How the Russian Oligarchs Became Oligarchs… and How You Can Too

Baron Rothschild may have been an unsavory character in many ways, but he was absolutely correct when he stated that "the time to buy is when blood is in the streets." This statement perfectly captures the essence of crisis investing.

The Chinese symbol for crisis is actually a combination of two symbols: the symbol for danger and the symbol for opportunity. The danger is what everybody sees; the opportunity is never quite as obvious as the danger, but it's always there.

Massive fortunes have been made throughout history with crisis investing, by which astute investors took advantage of the semi-hidden opportunities wrapped in an outward cloak of apparent danger in crisis markets.

It is how the Russian oligarchs became oligarchs in the first place. In the wake of the collapse of the Soviet Union, they were able to see through the evident danger to the enormous hidden opportunity that was present at the time. They had intestinal fortitude and bought when the blood was in the streets. They picked up some of the crown jewels of the Russian economy for literally pennies on the dollar and then went on to make fortunes.

Similar opportunities, albeit on different scales, are possible in other countries around the world today.

Case in point: Cyprus.

Crisis Investing in Cyprus

It is for exactly these reasons that I recently visited this crisis-stricken island with the legendary Doug Casey to get a 'boots on the ground' perspective of what is actually going on there. Doug is one of the world's foremost authorities on the topic, and literally wrote the book on crisis investing. He has made some of his biggest hits speculating in crisis markets.

If a potential investment meets the simple test of making most people, including your close friends, think you are crazy for even thinking about it, then you might be on to something. This is what being a "contrarian" is all about. And speculating in crisis markets is the ultimate way to be a contrarian.

In Cyprus, the blood is still in the streets from the crisis there earlier this year. There is essentially nobody who wants to buy anything that is in any way connected to Cyprus right now… which is exactly why it is the right moment to start looking for bargains.

Most people aren't even aware that Cyprus is an independent country, and even fewer know it has a stock market. Most of those who are aware don't know how to properly invest there or what exactly to buy, and would be too afraid to do so even if they did—especially now, when the index for the Cyprus Stock Exchange is down 98% from its peak. But that's exactly why Cyprus is now so attractive for a contrarian/crisis investor.

In all crisis markets, everything gets decimated, both good and bad companies alike.

The fact of the matter is that there are sound, productive, and well-run businesses that are listed on the Cyprus Stock Exchange that continue to produce earnings and pay dividends.

The crisis has created a remarkable opportunity to pick up these companies and other tangible assets at bargain prices that could show very large returns.

Some of these companies are now trading far below their cash values, most are trading below 50% of their book value, and some are even trading under 10% of book value… literally pennies on the dollar.

The crisis in the Cypriot financial system is not going to completely destroy these solid companies, many of which have been around for decades and have survived worse times. And it certainly won't undo the geopolitical value that so many civilizations throughout history have placed on the island itself.

Cyprus has been a strategic piece of geography for thousands of years, due to its location at the crossroads between Europe, Africa, the Middle East, and Asia. For this reason and others, Cyprus has been coveted by many ancient and modern civilizations. The Egyptians, the Greeks, the Phoenicians, the Assyrians, the Persians, the Romans, the Byzantines, the Venetians, the Ottomans, and the British all understood that this island in the eastern Mediterranean has great intrinsic value. It is unlikely that a collapse of the paper Ponzi-scheme banking system in Cyprus is going to alter what these civilizations found valuable for thousands years. But it has made anything connected to Cyprus temporarily cheap.

Below is a quick two minute video clip of Doug Casey and myself on the incredible investment opportunities we found.

Click here to learn more about the Crisis Investing in Cyprus report.

How to Access This Tremendous Opportunity

Everybody has decided that they don't want to have anything to do with a stock market whose index is down 98%. The Cyprus Stock Exchange is down about as much as any market index has been in history, which makes this a unique opportunity.

This is not to say that we're at the absolute bottom. It's possible that it could fall 99%, which would be equal to a further 50% decline from current levels. That being said, however, it would appear that most of those who wanted to sell have done so by now.

Currently there are around 40 stocks that are actively traded on the Cyprus Stock Exchange.

