Five Key Advantages of Offshore Investing

The “offshore” world is a world where you can achieve greater profits… greater privacy…greater asset protection…and greater protection against unanticipated events than you can domestically.
Let me tell you about what may be the single most significant reason to invest offshore. Profits!

You wouldn’t know it from the financial headlines, but in the last 10 years, the U.S. stock market placed among the 10 best performing markets in the world only once! That was in 1997, when it was #4.
Even though U.S. stocks have rallied for two years (after losing big for three straight years), the U.S. market was outperformed by many other stock markets —some of which more than doubled the S&P 500’s total return of about 35% in the last two years.

Big winners for 2004 included:
Germany: +72%
France: +49%
Australia: +43%
Turkey: +96%

Profits 50%, 100% or Even 200% Higher than in the U.S. Market

Unfortunately for many investors, buying foreign stocks through a domestic bank or broker carries some drawbacks. While it’s now possible to make some foreign investments in the United States—for instance, you can now purchase foreign currency CDs through domestic banks—doing so provides zero privacy and zero asset protection. Nor do foreign investments made through a U.S. financial institution provide investment continuity in the event of a shutdown of U.S. markets—a scenario that became all too real in the days following the terrorist attacks of September 11, 2001.
How can you gain access to these markets?

One way is by purchasing American Depository Receipts (ADRs) through a domestic broker. For the largest and most liquid foreign shares, ADRs are a great option. However, only a comparative handful of foreign shares are traded as ADRs.

Some U.S. full-service brokers will purchase securities traded on foreign exchanges for their clients. But buying—and especially selling—may be a nightmare. This is because most U.S. brokers aren’t equipped to take custody of foreign securities. You may discover that the offshore security you want to buy isn’t available to U.S. investors at all. That’s a consequence of the laws and regulations enforced by the U.S. SEC, which prohibit issuers of “unregistered” securities from marketing in the United States.

The Sovereign Society
The Sovereign Society, headquartered in Waterford, Ireland, was founded in 1998 to provide proven legal strategies for individuals to protect their wealth and privacy, lower their taxes and to help improve their personal freedom and liberty.
The Society's highly qualified contacts recommend only carefully chosen banks and investment advisors as well as financial and legal professionals located in select tax and asset haven jurisdictions around the world. The Society provides advice concerning the establishement and operation of offshore bank accounts, asset protection trusts, international business corporations (IBCs), private foundations, second citizenships and foreign residency, as well as practical safeguards for financial, Internet and personal privacy.
The Sovereign Society stands alone in fulfilling this singular, international offshore service role for its members. To learn more about our organization and how you too can become a member, Click the link below:

To gain access to the true richness of the offshore investment world, you need to open an offshore bank account. The Sovereign Society can help in this respect, through our Convenient Account relationships with three of Europe’s leading private banks.

For more information on the Convenient Account program, see The Sovereign Society

The offshore banks we recommend offer all the services you would expect from a full-service stockbroker—and you may purchase any security in the world, not those just listed on a domestic exchange. The purchase price, less applicable commissions, is debited from your account. SEC roadblocks are no longer relevant, because the offshore bank purchases the securities in its name, not yours. You will also receive professional research with regular buy/sell recommendations. And, like a domestic securities broker, you may issue limit and stop orders.

The Dollar Goes Down… but Foreign Currency Investments Win Big

Over the last three years, the U.S. dollar has lost more than one-quarter of its value against the euro and other major currencies. For most Americans, this is an invisible loss—you don’t notice it unless you travel abroad or import goods or services that are priced in terms of foreign currencies.
But a relative handful of savvy investors have been raking in profits as the dollar declines. One of the ways this is possible is with foreign currency investments. And it’s easy to purchase foreign currencies through any offshore bank.

For example, at the beginning of 2000, The Sovereign Society recommended purchasing euro-denominated CDs. Let’s say that you did so, and purchased a one-year 4% CD denominated in euros for US$10,000 on January 1, 2000. At that time, US$10,000 purchased _10,050. You rolled the CD over at the beginning of 2001 at a 4% interest rate. You did the same in 2002, 2003 and 2004, for interest rates of 2.5%, 2% and 1%, respectively.

On January 1, 2005, your CD was worth _11,368. But since 2000, the euro has appreciated sharply against the U.S. dollar. If you cashed out your CD on January 1, 2005, and converted it back to dollars, you would have received US$15,650, less fees and commissions. Because of your currency gains, your total five-year return nearly quadrupled, from 14.8% to 56.5%.

