Is Netflix being run by the United States Congress?

 
Shares of Netflix soared today on news the company lost a record $859 million in cash in the third quarter. Why are investors applauding this egregious destruction of capital? Well, it’s because investors only look at one number when Netflix reports earnings – subscriber growth. And on that metric, the company outperformed, adding 6.96 million subscribers, bringing the global total to more than 137 million. At 137 million subscribers, Netflix has about 2% of the global population as customers. There are still around 90 million traditional TV accounts in the US (and about 36% of those also have a streaming account). So there’s definitely room for Netflix to grow in […]
View article
 Trends & News
A fantastic Plan B solution for your future children

 
[Editor’s note: While Simon is traveling today, other members of the Sovereign Man team penned today’s missive.] February 2013, a 500+ foot yacht docked on the west side of Manhattan. The boat, named Eclipse, belonged to the Russian oligarch, Roman Abramovich – one of the richest men in the world. And the media went wild speculating why Abramovich had parked his mega-yacht in the US for more than a month. On April 8, with the boat still docked, Abramovich’s girlfriend Dasha Zhukova gave birth to a baby girl at New York Presbyterian hospital. And because Abramovich’s daughter, Leah Lou, was born on US soil, she gained a US citizenship (in […]
View article
 International Diversification Strategies
These international borders have become “no rights zones”

 
On June 15, 1215, King John sat in a field in Runnymede, England, surrounded by angry nobles. His Barons—the big landowners throughout England—had rebelled and seized London, forcing King John to sign an agreement guaranteeing certain rights to the people of England… and restrictions of his power. This agreement was called the Magna Carta. And it would become one of the most important documents in history. Centuries later in 1678, Charles II was King of England. Like many kings, Charles was terrible with money. And when he ran out of it, he started demanding extra taxes from his knights, and imprisoning those who refused to pay. The King was once […]
View article
 Trends & News
  
For legal reasons, I'll be shutting down this channel someday soon. You can follow the feed directly by making a connection to https://www.sovereignman.com/feed/
How to safely ignore everything that happened yesterday

 
Stock markets around the world were crushed yesterday… The Dow Jones fell 800 points, its biggest dump since February. The Nasdaq fell 4% (its worst day in seven years). Japan fell 3.9%. Chinese stocks fell 5.2% to their lowest since 2014. And people are freaking out (the market’s fear gauge, the volatility index (VIX) surged 43.9% yesterday). I’ve been writing for months that the current bull market could easily go on for another few years… or it could all come crashing down tomorrow. It’s possible the market lemmings simply “buy the dip” once again and push the market back up. Or, maybe, we should be legitimately concerned… The 24-hour news […]
View article
 Investing
How’s this for crazy: Tesla is still worth more than HONDA

 
Earlier this year I quoted Chicago-based hedge fund manager John Thompson of Vilas Capital Management– who has been incredibly vocal (and blunt) about Tesla. Back in March, Thompson said that he thinks Tesla is going to crash . . . “. . .partially due to their incompetence in making and delivering the Model 3, partially due to falling demand for the Model S and X, partially due to the extreme valuation, partially due to their horrendous finances that will imminently require a huge capital raise. . . and partially due to our suspicions of fraudulent accounting activities. . .” This morning Thompson released his latest investor update, slamming Tesla once […]
View article
 Trends & News
With corruption like this, it’s no wonder so many pension funds are insolvent

 
Last week, the head of a New York state pension fund found herself a new job. Vicki Fuller, the former head of New York’s $209 billion fund, now earns $275,000 per year working part time for a natural gas group called The Williams Companies– good work if you can get it. It’s noteworthy that when Ms. Fuller ran her state pension fund, she invested $110 million of taxpayer money to buy bonds issued by none other than The Williams Companies. Bear in mind that Moody’s, the credit rating agency, downgraded Williams’ financial outlook to “negative” because of the company’s high leverage and risk. The fund that Ms. Fuller managed also […]
View article
 LM: Retirement  Trends & News
This is the safest 20%+ you will ever make

