a matter of life and death, opinion formulators realize this is no time to be pontificating, but a time to stay the course with someone who understands what this is all about.   Short of that, the media help put a leader on the pedestal and then start chopping away at the pedestal until he/she falls in disgrace. That’s part of the cycle of constant change. Watch Sarkozy in France. They hoisted him up to prominence and now they’re already attempting to bring him down through his personal life.  Well, yes. But it’s also the enormous pressure of media competition and the giant appetite for advertising revenue, what television program gets what viewership, or eyeballs, or clicks online. Never mind the consequences. If you get the advertising, you win.

Q: When I last interviewed you in May 2001, I asked you what concerned you most about the next 10 years, and you replied, “an Islamist bomb, and mark my words, it will travel.” Four months later, we had Sept. 11. Secondly you said, “China and India’s challenge to the global status quo.” Do you still have the same concerns about the next 10 years?

A: Not quite. The Islamic bomb has traveled already (in Iran). I’m not sure how this will now play out. The U.S., the Europeans, even the Russians, will have to make up their minds whether to allow Iran to go nuclear. The Russians are playing a game, posing as the nice guys with Iran, supplying nuclear fuel, and making it look as if America is causing all this trouble. But if I were Russia today, I would be very worried about Iran acquiring the bomb, because Russia is more at risk than America. The risk Israel runs is another dimension. Russia is at risk because whether it’s the Chechens or Central Asian Muslim states that were former Soviet republics, none are friendly to Moscow. Next time there’s an explosion in Moscow, it may be a suicide bomber who isn’t wearing an explosive belt or jacket, but something a lot bigger. It would certainly be in Russia’s interest to say at some future point to Iran, “this far and no further.” It could also be that Russia no longer knows how to stop it, in which case the Russians will be opening the door to a very dangerous world of nuclear proliferation. You can be quite sure that if and when Iran gets the bomb, the Middle East will go nuclear.

Q: Which raises the question of the United States or Israel bombing Iran’s nuclear facilities.

A: (long silent pause) … I can express no views on that.

Q: As I travel in moderate Muslim states in North Africa, the Middle East and South Asia, I ask heads of state and government how many extremists, or would-be jihadis, they estimate live in their midst, also how many fundamentalists who support openly or secretly the jihadi cause. The answer is usually 1 percent and 10 percent. In a country like Pakistan, that translates to 1.6 million extremists and 16 million supporters. On a global scale, that comes out to roughly 14 million extremists and 140 million sympathizers.

A: Yes, but I do not see them winning, and by that I mean able to impose their extremist system. I can see them inducing fear and insecurity, and causing fear, but they don’t have the technology and the organization to overwhelm any government.

Q: So how do you assess the global threat since Sept. 11? What are we doing that’s right and also that’s wrong?

A: Even if we can’t win, we mustn’t lose or tire. We cannot allow them to believe they have a winning strategy, and that more suicide bombers and WMD will advance their cause and give them a chance to take over.

Q: Did Iraq have anything to do with al-Qaida?

A: Of course not, as became clear in the daily sessions the imprisoned Saddam spent with his Arabic-speaking FBI interrogator over several months before his execution. But U.S. authorities were convinced Saddam was secretly supporting al-Qaida with weapons and training and maybe even WMD. So therefore the imperative became the elimination of Saddam.

A: (Laughs for several seconds) We should learn to live with it for a long time. My fear is Pakistan may well get worse. What is the choice? (President) Musharraf is the only general I know who is totally secular in his approach. But he’s got to maneuver between his extremists who are sympathetic to Taliban and al-Qaida and moderate elements with a Western outlook. We forget that right after Sept. 11 he was given a stark choice by President Bush: either you abandon your support of the Taliban regime in Afghanistan or face the disintegration of Pakistan. There is an interesting study of Pakistan’s Inter-Services Intelligence agency that says 20 percent of the Pakistani army’s officer corps is fundamentalist.

A: There is very little, if anything, the U.S. can do to influence the course of events in Pakistan that wouldn’t make matters worse. Any U.S. interference in Pakistan would result in Pakistan’s four provinces becoming four failed states. And then what happens to Pakistan’s nuclear arsenal? It’s a horrendous festering problem. The Feb. 18 elections may bring a little clarity and hopefully democratic stability to Pakistan, but I am not holding my breath.

