Why Rich People Should Live in Cheap Countries
Summary
TLDRThe video discusses why financially successful people and investors should consider getting a foothold in emerging markets that offer growth potential. It argues emerging markets can provide diversification, hedge against instability in developed countries, and take advantage of changing momentum. Examples given include Mexico, parts of Latin America, and Eastern European countries. The strategy is not necessarily to live full-time in these places but to have backup citizenship options in faster growing and more affordable markets should economic or political situations shift.
Takeaways
- 😀 Successful people want access to emerging markets before prices rise
- 😯 Mexico could overtake the US economically in the long run
- 💰 Latin America offers cheap, productive farmland for wealthy investors
- 😎 Having options in politically neutral countries provides safety
- 👨👩👧👦 Gaining second citizenships opens opportunities for your children
- 🌎 Wealthy people want residences and citizenships across the globe
- 📈 Emerging market returns and investments can greatly outpace developed countries
- ⚖️ Developed countries are moving in the wrong direction politically
- ✈️ Having multi-country access provides protection in case of unrest
- 🏡 Residences abroad can lead to future citizenship if desired
Q & A
Why would a wealthy investor or entrepreneur want to consider emerging markets for investment or residence?
-Wealthy investors and entrepreneurs may want to invest in or establish residence in emerging markets to get in early before prices and barriers to entry rise, as well as to diversify their assets and have options in more locations around the world in case issues arise in their home countries.
What does the 'global citizen sandwich' refer to in the context of the nomad capitalist lifestyle?
-The 'global citizen sandwich' refers to having banking set up in established hubs like Singapore or Switzerland, obtaining EU citizenship through ancestry or investment if possible, and also obtaining residence or citizenship options in emerging markets for asset diversification and future opportunity.
Why does the speaker recommend considering Mexico for residence or having a child there versus the United States?
-The speaker believes Mexico's economy and passport strength will improve in the long term compared to the United States. He thinks it presents better opportunity 18 years from now for someone starting out in life compared to the issues he sees unfolding in the US.
What are some examples of niche opportunities the speaker sees individual countries competing on?
-The speaker cites niche opportunities like being the most crypto, Bitcoin or blockchain friendly country as areas where individual countries are trying to establish themselves as leaders to attract investment and talent.
What does the speaker see as the potential opportunity in agricultural land investment in Latin America?
-He believes Latin America presents some of the cheapest agricultural land in the world accessible to foreign buyers. This could be worthwhile for asset diversification and establishing a productive safe haven for someone with even $50 million in net worth.
Why does the speaker keep comparing emerging markets to Singapore and its development?
-Singapore represents an example of a country that grew quickly in economic importance and livability, but became very expensive with high barriers to entry. The speaker believes identifying and investing in the next Singapore while still early presents huge upside.
How can passports like Georgia be valuable to a global citizen portfolio?
-The speaker sees neutral and geopolitically diversified passports like Georgia as providing options without as many barriers compared to Western countries, which could prove valuable if circumstances change.
Why host an event showcasing the nomad capitalist lifestyle in Kuala Lumpur?
-Kuala Lumpur offers a high quality of living for a very reasonable cost. Hosting their event there allows attendees to experience an appealing emerging market opportunity firsthand.
How can having residences and passports in emerging markets benefit wealthy people?
-It allows them to diversify their assets globally, take advantage of growth opportunities, and have additional options if issues arise down the road - all without necessarily changing their day to day lifestyle if not desired.
What role does momentum play in the speaker's perspective?
-Places with upward momentum offer the most wealth creation potential in the speaker's view. He sees many emerging markets on an upward swing, compared to declining momentum in many Western nations.
Outlines
😕 Misunderstandings about Nomad Capitalist's advice
Andrew explains that many successful investors or entrepreneurs wrongly think Nomad Capitalist advises going to emerging markets only for lower income people. He explains how the wealthy also benefit from getting access to upcoming places before they become expensive and inaccessible.
