Alan's Finance Blog

Bald Faced Lies- Sarkozy, G20 Continue Anti-Tax Haven Campaign

Dear Sovereign Investor,

The G20 meeting in France ended last Friday with friction and a failure to solve euro zone problems. After failed talks in Cannes, financial markets dropped as the summit ended in a state of disorder.

But one demagogue stood out at Cannes: host French president, Nicolas Sarkozy. Known for his grandstanding, he closed the G20 meeting with a stern warning that tax havens would be shunned by the international community.

He claims they haven’t done enough to end banking secrecy.

Pretending to speak for all G20 nations he said: “We don’t want any more tax havens. Our message is clear.” He then claimed that Switzerland, Panama and Uruguay “…have not provided a suitable legal framework for the exchange of tax information.”

C’est un mensonge délibéré! That is a deliberate lie!

Sarkozy is Seeking Scapegoats

Sarkozy ignores the scores of tax information exchange agreements that Panama, Uruguay and Switzerland have signed. Each of them officially now operates under OECD (Organization for Economic Co-Operation and Development) transparency rules.

Panama President Ricardo Martinelli called his French counterpart out on the lie. As he pointed out, “Panama has even signed a double taxation treaty with France.”

Panama Foreign Minister Roberto Henriquez went further, saying Sarkozy and the G20 were “looking for scapegoats to cover its financial mismanagement at the edge of a crisis.”

And Sarkozy’s urging that the international community should “isolate Uruguay because it is a tax haven” produced a formal complaint from the Uruguayan government.

What the media never mentions about these G20 hot air sessions is that their virulent anti-tax haven policy is drafted and put forward by the OECD.

For more than a decade, the OECD and their high-tax sponsors have called for “tax harmonization,” which, by their radical definition, means every nation can impose ever higher taxes and that no escape is to be allowed by international tax competition.

Now the OECD and Sarkozy even assert G20 power to target legal tax avoidance, a radical step consistent with the ultra-leftist OECD philosophy.

This latest attack on tax havens proves my repeated assertion over the years that these OECD critics will never be satisfied until they accomplish the complete destruction of financial privacy and the imposition of a worldwide tax system.

Sarkozy has been pushing for just such a global tax: an UN-administered tax on every financial transaction in the world as a way to force everyone to pay for government bailouts to rescue debt and deficit-ridden economies.

Thankfully, his scheme has run into opposition from the United States, Canada, Russia, Australia and China… and now us.

How to Fight Back to Protect Your Wealth

These attacks on your financial and personal freedoms will continue. But you can fight back by reordering your personal and business affairs to include a strong offshore component that expands both investment profitability and asset protection.

Look to Switzerland, Panama, and Uruguay for the financial services and asset protection tools they offer:

• Switzerland remains the best all around offshore financial center for banking and as a global investment base.
• Panama, with its strictly territorial tax system, excels in trusts and private family foundations and welcomes foreigners as privileged new residents under it famous pensionado program.
• Uruguay mirrors that welcome to foreigners with an abbreviated wait (3 years) for full citizenship in some cases and it too levies no taxes on most offshore income.

Faithfully yours,

Bob Bauman JD
Chairman, The Freedom Alliance

The World’s Easiest Places to Retire

Where in the world is it easiest to retire or relocate? It depends.

It depends on what’s most important to you. Maybe you’re most concerned about being close to the United States. Or you quake at the thought of dealing with web-like bureaucracy. Or you’re worried about how quickly you’ll find a community of like-minded friends.

Regardless of your preferences, it must be said: Some places really are easier to move to than others.

They tend to be places with an established expat population. Places where you can find other folks who speak English. Places where you can get the “things” that make life comfortable – like reliable phone and internet service, good health care, a variety of restaurants, and leisure activities like a symphony, or a lecture series, golf courses, or arts events.

We asked International Living’s roving editors to share their picks for the destinations where you can make the transition overseas easily. Here are their favorites – a selection with something for every taste.

Panama City: Modern, Convenient Living

For expats of all ages, living in Panama City is easy.

