* International Investments – Go Nord Young Man
* Ecuador Real Estate – Fight Inflation in the Galapagos
* Natural Health Tip – Pain in the Pocketbook
This is a final look at synchronicity and seven clues about where it’s good to invest now. See all seven clues at Synchronicity and Where to Invest
The last three clues are #5 know the ecological and economic environments and anticipate change by watching for trends, #6 Head north and #7 adjust.
One northern area this site has been promoting for years is Scandinavia.
Many recent computer models show that Scandinavia seems to be most resilient to the ecological and human impacts of climate change. Indeed in the mid-term, numerous cold places, like Britain, Canada and Scandinavia will likely benefit from climate change, with longer, warmer summers, safer climate and increasing crop yields. The same goes for parts of the northern American continent.
Take England as an example. A Friday July 28, 2006 Guardian article entitled “Climate change could bring tourists to UK” says: “Climate change could ‘dramatically’ change the face of British tourism in the next 20 years, with European tourists flocking to the UK to escape unbearably hot continental summers, experts say. Research shows that European tourists may choose to holiday in Britain as resorts nearer to home become too hot. Weather changes may provide revival opportunities for northern seaside towns such as Blackpool and put new strains on roads and development in southern coastal resorts, a study in the Journal of Sustainable Tourism said. You can read this entire message at The Guardian Unlimited.
Scandinavia may benefit as well. Copenhagen is Merri’s and my favorite European city. English is spoken. The people are friendly and happy. In fact according to one survey, they are the happiest people in the Western world. See The Article on Happiness.
Plus Denmark is the safest country in the world to bank. See Banking Services for “AAA” Safety
Recent messages at our spottingtrends.com site have also shown that some of the strongest currencies in the world are all in the north…Norway, Sweden, Denmark and Canada. See International Investments in a Diving Dollar
International Investments in a Diving Dollar
This presents some opportunity as the Norwegian kroner has flagged recently. Thomas Fischer at Jyske Bank reinforced this in his last August, 2006 currency review when he wrote: “The strong NOK There is no doubt that NOK is currently driven by market expectations of the development in interest rates between the euro-zone and Norway, but certainly also expectations of the interest-rate difference between Norway and Sweden. Although as expected, Norges Bank raised the leading interest rate by 25 bp at the meeting on Wednesday, the subsequent press conference was not what the financial markets had expected. The hike is still justified by the tight labour market whereas high corporate earnings and a strong housing market also point to higher interest rates. The main catch is inflation which is still somewhat below Norges Bank’s target of 2.5%. Norges Bank expects a rise in capacity utilization this year and next year, which will contribute to inflation gradually rising towards the target over the next three years. But the conclusion of the statement from Norges Bank was clear. In spite of the recent weakening the krone remains strong!
Norway has a double advantage with its huge oil reserves to support the kroner now and perhaps more pleasant weather in the years ahead.
This could create some opportunity for borrowing the Swiss franc (the interest rate is about 2.75%) now and investing in Swedish, Danish and Norwegian currencies either in bonds or shares.
Join Merri, Thomas Fischer of Jyske Bank and me at our next International Business and Investing Made EZ course in North Carolina. Learn up to date MultiCurrency Sandwich fundamentals. Learn how to figure the risk and rewards. Learn which markets and currencies may be strong in the year ahead. Meet Steve, our man in Ecuador, and learn about products to export. Go to International Business and Investing Made Ez Course Information Page.
The franc needs to keep its parity to the euro. Switzerland is poor in natural resources. It must export to survive and over 50% of Switzerland’s exports go to Germany alone. A strong Swiss franc versus the euro makes the Swiss products too expensive.
For example you can invest in Danish Bonds (Realkredit) due 2008 that yield 3.63%, (Bullet) maturing 2013 yielding 3.89% and (Realkredit due in 2025 paying) 4.06% and (Totalkredit) due in 2035 paying 4.15%
Norwegian government bonds in NOK due in 2008 pay 3.74% and 2001 3.90%.
Swedish kroner bonds (Spintab) due 2008 yield 3.48% and 2009 3.68%.
This gives a very safe MultiCurrency Sandwich opportunity over the next five years. You can borrow Swiss francs and invest in Scandinavia bonds.
Assume you invest $50,000 and use the investment as collateral to borrow $200,000 more in Swiss francs.