🤑 Why the wealthy diversify globally
Wealthy people want banking in places like Singapore and citizenship in European countries, but also want options in up and coming places like Mexico, Argentina, and South America before they become expensive. This geographic diversification protects their assets and provides opportunities.
😎 Lifestyle benefits of global diversification
Spending time in affordable places like Uruguay, Colombia, and Georgia allows wealthy people to learn about emerging trends and opportunities while enjoying a good lifestyle. Andrew highlights how the quality of life delta between developed and developing countries has shrunk.
🌎 Having options everywhere as insurance
Wealthy people get residence permits and citizenships around the world not necessarily to live there full time, but as "call options" in case problems arise back home. This geographic diversification provides option value the way Peter Thiel has an option to go to New Zealand if needed.
Mindmap
Keywords
💡Diversification
💡Emerging markets
💡Citizenship by investment
💡Optionality
💡Black swan events
💡Lifestyle design
💡Flag theory
💡Citizenship planning
💡Neutral countries
💡Momentum investing
Highlights
Nomad Capitalist advises wealthy people on getting citizenship or residency in emerging markets before they become too expensive
Wealthy people want to diversify their assets and have options in different countries in case there are problems where they currently live
Mexico has potential to be a strong passport and economy in the future compared to the U.S.
Colombia and other Latin American countries offer affordable options for residency that could lead to citizenship
South America is a good location to escape to if there are problems in the northern hemisphere
Wealthy people are looking for the next emerging market that will grow rapidly like Singapore did
Having assets and citizenship diversified globally helps prepare for unexpected events
Nomad Capitalist Live event is in Penang, Malaysia which offers a great lifestyle for the cost
Wealthy people want citizenship or residency in every continent to have maximum options
Investing early in emerging markets can produce great returns compared to waiting until they are established
Western countries are moving in the wrong direction politically, while emerging markets are becoming more free
Wealth is created through momentum - being early to opportunities in growing emerging markets
Having citizenship or residency in Latin America provides access to investment opportunities not available to outsiders
Prices for citizenship by investment rise as countries like Singapore become popular - important to get in early
Average person has better chance getting citizenship in Colombia than what Peter Thiel got in New Zealand
Transcripts
for some people there's a
misunderstanding of what we talk about
here at Nomad capitalist and a lot of
people are confused about why anyone
who's financially successful as an
investor or entrepreneur would want to
listen to my advice about going to some
of the emerging markets that we talk
[Music]
about so we're going to talk off the
cuff uh it's in a sense Nomad capist
I've got a uh slightly cracked mug uh
with twg Earl Gray Fortune T we haven't
done this in a while it's just you and
me talking about uh the reality of The
Nomad capitalist
lifestyle and I have worked with a
number of very successful people their
companies went public they've made a lot
of money and one thing I've heard a
couple different times is yeah you know
we went to some big four company and
once or twice I heard yeah they gave us
some kind of report that was kind of
like hard to read and like you know they
really try those companies not to give
you very much
information um but you know we think
that noad ACC has their finger on the
pulse of what's upcoming and if you're a
very successful person you realize that
what the next place to come whether you
want to invest there whether you want to
get residents or citizenship to get your
tow hold there so that whatever happens
you can always be there the price won't
go up on you you'll always have access
for whatever reason you want access to a
certain country you want to get in
before everybody knows about it because
once a country is Singapore I mean
Singapore has a program now you need
nine figures to invest in Singapore now
there's cheaper programs you can start a
business there's other options but at
the top level Singapore has a nine
figure investment program if you want to
move there and you want to jump to
permanent residence and even then almost
nobody now who has permanent residence
is getting citizenship and I know people
who were naturalized Singaporean
citizens it wasn't that long ago you
could do that but in the last 10 years
or so it's very much difficult now
imagine you wanted to go to Singapore
back in the 1980s it would have been a
lot easier even up until until the early
2010s it really wasn't that difficult to
get into Singapore and again it's still
