These aren't the only businesses that benefit in this environment however. With that in mind lets take a look at agriculture, a favourite of Mark and I. "Ag" is a market which enjoys growing demand, supply shortfalls, is severely under-capitalized…and this says nothing of the inflation which central bankers are adroitly baking in the oven. Unfortunately, in the western world agricultural land values are prohibitively expensive, and certainly not attractive on a pure yield basis.

I've spoken before about streaming companies, and in fact one of our trade alerts suggested writing Sandstorm Gold (SAND) puts. I estimated that doing so would get us a 30% return overall, if things went as I predicted. Streaming is well-known in the mining world. Companies like Franco Nevada, Silver Wheaton and Royal Gold have made a LOT of money for their shareholders over the years. It is a truly unique set of circumstances we find ourselves in with respect to the resource markets today, but I want to talk about agricultural streaming in this post.

Agricultural Streaming?

Yes! Agriculture is in a bull market. Much like the better known metals streaming companies who provide financing for producing mines in return for a "stream" of the metal over specified time frames, agricultural streaming follows the same essential business model.

As mentioned above, one problem with agriculture that Mark and I have encountered has been the unbelievably high cost of agricultural land in the western world. Farmland in the Midwest US is now topping $20,000 per acre, which is certainly not bargain territory. Yields are simply terrible. Eliminating this problem is possible, and the model is being effectively proved by a reader of ours with whom Mark and I have been communicating for some time now. Brad Farquhar is the co-founder of Input Capital, the world's first agricultural streaming company.

Focused on canola streaming in Saskatchewan, Brad and his co-founder Doug Emsley have built an enviable business! With IRRs in the 20-40% range, and operating cash flow margins exceeding 50% the business model is completely scalable, provides leverage to the commodity, and allows Input Capital to bear no direct operational risks. Their model offers diversification simply not possible by owning a farm itself.

Brad raised money for the business in a seed round last year at $1, and unfortunately for us and for our CPAN members this was at a time when the service was only just being born. We did not participate. Just for reference, that's the type of early stage private equity deal that we live for in CPAN.

Input Capital is now doing a pre-IPO raise at a multiple to the seed round, and will then list via a reverse take over (RTO) on the TSX. In conjunction with the RTO, Input Capital is also carrying out a $100 million private placement. This is a sale of Subscription Receipts, which will be converted to shares in the company when this RTO process is concluded. The offering is targeted at institutional and accredited investors ONLY.

The syndicate for the offering is composed of: GMP Securities, CIBC World Markets, National Bank Financial, Cormark Securities, and AltaCorp Capital. Mark and I both have a relationship with Sprott, and in fact our brokers there reached out to us on this just this week. Our guess is most Canadian brokers will be familiar with the deal.

While it isn't the early stage seed round we typically look for, we do believe the upside from here is likely substantial… assuming Brad and Doug continue to run it as they have up to this point. As we've said, we absolutely love the sector and we believe they have what it takes to make their investors a lot of money during this bull market.

We don't have any skin in the game at this point, but we may participate. You can get in contact with Brad or Doug directly by visiting Input Capital's website. We are told that the placement closes near month's end.

- Chris

Disclaimer: We didn't get paid to mention Input Capital…we just like what they're doing and may participate in the offering ourselves. We will make no attempt to tell you or anyone else when or if we participate. Do your own due diligence, this is NOT a recommendation or a solicitation on behalf of Input Capital or ourselves. The fact is we like the ag streaming space so much that we're personally in the process of setting up an entity dedicated to streaming grains and high-value crops in frontier markets. CPAN members have already been introduced to what we're up to.

This is the slow season in Siem Reap, Cambodia, and it's stinking hot! Yet people are still flocking here to see the 7th ancient wonder of the world, the temples of Angkor.

Quite season…still swarming with tourists!

"You came to see the crumblies?" asked another fellow traveler. "Yes and no", I said.

My last attempt to see Angkor's temples, roughly 11 years ago, ended in failure…a failure caused by a combination of severe flooding, contracting a tropical eye disease which scared the life out of me (I thought I was going blind), and river pirates on the Mekong (they took only our money - thankfully). This time I took no chances and flew in directly from Phnom Penh after our Meet Up.

