Return of Capital is More important than Return on Capital
The Q Wealth Report
11 July, 2008
Before, Ive used this cliche more in terms of avoiding investment scams. These days, Im using it to refer to the markets in general. We are now in a bear market. The economic and fiscal environment continues to deteriorate. Stocks are going down.
I believe that commodities will continue their overall upward trend, but that doesnt mean that prices wont fluctuate in the short term. Some who are prone to conspiracy theories believe the gold price is being surpressed by the US treasury - they may well be right.
As commodity prices fluctuate, shares that rely on them are taking a beating. The market, remember, is not logical. It depends on short term emotions and is driven by derivatives which can cause havoc based on even minor price fluctuations. Therefore, keeping your money in the markets is risky at the moment - really only for the brave!
My personal inclination is to keep most of your assets right now in solid, long term investments like gold and real estate. In terms of gold, buy physical gold if you can, rather than ETFs. Its harder to buy and sell, but worth the effort in terms of security. A nice watertight set-up is a Panama S.A. (anonymous corporation) owned by a Private Foundation, with a bank account and safe deposit box in a European bank. You can buy the gold and hold it there in Europe. This whole set up costs less than you might imagine.
Needless to say, though, avoid banks like UBS which are in big trouble at the moment (derivatives exposure, plus the US Justice Department is trying to get the IRS access to information on UBS account holders in Switzerland) If you need referrals to European banks, feel free to contact my office.
People will always need places to live and land to grow food, too. Foreign real estate is a secure, confidential and non-reportable investment if you buy carefully.
Look forward to more blog entries about Freedom, Wealth and Privacy. I hope you enjoy them and that you can use the information here to benefit your business and your life. In turn I would much appreciate your feedback, comments and questions. I can be contacted via firstname.lastname@example.org.
Peter Macfarlane is joint editor of The Q Wealth Report an established newsletter dedicated to informing readers about creating, protecting and growing wealth in a secure offshore environment. It also covers international living, banking, retiring and investing. Visit www.QWealthReport.com to see more.
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