possible but even some of the wealthiest
people that we work with they'll Bank in
Singapore but when they look at oh I
have to spend half the year there there
are more requirements it is a bigger
Financial commitment you know it's just
it's not worth it anymore with my
lifestyle so Singapore even if you can
afford the nine figure price tag when we
present that to those people they're
like just there's too many things
involved because Singapore can demand
that to get in so what we talk about is
looking for the next Singapore and I
think that the next Singapore is going
to be a number of different places
because you have so many different
countries competing that you're going to
have a number of different Niche uh
players that are each going to try and
and be successful in something one thing
you've seen is you've seen a handful of
countries throw their hat in the ring of
we want to be the most friendly place
for blockchain or for crypto or for
Bitcoin and uh you know if you focus on
a couple of those Niche things as a
country you can be successful uh and
you'll be known perhaps as the sing
Singapore of this or the Singapore of
that and so I think that the strategy uh
for a lot of our very successful clients
you know we take people who have a
million dollars in liquid assets or who
have half a million dollars a year at
income but we go all the way up to
people who have hundreds of millions of
of dollars what they're looking to apply
is what I call the global citizen
sandwich they'll Bank in Singapore we
had a guy uh he cashed out he got about
$500 million and he started to call the
bank in Singapore and they're like you
you know let's talk let's think about it
and I think we were able to to plug him
in some of our connections and it ended
up working relatively well for him but
even at that level of wealth the banks
sometimes can be cautious but a very
wealthy person might want a bank in
Singapore might want a bank in
Switzerland or lonstein or Luxembourg or
maybe andur uh maybe the UK for some
people they like that um there's some
good Banks there but they are looking
for a diversified portfolio of
residences and citizenships what I have
said is if I were going to have uh with
my wife a child today I would choose
giving birth in Mexico over giving birth
in the United States neither of us are
Americans or Mexicans both countries
allow your any child born on their soil
to get their passport and so if I'm
looking forward 18 years from now I have
some resources I wouldn't give a lot of
my money to my child but I would make
sure they're not going to starve I'd
make sure they you know they were safe
they had a safe place to live uh and so
all those things be considered I I think
having a Mexican passport would be much
stronger and that's why we've advised a
lot of people to get Mexican residents
and it's a call option on potentially
being a citizen in the future that's
something that a lot of people we work
with choose to add onto their plans
Argentina in a different way is now one
that some people are interested and so
what I'm telling clients is if you get a
couple of these more affordable
residence permits that's a interesting
call option on potentially having
citizenships that could be uh highly
viable in the future I think Mexico
being one of the most interesting ones
now it's you know a bigger trading
partner with the US um taking business
away from China if I'm looking 18 years
into the future and I was on CBS News
talking about the rise of the PES
against the dollar I think Mexico has a
bright future I'm not saying that the
average Mexican will be wealthier than
the average American although I think
that the Delta will shrink but I'm
saying if you already have economic
stability I think being Mexican both
from the terms of geopolitically and
traveling and doing business and
regulations whether in your country when
go overseas Mexico will be the superior
place to be the citizen now my child
would have multiple citizenships but if
I can only choose one out of those two
CU again I'm not Mexican and I'm not
American my wife's not um I would choose
Mexico looking forward 18 years and so
we all like to say oh you know I wish I
would have discovered something 18 years
ago but it's really hard to make the
decision now because it's not popular I
was saying when Trump was running when
people were threatening to leave to
Canada and of course they never do uh
when it threaten move to Mexico it's
better and it's the future Canada is not
I said that in 2016 turns out I was
right and now you see a lot of people
moving to Mexico during the pandemic you
see Canada Canadians who really wanted
to go to Canada during the pandemic and
many of them had
problems and so I think what you want
and you don't have to have hundreds of
millions of dollars to do this I mean
you can we take client with as little as
a million dollars in liquid assets um
you might not have as many options to
that level but if if you're a wealthy
person I might offer you to say okay