It’s easy to buy property, qualify for residency, and do business. The government and the people are accustomed to foreigners and welcome them. There are special discounts for retirees, zero income taxes on offshore earnings, protections against probate, and property tax exemptions.

The ease of living filters down into everyday life. The sparkling Panama Bay, ringed with towers of glass and chrome, evokes images of Miami and Hong Kong. And the comparison doesn’t end there, as the cultural offerings are many and the nightlife is hip.

In Panama City you’ll find great restaurants, active expat groups, and a level of convenience and familiarity unmatched elsewhere in the region. Even the excellent health care is unrivaled. The most technologically advanced hospital in Latin America is located right in Panama.

There’s simply no city that out-values Panama City… the perfect place for thoroughly modern living.

To get a glimpse of what we’re talking about, The Sovereign Society is holding its 10th Annual Total Wealth Symposium down in Panama this April 27-30. You can experience all this city has to offer first-hand. Plus, you’ll get to rub elbows with a team of global expats, investors and businesspeople who have decades of experience spending time and making money in this hub of the Americas. And for a limited time, enjoy free registration.

European Lifestyle at Latin America’s Lower Prices

Europeans have long been in the know… but now North Americans, too, are discovering a handful of places where they can enjoy a slice of European life at Latin America’s low prices.

Here are three cities where you can do just that. They’re cities with a cosmopolitan flair, and with the satisfaction of four seasons, but without the ice or snow.

• Santiago, Chile, is the first of the First-World cities in the region. It’s clean, efficient, and well kept. Plus, its impeccably maintained colonial buildings, modern department stores, fine restaurants, and rapid-transit system will place you unquestionably outside the Spanish colonial Third World. Whether you prefer the manicured, tree-lined streets of Las Condes or the sidewalk cafés of the bohemian Bella Vista, Santiago boasts the region’s best infrastructure and highest standard of living.

• Montevideo, Uruguay, is a world capital that manages to retain a small-town feel. From the antique shops, art galleries, and bookstores in the historical center to the luxury condos and beaches of Pocitos, Montevideo boasts fine dining, theater, music, and tango, all with a European feel. Inexpensive living combined with an old-world romance draw plenty of retirees, who enjoy a laid-back ambiance that’s unlike anything else in the Americas.

• Buenos Aires, Argentina, enjoys the well-deserved reputation of being the “Paris of South America.” Its 48 neighborhoods and 3 million people are at the center of Argentina’s cultural life. But their influence stretches much farther afield. Buenos Aires—along with Madrid and Mexico City—dominates the intellectual and artistic life throughout the Spanish-speaking world. From the sultry tango clubs of Palermo Viejo to the cheerful and bustling flea market at San Telmo, Buenos Aires will enchant you at first sight.

Are You Ready to Retire Overseas?

High income taxes, expanding government regulations… Americans are becoming increasingly frustrated with the situation here in the United States.

And a growing number of them are escaping these threats by packing up and moving abroad. In fact, according to Zogby Research, a massive and silent migration is underway. Families are packing their bags… and deciding to go offshore at the rate of 54-per-minute.

Whether you’re seeking a full-time residence… or a part-time tropical vacation home where you can live like royalty for $20,000 a year, there’s something you must know:

If you’re among the savvy few who are ready to book a first-class ticket to financial freedom, you shouldn’t go it alone. It’s all too easy to make dozens of unnecessary small mistakes that end up needlessly costing you time and money.

That’s why Bob Bauman, legal counsel for the Sovereign Society, has created a “nerve center” for individuals looking for freedom from disaster back home.

It’s a place where you can pluck from the most effective and timeless wealth-building strategies, plus the most relevant, up-to-date knowledge on how to make the move overseas.

To learn more about putting an end to money worries, providing abundance for your family and detaching your fate from that of the U.S. government, watch Bob’s personal memo .

Lee Harrison
Contributing Editor, International Living Magazine

The Easiest Offshore Bank Account

Where can you find an easy, affordable, manageable, accessible offshore bank account? It’s closer than you think.