So yes, I came to see the "crumblies", but more importantly I came to see those creatures streaming up and down the walkways. In economic terminology they're called "consumers". Up here in Siem Reap they, and their well-padded wallets, are transforming the landscape. 5-star hotels now litter the streets around the old town extending north, south, east and west. What I came to see was the potential for tourism up here, and to get an idea of where we may be at in the growth phase.

Tourism is the second largest industry in the country after textiles, and the numbers have been growing steadily every year since the conflict ended in 1993, with the country being reunited under the monarchy.

Tourists who come to Cambodia come to Siem Reap. It's that simple.

It's not hard to see why. To say that the temples of the Angkor group, most notably the temple of Angkor Wat, which is but 1 of over 1,000 temples built in the area is impressive, is like saying that world war II was a little "dust-up".

Built in the first half of the 12th century, it is impossible to capture the size and scale in photographs. This was the largest pre-industrial city in the world and is a true architectural masterpiece. If these guys had seen the empire state building, or the Buj Khalifa they would have looked at each other and thought…."pfft, children!"

2010 saw 2.5M tourists visit Cambodia, 2.9M visited in 2011, 3.5M in 2012 and that number is absolutely going to be surpassed this year with estimates exceeding 4M. In other words, tourism numbers are growing anywhere from 15-20% annually.

What is evident in Cambodia in general, and is increasingly the case throughout SE Asia and Asia-Pacific, is the prevalence of Asian tourists over gweilo's, farangs, or if you have no idea what I'm referring to - pale faces.

I can tell you from my own experiences in SE Asia over the last decade, and this is backed up by my many friends who have been here far longer, that this was not the case until fairly recently. The days of poor Asians desperate to get westerners to come and spend their money are fast vanishing. Now it's as much a case of Asians in poor countries such as Myanmar, Cambodia and Laos seeking to attract Chinese, Thais, Malaysians, Indians, South Koreans, Japanese and Singaporeans as it is in seeking to attract pale faces. The cultural differences are more easily dealt with, these countries are all closer, growing wealthier and enjoying relatively freer markets. The trend is firmly in place and the single economic community of ASEAN will only further benefit Cambodia and the entire region.

FDI is pouring into Cambodia and the wealth is evident. Range Rovers and Mercedes now share the roads with tuk-tuks, Chinese scooters and hand carts. The ratio is rising in favour of the SUV's. Just today I was admiring a Porsche Cayenne when a Rolls Royce drove past. My tuk-tuk driver fondly noted, "we not have happy dancing road anymore". Locals tell me that the infrastructure is markedly better each year, though it's still under pressure to keep up.

I was curious to understand how much of the wealth was filtering through the economy and in what fashion. I sat down with the management at a recently built 5-star hotel I am staying at here. They tell me they're running 80% occupancy now! Remember, this is the slowest season of the entire year. Their IRR are over 30% based on free cash flow. Take THAT to the bank! A non-chalant comment from myself was, "you could flip this for a double in 12 months." Without missing a beat. The response was, "Oh certainly more than that." This will likely end the same way these things always end, in over supply, speculation, and a crash, but we're not there yet. The capacity constraints and occupancy rates seem to be telling us that much at least.

Side note on culture and a tale of two watches…

This may be simply anecdotal, but I have found Cambodians to be extremely generous and honest. After spending the day viewing the temples via a mountain bike, I went for a massage. I then hopped in a tuk-tuk and went into town to get some gifts for my kids at the night market. While browsing through the market my tuk-tuk driver ran up to me after having obviously been hunting me down… "Mr. Chris, Mr. Chris, you leave watch." He told me I'd left my watch at the health spa. Now the logistics of this are impressive. Firstly, the watch was found, not stolen by someone who likely earns $50 per month! Then the tuk-tuk driver who carried me there had to be located, goodness knows how, but he was rung on his mobile and sent to hunt me down. Amazing! Nothing was asked nor expected of me, yet in return I generously tipped all involved, and deservedly so!