Of course, the euro could have just as easily gone down against the dollar. But in an uncertain long-term economic environment, it only makes sense to diversify your currency holdings internationally—and foreign currency CDs are one of the easiest ways to do so.
Incidentally, it’s possible to purchase foreign currency CDs domestically through sources such as Everbank But minimums are generally lower, and yields higher, when you buy them through an offshore private bank.

Offshore Investments Take Your Wealth Off the “Radar Screen”

Your wealth, spending habits and almost every other detail of your financial life is under scrutiny in the United States. The website usuncover.com, advertises “Find Anyone and Find Out About Them.” Hundreds of other websites that advertise their services in “tracking assets” make similar claims. Sue-happy lawyers and anyone else curious about what you have and where you have it can easily invent a pretense to obtain access. Fraudulent access is common as well, as proven by the recent penetration by identity thieves of data brokers such as ChoicePoint and Seisint.

However, if you look carefully, you’ll notice that these services can only locate assets in the United States. There’s an important reason for that. The United States is one of the few nations lacking a federal statute that protects bank or securities accounts from disclosure except under narrowly defined circumstances.1 Many disclosures that would be illegal in other countries, either under international agreements such as the European Privacy Directive,2 or under national laws guaranteeing bank secrecy, as in Switzerland, are commonplace in the United States.

The practical consequence is that once you move your money outside the United States, it drops off the domestic “radar screen” and becomes virtually invisible to information brokers and private investigators. If someone is sizing you up as a target for a lawsuit—or a government agency is looking for property to seize—these assets won’t show up without some digging.

The Right Offshore Investments—and Legal Instruments—Can Make You Virtually Judgment-Proof

No doubt, you’ve read the horror stories and are familiar with the litigation explosion in the United States. Many hard-working Americans who have accumulated wealth over a lifetime have tragically discovered they are “easy pickings” for legal predators. This is simply a fact of life in our legal system where justice is incidental to lawyers successfully recovering huge judgments under such nebulous theories as “emotional distress.” Even burglars breaking into homes have been awarded damages against the homeowner if they are injured!
True, there are domestic asset protection laws and instruments—homestead provisions (state-legislated tax breaks on your principal residence), limited partnerships, trusts, annuities—but in most cases, the protection they provide is a matter of state law. And there are very wide variations between states. For instance, Florida law provides an unlimited homestead exemption to an owner occupied home. New Jersey, by contrast, has no homestead exemption at all.

In contrast, prudent offshore asset protection techniques, jurisdictions and programs can offer enough wealth preservation barriers to send most litigants and lawyers after Americans without offshore structures and protection. Even if a creditor discovers your offshore assets, those monies ordinarily won’t be retrievable without a judgment. In that event, a U.S. court can order the repatriation of any foreign assets controlled by a U.S. debtor. Failure to comply may lead to a civil or criminal contempt citation.3 However, in some offshore centers, such an order won’t be honored against certain investments or structures, such as an insurance policy or trust.4. Indeed, an offshore investment such as a Swiss annuity—available for an investment as low as US$20,000—can offer virtually ironclad asset protection in the event of a lawsuit or bankruptcy, with no additional attorneys’ fees. For more information on The Sovereign Society’s Swiss Asset Protection Programs, click on sovereignsociety.com

The Hidden Terrorist Risk of NOT Investing Offshore

The world has changed since the attacks of September 11, 2001. One risk that has not received much attention by the news media—most likely because Wall Street doesn’t want you to know about it—is the threat to your wealth and portfolio should another attack target America’s financial infrastructure.
After the September 11 attacks, U.S. financial markets were closed for four days. During that time, you were locked out of buying or selling any of your U.S. stocks, bonds or mutual funds. In contrast, if you had assets safely stowed away in a secure, neutral country such as Denmark, Austria or Switzerland, you could continue trading any foreign securities you owned, as markets in these countries were not affected by the attacks.
If there are future attacks on the U.S. financial markets, they could be conducted with weapons of mass destruction with even more devastating impact. It’s possible that U.S. markets could be shuttered for days or weeks. In the meantime, the U.S. dollar could be decimated and the vast majority of U.S. investors would be powerless to protect themselves financially. Read the case study, “Nightmare On Wall Street,” to learn what could happen to your Wall Street wealth and your U.S. domiciled investments when terrorists strike America again. Link: www.wolflaurelnews.net

What About the Risks?