Doug and I have researched and met with a number of them and found ones that would make excellent crisis investing candidates.

Specific information on sound, productive, profitable, Cypriot stocks trading at bargain basement prices is not something you will find anywhere else. Not in the in the mainstream or alternative financial media, nor with any other research publication.

Only with Crisis Investing in Cyprus from Casey Research will you find the specific, actionable information on exactly how to capture the tremendous opportunities for massive profits created by this crisis.

The only way to economically access the Cyprus Stock Exchange is with a Cypriot brokerage account—which unfortunately is not easy for American citizens to obtain.

It's a testament to the chilling effects of FATCA and other extra-territorial US regulations that the vast majority of financial institutions in Cyprus, which are extremely desperate for cash, won't even consider dealing with American citizens because of the associated regulatory burdens.

However, Doug and I have found a solution. We scoured the island for every single brokerage, and fortunately, out of all the potentials, we were able to find one that is willing to open accounts for American citizens remotely and without the need to visit the country. We have all the details and on-the-ground contacts listed in Crisis Investing in Cyprus to show you exactly how to access the opportunities on the Cyprus Stock Exchange from your laptop in your living room.

You may of course be naturally hesitant about sending your speculative capital to Cyprus after the bank deposit confiscations and capital controls. There is risk of course (and enormous reward potential), but some points should be clarified.

First, the capital controls do not apply to new money brought into Cyprus (nor the capital gains and income generated from that money). Second, the bank deposit confiscation only applied to cash balances above €100,000 at the two largest banks, Bank Laiki and Bank of Cyprus. Relatively sound institutions were not affected. Also, there was no forced selling or conversion of securities held in brokerage accounts. All of the brokers that we met with held the majority of their cash in institutions outside of Cyprus.

Of course, the government could always come up with a new edict or decree, but we view that as unlikely at the moment since they are actively encouraging new investments into the island.

Taken together when you weigh the risks with the massive potential rewards, it is clear that allocating some speculative capital in the right places in Cyprus makes sense.

Real Estate Bargains and Economic Citizenship

There are good reasons why Cypriot real estate may be worth looking into. A number of eye-catching deals are developing.

Cyprus has long been, and will continue to be, a popular place to own property for a lifestyle choice. If that is the kind of purchase you are looking to make, then the crisis could present some interesting opportunities. Cyprus has a pleasant winter and has what many to believe are some of the most beautiful beaches on the Mediterranean. People from all over the world come to Cyprus to retire and to own vacation homes.

The good news is that there still is time; Cypriot real estate has not yet hit rock bottom. In the near future the distressed banks will be auctioning off their non-performing assets… getting access to these auctions is key to scooping up these crisis-driven bargains. But that is not an easy task for a foreigner. In Crisis Investing in Cyprus, you will find out how to tap into these auctions, along with much more about the bargains in the Cypriot real estate market.

Also in Crisis Investing in Cyprus, we give you the details on the new and relaxed requirements for Cyprus' economic citizenship and residency programs. These programs grant foreigners permanent residency and full citizenship in an EU country. Having an EU passport as a second passport is particularly coveted since it gives you the right to live and work in all 28 member countries. The economic citizenship program in Cyprus could be your gateway to the EU.

Fortune Favors the Bold

When you weigh it all together, it's clear that the time to start looking for opportunities to deploy speculative capital is now.

Crisis Investing in Cyprus is the only place where you will find the information on how to do exactly that... and from the leisure of your living room.

Like in all crisis markets, it takes intestinal fortitude to look past the obvious danger in Cyprus to see the enormous investment opportunities. And there is no better person to guide you through this crisis market than the legendary crisis investor Doug Casey.

To learn more about how you can take advantage of these tremendous crisis-driven opportunities before it's too late, click here.

Nick Giambruno

Nick is Doug Casey’s globetrotting companion and is the Senior Editor of Casey Research’s International Man. He writes about economics, offshore banking, second passports, value investing in crisis markets, geopolitics, and surviving a financial collapse, among other topics. He is a CFA charterholder. In short, Nick’s work helps people make the most of their personal freedom and financial opportunity around the world. To get his free video crash course, click here.

Tags: doug casey, cyprus, crisis investing,