 
Yesterday I told you about a still little-known gem in the US tax code known as opportunity zones. The example I gave you yesterday is– let’s say you have Apple stock, and you sell today for a total gain of $250,000. Ordinarily you’d have to pay tax on that gain. But if you invest that money in a fund that invests in specially designated ‘opportunity zones,’ which are generally underdeveloped areas, you can push out the tax bill on that $250k for years and years. And any gains you make on that money in the meantime will be tax free… forever. Here’s why I think this is a pretty big […]
View article
 Trends & News
Possibly the perfect place to invest today (and pay ZERO tax on your gains)

 
One other important factor to consider is TAX. I’m a big believer in taking every legal means at your disposal to reduce the amount of taxes that you owe. It’s one of the reasons I’m in Puerto Rico. Here, I legally pay just 4% on my worldwide income. Barrack Obama used to tell his audience, “Don’t boo. Vote!” (Jeez did I just quote Obama again?) If you disagree with your government and are appalled at how much of your money they waste. Yes it’s important to safeguard and grow your wealth. But it’s also important to make sure you’re not giving away more of your hard-earned money than you have […]
View article
 Investing  LM: None
Making money isn’t supposed to be easy

 
I remember having a conversation with a woman during the peak of the housing bubble, probably 2005… She was a psychologist based in Florida. And she was explaining to me how she was flipping condos that hadn’t even been built yet. Back in the boom times, buyers would line up at condo sales offices and have to decide within minutes if they wanted to put down a deposit. The demand for these undeveloped units was so large, developers would raise prices, sometimes multiple times a day, to whip buyers into a frenzy. The woman I was talking to would put down a deposit before the developer had broken ground. Then […]
View article
 Trends & News
The world’s greatest investors are sounding the alarm… it’s time to be cautious

 
Howard Marks is one of the greatest investors in history. Marks is the founder of the credit investment firm Oaktree Capital Management. And he’s been sharing his insights with the public in his Chairman memos since 1990 (which you can read for free on his website). Even Warren Buffett stops what he’s doing when Marks releases a new memo… Buffett says it’s “the first thing I open and read.” Marks’ latest memo, titled The Seven Worst Words in the World, came out last week. And those seven words are – “too much money chasing too few deals.” As you probably guessed, Marks is talking about how overheated the market is […]
View article
 Trends & News
The Return of the Inquisition: Do you confess?

 
In 279 BC, the vast army of King Pyrrhus of Epirus was met by Roman forces at the Battle of Asculum in southern Italy, in what would be one of the costliest military engagements of ancient history. Pyrrhus fancied himself the second coming of Alexander the Great and believed that he was a descendant of Achilles. Many of his peers and contemporaries believed Pyrrhus to be the greatest military commander of all time. His exploits were legendary. And when he set sail for Italy in 280 BC, the Romans did not underestimate him. The Battle of Asculum was decisive. Pyrrhus actually won the battle; but in defeating the Romans, he […]
View article
 Trends & News
Look at how well gold has retained its value from 1,000 years ago

 
On October 12, 929, roughly 1100 years ago, Abd-er Rahman III of the Umayyad Dynasty was proclaimed ruler of Cordova– the Islamic kingdom that comprised most of Spain at the time. Rahman was just 21 when he ascended to power, and he remained there for nearly 50 years as one of the wealthiest and most powerful monarchs in Europe. Historians Denis Cardonne and Edward Gibbon calculate his annual tax  revenue at approximately 12 million gold dinars… which was a LOT. The dinar contained 4.25 grams of gold, so 12 million of them would be worth about $2 billion today. With Cordova’s population estimated at around 500,000 people back in the […]
View article
 LM: Gold  Investing
For people with talent and vision, this place has a LOT to offer

 
It was February 15, 1898. The American Civil War was a distant memory, and the United States had become the largest economy in the world. Still, something was missing in the Land of the Free: colonies. More than 100 years before, other leading powers like Spain and Britain had established colonies all over the world back when the US was just an infant. By the time the US became wealthy and powerful, the Age of Imperialism was over– all the exotic foreign lands had already been claimed. So, in 1898, the US decided if it couldn’t establish its own colonies, it would take them from somebody else… Cue the Spanish […]
View article
 Trends & News
IRS agent indulges in bizarre fetish in taxpayer’s home

