Will the Volt put voltage back into General Motors shares?
Will the new Chevy Volt add energy into an electric investment portfolio?
Probably not… because small is beautiful.
In this era of rapid change a company’s value is its idea… less its size and experience. A monster organization like GM… even trimmed down comes from the muscle car experience. Changing course from the “Giddiyap 409” attitude to “Go Green” requires enormous effort.
Yet who will come out ahead?
Chinese? South Koreans…. even Japanese? Europeans?
The Japanese and Europeans have the benefit with their small, crowded nations, narrow and winding roads. They have always had to think smaller than in the US, where soft big and fast were the norm.
Japan’s gas prices are almost double those in the US and Europe’s are sometimes triple…. so when America’s cars were getting bigger… Europe’s and Japan’s were shrinking.
The Chinese and South Koreans are relatively new to the game so their mindset may not be as formed.
Americans did not learn much from the 1980s oil crisis. Americans made pretty crappy, small cars at that time… the Dodge Reliant… yuck! No wonder Chrysler went broke.
The Ford Mustang had fallen from its great beginning to a miserable low and the Chevy Malibu wasn’t any better. We should not be surprised that the Japanese grabbed so much market share.
GM rebounded with the Suburban. Ford watched F150 pickup sales soar. Chrysler made the minivan an every day affair and American drivers moved from gas guzzling muscle cars to gas guzzling SUVS and trucks.
Here are reader comments from our last message about green investing.
Greetings Gary, Thank you for printing the electric engineer’s letter. He is a smart guy, and used good illustrations. In his passion for reminding us that a battery is like a bucket [of course he is right] he managed to throw out the benefits of the battery out the window. I hope he doesn’t impede you from reporting on new tech you hear about in the future. We all knew what you intended. The real point is reducing our grid use [via wind solar, whatever] and being able to store it economically. If this battery works it is the breakthrough you reported. Please don’t lose your passion, tell us as many of the details of the vision you see, please. Happy Trails, and keep up the good work.
No chance I’ll lose my passion! I have grand kids and my children are really passionate about this so they push me right along.From the investing point of view, I know that big problems create big opportunity and there are few bigger problems than environmental pollution.
Here is another reader: In response to the solar battery section of this post, it may interest you to access National Geographic’s August’s “Picture of the Month”. Scout around the site until you find the series of photos from their recent article on the current state of solar power technology.
You may know that the WSJ recently had an article about a meeting Correa had with a Russian delegation to discuss Russian help building a nuclear energy plant in Ecuador. The WSJ (which hates Correa) was on red alert. But the general feeling in other media is that the Russians are meddling in “our” backyard in response to us meddling in “their” former sphere of influence, particularly those missiles in Eastern Europe. I continue to be puzzled why no one in Ecuador, or interested in Ecuador, is looking at developing a solar power industry. Apart from the obvious abundance of stable and intense year-round solar radiation, a distribution system along the north/south axis of the Andes would avoid all the problems of moving oil and gas through mountains and volcanoes from the eastern Amazon basin west to the Pacific ports for trans-shipment.
The lack of solar would seem a puzzle until one thinks it through. Solar power is still costly and poor nations tend to go with the least expensive choice. Plus who would help? Solar could make Ecuador independent and no one seems to have that on their agenda.
Mankind must become greener. This is a huge problem and because problems create opportunity, demand for electric cars that help the environment may continue to grow.
When looking at investment ideas in electric cars think small… the winners are not likely go come from America’s… big (mostly busted) three.
Our emailed course “Tangled Webs We Weave – How to Have Your Own Web Based Business” is a continuing educational program. You receive the first 28 lessons when you enroll and a new lesson every week or two.
This course teaches how to create a web based business and is developed from the ongoing experiences that we have from our successful and profitable internet business.
This course is well worth the enrollment fee of $299… but currently you also receive two additional courses FREE.
The other two courses are #1: International Business Made EZ, and #2: Self Fulfilled – How to be a Self Publisher.
These two courses have sold for $398 and thousands have paid this price. We add them to your course at no added cost as I believe they will help you develop a better business in these crucial times..
