Mailbag: Answering your questions

Greetings– lots of questions this week so I’m going to jump right into it:

MARK NESTMANN INTERVIEW

Thanks for the emails and comments from yesterday’s Nestmann interview, I’ll try to do more things like this… and thanks to Matt for doing such a great job on the interview. The most common question was whether there is a great book like Nestmann’s Lifeboat Strategy specifically for Canadians.

We asked Mark, and he said to check out How to Tax a Billionaire by Doug Smith. Mark also works with several prominent Canadian asset protection lawyers, and you can contact him on his website for referrals.

LITHUANIA

Several people asked about citizenship in Lithuania– My understanding, as it has been explained to me by a government minister, is that if you can prove that you have ancestors who were Lithuanian citizens prior to 1940, the government will award you citizenship with little red tape. A trusted contact here gave me the name of a lawyer who can help– Marius Tamosiunas, office number +370 5 249 7100. PLEASE do not flood him with calls unless you meet the above criteria and have the proof in hand.


ARGENTINA

More questions about Cafayate. Let me disclose fully– I have not purchased a lot there. I will likely buy one as an investment, but I still probably won’t be spending much time in Salta because quite honestly it’s just not my thing– too remote. To be even more clear, I receive no compensation of any sort from Doug or Cafayate regardless of what I say about the project. I’m just giving you my straight opinion– for some people it’s probably paradise. For my taste, the town is too small.

HONDURAS

Great comments and questions. There are certainly as many, if not more Zelaya detractors as there are supporters. He is no angel, notwithstanding the coup. His government has been filled with corruption, rising crime rates, and reduced civil liberties. All in all, the country is probably better off without him.

That being said, there are definitely scenarios whereby US troops could be engaged by Venezuelan forces should Chavez decide to invade Honduras. If a Venezuelan solider would happen to so much as break wind in the general direction of a US troop stationed in Honduras, Obama’s policy wonks will bring overwhelming force to bear as an excuse to tease out a larger conflict and neutralize the Chavez threat.

The likelihood of that scenario playing out at this point? very low. Zelaya will probably just end up making a deal with the coup leaders, and someone will walk away with a thick white envelope in his jacket pocket.

SILVER TRADE

We had a lot of really fantastic comments about this. To briefly explain my own strategy, I should first say that while I am certain inflation will be a menacing force in the long run, deflation will likely persist in the short run. As such, I can see quite a few scenarios for a stronger (or at least stable) dollar, at least through the end of the year. Mark Nestmann discussed this in his interview yesterday.

I mentioned in this week’s missive how I don’t buy the 70:1 gold/silver ratio. And while I can’t possibly determine what the price of silver will be tomorrow, I am absolutely certain that the future price in the next several years will be much higher.

I’m specifically looking to sell long-dated PUT options where I can find liquidity– $10 strike price December 2011 for $1.20-$1.50, for example. This means that, as long as silver is trading above $9 over two years from now, I make money. If I am wrong, I will still happily be a buyer at $9 (my effective price) and take delivery.

Simultaneously I’m also buying CALL options, for example the $15 strike price, December 2011, for around $2.00; if silver is trading above $17 by that time, I make money.

Some of this may sound confusing if you’ve never traded options before… let me know and we can have a more in-depth dialogue if need be. There are a lot of options alert services available– and thanks to those of you who provided some recommendations. I’ve decided that I will sign up for many of the services that you recommended, conduct a full audit of the track records, and publish the results for everyone to see.

In the meantime, aside from the silver trade, I’m investing heavily in some of the pharma picks from the Dr. George Huang’s FDA letter that I mentioned a few weeks ago. I’ve already audited his record and it is really impressive– his options strategy has been spot on and generated a lot of short-term gains.

MISCELLANEOUS

I’ll be reporting from Latvia and Poland next week, then heading to Hungary for awhile. Over the next several weeks I will try to make my way to Geneva, Vienna, and Luxembourg to sit down with some bankers on your behalf. If anyone is in the area, feel free to drop me a line.

On that note, actually, the BEST way to reach me (and to get a response) is to leave a comment on the site… I read every comment, and it is a much better way to grab my attention. If we need to have a private conversation, let me know and I’ll try to find you on email. Bear in mind that I simply cannot respond to everyone (especially as this community grows), but I’m doing my best.

Have a great weekend.

About the Author

Simon Black is an international investor, entrepreneur, and founder of Sovereign Man. His free daily e-letter Notes from the Field is about using the experiences from his life and travels to help you achieve more freedom, make more money, keep more of it, and protect it all from bankrupt governments.