Q: So you do feel that NATO’s future is at stake in Afghanistan?

A: No doubt about it. But you should also realize Afghanistan cannot succeed as a democracy. You attempted too much. Let the warlords sort it out in such a way you don’t try to build a new state. The British tried it and failed. Just make clear if they commit aggression again and offer safe haven to Taliban, they will be punished.

Q: If NATO collapsed in the wake of a failed campaign in Afghanistan, would that be a major concern of yours in Singapore?

A: Not immediately, but overall the balance of power would be upset.

Q: In whose favor?

A: China and Russia. They would be faced with a much weakened West in the ongoing global contest. I can also see the danger if America loses heart and says to hell with it all because the Europeans are not helping and the Japanese are blocking this and that, and tokenism from all the others. Let’s not forget that what we’re all enjoying today is the result of Pax Britannica and Pax America over the past 100 years. So don’t give it up.

Q: But in the Gulf, if the U.S. and/or Israel bombed Iran’s nuclear facilities, Iran has formidable asymmetrical retaliatory capabilities?

A: But let me repeat, they cannot conquer you. Hezbollah cannot conquer Lebanon. They can create trouble for the non-Hezbollah Lebanese. So micro actors can cause a lot of trouble for your friends, but they can’t eradicate them.

You can read this entire report as an Ecuador Living subscriber and see why if there were to be a military concern in Latin America it would be over China…not Iran..

ecuador-iran

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There were two articles readers have recently mentioned.

The first article began, QUITO – Iran will finance two new power plants in Ecuador and extend a 40-million-dollar loan for business development, officials from both countries said Thursday, three months after the first visit by an Ecuadoran president to Tehran.

The second:  Iran, Ecuador Eye Military Ties As U.S. Prepares to Withdraw from Airbase Friday, May 29, 2009, by Patrick Goodenough, (CNSNews.com) – As the United States military prepares to vacate an airbase in Ecuador in the fall, the leftist government responsible for its upcoming departure is looking to Iran as a future military partner.

While I do not feel that nuclear power or expanded military might are good things, I do believe completely in the global economy and in expanding the wealth of all.

ecuador-iran

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ecuador-iran

trout pond.

One can argue about all the numerous conflicts in the world but if we boil it down to the few most important, one of the biggest tensions in today’s society is that there are a few very wealthy people and many, many poor.

For decades my premise for economic expansion has been based in part on the belief that most people, if given a choice, will spend their time doing positive things, like working at something they love for increased material wealth and great fulfillment rather than living a guerilla’s life.  A poor soldier’s living conditions are  generally not pleasant… the pay low… the risk extreme.  That life, however, is better than one of complete hopelessness and despair.

If Ecuador Iran cooperation can help make more poor Ecuadorians and Iranians rise out of poverty… I say…”go for it!”

There are many potential and huge benefits to be gained by bringing Iranian business to the West. Maybe Iran being closer to the West will help it integrate?  Current events in Iran suggest that many of the population would be happy to do so.

ecuador-iran

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I have had an opportunity to observe Correa and the people of Ecuador react for a couple of years now.  At times I have been quite close… such as when I took this photo.

Ecuador-photos

Correa is in a strong political situation at this time. One thing that could destroy his popularity quickly would be the perception in this 90% Catholic country that he is introducing Islamic radicalism.  Therefore Correa may line up with Iran for some money… and to gain leverage in his dealings with the West… but a major integration would surprise me very much.   One bombing in an American hotel in Quito or Guayaquil and Correa’s popularity would be toast.

There have been worries about his friendship with Chavez. There are these worries of Correa with Iran. There have been worries about South America pulling away from the US dollar.

Yet so far none of these fears have affected life, happiness, opportunity, real estate values or  law and order in Ecuador.

In short anyone who never heard of or ignored all these fears and moved optimistically forward is better of than those who did not.

Most of the press are writing about the world sliding into recession. Many articles in the Western press make it sound like there’s little opportunity and great danger everywhere.

Good. Their doom and gloom creates positive global investing opportunity for those of us who can see through the illusion.

ecuador-iran

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Regards,

Gary

We hope you’ll join us to learn more business and investing opportunities globally as well as Ecuador.

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