Even Better Get All three Courses Free
To make this offer even more compelling, I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November all three courses, “Tangled Web… How to Have an Internet Business Course,” “Self Fulfilled- How to be a Self Publisher” and “International Business Made EZ” free.
Join us with Jyske Bank and my webmaster David Cross in West Jefferson North Carolina. Learn more about global investing, how to have an international business at the seminar.
Join us with Peter Laub of Jyske Global Asset Management in Ecuador. Learn more about global investing, how to have an international business at the seminar.
International businesses are global business warriors.
If we could get everyone working together, making and serving each other around the world… we might avoid a lot of the confrontation and aggression we see today. Who wants to blow up a good client?
See how this fact can help create income for you.
This is why we have increased our focus on helping readers have their own global internet business in, to, or from Ecuador or anywhere.
There is a wonderful poem, the Warriors Creed. If more and more people apply this to business… perhaps we’ll have less war.
On our Ecuador export tours we visit the San Rafael Reed Factory where they make reed mats, baskets and furniture… by hand. Here is a global business warrior busy making his reed goods that will sell around the world.
Here is the Warrior’s Creed: I have no parents: I make the heavens and earth my parents. I have no home: I make awareness my home. I have no life or death: I make the tides of breathing my life and death. I have no divine power: I make honesty my divine power. I have no means: I make understanding my means. I have no magic secrets: I make character my magic secret. I have no body: I make endurance my body. I have no eyes: I make the flash of lightning my eyes. I have no ears: I make sensibility my ears. I have no limbs: I make promptness my limbs. I have no strategy: I make unshadowed by thought my strategy. I have no designs: I make seizing opportunity by the forelock my design. I have no miracles: I make right action my miracles. I have no principles: I make adaptability to all circumstances my principles. I have no tactics: I make emptiness and fullness my tactics. I have no talents: I make readiness my talent. I have no friends: I make my mind my friend. I have no enemy: I make carelessness my enemy. I have no armor: I make benevolence and righteousness my armor. I have no castle: I make immovable mind my castle. I have no sword: I make absence of self my sword.
This creed makes a good global business creed as well. May many of you successfully apply it!
Gary
The greatest asset of all is the ability to labor at what you love wherever you live. This brings everlasting wealth.
This course can help you create your own internet business.
Our emailed course “Tangled Webs We Weave – How to Have Your Own Web Based Business” is a continuing educational program. You receive the first 28 lessons when you enroll and a new lesson every week or two.
This course teaches how to create a web based business and is developed from the ongoing experiences that we have from our successful and profitable internet business.
This course is well worth the enrollment fee of $299… but currently you also receive two additional courses FREE.
The other two courses are #1: International Business Made EZ, and #2: Self Fulfilled – How to be a Self Publisher.
These two courses have sold for $398 and thousands have paid this price. We add them to your course, at no added cost, as I believe they will help you develop a better business in these crucial times..
Even Better Get All three Courses Free
To make this offer even more compelling, I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November all three courses, “Tangled Web… How to Have an Internet Business Course,” “Self Fulfilled- How to be a Self Publisher” and “International Business Made EZ” free.
During our North Carolina course we bring delegates out to the farm for lunch, here at our house.
For a lunch and walk in the autumnal woods.
We always conduct our autumn North Carolina course on the first weekend of October… traditionally the best time to enjoy the leaf change.
Join us with Jyske Bank and my webmaster David Cross in West Jefferson North Carolina. Learn more about global investing, & how to have an international business at the seminar.
On the Imbabura Real Estate Tour… we’ll see new premium houses…
designed by the architect who designed the house above and this one…
now being built that you could own at a discount with…
this view through your front window.
Join us with Peter Laub of Jyske Global Asset Management in Ecuador. Learn more about global investing, how to have an international business at the seminar.
A new Quito Ecuador airport is scheduled to open in 2010 to replace the current Mariscal Sucre airport.