Wall Street, regulatory agencies and probably your own broker have long warned about the so-called risks of “going offshore.” They claim that offshore investing subjects your portfolio to foreign currency risk, but say nothing about the potential for currency gains in today’s weak dollar environment. They warn that the regulatory and accounting standards outside the U.S. are not as strict as in America, but conveniently forget about the dot-com, technology and Enron accounting scandals that cost investors billions. Financial pundits continually harp on the importance of diversification as the safeguard for every investment risk and scenario, but say nothing about the benefits of diversifying outside the U.S. market and the U.S. dollar.

Why are the government and the financial establishment so opposed to offshore investments? One reason is that when money leaves the United States, it’s much harder to track because of the privacy laws I’ve already described. In addition, money going offshore means less profits and commissions for U.S. firms—and they will do anything they can to avoid this loss.

Sure, the offshore investment industry has its share of sharks and charlatans. On the other hand, the jurisdictions The Sovereign Society recommends have regulations to protect investors from fraud that are just as strong—and sometimes stronger—than in the United States. To avoid offshore frauds and scams, it’s important to work only with established institutions and quality jurisdictions. Second, always deal with competent tax, legal and accounting experts in the United States, who understand U.S. tax laws and foreign investment reporting requirements. Finally, if an investment or recommendation, offshore or domestic, sounds too good to be true, then it probably is. Hang on to your wallet when you hear outrageous claims of “guaranteed” profits.

In the final analysis, it is up to you to educate yourself and take the steps necessary to defend your wealth. You’ve already taken the first step by becoming a member of The Sovereign Society. Now, it’s time to take action!

Ron Holland is a retired financial consultant and global advisor who developed the first gold IRA, Swiss franc IRA and the first Swiss franc denominated U.S. variable annuity portfolio for Pioneer Mutual Funds. He has written extensively on offshore investments and the terrorist threat to U.S. investors and markets. He lives in the mountain resort of Wolf Laurel, North Carolina, where he is a realtor and broker with Wolf Laurel Realty for this gated retreat community with 5,000 acres almost totally surrounded by national forests and the Appalachian Trail. Tel.: 1 (888) 689-5001. Link: www.wolflaurel.com.

Real Estate In Bulgaria - - The phenomenal interest in Bulgarian property

The phenomenal interest in Bulgarian property shown by shrewd buyers during the last two years has been compounded by a sudden surge in golf course development. The millions of Euros being invested by large international corporations in these ventures will probably feed this buying frenzy.

According to the 2004 survey of the International Real Estate Federation (FIABCI) and ResearchWorldwide, which monitors house price rises in 23 countries on a monthly basis, the highest was South Africa at 27.8%. By comparison, Bulgaria recorded an average increase of 31% for the 12-month period (Q4 2003 - Q4 2004).

The most popular investment now, and probably until Bulgaria enters the European Union in 2007, is 1- and 2-bedroomed apartments, purchased off-plan, in strategic winter and summer resort areas.

At the present time there are only three golf courses in the whole of Bulgaria: one at Elin Pelin, near the capital, Sofia, and two owned by Air Sofia. These are located at Ihtiman, opened in 2000, 40km from Sofia, and at Sliven, opened in 2004, 90km from the Black Sea. Because of the increasingly rapid rise in foreign interest in Bulgaria recently, several more golf courses are proposed. One of these will be located at Razgrad, in the northeast, about 90km from the Black Sea. More are scheduled to open in the next few years: two at Kavarna and one at Primorsko, near Sozopol.

Mountain and ski areas will be represented by a golf course in the ski town of Bansko this year, and a very large golf complex between Kostenets and Borovets, the country's foremost ski resort. This is scheduled for 2007, the year of Bulgaria's entry into the European Union, and will be located at Dolna Banya, already near Bulgaria's first golf course at Ihtiman.