let's check your family treat do you
have any citizenship you can claim
particularly if it's in a European
country there's also Latin American
countries we've helped with but let's
say particularly European countries
because that's kind of the top grade Tia
passport as we call it any pretty much
any European Union country that's one
part of the strategy so if you're an
American we've helped people you know
get citizenship by descent we've helped
people get multi citizenship by making a
donation close to a million dollars uh
We've helped people move to European
countries or we've had clients who
already lived in European countries and
they were
naturalizing um whether it's you know
Ireland or the UK where you already
speak English or maybe you move
somewhere else and learn it or maybe you
get a golden visa and work towards it in
a country like Portugal which is a
little bit back on track now that's the
first part of the strategy but I just as
I have multiple residences and passports
around the world in emerging countries
number one you never know where you're
going to have to go if you're safe now
if you're Peter teal or a couple of
other billionaires the Google guys maybe
you can going to New Zealand I just
personally don't want to spend any time
in New Zealand doesn't mean you
shouldn't want to it's not a place that
I want to spend my time I'd rather spend
a couple weeks a year in Colombia
learning about how Latin America is
emerging and seeing those opportunities
and you know talking to people there um
I'd rather make that a place that I can
go and you know I don't know if Colombia
is the best place in South America but
South America for me outside of New
Zealand is one of the best places in the
world to be if the fur starts flying in
the northern hem Hemisphere and so
having access to Southern American
countries South American countries is a
good thing and you know what you can get
some very nice homes I bought the
minimum home that you need to buy to get
Colombian permanent residents back when
that program existed but you know I
could have bought a one I was looking at
a property the other day for about
$900,000 beautiful property in a very
safe neighborhood but by batah standards
uh if you wanted to spend more money you
could certainly spend close to a million
dollars and buy an amazing property and
live there uh I'm not in Colombia that
long I'm not in Colombia long enough to
pay taxes so having a home is
diversification it's an asset in another
country it gets me immigration status
and you know if you are substantially
wealthier you could buy a a bigger
apartment but for me I'd rather do that
from a lifestyle
basis and than go to New Zealand not
saying Peter Teal's wrong but I think
that um the average Among Us have a
better chance of getting Colombian
citizenship than what Peter teal got
which was getting New Zealand
citizenship uh we know people who've
been given very high level citizenships
but you know just the average person and
by the way average person can mean you
have $50 million I mean the average
person with $50 million doesn't have
some connections and and whatever else
but if you just want to protect yourself
having a home in in Mexico or maybe also
having something in South America is a
good idea you know having something
perhaps in Eastern Europe I've taken a
number of people to Serbia some very
wealthy people they're like this place
is is I just feel like I'll be left
alone uh I'm not saying it's the answer
to all your problems but hey if Europe
just falls apart these people are made
differently Georgia interesting place I
I love to go to Georgia and enjoy the
wine you know there's Islands I'm happy
to have citizenship on small islands and
so you know if I'm thinking about what
are all the different possibilities out
there that could happen in the world
Black Swan events or white swan events
let's call them good stuff happens I'd
rather be seeing all the potential of
Latin America look at Marcato Libre St
by the way I I was aware of Marcato
libbre a long time ago cuz I spend some
time every year in South America and I
see you know what's going on with it I
mean that stock has done incredibly well
I think you'll find more of those kinds
of opportunities if you're surrounded by
people who were down there doing stuff
earlier I mean there are some real if
you look at the Latino metrics
newsletter they talk about real
interesting opportunities in that part
of the world if you spend some time
there you'll find better tips on some
real world changing companies for that
part of the world than you would if you
just spend time in New Zealand and so
that's why I think for a successful
person maybe if you have you know $20
billion maybe New Zealand's better but
if you have $50 million I'd rather be in
Uruguay or Colombia or um somewhere like
that and if I want to bet on a time when
I want a lot of productive land Latin
America I mean Ecuador is extremely
cheap they've had some problems in the