Just head north to Canada.

Before I continue, let me make something clear – our neighbor to the north is not a tax haven or ideal for asset protection. But for general diversification or to simply move some assets outside the U.S., Canada might be just the place you are looking for.

A Safe Haven Close to Home

Canada offers a sound banking system, conservative lending regulations and a currency that should continue to appreciate versus the U.S. dollar.

In fact, my colleague Sean Hyman believes the Canadian dollar will be the top-performing currency of 2011. For two reasons, rising oil prices and an economy that thrives no matter what’s happening in the world.

What’s more, Americans can look to Canada as a safe place to park some assets outside of the horrors of U.S. banking and the financial system.

It’s an easy-to-access banking destination that bears many of the same attributes you’ve become accustomed to in the United States — including the same language and deposit protection. The Canadian Deposit Insurance Corporation (CDIC) provides C$100,000 protection per account (US$100,000).

With 316 banks failing over the last two years here in the U.S., banks in Canada are now among North America’s leaders. Canadian banks are profitable and outperform their North American counterparts because of tighter government restrictions on lending capital requirements.

In the aftermath of the credit crisis, not a single Canadian bank collapsed thanks to the country’s responsible banking practices and conservative lending regulations. Financial institutions in the U.S., on the other hand, continue to founder and fail. In fact, 12 U.S. banks have failed this November and December alone.

One reason Canada has escaped the same fate is its foreign ownership law. This law restricts foreign banks from owning more than a 10% stake in domestic banks.
Because of this, Canadian banks are less dependent on risky foreign institutions and aggressive lending tactics.

Easily Add One of the
Top Currencies to Your Portfolio

Canada can also be considered a currency haven. The country has banks that are allowed to house accounts in various currencies. The Royal Bank of Canada (RBC), for instance, offers currency accounts in U.S. dollars, Canadian dollars and British pounds sterling. This is a good and simple way to diversify your nest egg.

In fact, some of the bigger Canadian banks may offer discount brokerage platforms. Using these low-fee services, investors can trade securities in Canada inexpensively.

In the last 12 months, the loonie has hit par with the U.S. dollar. As of yesterday, the loonie was hovering around $0.99 U.S. cents. The Canuck buck deserves to trade on par or at a premium to the greenback for many reasons.

Earlier this year, Canada also has a trade balance surplus with the U.S. compared to monthly trade deficits of over $40 billion here at home – and that’s to say nothing of the U.S.’s exploding budget deficits.

Canada’s economy, however, like most other economies, has been slowing since June. A high Canadian dollar continues to put pressure on exports and acts as a drag on employment growth in the country’s manufacturing belt in Ontario and Quebec.

But resource-driven exports — like oil and natural gas — have remained buoyant in 2010 and should continue to push the Canadian economy forward in 2011.

Bottom line: Canada is the nearby destination for “offshore banking.” Why not take advantage?

Stay Sovereign,

Bob Bauman, JD
Legal Counsel, The Sovereign Society
Blog: http://bauman.sovereignsociety.com/

Three Simple Strategies to Escape U.S. Taxes

President Calvin Coolidge has been ridiculed for supposed limited intelligence. In reality, he was but a man of few words. Unfortunately, one of his most memorable quotations no longer applies fully today as it did in his time …

“The chief business of the American people is business.”

Today anyone attempting to start or conduct a business in the United States faces discouraging obstacles in high and uncertain taxes, government edicts and a maze of state and federal regulations.

So why don’t more Americans “go offshore” when there is so much potential business abroad?

Probably because they aren’t aware of the attractive possibilities for profit. But there are many jurisdictions friendly to Americans seeking to do business offshore. While I often write about getting a second passport and dual citizenship, doing business can be a way to gain offshore asset protection and opportunities at the same time.

Tax Free Offshore … If You Know Where to Look

Even though U.S. persons (citizens and permanent residents) are taxed on their worldwide income, there are many places where local business taxes are reduced, or where business may be totally tax exempt.