On the subject of Mariscal Sucre airport, this is one of the nicest emerging market airports Merri and I have ever used. Clean carpeted jetports take you to a shiny marble clad, rose decorated immigration area where the officers politely and efficiently welcome you to Ecuador . Baggage arrives promptly and customs rarely looks at your baggage. We are often from the deplane to our waiting van in less than 30 minutes. The entire process is quiet, well organized and the baggage handlers treat us well.
The new nearly 4,000 acre airport scheduled to open next year we expect to be even better. Because it is about 45 minutes closer to Cotacachi, this adds some great opportunity for real estate in our area now. We look at this in our real estate tour. See below.
The new airport scheduled to open in 2010 is about 15 miles east of Quito and that much closer (about an hour of travel saved) to our province. This airport will sit at about 7,500 feet altitude compared to Quito ’s 9,500. This lower altitude and elimination of noise reduction procedures (due to being away from town) means larger loads can arrive and take off.
Our emailed course “Tangled Webs We Weave – How to Have Your Own Web Based Business” is a continuing educational program. You receive the first 28 lessons when you enroll and a new lesson every week or two.
This course teaches how to create a web based business and is developed from the ongoing experiences that we have from our successful and profitable internet business.
This course is well worth the enrollment fee of $299… but currently you also receive two additional courses FREE.
The other two courses are #1: International Business Made EZ, and #2: Self Fulfilled – How to be a Self Publisher.
These two courses have sold for $398 and thousands have paid this price. We add them to your course at no added cost as I believe they will help you develop a better business in these crucial times.
Even Better Get All three Courses Free
To make this offer even more compelling, I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November all three courses, “Tangled Web… How to Have an Internet Business Course,” “Self Fulfilled- How to be a Self Publisher” and “International Business Made EZ” free.
Join us with Jyske Bank and my webmaster David Cross in West Jefferson North Carolina. Learn more about global investing, how to have an international business at the seminar.
Join us with Peter Laub of Jyske Global Asset Management in Ecuador. Learn more about global investing, how to have an international business at the seminar.
Pay for your tours with Christmas shopping savings
On Saturday December 5th, 2009, we’ll take delegates on an extensive shopping trip to see:
Workshop of Jose Cotacachi. A delegate poses alongside Jose after purchasing the center wall hanging.
We’ll shop all day, plus for reasons of time, space we just can’t visit all the producers in the area on this art and crafts tour so we’ll invite them to Meson de las Flores.
When word gets out we are having an exposition at the hotel so many craftspeople apply that we turn away disappointed artisans because there just isn’t the space.
We’ll see art from Montero.
Artist Montero produces exquisite watercolors for as little as $25 such as those below
Local weavers will display tapestries.
Hand knit woollen sweaters prove a big hit time and time again at $15
Totally natural medicinal and beauty products from the Amazon are distributed by our very good friend Alberto Verdezoto. Prices are eye extremely low.
Mario a local jeweler with fantasy designs always realises several sales of pieces such as those below
Juan produces wonderful pre-colombian designs on recycled card
A local family of musicians make and sell instruments, pan pipes at $2 each at a local workshop
display them .. the large tubular horns at left are small compared to the 35 foot horns used ancestrallt to announce village meetings
……..and then the same group comes to play and dance during supper – using the very same hand made instruments.
Delegates who enroll in any of the December tours above are invited to this free Christmas shopping extension on Saturday December 5, 2009. No Extra Charge.
Here is an Ecuador investing and business ideas for Ecuador or anywhere you live.
In a moment, I am going to show you how to own this 16 room hotel in Otavalo for almost nothing… maybe even free.
First let’s look at a business idea for this hotel… rootlessness… a growing global problem.
Problems create opportunity so there is business opportunity in rootlessness.
Technology has given mankind the ability to work, live and invest globally… a wonderful benefit. Yet this mobility has created a problem as well.
One of my messages many years ago (2002) outlined that there would be a growing market for friendship in this modern era.
That message said:The market for friendship has to grow because technology has made society so mobile. I for example have lost nearly every single really good friend from school. I haven’t seen most of the friends I grew up with for forty five years. I imagine they still live in Portland, Oregon, but maybe not. They might all have become travelers like myself. Out of a six pack of school buddies, Steve is the only one with whom I keep in touch.