Shortly thereafter I received a message from a friend and attendee at our Meet Up. Below is his story in his own words:

"The Cambodians are extremely friendly so far. In addition, I found integrity in places where it can not necessarily be expected. After the Kingdom brewery evening I had another beer or two in the Air Force bar where my watch went missing from my wrist and could not be found anywhere. Ok, no big deal. Why do I wear a watch in these places anyway!? I mentioned the incident at a party the next day, and by coincidence the lady who runs the bar was present. She called me back the following day with my watch ready for collection, stating the cleaning lady had found it, and adding emphatically that "nobody ever steals things in my bar!' I was impresse,d as such an outcome seems rather unlikely in many places, including Germany or the UK."

As I've said before, put this place on your radar, good things will be heard from Cambodia over the coming decades.

- Chris

"The potential for investors in Cambodia is excellent.The listing of publicly traded stocks will drive up interest and demand. If a country can list its state-owned enterprises and list enough stocks so that foreign investors can get involved, then it can be very, very good." - Marc Mobius

"promote and facilitate cooperation in international law, international security, economic development, social progress, human rights, civil rights, civil liberties, political freedoms, democracy, and achievement of lasting world peace."

Now those are noble goals, to be sure, and admittedly they set the bar pretty high for themselves. However, 68 years later the UN is an abysmal failure, and it's abundantly clear to anyone that is paying attention that literally every single principle mentioned in their charter is being consistently and repeatedly broken, oft-times by the founding nations themselves!

What about that peace mandate? There are currently over 36 wars being waged globally, so you be the judge…

As a "quasi" world government, the UN is able to extract money by force (do government's have any other play book?). The result has been the Mother Ship expanding like kudzu, spawning in its wake organizations such as the WHO (World Health Organization), the ILO (International Labor Organization) and dozens of other useless, bureaucratic nightmares. Mind you they have grown exponentially whilst achieving less and less with each passing year. In the same way that Amtrak "successfully" operates solely via grotesque theft from the US taxpayer, so too the UN will keep sucking in tax dollars and engorging itself like a video game-playing fat kid downing chips and sodas 12 hours a day. The only difference being that the fat kid makes no assertions that he is bettering human kind.

Rest assured, new "problems" in need of meddling will be found, ensuring more capital is "urgently needed" mis-allocated, or outright wasted. The UN is one of the most opaque, diplomatically immune, unaccountable to its funders, (largely the US tax payer) entities in the world, and much like any other bureaucracy views the tax dollars which fund it, not as a privilege to be earned, but as an "entitlement".

I've personally seen some of the most ill-conceived UN-sponsored projects, debacles that no sane person would dream up, get implemented. They all came complete with false, UN-created reports which were cobbled together in order to enlarge the scope of said "assistance" program. These "programs", I might add, are typically just transfer of payment mechanisms from "poor people in wealthy, developed countries", to "unbelievably wealthy, corrupt politicians in poor countries".

These NGO folks are driving around Africa, Asia and most of the poor countries of the world in their air-conditioned Land Cruisers, spending money they don't deserve on projects that most third graders would scoff at.

We saw it plain as day in Cambodia last week. They've got it good…and they know it. I met a woman on the plane from Phnom Penh to Siem Reap who worked for the WHO. What a joke. She was "living" in a $250/night resort, being chauffeured around in, you guessed it, a Land Cruiser. She was agitated when I met her because her Cambodian driver, who is likely getting paid the minimum $70′ish per month, forgot to pick her lazy butt up at 6 AM and shuffle her to the airport. She had to take a taxi… God forbid!

NO way they let the party end! Sadly, and almost unbelievably, many of these same individuals believe in what they are doing, which just accelerates the growth of these parasitic institutions. Make no mistake, they ARE parasites.

The UN's existence is absolutely destructive, period. Remember, before you send me email from Ohio telling me I'm wrong, I grew up in Africa, I have seen this crap first hand. I won't argue that many well-intentioned successful projects the UN may have had in the early days don't exist, but those days are long gone, and certainly on balance and for the enormous amount of capital squandered this institution now simply leaves in its wake a destructive, powerful, bureaucratic force. The fact that today the UN has any legitimacy left is testament to the Walmart car park ignorance of an intellectually indifferent, media-fed populace.

