🚨Investment Power Play🚨 Storage

Dogs Bury Bones, What Should an Investor Do?

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I’ve been thinking of the larger macroeconomic landscape and the need for investors to preserve their wealth during an inevitable recession or depression ahead for most of the global economy. I believe if history is any guide, the winners (or those who lose the least) will find assets that go up in unison with inflation or fail to fall due to their safe-haven status. Besides investing in those assets or sectors yourself, I’ve thought of a potential business opportunity.

I sincerely believe that the overall macroeconomic picture signals that gold/precious metals will become more relevant in global affairs. While there are some reputable, large companies for storage–there is an increasing void with many countries either remaining closed due to immigration protocols or others seemingly coming out of neutrality by throwing their hat in the political ring—at a time when political risk to capital is intensifying. I therefore believe that the small, yet troubling question of Where do I store my wealth? has no obvious answers.

For this reason, I think it would be a sound business proposition to create a new gold custody company. I have met with relevant individuals in the Isle of Man but admittedly in practice it falls flat on its face. I’ve abandoned thinking of the idea but the more I look at the factors of gold & silver and the need for neutrality, I continue to think having a storage company is a good idea.

Ideally, a place with great geographical positioning (outside bad weather & relatively connected), it’s politically benign for the most part, it has low crime rates and a high standard of living for the region. Additionally, a place with a smaller population means less in-fighting & a place with viable real estate/land for a project of this sort. Below I’ve named some proposed countries that fulfil some of these requirements.

For the local side of things, it would create local employment and a simulative factor to the domestic economy. Secondly, it would indirectly bring in foreign direct investment as confidence as a new wealth haven improves. Lastly and moreover on the second point, it would diversify the economy to improve resiliency.

I realize that costs behind security, the storage vault/room itself, the importing of items, paying of staff & insurance would all run high (perhaps why many are not jumping to the idea). However, in a world where gold may revert to once again be established as money then we are quite literally considering the idea of creating a bank which specializes in the safe keeping of real wealth, not fugazi deposit liabilities.

The countries that I’ve searched thus far include: Aruba, Falkland Islands, Iceland, UAE (Gulf), Cook Islands, Uruguay, Mauritius. I’ll summarize the immediate issues I have uncovered in this mini-investigation as well as their pros as I see them.

Aruba

  • Taxes. Aruba completed a tax reform in 2022 that ultimately makes themselves less competitive, raises tax, squeezes margins and limits their ability to diversify beyond tourism.
  • My consultation with a lawyer quickly made it apparent that there were no viable tax incentives on any level either. Effort is given to nurture their tourism sector rather than new ventures
  • Corporate Tax sits at 25% & import taxes are high. Indirect taxes add up as well.
  • My take away was that it would not be profitable without some loosening of tax/regulation.

The pros however:

  • One of the wealthiest Caribbean country.
  • Island which is far safer than rest of the region
  • 80% of their economy is dependant on tourism with almost 70% depending on USA tourists, their economy could use a change up.
  • Outside of the Hurricane Belt
  • Constituent country of the Kingdom of Netherlands but often politically agnostic
  • Existing flight routes from US, South America and Caribbean

*I have inquired with Aruba’s Free Zone for more possibilities*

Falkland Islands

  • Falkland Islands are far, far away. Perhaps this could be a pro, but it could limit the ability to expand the business. Costs would be high for everything.
  • Falkland have had a relatively recent conflict with Argentina. In a world with conflicts arising, it may not be stable
  • Taxes. 21/26% Corporate income tax
  • Lack of viable real estate
  • British Overseas Territory, ultimately dictated by insane politicians

The Pros however:

  • Based upon British Common Law
  • Extremely low crime rates & self-sufficient population
  • Perhaps a bright future (read my article)
  • Truly secluded as an ideal storage location
  • Import Duties may be tax exempt upon request

Iceland

  • 20% corporate income tax, holding income is 20-22% and social security, pension & payroll taxes are very high as well
  • Limited real estate which is very expensive
  • US Navy airbase is present
  • Potential VAT tax of 24%
  • Tax incentives do not apply
  • Some restrictions on investments & business based on nationality

The Pros however:

  • Being an EEA member, they have a free trade arrangement (Switzerland is also in the EEA—a chance to take advantage of investors moving from there). This arrangement has also extended to other countries in the Mediterranean, Singapore and Mexico
  • Safest country in the world
  • Isolated, yet still between North America and Europe
  • Not an EU member
  • Relatively neutral (did not display aggression towards Russia)
  • High standard of living

UAE (Gulf)

  • The region is reliant on foreign powers to protect their riches
  • They do not champion freedom in the region like other locations
  • No investor guarantees that they’ll be able to lay claim to their asset
  • The law applied are twofold; GCC & nationals and foreigners –not a true rule of law
  • The place is very unidimensional in its abilities (though this is changing)
  • Often politically belligerent (taking sides) and often implicated politically because of their abundant resources
  • Taxes such as CIT or VAT have been implemented as well as economic substance requirements & other restrictions, modelled after the OECD and the European Union

The Pros however:

  • Extremely safe
  • Low or zero tax
  • Many opposing actors have their money in the region (disincentive to cause trouble there)
  • Rapidly growing
  • Perfect location to connect all corners of the world
  • Asia is pro-gold

Cook Islands

  • Personal difficulty encountering anyone local to take the proposal on
  • Heavily influenced by New Zealand and their nightmarish policies
  • Frequent poor wealth systems
  • Few logistical routes entering
  • Tax modification, not as friendly as before
  • Weak infrastructure/internet
  • Difficult to build structure
  • Difficult to become a resident
  • Time zone (could be beneficial)
  • Weak economy/lack independence

The Pros:

  • Compete with Nevis for the best Asset Protection laws
  • Generally untouched landscapes (opposite to Hawaii) for finding real estate
  • Safe Island
  • Close for Asian investors
  • Secluded islands

Uruguay

  • Possess a Wealth Tax, high corporate income tax & VAT
  • Spanish-speaking
  • Far from most of the developed world–expensive costs
  • Volatile region with relatively low crime rates by Latin American standards
  • Welfare state
  • Narcotic activity in capital
  • Expensive to import products

The Pros however:

  • Free Trade Zones can mitigate the tax issue (at a cost)
  • Secluded, ideal for storage
  • Lots of land for appropriate real estate
  • Friendly taxes for investors
  • Food and Energy secure to limit risk of internal conflict

Mauritius

  • Social inequality is high in the country
  • Cost of importing materials
  • Increasing food insecurity (food prices increasing and food waste is a concern)
  • Reliant on oil and food imports
  • Strict lockdowns in 2020; WEF and WHO fanboys
  • Authoritarian society/history

The Pros however:

  • Safest, most prosperous country in Africa, secluded from Mid-East and African problems
  • Business friendly
  • Many ways to reduce tax through incentives, foreign-credits, exemptions or just general good policy
  • Friendly with both Western and Eastern “worlds”, hedged with both areas for imports
  • Lots of high-end real estate available for more affordable prices
  • No history of bad wars
  • English and French law in East Africa/South Asia
  • Expanding hub for shipping (one best Freeport in 2022); proximity to Asia

I’ve outlined my research thus far. I’d love to hear back from you with your thoughts on 1) whether the proposal itself has any legs 2) the locations I have searched and/or inquired about being viable and 3) a location you think I missed somewhere that could be a great jurisdiction.

#StayOnTheBALL