last year or two I still think I mean it
could be interesting some of the
cheapest Farmland in the world that's
accessible to foreigners to buy is in
Latin America so you know even if you
have $50 million and I talked to people
and I talked to people for years who
have $50 million they might say you know
what I don't want to move more than 1%
of my net worth into foreign property or
into that one foreign property that's
productive land that's where I'm going
to go where I have 500 Acres if if all
hell breaks loose you're not getting
much for 500,000 in New Zealand in fact
the reason Peter teal became a New
Zealand citizen is you know why we know
that is because he had to be a citizen
to buy that land so again unless you're
a a multi-billionaire you're going to be
better off just going to a country where
they already allow you to own their land
and buying it at extremely low prices
you know for someone who plans to stay
in their country which a lot of wealthy
people that we talk to do they want to
stay in the US or Canada or Australia uh
and just have options they're not
usually saying hey take 25 of my $50
million and let's go buy land in some
foreign country uh they're trying to get
you know started very slowly and so you
know buying land in some of these
emerging places uh is interesting uh and
so
I think that what makes this all work is
that wealthy people don't have to be in
Ecuador or Colombia or any these places
very often I have the ability to live in
Colombia as long as I want if something
crazy happens if my lifestyle requires
it if I've got a business project that
requires it we are doing more business
in Latin America and with Latin
Americans um but I don't have to be
there really more than one day a year is
what I do and so I have the option of
another requirement the more of those
you have are because you have a
residence permit that allows it or
because you have a citizenship that you
can always go there for the rest of your
life you and your children generally and
their children then it becomes tolerable
right I mean like I don't spend my life
in
Colombia uh and as I get older and more
successful and I've seen a lot of the
exotic places in the world and I've
taken advantage of that there's a part
of me that you know is say all right let
me spend a little bit more time in
places that are a little bit closer to
what I grew up with in the US but
hopefully without the baggage and I've
talked about Ireland and Switzerland I
think as being places that are
comfortable enough for wealthy people to
go that where they function and you can
get citizenship and you can get good
taxes and all that kind of stuff so you
don't have to live in the places that
are up and coming but imagine if you had
a second home in Singapore in the 80s
would that' be worth today and you'd
seem like a
genius and everyone would say wow you're
smart you know it's like people in the
Bitcoin Community always talk about hey
people said oh I wish I would have
bought Bitcoin right well when Bitcoin
was in the tank not very long ago people
were laughing at it oh that's stupid
it's over it's done well now it's back
and now people wish they did it it's the
same thing with countries you want to go
to a country and people are kind of
laughing at it once it's Singapore it's
expensive I'm not saying Singapore can't
be part of your deal even Singaporean
banks are harder to accept clients these
days I just talked to a bank the other
day uh they're the most accepting Bank
we have in Singapore but they want one
and a half million us whereas the banks
that have kind kind of tightened up want
like 200 250 us so you know there's a
choice to be made there uh and more
importantly the Delta has
shrunk uh both on passports georg's
passport some our Georgian colleagues
they just got access Visa free travel to
China today I think geopolitically
that's interesting whether you like
going to China or not it means that more
countries are opening up to places like
Georgia they're not opening up to the US
they're not opening up to other Western
countries I'd like to have some neutral
countries in my portfolio but the
passport difference between the US and
Georgia Now versus even seven or eight
years ago was dramatic let alone now
versus the Soviet times I mean it was
obviously a far different picture uh you
couldn't even leave you know Colombia
Colombians can now go to London the
exact same way as the American can it
was only I was in Colombia in 2015 they
had just gotten Visa free travel to the
shenen area in Europe so less than a
decade ago Colombians I mean you could
travel around Latin America but it
wasn't that good all right for traveling
around the West look at a place like
turkey for example that passport is
pretty good except for the West not a
bad passport to have if you're not
traveling to Europe or the US what if
one day you know things change in turkey
and the relations with Europe improve um
listen that might hurt you in other ways
maybe it's nice to have some