So what's the answer?

Undoubtedly what has had the greatest impact throughout man's troubled history on this ball of dirt, has been harmony created by trade. Centralized, top-down administration of principles, when forced on people of differing beliefs, whether they be religious (Hindu, Muslim, Christian, etc.), political or otherwise has a spectacular failure rate. Free trade and the free flow of goods and services - allowing individuals to choose how and with whom they trade - has had THE highest rate of success, bar none.

Let's take multinational corporations for example…they are everything that the UN pretends to be. They are filled with people from various cultures working in countries scattered across the globe, they are characterized by people of all religions, race, ethnic groups, and they are all trying to help each other rather than obliterate each other. Whats more is they are producing goods and services which the market desires and turning a profit doing so.

Why? Because the free market works. It is in essence people acting of their own free will to further their own objectives. It's not selfish, it's human!

Humans are self-interested animals. That should be apparent. Let's get over the concept that we're inherently chivalrous, philanthropic, self-less spiritual beings with our sole reason to exist being to better the lives of everyone else. Bull$%&#. For the most part we are always going to look after #1. Doubt me? Next time you're on an airplane and the stewardess (sorry, flight attendant) gives you the safety demonstration take note of who she tells you to put the oxygen mask on first (hint: it's YOURSELF!). The reason for this should be obvious, but if not I'll spell it out: We are incapable of helping others if we ourselves are not safe, secure and stable… This same "safety" principle extends to economics and personal finance.

Multinationals work on the premise that humans ARE self-interested. Thus they produce products which they believe cater to the self-interest of consumers (also humans, by the way). They are forced by the market to adjust their actions, products and business practices all over the world, almost in real time.

McDonalds in New Delhi serves curried burgers. In Asia you can buy a green tea and red bean ice cream sundae, and get seaweed seasoning for your fries. In Japan they will sell you shrimp burgers. Even in Hawaii the traditional "orange drink soda" is replaced with fruit punch!

I would suggest that McDonald's has done more to "promote and facilitate cooperation in international law, international security, economic development, social progress, human rights, civil rights, civil liberties, political freedoms, democracy, and achievement of lasting world peace" than the UN ever has…and this from a company that sells God awful cardboard masquerading as food!

- Chris

"None of us is as good as all of us." - Ray Kroc

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

So who is Coats Inc.? A recently closed CPAN deal of ours involved a small, rapidly-growing company with a leading edge proprietary technology. This company recently signed an exclusive multi-year research and development agreement to create a new range of products. The agreement was signed with - you guessed it - none other than Coats Inc. Thus began my introduction to the company.

Founded in Scotland in 1755, Coats today must be one of the oldest continuously operating companies in the world, if not the oldest. Coats is the world's leading industrial and textile craft business, and rank second in global zips. In fact 1 in 5 garments around the world contain Coats threads. They are the undisputed market leader supplying threads to companies such as Adidas, Marks and Spencer, and Abercrombie and Fitch. Today with Revenues of £1.12B annually it is a cash-generating machine.

Coats itself is wholly-owned by a New Zealand conglomerate investment firm called Guinness Peat Group Plc (GPG:AX). GPG keep a listing in Australia, NZ and the UK. Now this is where the story gets interesting, as GPG has been trying to figure out how best to release value to its shareholders, and to that end the decision to wind down and sell off its assets was made over a year ago. There has been a bit of internal hostility as well, but that isn't the topic of this missive and really par for the course in internal shake-ups of this nature.

By the end of 2013 the one remaining asset which GPG plan to retain, is that of Coats, the thread maker mentioned above.