When I moved to North Carolina, I visited the local car mechanic named Jay Dee to have some work done on my 1986 Suzuki Samari Jeep. This is the perfect farm car but often needs work. Jay Dee’s garage is a barn by his house and local people sort of collect around that barn to shoot the breeze, spit a little tobacco and talk over old times. “Remember old Johnny Blevins and that time he threw you in the creek,” one of them might say. “Well darn that must a been fifty years ago.”
My Samari… 23 years old and only 62,000 original miles.
I love being with these wonderful mountain people and their easy going, friendly ways. They have such deep roots and ties and are comfortable and at ease with their friends. They know who they are, where they are and who their friends are because they have been with them their entire lives. These people aren’t hanging around Jay Dee just to get their cars fixed. They are enjoying a ritual of friendship that has united them since they were kids.
I love this! My friendships are scattered and far flung all over the world. I sometimes don’t get to see my friends for years!
A huge segment (much of the wealthiest) of the population no longer lives where they were brought up. They have lost touch with their roots. The more technology removes us from our origins, the more the market for togetherness and friendship grows.
Friendship is an extension of togetherness and can develop around many themes. For the mountain folk of North Carolina or anyone who remains rooted in their birthplace the theme is mostly “down home”.
These friendships are tight and if you have ever heard the phrase “You ain’t from around here are ya, boy,” you have experienced the reverse side of this type of friendship. The implication is that with these long term, locally based friendships, the only way to be a friend is to have been there for years.
Some of the years I lived in Gloucestershire, England were spent in a tiny village named Chalford. I lived over a local pub there, “The Mechanics Arms.” Though I was a newcomer to the area I was accepted as an old timer because of family ties. One man in his sixties, who visited the pub every night however wasn’t quite part of the crowd.
Many of the locals talked about him as the new man in town. I was surprised later to learn he had lived in Chalford for nearly thirty years! The locals would always view him as less trustworthy because he had not been born and raised there. Childhood experiences were the basis of their deepest friendships.
Many of us will never have this type of long term familiarity friendship.We have moved around too much. This creates markets for many types of new friendships.
Networking is a form of business friendship. The theme of the friendship is scratch my back and perhaps I can scratch yours or we will both be better off scratching each others’ backs. Such friendships can be local, state or country wide or as mine span the globe. They can be very informal or very formal.
The market for formal friendships has already exploded. Incredible growth of support groups such as AA are a sign of the momentum in the friendship market. Such groups offer a format for formal friendships and range from disease support groups to abused support groups. Each offers an organized way to have friends. The growth of these groups is not because there are more problems than thirty years ago. The growth is because of the increasing market for friendships.
We can see this trend spreading everywhere. For example one telephone company has recognized this growing trend and has successfully built its business around the idea of calling “family and friends.
This thought (that a market for friendships would grow) was correct. We see this on the internet with one of the biggest trends being social networking sites.
A recent New York Times article, “Invisible Immigrants, Old and Left With ‘Nobody to Talk To” by Patricia Leigh Brown reveals a sliver of this problem.
Here is an excerpt from this article: They gather five days a week at a mall called the Hub, sitting on concrete planters and sipping thermoses of chai. These elderly immigrants from India are members of an all-male group called The 100 Years Living Club. They talk about crime in nearby Oakland, the cheapest flights to Delhi and how to deal with recalcitrant daughters-in-law.
Together, they fend off the well of loneliness and isolation that so often accompany the move to this country late in life from distant places, some culturally light years away.
“If I don’t come here, I have sealed lips, nobody to talk to,” said Devendra Singh, a 79-year-old widower. Meeting beside the parking lot, the men were oblivious to their fellow mall rats, backpack-carrying teenagers swigging energy drinks.
In this country of twittering youth, Mr. Singh and his friends form a gathering force: the elderly, who now make up America’s fastest-growing immigrant group. Since 1990, the number of foreign-born people over 65 has grown from 2.7 million to 4.3 million — or about 11 percent of the country’s recently arrived immigrants. Their ranks are expected to swell to 16 million by 2050. In California, one in nearly three seniors is now foreign born, according to a 2007 census survey.