geopolitical diversification but they've
talked about turkey getting access to
the shenen area now you've got a pretty
solid passport and all you had to do to
get it was to buy a property but that
price keeps going up because more and
more people are interested in it so as
noad cus diversifies more and we get
more clients from some of our efforts
that you don't see here online we get
more clients offline we get more
referrals from around the world we're
seeing that those people realize the
benefit of having a plan a plan B plan C
I saw some of the other day mention like
Plan F yeah have a plan F have a plan
for anything that could happen and for
me I don't mind having multiple plans
because I My Lifestyle just enjoys it
it's not like oh my God I'm planning for
the coup I just like to live in
different places I like to have
different homes I like like to have
different just it's enjoyable for me and
so I think that's why I mean the
difference between and by the way no Met
capist Live this year koal and poor
again why Best Value City in the world
not saying it's the best city in the
world but it's up there in my opinion
best
value and uh the difference between koal
and poor and
Milwaukee Adelaide you know
Birmingham it's a lot closer I mean I I
would probably argue that qualm is
better than some cities in the US and
the UK I mean for sure people come
they're like oh my I I didn't know it
would be this nice people from all over
the world came last year to call and
poor and said I wasn't expecting this
I've never been here I wasn't expecting
this people were saying man this isn't
really this isn't really a trade-off
when you factor in much better more
efficient cheaper health care and the
tasty food and it's cheaper like this is
a a steal and that's why unlike unlike
the people who have you know events
where you go to Austin and they try and
tell you how to go overseas and
diversifies a global citizen from Austin
Texas like you're not learning anything
you're just being baby they're just
taking your money our event no math
capitalist live is in qual andour where
I think you should see it and you'll
start to see how the Delta has shrunk so
my point is why would a wealthy person
want to have a toe hold in some of these
emerging countries because they want to
be Diversified across the globe one guy
came to me said I want to I want to have
something on every continent forget
Australia forget obviously Antarctica uh
and if you're calling North America just
the US and Canada like I want Central
America South America Africa uh Europe
maybe even Eastern Europe and then he
already had
Asia and he uh you know he said hey I'll
be cover no matter what happens and my
kids will have
opportunities and you don't have to live
in those places you might have some
great investment returns from some of
those places uh one of those places
might become the next big thing in the
meantime you've Diversified your assets
around the world so that when bad stuff
happens you're covered you got places to
go your money is a little safer that's
why I think people we we helped people
move to Switzerland we've helped people
move to uh to Ireland to Portugal to
Spain um we've help people moved to
Greece I don't know that many people
have moved to
Singapore uh but we've help people moved
we have people who already live in like
I said London who come to us they're
expats in London but you know when
someone comes to us us all the Mexican
clients they're like yeah Canada that's
what all my friends say and I'm like
you're not going to save any money in
taxes you're not going to like the
weather the politics aren't what you
think they are you just are being sold
this brand image and eventually they're
like all right fine and they at least go
to one of the more tax friendly European
countries where they can also get
citizenship I mean if you're Latin
American you can go to Spain you can get
citizenship in a couple of years and you
can do so in a relatively tax friendly
basis harder for non uh Latinos but you
know that's why Eduardo Sab the Facebook
co-founder lives in Singapore I don't I
don't I don't believe maybe haven't seen
I don't believe he's a Singaporean he's
Brazilian so he doesn't live in Brazil
he's got the option to live in Brazil or
around South America like who cares like
you can live wherever you want but why
wouldn't you have want access to all
these different places that's why uh we
tell people who are successful to have
these different places in their
portfolios because that's the growth
that's the future that's the opportunity
and in many of these cases they're
recovering from being anti-freedom and
they're moving in the right direction
whereas Western countries are moving in
the wrong direction I think the secret
to wealth creation is momentum and
that's what wealthy people are looking
for the places that we talk about may
not be there quite yet but they can get
them in their portfolio and grow with
them
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