I've always maintained that conglomerates rarely get priced correctly by the market. It is often to difficult for investors to accurately value their many businesses and when they are publicly-traded shareholders often do not get rewarded for the companies value. In short, what can at times happen is much like government accounting…

1 + 1 DOESN'T equal 2

I believe that that is the case with GPG right now. Let's start with looking at GPG's assets. Currently GPG still owns stakes in the following: Tower Insurance; Ridley Corporation (agri-producer); CIC (Australian property developer); Prime Ag (Agri-investor); and, Tandou (Agri-business). These businesses together are valued conservatively at £216 million. GPG also has a cash position of £275 million.

GPG trades at £0.32p, or a market cap of £486 million. This makes sense, except that Coats is wholly-owned by GPG. Coats is therefore being valued at ZERO.

Lets take a look at Coats then. It is an extremely large business in its own right with over 70 factories around the world and 20,000 staff.

It is the largest holding of GPG, with a book value of £150m, £46m in profit, and £97m in cash from operations.

Insiders buying

Looking further I see that Waldemar Szlezak has recently been appointed as a non-executive director. Now Waldemar, some of you may recognize the name, is managing director of private equity at Soros Fund Management. Looking through filings which I corroborated with news releases, I find that Quantum Strategic Partners Fund has recently taken an 8% stake in the company.

Rob Cambell, GPG's chairman this month alone purchased 323,298 shares.

On the obligation side GPG has to deal with a £125 million pension scheme obligation at Coats. This is non-recourse to GPG, however they certainly have sufficient capital to deal with this regardless.

The question investors needs to ask themselves is if the pile of cash which is on the GPG balance sheet, plus that which will come in from the subsequent asset sales planned, combined with Coats is worth more than the current share price? Clearly Quantum and Rob Cambell believe it is.

One other notably interesting little titbit is that GPG has a £1.9 billion unused tax loss sitting on its balance sheet. That is HUGE. In essence GPG could sell Coats for less than its true value, use the tax right-off and simply return that cash to shareholders. Who knows what they will do, but it certainly looks intriguing to me, as well as being undervalued based on book value alone.

In full disclosure (not that it matters since this is a free blog and hey you get what you pay for), I have a bid out now to pick up some shares in GPG.

- Chris

"I contend that financial markets never reflect the underlying reality accurately; they always distort it in some way or another and the distortions find expression in market prices. Those distortions can, occasionally, find ways to affect the fundamentals that market prices are supposed to reflect." - George Soros

Disclosure: I am long [[GPGPF.PK]].

What exactly are pre-emptive rights?

Sometimes called subscription rights as well, these are pretty common in private equity and VC (Venture capital) deals. A pre-emptive right gives you as an existing shareholder the right to acquire new shares issued by a company. For example, after a round of VC financing by Series-A investors, if the company decides to issue new shares to potential Series-B investors, the Series-A investors will have the right to acquire shares up to their pro-rata shareholding. This helps ensure that Series-A investors can, if they so choose, retain their voting power even if the company decides to issue new shares in the future.

Pre-emptive rights allow early investors to ensure that they have the ability to retain their ownership share on a pro-rata basis and not be diluted. These rights do not need to be taken up, and act more like an option contract than a futures contract in that respect.

Why would an investor want this?

This gives us, as investors the right to participate in subsequent financing rounds to the extent that is required to protect our percentage equity stake. If the company is executing and doing well, this provision can be immensely valuable. When the company then goes to raise capital for its institutional round of financing the dilutive effects of that raise are mitigated by early stage investors taking up those pre-emptive rights.

I will say that I've had deals whereby VC's come in and attempt to kill the pre-emptive rights previously agreed upon. This is incredibly frustrating for all parties. The founders find themselves stuck between a rock and a hard place as they don't want to annoy seed investors (you/us) and they don't want to annoy the VC's either and risk losing the deal.

My own personal attitude when this happens is that the VC's can go to Hell, suck eggs and eat s#!^, but I'm a nice guy, so I'm not sure how others deal with it. We do our damnedest to NEVER deal with unethical people, and when VC's try to do that it is unethical…plain and simple. Of course if the rights are written into contract then they're enforceable, and as early stage investors with those rights you can enforce and should enforce them.