Now let’s look at this 16 room hotel in Otavalo that you can have for almost nothing… maybe even free and how it could offer a business that solves this problem.
First, let me detail the hotel and why a fabulous bargain has come up… and how this hotel can fit into the friendship market.
This is an really good Ecuador income opportunity, a…
hotel for sale in Otavalo.
The owners have had this on the market for a number of years at one million dollars. We thought this price was too high and never wrote about it.
Earlier this year they dropped the price to $750,000 and offered us $150,000 commission if we sold it. I wrote then: The owners offered us a $150,000 commission to sell the hotel. We are not brokers and do not take commission so our reply was “cut the price for our readers”! This would place the price at $600,000… an interesting value.
$600,000 may have been interesting but the owner now just emailed us and dropped the price to $495,000. This places the price beyond an interesting value into the bargain range.
Plus the owners again offered us a commission. We do not take commissions so whatever (how much commission was not clear) amount they would pay could be deducted from this price.
This makes the hotel a real bargain.
At $750,000 the commission of $150,000 was 20%. We don’t know of course about the commission, and I didn’t want to wait to verify this because this hotel is valuable, beautiful and it could work out at about $35 a foot on the building and leaves you the land (which right next to Otavalo market is worth a lot).
Yet there is more. I believe you can get the land and the 16 room hotel for almost nothing.
I’ll explain how below.
First: the hotel details. The hotel is right next to Otavalo Market, one of the largest tourist attractions in Ecuador.
The property has these characteristics: Appx. 30,000 sq. feet of land and 12,000 sq. feet of building in 3 apartments and 16 hotel rooms.
Property Details: The property consists of approximately 30,000 square feet of land, with trees, gardens and many types of exotic birds. The gardens…
are large… well groomed and…
have a wonderful patio.
Ma too likes it there.
There is approximately 12,000 square feet of solid brick and cement construction.
On the property, there is plenty of room for expansion and development, especially in a town where there is absolutely no land left to develop. The building is built in the old colonial style with finely crafted hardwood arched windows and doors, rustic floor tile and traditional clay-tiled roof. The building is constructed according to U.S. anti-seismic standards.
The owner claims this is one of the best built constructions in Otavalo—and one of the prettiest in the city!
The building boasts excellent water pressure on all four floors. (Please don’t pooh pooh this quality!) The building has a powerful, propane gas-fueled boiler system capable of producing up to 700 gallons of hot water a day. With access to the land/building from two streets, the property has frontage on 3 streets, which have been newly paved by the City of Otavalo.
Characteristics: 16 rooms, large social area (restaurant), large working kitchen, two medium-sized apartments, one large penthouse apartment, small building in back (approximately 250 square meters) that serves as a laundry room and storage facility, which also has a full bathroom and a working fireplace. This could easily be converted into a small rental property. Adjacent, yet private, to the main property, and which consists of 350 square meters of our total property, is a working area and parking garage (which can accommodate approximately 6 cars), with clothes lines, and general storage area.
First floor: Consists of large working kitchen, with back door exit to outdoor enclosed pantry/food storage room, laundry area and herb garden. There is a large dining room (approximately 2,500 square feet) with excellent working fireplace, and space to comfortably entertain 60 or so people.
Reception.
Restaurant is beautiful also.
The dining room leads outside onto the tiled patio and garden where there are tables and chairs for serving and relaxing, and this area may be used to accommodate another 30 or so people. Also on the first floor there are 8 rooms which have served as hotel rooms, each 55 X 45 feet in size with large bathrooms.
All rooms face out into the garden and the property is in front of Mount Imbabura. Hundreds of hummingbirds and exotic birds roam the grounds.
Patio seen from one of the three apartments.
Hotel room…
shots.
Second floor: There are two spacious apartments, each about 1,100 square feet in size, with glass windows looking down onto the garden.
Apartment #1 view…
Apartment#1 bedroom.
Apartment #1 Living room
and kitchen.