 
On June 8, 2006, more than a decade ago, armed agents from the Internal Revenue Service arrived at the home of Michael and Shelly Ioane of Atwater, California. Michael Ioane was suspected of tax fraud, and the IRS agents were there to conduct a search of the premises and look for evidence. About thirty minutes into the search, Shelly Ioane (the wife, who was not suspected of any crime whatsoever) told the agents who were ransacking her bedroom that she needed to use the bathroom. According to court documents, one of the IRS agents escorted Shelly to the bathroom… then came inside with her. Shelly protested and asked the agent […]
View article
 Trends & News
How to dodge student debt and get a second passport

 
This month, college freshmen across the US are settling into their new lives. For the next four (or five… or maybe even six) years, they’ll be immersed in safe spaces and bombarded with repugnant, hyper-socialist groupthink. Then, at the end, they’ll walk away with a degree of questionable use… but they’ll also walk away with TONS OF DEBT. Consumers are on pace to end 2018 with over $4 trillion of debt. And $1.5 trillion of that is student debt (more than credit cards and auto loans). According to the latest stats, the average student loan debt in the US is nearly $40,000. But that’s just average… There are more than […]
View article
 Trends & News
Where you can rent a luxury 2,800 ft. beachfront villa for less than $90/night

 
Last week I wrote about farmland in South Africa… And how it’s taken a pounding thanks to a radical politician who is threatening to seize farmland from white farmers without compensation. While I don’t think it’s time to buy South African farmland yet – that situation can get MUCH worse before bottoming – it’s always smart to keep an eye on a country in crisis. And today, there’s an ongoing tragedy in Nicaragua – a beautiful Central American country just north of Costa Rica. Nicaragua has emerged as the next Central American tourism success story (after Panama and Costa Rica’s rise to prominence)… The country made headlines in the Wall […]
View article
 Trends & News
This time is different because there’s free tequila…

 
We poke a lot of fun at the MANY absurdities we see in this current bubble. As we’ve discussed countless times over the past few years, there are consequences from the fact that central bankers have conjured trillions of dollars out of thin air and pushed down interest rates to zero. Stock, bonds and real estate are at or near record highs. Bankrupt countries are issuing trillions of dollars of debt with negative yields (not to mention, serial defaulter Argentina was able to issue 100-year bonds…). Netflix is one of the most expensive and popular companies in the world even though it burns through billions and billions of dollars with […]
View article
 Trends & News
Netherlands prosecutes its own citizen for calling Turkish dictator a “Goat F*cker”

 
It was mid-September in 1683, almost 335 years ago to the day. Turkish forces of the Ottoman Empire surrounded Vienna, one of the most strategic cities in Europe at the time. Controlling Vienna meant controlling the Danube River, which flows from Western Germany to the Black Sea, providing critical access for the Ottomans to invade the rest of Europe. So if Vienna fell, Europe would soon follow. The Holy Roman Emperor, Leopold I seemed to abandon Vienna with the bulk of his forces as the Ottoman Turks advanced. He left only a vastly outnumbered garrison to protect the walled city. The Ottoman’s laid siege to Vienna. Though the inhabitants were […]
View article
 Trends & News
Ten years after the crisis… they’re doing the same thing and expecting different results

 
“Holy Crap– turn on your TV! This is crazy!” It was Sunday, September 14, 2008. Exactly 10 years ago to the day. My friend Jeff called me and told me to turn on the television—where I saw dozens of people on the streets of Manhattan filing out of a skyscraper carrying boxes full of their office junk. They were all employees of Lehman Brothers, one of the largest investment banks in the world. Lehman was hours away from filing bankruptcy in what would go down as THE biggest bankruptcy in US history. The next day the US stock market tanked. And for most of the next several weeks, all global […]
View article
 Trends & News