From the founders perspective what they need to consider is the company they keep. Angel investors and VC investors are often much, much more than simple shareholders. This is a partnership and it's certainly not uncommon for angels and VC's to play a significant part in the strategy of any young business. In other words early stage investors are not always passive. Do you as a founder really want to be keeping company with people who are unethical and willing to run roughshod over existing shareholders if given the chance?

What about "anti-dilution provisions"?

Anti-dilution (not to be confused with antediluvian) provisions allow for early stage investors to retain their percentage ownership in a company in the event that future financings would dilute them. Shares, options and convertible securities are adjusted so that the holder of these securities receives additional securities.

It is typical that anti dilution rights apply to financings done at a lower valuation to that which the investor has originally participated at. Where financings are done at a higher valuation what typically happens is that the angel or early stage investor, though diluted in percentage terms is realising an accretive dilution. This is often where pre-emptive rights become valuable. Just remember that the shares, options or convertible securities originally purchased are worth more even though the share count has risen in the event of a subsequent capital raise at a higher valuation.

We hope this little "cheat sheet" on these relatively simple terms helps. If you have any questions fire away!

- Chris

"If you are not willing to risk the unusual, you will have to settle for the ordinary." - Jim Rohn

Often a dirty and unpleasant experience, and quite hot this time of year, my goal is to move on as quickly as possible! Besides a couple of hawkers and casino's there isn't much to see anyway, and this is not a place I would like to transit through after sun down.

You might be wondering just where in the world I am..? In between Viet Nam and Cambodia, coming back from a week-long due diligence mission in Saigon. These two countries have a complicated history, one of conflicts and allied stances (Fact: Cambodia's territory used to cover what is today Saigon), so I figured it would be worthwhile to visit Viet Nam in order to better understand how these two countries presently interact and how they will prosper in the years to come.

Before I get into the nitty gritty from my trip a history lesson is in order. Not being well enough read yet to discuss the multiple layers that comprise Indo-Chinese history, I will highlight the more recent relationship these countries enjoy. If you want to learn more about Cambodian history I suggest you pick up a copy of A History of Cambodia, by David Chandler. It's one of the best books on the subject.

After three torturous years of Khmer Rouge rule, where nearly everyone was forced into the countryside to farm rice (Which was sold to the Chinese in return for arms to fight the Vietnamese) and the intellectuals were "cleansed", Pol Pot's regime finally came to an end on December 25, 1978 when Vietnam invaded what was then called Democratic Kampuchea. Scaring the Khmer Rouge into the countryside, the Vietnamese put Hun Sen into power as Prime Minister, and renamed the country the People's Republic of Kampuchea (PRK).

The next decade saw the Vietnamese occupy the PRK and attempt to rid it of rebel insurgencies, that is, until 1989 when Viet Nam pulled out of the country due to pressure from the international community. Over the next 15 years the country initiated free market reforms and subsequently experienced rapid growth, while simultaneously patching up its wounds. This growth can be contributed in large part to the Vietnamese who have maintained an active presence in the economy and politics since (One such example being, at the cremation ceremony of King Sihanouk earlier this year, Viet Nam donated the artillery shells for the 21-gun salute).

But I digress. My trip to Viet Nam was an interesting experience, much different than my Cambodian impressions, but I came away with some ideas on how to be a part of the Vietnamese growth story, nonetheless.

Upon arriving in Ho Chi Minh City (Saigon) I was struck at how familiar Saigon felt. Saigon and Phnom Penh look eerily similar, though Phnom Penh is about 5 to 10 years behind in regards to development. Beyond the architecture and taking an initial stroll through District 1, I was surprised to see so many financial institutions, commercial chains and food and beverage products here that also make up a large part of everyday life in Cambodia. One might go as far as to call Cambodia a "little Viet Nam."

Of course, I didn't come to Viet Nam to walk around, I came to identify how best to gain leverage to this economy of 90 million people, something that has already attracted the likes of KKR, Goldman Sachs and many others.

I met with brokerages, investment bankers and hedge funds. During the discussions I was (un)impressed to learn just how socialist Viet Nam still is. Of course, the country has opened up, as has China and Laos, but the bureaucracy was stifling.