Golf in Bulgaria

Bulgaria Properties Ltd has purchased almost 6 acres of prime development land adjacent to the proposed golf course at Dolna Banya. The plans are to construct about 220 apartments around a comprehensive sports complex, with access to the golf course by a short footpath. The amenities on site are to include tennis, volleyball, squash, badminton, lawn bowls, boules (boccia), shooting, archery, croquet, mountain biking, and fishing nearby. Indoor facilities will include a 140-seat main restaurant and cabaret stage, a huge main bar (perhaps the largest in Bulgaria), a sports bar with projection TV, snooker, pool, table football, table tennis, a Chinese restaurant, Indian restaurant, fast food cafeteria, pizzeria, gymnasium, sauna, massage parlour, clinic, chemist, sports shop and mini market.
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Bansko Town
Apart from having ski lifts and ski runs, Borovets and Bansko these two towns are quite different from each other, and appeal to different groups of people. Bansko is an old, traditional residential town with lots of character and no fewer than 180 quaint taverns full of local people singing and dancing to a typical Bulgarian folk band. Borovets, by contrast, is purely a resort, with hotels, modern west European style bars and night clubs, caf�s and restaurants. Residential property and holiday homes are therefore readily available in Bansko, but not in Borovets, where the closest you can get is usually in one of the surrounding villages.
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As for property values, Bansko went mad for a period of three months at the end of 2003, with land prices doubling, and then calmed down. Many poor goat herders suddenly found that they were rich. Nothing wrong with that, I say. Since then values have been pretty steady there until now, when they’re starting to creep up again. The reason for this is that the sudden surge in foreign tourists to Bansko has left the supply of holiday accommodation woefully short of the demand. And this trend shows no sign of abating. To try to cope with it, many hotels have been springing up and apartment projects, but it seems unlikely that even these will be able to satisfy the demand for accommodation for several years yet. As a result, the prices for such apartments range from 1,000 Euros per sq.m. for a ground-floor unit facing away from the mountains, to 1,350 Euros per sq.m. for a top-floor example with a mountain view. Yet, people buy them. I guess, because a 1 bedroom 60sq.m. apartment for £41,000 is still a far better deal than you’d get in Spain. I’ve heard developers claim that 90% of their apartments are sold within 3 weeks! I only hope that we have such luck when ours are released in April!
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In this respect Borovets, again, is different. Although it’s Bulgaria’s first and best-known ski resort, it stagnated for years… until now. The ‘Super Borovets’ project, funded by EU, governmental, foreign and local business sources, is scheduled to run from 2005 to 2009, and will revitalise the whole region around the town to a radius of 10-12km. This has already started to affect property values in the surrounding areas. To give an example, in March 2004 we bought, unseen, a half-acre plot in a village 15km from Borovets. When I visited it, I discovered that it wasn’t suitable for building apartments; so, I put it on the market in August. By November it was sold at an 80% profit even after all costs were deducted!
Maritsa Appartments
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I am personally of the opinion that the ‘Bansko effect’ could strike around Borovets at any moment. That’s the reason why Bulgaria Properties Ltd is developing four projects here, and only two in Bansko. We can sell these apartments about 15% cheaper – at the moment, anyway. Borovets must surely offer a better return on investment, regardless of the type of property bought: land, a shack, whatever. You won’t find new apartments easily, though. As far as we know, Bulgaria Properties Ltd is the only developer building them. I don’t, however, expect this monopoly to last for long.

Bulgaria’s third ski region is at Pamporovo, which, like Borovets, is purely a resort. Funding is starting to come in, but full development, if it happens at all, is likely to follow several years behind Borovets. Its distance from Sofia (a day’s drive) makes it less attractive to visitors from north and west Europe. It is, however, popular with Greeks, because of its proximity to the frontier. One of Bulgaria’s major motorway routes to Greece will pass very close to Pamporovo, and this should boost its popularity, as well as making the Mediterranean Sea more accessible.

Property values are lower here than in Bansko and Borovets, but are creeping up gradually. I reckon that Pamporovo is a good long-term prospect; say five to ten years. The only reason why Bulgaria Properties Ltd has no developments here is because I’ll probably have retired before the boom happens.

There are plenty of outdoor pursuits in stunning surroundings for you to enjoy in Bulgaria

How does a mountain area investment compare with coastal properties?

Significant differences yet again. Until recently, most of the investment was flooding into the northern Black Sea coast resorts, from Varna down to Sunny Beach. The area became very popular as a result of the Bulgarian government’s ‘Bulgaria the Beautiful’ TV campaign back in the ‘80s, and the subsequent interest of package tour operators. Now that the north is saturated with developments, the interest has begun to creep down the coast.

This is causing a steep rise in property values. They are still lower than those in the north, but the gap is closing. An investment in the south should therefore offer a better return of investment.

Don’t expect, though, the ambience of the south to become like that of the north. When I discussed the subject with the Chairman of the Bulgarian Foreign Investment Agency last year – an extremely intelligent and able young man, I must add – he told me in no uncertain terms that he did not want the south to become like the north. His very words were: “We don’t want another Benidorm.” So, prospective property purchasers need to bear this in mind, and balance their desire for more capital growth, or their willingness to accept less, with the different rental market appeal of the two regions, along with their own taste in holidays.

