May 24, 2013
Doug Casey’s Primer on Internationalization
 As many of you may know, International Man has its roots in the book of the same name. It was first published in 1978 by best-selling author, speculator, and renowned world-traveler Doug Casey. The original intent of that book was to give readers a general sense of the exciting and opportunity-rich world that lay outside of their national borders, with a review of over 100 countries, valuable “opportunity intelligence,” and the resources that anyone could follow to realize these opportunities. Even though the book is now clearly out of date, the need for information on internalization is more relevant than ever, as governments the world over become more desperate. The purpose of this website is to preserve the mission of that book and be the premier location for up-to-date, highly actionable, and practical information on the topic. So why is (more)…
May 21, 2013
Thoughts from the Frontline: All Japan, All the Time
 Japan grew at a 3.5% annual pace last quarter, the fastest pace in a very long time. Of course, government officials see this development as vindication of their new policies and will no doubt decide that even more of the same will be needed in the future.Retail sales in Japan are soaring as a “wealth shock” electrifies the economy. The Nikkei index has risen 70% since November, with foreign hedge funds among the first to jump on the bandwagon. The chart below provides some perspective on that rise. I can see several similar moves in the past 20 years. If this were a one-year rather than a 30-year chart, would everyone be so eager? I’m not saying that the move isn’t real. A lot of money has been made, at least on paper. The weaker yen is already delivering a (more)…
May 20, 2013
Could Cuba’s Past Be Your Future?
 An article was published in Uruguay that has received little notice outside of Latin America. This article refers to Cuban dissident Yoani Sánchez, also little known in the First World. Ms. Sánchez has recently been allowed to travel outside of Cuba for the first time, as a result of the elimination of “exit visas.” The requirement for exit visas was imposed in 1961 to stop Cubans who opposed the then-new Castro regime from being able to leave Cuba. (Editor’s note: The regime in Washington imposes an “exit tax” for certain Americans who renounce their citizenship.) It’s comforting to think that Ms. Sánchez and all Cubans are experiencing the early stages of a more open Cuba, just as the peoples of East Germany, Russia, China, and other countries have experienced in recent decades. This is another reminder that the concept of (more)…
May 17, 2013
Geopolitical Journey: Europe, the Glorious and the Banal
 Standing at the edge of the old world and the beginning of the new one, at the tip of Portugal, Stratfor’s George Friedman is moved by the exploits of 15th-century European explorers and dismayed by the present fear pervading the Continent that “any decisive action will tear the place apart.”Europeans wreaked much havoc as they spread throughout the world, but they also “left as [their] legacy something extraordinary: a world that knew itself and all of its parts.” But now, George asks, with “the death of hubris and of risk-taking … what follows, what is left?” The Europeans are “now reduced to finding a way to resume the comforts of the unexceptional…. Europe has chosen comfort, and now has lost it. It sought transcendence and tore itself apart.” This is an unusual Outside the Box, not focused on markets per (more)…
May 13, 2013
If Cyprus Is the Bellwether, Then Canada Is the Red Flag
 An intriguing article titled “Canada Includes Depositor Haircut Bail-In Provision for Systemically Important Banks in 2013 Budget” was recently published in SD Bullion. The somewhat lengthy title offers all the information necessary, but for those who – quite understandably – may not be able to accept that they have just watched Canada tumble down the Cypriot rabbit hole, here is a bit more detail from the approved budget itself: “The Government proposes to implement a bail-in regime for systemically important banks. This regime will be designed to ensure that, in the unlikely event that a systemically important bank depletes its capital, the bank can be recapitalized and returned to viability through the very rapid conversion of certain bank liabilities into regulatory capital.“ Customer deposits could certainly fall under the label of “certain bank liabilities,” and converting them into “regulatory capital” (more)…
May 8, 2013
Grading Growth Plans
 Imagine you’re running a country whose economy could perhaps use a bit of a boost. You could just spend some money on a few major construction projects, but you’d rather see domestic businesses grow more—especially since some have struggled to maintain high profit growth. If they improved, the whole economy would benefit. But how do you get them to turn things around? That’s the question facing Japan and China right now. And in late April, policymakers seemed to arrive at opposite conclusions. China’s approach was straightforward and predictable. The State Council ordered state-owned firms (SOE) to keep profit growth over 10% a year. Just do it. Because we said so. Well, orders are all well and good, but China’s missing a key ingredient: incentive. Where’s the motivation for firms to grow and earn more? State-Owned Assets Supervision and Administration committee (more)…
May 7, 2013
International Money Flow Is Tightening
 The EU continues its chainsaw juggling act. The austerity pledge from France is holding about as well as its Maginot Line, while Greece has sworn to meet its fiscal targets in 2014 2015 2016 soon, and the Italians promise they’re going to kick some serious fiscal butt as soon as the country returns from holiday. Spain reassures that it will squarely confront its need to raise worker productivity whenever the unions call an end to protests against austerity. And the Portuguese high court ruled it is unconstitutional for civil servants to work for less than twice the wages of their private-sector counterparts. This chronic “the sky is falling” in the EU had induced investor news-cycle fatigue and rendered last year’s black-swan threat level from red to this year’s collective yawn… … until Cyprus tossed another chainsaw into the act. The (more)…
May 3, 2013
Is Gold Losing Ground to Emerging Markets in the ETF World?
 While still the world’s biggest bullion ETF, the SPDR Gold Shares Exchange Traded Fund (GLD) took the brunt of the beating sustained by commodities last month, and has now lost its position as the second-place holder in terms of largest U.S. ETFs by assets, falling to third behind the Vanguard FTSE Emerging Markets ETF (VWO). Down almost 6 percent over the past month, GLD lost $6.77 billion of investor cash in April, the ostensible result of a 7.6 fall in the price of the precious metal. The ETF has lost more than $13.5 billion in assets in 2013 alone. Various reasons have been given for the travails of gold and by extension the most important gold ETF, with the Federal Reserve being among the most widely cited of these, but for reasons that are not immediately evident. In a climate (more)…
May 1, 2013
Slovenia Cancels Bond Sale Ahead of Downgrade
 Apparently in response to a Moody’s downgrade, the Slovenian government canceled $6 billion in bond sales that would have been used to save the nation’s ailing banking system. Just days after Slovenian President Borut Pahor gave an interview to a German magazine in which he said that his country would not become the next Cyprus, Slovenia dropped its recent attempts to issue bonds ahead of Moody’s cutting the country’s debt rating to junk. The news represents yet another upheaval from the recession plagued Eurozone, and comes on the heels of the Cyprus bank-bailout crisis that had markets worried in March. Slovenia’s state-run banking system is beset by some 7 billion euros of bad loans, a problem the country’s new Prime Minister says can be dealt with internally, and without a loan from the European Union. The month old government of (more)…
April 29, 2013
A Blueprint for Internationalizing Yourself
 The countries of the developed world are experiencing a new class of refugee – members of the middle and upper class. These rungs of the socioeconomic ladder are realizing that their countries of residence are in many ways going rapidly downhill without much hope of a short- or medium-term reversal. This is particularly true for national economies, taxes, and regulations, and in terms of deteriorating individual liberty. As a result, many are seeking permanent expatriation, or a “back door” destination, should a sudden move become necessary. In fact, after internationalizing your assets, establishing a back door is the next most important diversification strategy for most. This article will provide valuable insights toward that goal. The first big hurdle is determining which destination is the right fit for you and your family. This task can be time-consuming and frustrating. Many in (more)…
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