One way that these places exempt foreigners who live or do business there from taxes on income earned abroad is by a “territorial” tax system. This means imposing taxes only on income earned within the country’s borders.

Special Use Tax Havens:
Countries That Want Your Business

Many countries impose the kind of taxes we know and dislike – the high kind. But these are tempered by government policies of granting special tax holidays, concessions, or rebates to favored business enterprises they want to attract and promote, usually to increase local employment.

These concessions typically include:

• corporate tax credits for local job creation;
• tax exemptions for manufacturing and processing of exports; and
• tax benefits for international business or holding companies, offshore banks, insurance or other selected industries.

In the U.S., critics call this kind of domestic business tax break “corporate welfare,” but many nations (including the U.S.) offer these business inducements to foreigners. Among nations that offer generous special tax concessions to foreign-owned businesses are Chile, Portugal and Barbados.

Tax-Free Zones: Exactly What They Sound Like

Closely akin to special use tax havens are “tax-free zones” established within specified areas of some countries. These zones are used as trans-shipment points for finished goods, such as the Colón Free Trade Zone in Panama or the Hong Kong free zone.

Other tax-free zones are major bases for industry, business and finance. They are complete with well-developed infrastructure and favorable laws to attract business to the zone. A good example is the Jebel Ali Free Trade Zone in the United Arab Emirates, although at the moment the UAE economy is in a major downturn.

Canadian Welcome:
Benefits for Americans Who Move North

Canadian law favors a special independent class of preferred immigrants including investors, entrepreneurs, the self-employed and those who will add to the “cultural and artistic life” of the nation.

For potential investor visa applicants, the government rolls out the proverbial red carpet, officially known as the “Business Migration Program.” Business experience, marketing skills, contacts within Canada, an adequate credit rating and available funds all greatly increase your chance of success. Applicants are usually required to submit detailed business proposals or general business plans, which must accompany the application for permanent residence.

America May Not Want Your Business,
But Someone Does!

I’ve only scratched the surface of countries that may be right for your business. But clearly, taking your business offshore may allow you to enjoy greater financial privacy, lower taxes, and a better business climate.

If you are looking for a place to do business offshore or to make a new home, the haven that will meet your needs does exist. It’s “out there” waiting for you, and we’ll help you find it.

Bob Bauman, JD
Legal Counsel, The Sovereign Society
Blog: http://bauman.sovereignsociety.com/

Shield Assets from Lawsuits in One Easy Step

By Bob Bauman JD, Legal Counsel, The Sovereign Society

It’s hardly news that America is one of the most sue-happy nations in the world. For many years it’s been commonplace to hear about people winning hefty settlements for frivolous lawsuits.

To grasp the severity of the problem, consider that over 50,000 lawsuits are filed each week in the US. More than $200 billion is paid each year in, damages, lawyers’ fees and costs related to tort lawsuits.

And these days, it’s easy for you to become a target.

Do you have a neighbor, friend or colleague with a petty grievance against you and your barking dog? You better take that complaint seriously. If you don’t, one day you just might find a process server at your door giving you notice of a lawsuit filed against you.

Frivolous litigation, expensive legal defense costs, outrageous jury awards and government privacy invasions have combined to create an urgent need to protect your family and business wealth and your privacy.

So today, I’m going to tell you all about asset protections trusts (APT) – a legal device that secures your wealth from lawsuits, creditors, an irate ex-spouse and even the government of your home country.

What Is a Trust…
and Who Really Needs One Anyway?

Stripped to bare bones, a trust is a three-way legal device. It’s a contract of sorts, that allows one person (the trustee) to take title and possession of cash or property and hold, use or manage those assets for one or more other persons (the beneficiaries).

The person who creates the trust (the grantor) decides what it will do and donates the property to fund it. You actually create the trust by writing and signing a trust declaration, usually as part of an overall estate plan.

Setting up a trust requires expert legal and tax advice and a careful review of existing arrangements that affect your estate.

One special kind of trust that I often recommend is the offshore asset protection trust (APT), and The Sovereign Society has long advocated its use.