Each apartment has a large bathroom and a kitchenette with small balconies in the back. Also on the second floor there are 8 more rooms, equal to the rooms on the first floor, that open onto a balcony over-looking the garden.
Apartment #2 living room
Bedroom.
bathroom.
Third floor: There is a very large “penthouse” apartment, approximately 2,250 square feet with large glass windows and a large balcony overlooking the garden. This apartment has one bathroom with a small adjacent room that may be converted into a sauna, large spacious kitchen and living room, two large bedrooms, and a large working fireplace.
Penthouse…
views.
Penthouse.
Penthouse fireplace.
Kitchen.
Penthouse bedroom.
Extra room.
Penthouse bedroom #2.
The Roof: The penthouse apartment has stairs that lead to the roof, where there are two 5,000 gallon reserve tanks for storing water (if needed), as well as more storage space. As stated before, there is excellent water pressure on all 4 floors. Also includes a solar hot water system which connects into the boiler system.
Two 5,000 gallon water storage tanks…
plus solar water heater.
This is an excellent facility with wonderful grounds in a high priced area..
Let’s look at the owner’s explanation of why they have lowered the price… then we’ll see how to get this hotel for almost nothing.
Hello Merri and Gary, This is Margaret from Ali Shungu in Otavalo. I have been living up here on the mountain for about 6 months full time, going back and forth to the Hotel. I feel better up here in my little house with my projects. I have been recovering from an illness and have been in the hospital in Quito. They said that if this diverticulitis does not clear up, and it has been bad for about 6 months with 3 months of vomiting, fever, etc.,–that I will need an operation to remove it. I’m drinking all kinds of herbs and aloe vera cactus and only boiled simple foods, and hoping to heal without an operation. Did 2 rounds of antibiotics, might have to do more…….I will say though, that the hospital bill was not that bad in Voz Andes for all the tests that I had and treatments, etc. I will now take care of myself more, and do more praying! I might need intravenous antibiotics but I do not want to go back to the hospital in Quito.
There you have it… a owner whose health no longer allows them to run the hotel nor wait out a high priced buyer.
Here is how to get this 16 room hotel for almost nothing.I believe that the three apartments, if separated from the hotel and sold on their own, are worth near the price of the hotel. I do not know the Otavalo real estate market so well…but I have seen the apartments and penthouse and they are exquisite.
If they are and if you can buy this for hotel in the $400,000 range… this means the 16 room hotel, the grounds and the restaurant are almost free.
This will require some negotiating, some work and legal work (Ecuador lawyers are not very expensive)… but could provide one heck of a deal.
We have put our Ecuador Living subscribers in touch with the sellers. To gain this contact information you can subscribe to Ecuador Living here.
If the hotel is not under offer, we’ll show it on our upcoming October Andean Real Estate tour. See tour details here.
Merri and I are not involved financially in any way with this offer. We have not looked at the hotel’s financial accounts, legal situation, titles, nor had an engineering inspection, so be sure to take all normal precautions if you are interested. Especially look at the labor obligations you’ll absorb.
Our recommendation for those who are interested in Ecuador is to come visit first… look around… rent and stay awhile… before you buy. One reason for this recommendation is that when you are here awhile you’ll see bargains… like this and I believe for the reasons stated that Hotel Ali Shungu is now a bargain.
Now let’s see how this creates opportunity from the problem of rootlessness.
Americans and Canadians are flocking to Ecuador. I know. Our Ecuador Living business is going wild. The subscription pace has almost doubled recently and the request for rentals in this area has skyrocketed past our ability to keep up!
The demand is especially strong at the lower income level… those who are retiring and can no longer have a decent life in Canada or the US… especially in places where there is winter sun.
There people are isolated… often not speaking Spanish and with little to do. So Turn this hotel into a residence for gringos. Provide free internet… US papers…. weekly Spanish lessons… a support program… group tours, travel assistance etc.
There is one more value. Yesterday’s message How to Make Money in this Multi Currency Eraexplained how, due to the falling US dollar, Ecuador real estate has become a 10% better value since this last February.
Gary
The greatest asset of all is the ability to earn globally in many currencies.