Initially I was most intrigued to learn about the prospects for private equity in Viet Nam. However, during every one of my meetings I was strongly advised to stay away. The private equity business in Viet Nam is notorious for its lack of transparency, restrictions on foreign ownership, unqualified management and a whole host of schemes designed to separate the unwary from their money and magically turn it into Ferrari's. Looking at the luxury and sports cars driving around Saigon, it's safe to say this has happened more than once!

With private equity pretty much off the table (at least for now) I turned my sights toward shares in the public markets, for which Viet Nam has two exchanges: the Hanoi Stock Exchange; and the Ho Chi Minh Stock Exchange. While volatile, they are host to a handful of some of the "most transparent" companies in the country. Based on relative liquidity and an undervalued securities market, large players including KKR, VinaCapital, Dragon Capital, etc are actively involved in these two exchanges.

Vietnamese equities are relatively cheap. After a period of high inflation and a real estate bust, I was relatively optimistic about the prospects for public equities. Though, yet again bureaucracy trumped that optimism. Opening a brokerage account is a hassle, and things like daily trading limits imposed by the exchanges make building positions a challenge.

One of the more significant hurdles is foreign ownership. Foreigners are not permitted to control more than 49% of a listed equity. While this might not seem like a significant issue, it is. This means that shares of blue chips, such as Vinamilk, that already have 49% foreign ownership command a premium for those seeking an allocation. In other words, since the limit has been reached for foreign ownership, someone may sell their shares, but it will be at a premium to the market. Price discovery is difficult. Further to that, buyers sitting on the bid waiting for a foreigner to sell can create price distortions and illiquidity.

Seeing how private equity is in large part out of the question, and public equities are not yet "user friendly", I decided to try real estate. I spoke with one real estate agent on the phone, but quickly ran into MORE bureaucracy…it tends to follow you around the place. There's more to discover about buying real estate in the country, but by this time I was ready to head back across the border.

So, feeling a dis-heartened by my trip, I write to you now jubilantly back in Cambodia, where frankly I couldn't be happier!

Looking back, Viet Nam, while still a bureaucratic nightmare, will at some point jump through the hurdles of liberalizing its economy, which will make it a much friendlier country to invest in. In the meantime, I believe one of the best ways to gain exposure to Viet Nam is through its neighbor, Cambodia!

How can you do this? Through a strategy I mentioned in a previous post regarding Mongolia and China. Start a company in Cambodia that will produce goods the Vietnamese want, and export them to the country (some ideas include organic agricultural products, garments, high-value teak, etc). This allows you to sidestep much of Vietnam's bureaucracy.

You might be asking why I suggest doing this in Cambodia. Consider that Cambodia is a Laissez Faire society. It is easy to incorporate a business and a foreigner can own 100% of said business. Repatriation is not a problem, taxes are low, and you can acquire a 1-year multiple entry visa. The best part is that the Cambodian government will leave you alone. Not too many countries offer an opportunity like this.

Cambodia is not only business friendly, but as long as you operate under the existing laws you will not be bothered by anyone. Unfortunately, you can't say the same for places like Viet Nam, China, the United States, etc. This is also what made Thailand such a booming success, despite rampant corruption.

In summary, I must say that after my trip to Viet Nam I couldn't be more excited about the prospects for Cambodia. It is easy to live here, you can operate your business with ease and "Western" food is plentiful (if you want it - The Cambodian cuisine is wonderful!). If you are thinking of moving to Asia I have to ask, why wouldn't you live here? It's Thailand light, cheaper and starting from a much lower base, so the upside is magnified.

You can find out why I'm so excited by attending our upcoming Cambodia: Boots on the Ground Meet Up. You'll get to hobnob with some of Cambodia's sharpest entrepreneurs, legal eagles and service providers. We'll even discuss how to grab a Cambodian passport, legally!

CLICK HERE NOW to get more information and register for the event. I hope to meet more than a few of you there!

-Scott

"If one rejects Laissez Faire on account of man's fallibility and moral weakness, one must for the same reason also reject every kind of government action." - Ludwig Von Mises