The offshore APT is a powerful wealth preservation structure.

• It offers an ideal means to protect your assets and to assure your heirs and chosen beneficiaries get what you want them to have after you’re gone.
• It defends your wealth and can be the key to strategically sound and successful estate planning.
• It adds a significant layer of asset protection – distance. A domestic trust in your home country may serve your needs, but an offshore APT places your assets outside the jurisdiction of courts in your home country. And it avoids the public and lengthy post mortem probate process required when the deceased has only a last will and testament.
• It can hold title to, and invest in, real estate, cash, stocks, bonds, negotiable instruments and personal property. An APT is an excellent vehicle for investing in offshore funds, currencies and other investment possibilities generally denied by SEC rules to individual American investors.
• It can provide care for minor children or the elderly; or pays medical, educational or other expenses; provides financial support in an emergency, for retirement, education, during marriage or divorce or carries out premarital agreements.

Doing business with an offshore APT is little more difficult than dealing with your local bank, although the hours may differ in other parts of the world. These days, with instantaneous digital international bank transfers, telephones, faxes, e-mail and the Internet, foreign asset haven jurisdictions provide the kind of communication services you as a trust grantor needs to operate an APT.

With regard to affordability, the cost of creating a simple offshore trust in Panama, for example, can cost as little as a few thousand dollars, plus $1,000 annual maintenance fee.

A highly complex APT in a foreign nation can exceed $15,000, plus several thousand dollars in annual maintenance fees. Unless the total assets to be shielded justify such costs, an offshore APT may not be practical. The cost calculation should always precede a final decision on creating an APT. My suggestion is that if your total estate is valued at US$500,000 or more, you should consider creating an offshore APT

Where Should You Create Your Trust?

Many offshore financial centers specialize in the creation and administration of offshore asset protection trusts.

What the corporation-friendly State of Delaware is to U.S. companies, these jurisdictions are to asset protection trusts. Many are well developed, globally recognized financial centers. They boast modern, efficient banking, legal and other professional providers who understand servicing APTs and offshore finance in general.

Among established APT havens are Panama and Belize; the British overseas territories of the Cayman Islands, the British Virgin Islands, the Turks and Caicos Islands and Bermuda, and the Bahamas and Nevis (half of the Federation of St. Kitts and Nevis).

In Europe there are Liechtenstein and Gibraltar. Also noted for favorable trust laws are the U.K. Crown dependencies in the Channel Islands, Guernsey and Jersey and, in the Irish Sea, the Isle of Man. Way out in the south Pacific are the Cook Islands and New Zealand.

Before you choose a place for your trust, make certain of the latest developments in the jurisdiction you’re considering. You can keep abreast of the latest trust news in our Sovereign Society publications.

The Sovereign Society also can recommend attorneys and professional trust services in the U.S. and in tax and asset haven nations. Just ask us.

APTs and Taxes

Unlike almost all other nations, the United States taxes all worldwide income of its citizens and those with permanent US resident status, regardless of where they live in the world. (Many nations exempt their citizens from taxes if they live abroad).

Under U.S. tax law, foreign asset protection trusts are “income tax neutral,” as are domestic US trusts. That means the trust itself is not liable for taxes on its income. But all trust income is treated as the grantor’s personal income, reportable annually as gross income on IRS Form 1040 and taxed accordingly at personal income tax rates. The fact that a grantor’s trust is located offshore does not negate the U.S. grantor’s personal obligation to report trust income.

All this may sound complicated but it’s not really. The Sovereign Society can help members with advice on every aspect of offshore trusts. Just ask us.

Stay sovereign…

Bob Bauman, JD
Legal Counsel, The Sovereign Society
Blog: http://bauman.sovereignsociety.com/

New Haven on the Horizon; the Cook Islands

By Bob Bauman

A broad net of 15 coral islands in the central heart of the South Pacific, the Cook Islands are spread over 850,000 square miles, southwest of Tahiti and due south of Hawaii. The islands occupy an area the size of India, but have a population (a little over 21,000 people) no larger than a small town in America.