Our emailed course “Tangled Webs We Weave – How to Have Your Own Web Based Business” is a continuing educational program. You receive the first 28 lessons when you enroll and a new lesson every week or two.
This course teaches how to create a web based business and is developed from the ongoing experiences that we have from our successful and profitable internet business.
This course is well worth the enrollment fee of $299… but currently you also receive two additional courses FREE.
The other two courses are #1: International Business Made EZ, and #2: Self Fulfilled – How to be a Self Publisher.
These two courses have sold for $398 and thousands have paid this price. We add them to your course at no added cost as I believe they will help you develop a better business in these crucial times..
Even Better Get All three Courses Free
To make this offer even more compelling, I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November all three courses, “Tangled Web… How to Have an Internet Business Course,” “Self Fulfilled- How to be a Self Publisher” and “International Business Made EZ” free.
Join us with Jyske Bank and my webmaster David Cross in West Jefferson North Carolina. Learn more about global investing, how to have an international business at the seminar.
Join us with Peter Laub of Jyske Global Asset Management in Ecuador. Learn more about global investing, how to have an international business at the seminar.
The US and Ecuador property market offers a rare opportunity to make money in this multi currency era. Here is an excerpt from a recent multi currency update.
Two economic forces have come together to create extra special profits.
I know because the same combination occurred in London during the late 1970s and allowed me to increase an investment eleven times in two years by buying property then.
Earlier in 1970 I had lived in London, England for a year, then moved to Hong Kong. During that time I also maintained a home outside of San Francisco, California.
This was a time of great inflation. My homes in California and in Hong Kong appreciated greatly. In the mid 1970s, when I moved from Hong Kong back to London, I noticed that London real estate was priced about the same as it had been in 1970. This puzzled me. Why had London property prices remained flat despite inflation?
On investigation, I learned that there had been a huge real estate crash in 1970 which continued to dampen real estate prices six years later despite the rampant global inflation. I felt this was a great distortion as European property prices had risen, but London prices had not. Yet London offered the best utility as the center of the English speaking world. This, to my way of thinking, created a huge distortion.
It’s late 1976. Britain faced a sterling crisis. In less than two years the pound has fallen from $2.40 to $1.60. Investors had no faith in the British economy, or the government that ran it. The government’s budget was a mess. Investors were ditching the pound.
The plummeting pound pushed the economy to breaking point. Prime Minister Callaghan, in desperation borrowed as much as possible, £2.3 billion from the IMF.
At that time, the British pound collapsed to its lowest level ever (a pound per dollar for a short time) so the distortion widened. This meant in US dollar terms London property had dropped almost 50% while property in other major cities of the western world had increased in price by three or four times.
The house I bought was right next door and very similar to this house in Bedford Park, London W4.
This house in West London was 34,000 pounds, 9,000 pounds down (then $9,000). I took a mortgage for 25,000 pounds ($25,000). I lived in the house and three years later the pound had recovered to 2.2 dollars per pound plus London real estate had caught up with property in other major western centers. I sold the house for 115,000 pounds or $253,000 a profit of $244,000 on a $9,000 investment.
Now it’s the US dollar that is very low.
You will have seen articles something like the the September 7, 2009 Bloomberg article “Weak Dollar? Currency, at 10-Year Low, May Fall More” by Bo Nielsen.
An excerpt says: Anyone who says the dollar is weak after it fetched a record-low $1.3681 against the euro and the fewest pence against the pound in 25 years is expressing a euphemism.
The currency may decline at least another 10 percent by the end of 2008, say Jay Bryson, an economist at Wachovia Corp., and Kenneth Rogoff, the former chief economist at the International Monetary Fund. The dollar has only fallen 3.4 percent in the past two years to a 10-year low, according to a Federal Reserve index that weighs trade with 38 countries including China, Mexico, Canada and countries in Europe. It tumbled 30 percent in the three years ended 1988.
“Dollar weakness will be broad-based and could last for years,” said Bryson, a global economist at Charlotte, North Carolina-based Wachovia who previously analyzed currencies at the Federal Reserve.