You invest the $150,000 equally in
|Amortized cost of loan||$400|
|Amortized bond purchase cost||$100|
|Amortized forex cost||$65|
|Interest at 2.75%||$5,500|
|Net Income before forex shifts||$3,457|
|Yield Per Annum||6.91%|
Assuming you held this position for five years (if held for less time the up front 1% loan fee, 0.25% bond cost and 0.15% forex fee would reduce return) the income on the original $50,000 is nearly 7%, a very good return for such a safe portfolio. There are risks, that the Swiss franc interest or parity could rise or bond values could fall. However, there is also added potential that Swiss franc interest or parity could fall and bond values could rise.
You can reduce risk (earnings and potential) by borrowing less than four times your investment.
If you like the long range view of Scandinavia and these three currencies this type of portfolio makes sense.
For more details on how to set up this MultiCurrency sandwich contact Thomas Fischer at Fischer@jyskebank.dk
Another way to enhance this potential is to invest part of the borrowed Swiss francs in Scandinavian shares. See how tomorrow.
P.S. Double your profit potential with the MultiCurrency Sandwich. Learn how to leverage Asian investments in top value markets. See Borrow Low Deposit High – How to Use the MultiCurrency Sandwich for more information.
Not all this change will be pleasant an July 23, 2006 Observer article outlines some of the negative aspects of a warmer Britain. Entitled “100º – get used to it” the article says: “Britain experienced its hottest July day on record last week and forecasters say more is to come as climate change tightens its grip on the country. Global warming experts claim that by 2050 temperatures will regularly top 40C and warn that our health and infrastructure will be unable to cope. They were the images that finally demonstrated the irreversible climate change now taking hold in Britain. Where green parklands once provided cool refuges in our cities, newspaper photographs last week showed them to be bleached, white landscapes. Reservoirs were revealed as cracked, arid deserts. And from Cornwall, pictures of the nation’s first cage-diving trips for shark-watching tourists, an experience normally confined to Australia’s Great Barrier Reef. In addition, schools closed, steel railways buckled, and road surfaces melted. And finally, last Wednesday, the temperature reached 36.3C, the hottest July day on record. Once more Britain experienced a scorching heat wave, the fifth bout of intense summer heat to have struck the country in 10 years. And the weather forecaster says there is a lot more to come. Read the entire article at The Guardian Unlimited
Pleasant or not pleasant change creates opportunity. Weather shifts can reduce property value in places like Florida, Spain and around the Med. Prices may rise in cooler coastal climes such as the Isle of Man, the Nordic nations. Suddenly sunny summer holidays in Alaska, Helsinki or British Columbia may be hot (in more than one way).
Our sites are based on the concepts that the sun always shines somewhere. Though it may be shining more than we like, as it shifts so too will opportunity. Look for the trends that come and until next message, enjoy good global investing!
Ecuador Real Estate – Fight Inflation in the Galapagos. Invest with a Purpose.
Natural Health Tip – Pain in the Pocketbook. Knock 80% off dental bills.
Change will come weather, social and much more. Adapt to it and most of all be happy, though we cannot always see it, this change is good. While on the subject of happiness and the north, here are two northern readers who share pictures of what makes them happy.
First are two readers from Montana who are in Canada in this shot. One item I knew had to make readers happy but had not yet heard….Harleys…in this case go north! The reader shares: “Hey Gary: I enjoy very much your newsletters. We concur 100% that simple living and high thinking are the blessings of life. I once heard a great proverb in China. “A man drinks water from his own well. He eats food from his own garden, and a King can have no more.” We always tried to live by this tenet and found great fulfillment and happiness. We too eat from our garden, have venison in the freezer and trout in the creek. Karen and I hope to join you one of these sessions and share more. Attached is a recent picture of Karen and me as we took our Harley around British Columbia and also the garden as it was being built. What a glorious Province British Columbia is. Thanks for your contribution.”
Another Canadian reader who spends much of the winter in Ecuador is happy with the grandchildren.
She writes; Gary: “One (or should I say two) of the things that make me happiest are my little granddaughters, Madeline and Zara. We’ve had the pleasure of living next door to them for a year. Receiving unconditional love from a child is truly one of the joys of life! Looking forward to seeing you both in early November.”
Those grandkids are great! Here is Merri and me with my mom and ours. Four generations with the third taking the picture. Another is on the way any day, our first granddaughter!
P.S. Be Free & Fulfilled – Turn Your Passion Into Profit Thru Writing and Publishing.