There is one highly significant factor, however, which very often goes unnoticed until it is too late; and it applies to the whole coast. Most people don’t know that it freezes on the coast in winter. When they see the coastal resorts basking in the hot summer sunshine, it’s difficult to imagine snow on the ground. The entire coast simply shuts down in the winter, and nothing happens. It’s as dead as a doornail. Therefore, rental income can be fairly assured for 15 weeks, possibly 20, plus some odd bits in the shoulder seasons of April and October. The coast has a five-month season from May to September, compared to nine months in the ski areas. Those people buying only for rental income, therefore, would find the mountains far more lucrative.

Rents vary greatly, and depend on many factors, most of which should be obvious: location, size, view, amenities. The standard of finish and the condition of the property can also determine your market quite radically. To appeal to west Europeans, and to command the highest rents, your property must be well finished and appointed, and be in tip-top condition. If it is not, you still have a market for east Europeans, who tolerate less salubrious surroundings because they pay much less, usually about half of the west European rates.
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Generally, summer rental rates on the coast equate to winter rates in the ski resorts, both seasons being about five months. Remember that you also have about four months additional rent, though at lower rates, during the summer in the mountains. These rates should increase gradually, as the Government programmers to make the ski towns more popular for summer holidays make their mark.

There are several Bulgarian agencies willing to manage your rental properties for you. Expect to pay about 20% of the rent as a fee.”

What about properties in the countryside?

Not a serious contender in the return of investment stakes, I think. Not if you consider the effort involved. You can pick up property very cheaply indeed in the inland areas, away from the resorts. Almost always it’ll need some kind of work; anything from a face-lift to demolition. There’s often no inner staircase to the bedrooms, no bathroom, and the toilet is in a shed in the garden. This kind of property is great for buyers who want to get away from their homeland, and disappear in the beauty of nature permanently. As a business, it could appeal to self-builders or DIY enthusiasts, prepared to do it for fun, and accept a low return on their financial and physical investment. As for rental income, forget it!”

And the cities?

Again, there are differences, even between cities. The prime city is, of course, Sofia, the capital. Buy the right apartment here, in the right area, and you can expect a guaranteed rental return of about 12% per annum. The flavour of the month is gated communities, particularly in the south of the city. The diplomatic residential district of Vitas is one of the best bets. There is a ready demand for luxury accommodation from diplomatic staff and executives seconded by foreign companies, usually on a long-term basis, and this demand should increase as 2007, the year of Bulgaria’s accession to the European Union, approaches. Although you should expect to pay high for such properties by Bulgarian standards, it’s still only the price of a renovated Victorian terraced flat in a UK provincial town.

There’s virtually no market for tourist rentals in Sofia, as it’s probably the least interesting European capital city. It’s also very polluted, although they are trying to clean up their act, ready for EU entry in 2007.

Plovdiv, the country’s second city, is much more pleasant. It has a quaint old town, as well as modern business districts. It therefore bridges the gap between business and tourism, as far as rentals are concerned. Plovdiv is connected to Sofia by an excellent motorway, on which you can keep the pedal to the metal, if you’re prepared to risk an on-the-spot fine of 50 Leva (about US$34 or £18).

Veliko Tarnovo is probably Bulgaria’s most touristy city, with its citadel and mediaeval ramparts. Most people who buy property here do so to make it their main home. The city itself is beautiful, and it has everything a townie needs. Drive a short distance, and you’re in some wonderful countryside. You couldn’t really make a good living from rentals, but it’s the perfect place to retire to.
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A relaxing spa bath
There’s one more thing which is important enough to mention: Mineral baths. These exist all over Bulgaria, the most significant being at Narechen, south of Plovdiv, and Momin Prohod, near Kostenets. Scientific studies rank Bulgaria among the foremost in Europe for hydrothermal, bioclimatic and mud treatments, sea cures and other health resources. Bulgaria is a world leader with its exceptional diversity of medicinal herbs and the excellent curative properties of its apian products. Any property near a spa should attract a premium to its sales or rental value.
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Bansko Mountains
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Full details about the ‘Super Borovets’ project, price madness in Bansko, golf developments in Bulgaria, and new apartments in Bansko and Borovets can be seen at Bulgaria Properties Ltd Or you can e-mail advice@BulgariaProperties.net, or call the company at + 44 (0)1268 684 484 to order a free 28-page hand-out, or just for a chat, if you prefer. They always have time for you.