Local time is 10 hours behind GMT, with 9:00 a.m. in Hong Kong is 3:00 p.m. the previous day in the Cook Islands. When it is noon EST in the United States it is 5:00 p.m. in the Cook Islands.

This geographic location gives the Cook Islands, with its excellent modern communications, a strategic advantage in dealing with both the Asian and American markets.

Not as well known as some offshore financial centers, in 1981 the Cook Islands government first began adopting (and updating) a series of wealth and asset-friendly laws. Since then these islands have attained a definite role in offshore financial circles, especially when it comes to asset protection trusts.

Named after Captain James Cook, the famous British explorer who visited them in 1773, the islands became a British protectorate in 1888. By 1900, administrative control was transferred to New Zealand; in 1965, residents chose self-government and a free association with New Zealand. A member of the British Commonwealth, the islands have a constitution with a Westminster style parliament elected every four years by universal suffrage. The legal system is based on British common law and English is widely spoken.

There is much here to for serious persons of any nationality who want strong asset protection supported by sympathetic government and judicial policies.

Existing statutes provide for IBCs, offshore banks, insurance companies, and trusts. All offshore business conducted in the Cook Islands must be channeled through officially registered and regulated trust companies. A comprehensive range of professional trustee and corporate services is available.

In a major American legal case, the U.S. government tried to force the repatriation of funds held by a Cook Island trust and lost, even though the Americans who created the trust for a time were jailed for contempt of court. Not even a federal court could crack the Cook Island trust laws. For more about what is known as the “Anderson case” see FTC vs. Affordable Media LLC, 179 F. 3rd 1228, U.S. Ct. of Appeals, 9th Cir. (1999).

I have a good friend who has had a Cook Islands trust for many years as as protection against possible business liabilities. He is fully satisfied with its operation and protection, with his local American attorney acting as liaison with his Cook Islands trust company.

Source: Sovereign Society

India – Back page bull market

While Other Asian “Tigers” Grab Headlines, This Forgotten Giant Has Quietly Begun an Economic Boom…

By Justin Ford

The front pages were busy last week with President Obama’s trip to Asia. Yet while experts debate whether he bowed too low (or shouldn’t have bowed at all) in Japan… one of the most important stories about Asia didn’t make the front pages at all. In fact, the country wasn’t even on the Ppresident’s itinerary.

Yet, it’s the largest democracy in the world, the U.N. predicts it will become the most populous country by mid-century, and the World Bank expects it to become the fastest growing economy on earth next year.

I’m talking about India.

India has been off the radar even for many emerging-market investors for a long time.

• When investors talk about “Asian Tigers,” they don’t include India even though it its stock market is up nearly 500% in the last seven years.
• When they talk about rapid growth, they inevitably refer to China, even though India also never sank into recession during this credit crisis. Instead, it has averaged 7% annual growth for the last three years and is expected to grow by about 8% next year, surpassing China for the first time as the world’s fastest growing economy. And it is achieving this with far less reliance on exports than China, so it may be a more sustainable growth should the Great Recession deepen.
• When Washington talks about spreading democratic values around the world, they often neglect India—which alone among the Asian nations has had an uninterrupted democracy since the end of World War II.

India simply hasn’t gotten much attention from the investment community, though some of the neglect has been deserved.

The country has long suffered widespread poverty and for many years a caste system impeded the spread of knowledge and opportunity—two prerequisites for economic growth. Initially, after winning independence, the country also embraced socialism and developed so many pockets of bureaucracy that it became known as the “license raj.”.

But in recent years, this has changed and this year the pace of progress has accelerated dramatically. So there are now some very good reasons you may want to put India on your radar and consider investing in some of its rapidly growing companies.

Economic Liberalization Is Gaining Steam

In the last few decades, one phenomenon has probably created more wealth—in people’s everyday lives and in the markets—than any other. It’s called “economic liberalization.”. The term refers to what happens when a formerly controlled economy moves towards free-market policies.