Investors are dumping dollars, lured by higher returns elsewhere. The U.S. will grow more slowly than Europe for the first time since 2001 and Japan for the first time in 16 years, the IMF forecasts. The difference in yield between 10-year German bonds and Treasuries has shrunk to the smallest since 2004.
Those who read this site regularly or subscribe to our multi currency course know that I reported my personal portfolio and recommended getting out of the US dollar in February 2009.See that recommendation here.
I showed that my portfolio was 86% out of the greenback.
My liquid portfolio currency allocation was reported as Brazilian real 4%, Denmark kroner 33% , euro 31% , British pound 10% , Turkey lira 8% , US$ 14%.
So Merri and I began looking and in our research found that there appears to be a hole in the market for Central Florida property selling in the million to $750,000 range. There seems to be no buyers at all. We have been watching prices tumble hundreds of thousands.
We are viewing one property next week that started at $800K+. It just dropped $100,000 last week from $395,000 and is now down to $295,000.
This is about a 25% drop in that house’s price in six months. That’s pretty good!
Now look at what this means in depreciated dollar terms.
Here is a chart of the euro to US dollar from yahoo.finance.com from February 2009 to September 10, 2009 when this was written.
In February a US dollar bought .80 euro so that house at $395,ooo cost 319,200 euro. Now a US dollar buys about .68 euro so this house at $295,000 costs about 200,000 euro.
That is a drop in that house price of 37% in six months in terms of euro. That’s even better!
Here is the magic in this hidden, built-in profit. For most of the market, the profit is hidden. Most investors are not comparing currencies and real estate prices. Yet these distortions will filter through. Eventually European investors…. or those like me who are holding currencies other than dollars will see this distortion and cash in.
I, and now you, just have an advantage because we are always looking at both markets… currency and real estate.
Ecuador Real Estate Cheaper as Well
This also creates better value on Ecuador real estate. Take for example one penthouse property I am selling at $139,000.
This is a perfect property for those who want peace… quiet…and instant access to miles of empty, warm Pacific beach.
This two room, top floor penthouse is at Palmazul and includes use of the the swimming pool, tennis courts… and spa. You can dine here, one floor below.
The units are fully equipped… kitchen…
with full size fridge.
Living room…
with a view…
leading…
to large private balconies…
with these views…
and sunsets to kill for.
Long walks on the beach… you can amble at low tide for ten miles and not see a soul.
Luxury bathrooms with bathtub…
and a king size bed with view and caressed by the ocean breeze.
This unit would have cost 111,000 euro in February. Now the price has dropped to 94,500 euro… just from the dollar’s fall.
The US and Ecuador property markets offers a rare opportunity to make extra profit now because of hidden added value from the US dollar’s fall. History suggests that real estate is a real asset so its price rises as the currency its counted in falls.
These corrections take time because most property owners do not calculate their property in multi currency terms. Those of us who watch this can gain extra profit now.
Our emailed course “Tangled Webs We Weave – How to Have Your Own Web Based Business” is a continuing educational program. You receive the first 28 lessons when you enroll and a new lesson every week or two.
This course teaches how to create a web based business and is developed from the ongoing experiences that we have from our successful and profitable internet business.
This course is well worth the enrollment fee of $299… but currently you also receive two additional courses FREE.
The other two courses are #1: International Business Made EZ, and #2: Self Fulfilled – How to be a Self Publisher.
These two courses have sold for $398 and thousands have paid this price. We add them to your course at no added cost as I believe they will help you develop a better business in these crucial times.
Even Better Get All three Courses Free
To make this offer even more compelling, I am giving everyone who enrolls in our North Carolina or Ecuador International Business & Investing seminar in October or November all three courses, “Tangled Web… How to Have an Internet Business Course,” “Self Fulfilled- How to be a Self Publisher” and “International Business Made EZ” free.
Join us with Jyske Bank and my webmaster David Cross in West Jefferson North Carolina. Learn more about global investing, how to have an international business at the seminar.
Join us with Peter Laub of Jyske Global Asset Management in Ecuador. Learn more about global investing, how to have an international business at the seminar.
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