In the 1980s, the “Chicago Boys” took control of economic policy in Chile. These were economists educated at the University of Chicago and influenced by the writings of Milton Friedman. In the 1990s, Chile experienced strong economic growth, the United Nations says one million Chileans rose above the poverty line, and stocks shot up 1,725% in less than seven years.

In Poland, per-capita GDP has more than doubled since the Soviet Union fell. And when the country began to privatize in 1993, the stock market soared 1,144% in a single year.

According to Stanford economist Robert McKinnon, South Korea’s economic growth nearly tripled after it began to liberalize. Its stock market went on to rise 1,578% during a 10-year bull market.

In 2002, Eastern Europe went into a 2nd phase of economic reform in preparation for joining the E.U. Once again, economies grew at record levels and markets soared. Hungary’s stock market rose 517%, Poland 556%, and the Czech Republic 1,391%.

Also in 2002, Inacio Lula Da Silva ran for the presidency of Brazil. He ran as a populist, but ultimately turned out to be a “radish”—red on the outside and white on the inside. That is, he implemented social safety net reforms but also reforms to cut regulation, increase privatization, liberalize foreign trade and reduce taxes. The stock market rose 130% in a year… and 2,000% over the next seven years.

These are compelling precedents because something similar is happening in India.

A History of Accelerating Reform

India began to move away from socialism after the fall of the Soviet Union in the late ‘80s/early ‘90s.

The first major change came with the appointment of Manmohan Singh as finance minister in 1991. Singh – an economist educated at Oxford and Cambridge – worked to reduce taxes and bureaucracy and free up the private sector. Progress was painstaking as socialist’s maintained significant influence in the congress. Yet over the next five years the economy’s growth rate rose from 5.6% to 6.7%. In 2004, Singh was elected prime minister, reforms accelerated and economic growth jumped to 8.7% a year over the next five years.

But this May 16th marked the biggest milestone of all.

Indian voters re-elected Singh as prime minister and for the first time in history they also gave his Congress Party effective control of the legislature! Indian stocks shot up 17% in one day. And they haven’t looked back. They’re up over 40% since the election.

Most importantly, this isn’t about a one-year boom. India is entering the 21st century and the 20th century at the same time. Its 21st century IT and pharmaceutical sectors are growing rapidly. But so are its 20th century automobile and telecom industries. And because India is starting from such a low base (its per capita GDP is about half that of China and about one fifteenth that of the U.S.), the growth can be strong for many years to come—much as China has averaged nearly 9% annual growth for the last 25 years.

Various Ways to Play

The simplest way to play India is through an exchange-traded fund. The top-performing U.S.-listed fund year to date is Wisdom Tree India Earnings Fund (EPI), up 85%. Since this fund follows an index, it’s passively managed and expenses are reasonable, just 0.88%. This could be a good place to put money, especially after any significant pullback in global equity markets.

For greater profit potential, you can target emerging leaders in some of India’s fastest growing core industries, including telecom, pharmaceuticals and information technology. A number of these are listed in New York and London and are easily traded from any U.S. brokerage account. And the number of Indian companies available to trade this way is steadily growing so keep an eye out for more opportunities in the future.

But when you look to diversify your portfolio internationally, be sure to consider India. The Bengal Tiger could turn out to be the most exciting Asian Tiger of all.

Common myths about offshore banking

Legislating from 31,000 Feet…

Common Myths and Misconceptions About
What Global Banking and Investment can Do for YOU

By Patrick Bove

“This must be what it feels like to be a Congressman.”

So said my seatmate on the flight from Dallas Fort Worth to Los Cabos, Mexico, home of the 2009 Offshore Advantage Academy.

“From 31,000 feet, everything looks so simple… Entire states blend into each other. Towering mountains are flecks on the horizon. And Americans’ most pressing concerns are inaudible. (Except for the guy three rows up who wants extra peanuts.)”

He had a point. From this vantage point, you can see everything – and nothing.

And here’s the scary part…

If your perspective was “fixed” at this giddy height – you might start to act like a Congressman too.

From this perch, there’s no problem that can’t be solved. No “micro” that should go unmanaged.

It Makes Sense When You Think About It…

No wonder Washington’s bureaucrats, Senators and Congressmen are so intent to tell us where to invest, how to live… and (who knows what’s next) when to breathe?

They’re thinking and acting at 31,000 feet… while causing massive uncertainty on the ground.

And as a result… we are threatened by one grand delusion after another. Which has led us to massive national debt, a devalued currency… and the “genius” idea that more spending will actually save us money.

Meanwhile, medical costs are exploding, Social Security is about to dip into the red and unfunded pensions are forcing millions of Americans to re-think retirement.

I know it’s not just me. Odds are you’ve cracked open the newspaper this week and said to yourself, “They did WHAT?”

And you’re not alone…

According to our research, 11.1 million Americans have asked that question one-too many times. They’re fed up and they’ve decided to leave the country.

Some are picking up everything and going offshore. Others are simply investing in a safe-house-slash-vacation-home or moving their assets to safety…

There are a couple myths about the offshore world that get circulated each year, and they’re way off base!  So let’s go ahead and dismiss them with a 1-2 punch:

Myth #1: You should make your first million… or three… before thinking about going “offshore.”

Wrong! Most people believe the “offshore world” is reserved for millionaires and billionaires – but nothing could be further from the truth! There are benefits to going offshore that can benefit practically anyone – from the average investor to the tycoon.

Case in point, a man I know of – I’ll call him Carl – has relocated his family offshore, for the simple fact that his elderly mother requires live-in assistance. Today, she enjoys this high level of personal care and it only costs Carl $160 a month. (A similar setup in the U.S. would set him back nearly $5,500!)

Myth #2: You need to quit your job, hire six lawyers, thirteen accountants and a magic eight-ball to set-up an offshore investment or bank account.

Wrong! That’s what the keepers of the “status quo” would have you believe! In reality, it’s a breeze to check the financial stability of an offshore bank… transfer money overseas… and invest in a bevy of legal opportunities that can smash the S&P 500. You just need to know the right questions to ask… who to trust and which offshore entity is right for you. And that’s exactly what you’ll learn in lessons one through three.

Until next time, I wish you all the best!

Patrick Bove

Swiss private bank puts US on the Blacklist

This Wednesday morning, I received a phone call from Rob Vrijhof, (right) our long time investment and banking associate in Zurich and a member of the Sovereign Society Council of Experts.

Rob called my attention to the announcement today by the venerable Wegelin & Co., Switzerland’s oldest private bank, that it will stop doing business in the United States and with Americans.

Founded in 1741, the St. Gallen-based bank, said their decision was a response to stricter measures introduced in the U.S. against tax evasion and projected changes in U.S. estate tax laws, which could make some non-U.S. citizens liable for U.S. taxes if they inherit U.S. securities.

The bank did not mention new U.S. government demands that offshore banks giving investment advice to U.S. persons must register and qualify under SEC rules…which is itself a blatantly illegal attempt to extend American law well beyond its normal jurisdictional area (which ends at the U.S. border, regardless of what the feds may have you believe).

So drastic have the IRS/SEC extraterritorial measures become that even members of the U.S. Congress have protested they go too far.

“Untenable Position”

In their letter to investors, Wegelin bank said Swiss banks were being forced into “an untenable position,” and in all fairness, they make a good point…

Given the lack of clear definitions in the IRS proposed rules, Wegelin believes the imposition of being expected – by the IRS – a to know which clients were liable to pay U.S. taxes is “an impossible undertaking.”

“The danger of inadvertently making false declarations to the U.S. tax authorities will be too great,” the letter went on to explain.

The bank gave the United States an added zinger, saying it believes the U.S. government overestimates its attraction as a financial center, thus Wegelin is advising its clients to pull out of all U.S. securities investments.

So the inevitable question, then…Are more banks going to follow in Wegelin’s footsteps?

Yours truly,

Bob Bauman, JD
Legal Counsel for The Sovereign Society

Article Source:  Sovereign Society