This defies all reason...
Why has the price of silver dropped like a rock... while the supply is at an all-time low, and demand is increasing at an alarming rate. A federal complaint alleges a massive scheme has kept the price of silver artificially low. But now that scheme is unraveling, and silver is on the verge of soaring. Those who get in early could well see returns in mid- to high-triple digits. Here's the full story.
February 13, 2012Is Gold Money?... Don't Ask Ben Bernanke, Examine the Federal Reserve
By Peter Krauth, Global Resources Specialist
If you really care about your financial future, here's something you need to know.
It's about a story that received almost zero coverage from the mainstream press. I can't say that I am surprised.
It involves gold.
Thanks to requests by Bloomberg News under the Freedom of Information Act, the Federal Reserve has revealed unprecedented details concerning the personal holdings of its regional bank presidents.
What they found is nothing short of stunning ...
Why has the price of silver dropped like a rock... while the supply is at an all-time low, and demand is increasing at an alarming rate. A federal complaint alleges a massive scheme has kept the price of silver artificially low. But now that scheme is unraveling, and silver is on the verge of soaring. Those who get in early could well see returns in mid- to high-triple digits. Here's the full story.
February 13, 2012Is Gold Money?... Don't Ask Ben Bernanke, Examine the Federal Reserve
By Peter Krauth, Global Resources Specialist
If you really care about your financial future, here's something you need to know.
It's about a story that received almost zero coverage from the mainstream press. I can't say that I am surprised.
It involves gold.
Thanks to requests by Bloomberg News under the Freedom of Information Act, the Federal Reserve has revealed unprecedented details concerning the personal holdings of its regional bank presidents.
What they found is nothing short of stunning ...
Ben Bernanke on Gold
But let me back up a little.There's an exchange between Fed Chairman Ben Bernanke and Congressmen Ron Paul you need to hear first.
During a monetary policy report delivered to Congress last summer, Congressman Ron Paul asked Bernanke if he thought gold is money.
After a clearly uncomfortable pause Ben said, "No. It's a precious metal." [By the way, if you haven't seen Ron Paul questioning Bernanke about gold, click here. It's already had over half a million views.]
Paul went on to ask Bernanke why it is then that central banks hold so much gold. Bernanke answered that it was simply a tradition.
Well, congrats Ben, you did get that one right, just for the wrong reasons. (Deep down, you surely know the true reasons).
The fact is gold has been a monetary tradition for millennia.
Nearly 2,000 years ago Aristotle laid out what characteristics make for good money. According to Aristotle:
- It must be durable.
- It must be portable.
- It must be divisible.
- It must be consistent.
- It must have intrinsic value.
So it's no accident that the most common basis for money - in all of human history - has been gold.
You might want to reread that: the most common basis for money - in all of human history - has been gold. It's no accident.
After all, only gold meets all five of those requirements for sound money.
It is only in the past century that fiat money has supplanted gold or gold-backed currencies on a worldwide basis.
What makes today's central bankers and their system of printing fiat currencies and setting interest rates so special? It is hubris and nothing more.
Fiat currencies are just a relatively recent, and failing, experiment in economics. So much so, it's become exceedingly dangerous to hold them of late.
Here's why.
To continue reading, please click here...
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A Shocking Change to the U.S. Financial System Could Soon Cause Billions of Paper Dollars, Quarters and Nickels
to VANISH
When this happens, it will change everything... from the way we shop, invest, pay the baby sitter and tip our bartenders. This life-changing event is practically ignored by the mainstream press. But we recently put together a brief report that could prove invaluable to you in the weeks ahead. To view it, click here.
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Whiskey and Cigarettes: The Best Way to Play Sin Stocks
By Jason Simpkins, Managing Editor
The common misconception is that so-called "sin stocks" only perform well when the economy tanks.
But the truth is that purveyors of alcohol and tobacco take their lumps during a recession just like everybody else.
That was certainly true of the world's largest spirits company Diageo PLC (NYSE: DEO), which traded as low as $42 a share in 2008. Of course, the stock has more than doubled since then, closing Friday at $93.38.
Shares of cigarette-maker Philip Morris International Inc. (NYSE: PM) have nearly doubled in the past two years, as well.
Still, you don't have to worry if you missed either of those rallies because there's still plenty of room for these two sin stocks to run.
Indeed, more and more consumers are returning to their vices as the global economy improves.
For instance, liquor sales, which stagnated in 2009, rose 4% last year, while sales of top shelf spirits increased 5.3% -- a near return to pre-2008 levels.
What's more is that these gains came at the expense of the beer market, which typically has the upper hand in tough economic times.
"People who are doing well are going out and spending on spirits as an affordable luxury," John McDonnell, chief operating officer for The Patron Spirits Co. and chairman-elect of the Spirits Council, toldBloomberg. "Also, spirits companies never stopped spending through the downturn."
The same goes for tobacco products, which have been gathering steam in emerging markets even while they fall out of fashion in developed countries like the United States.
So let's take a closer look.
Diageo is Uplifting Spirits
Diageo - the company behind Baileys, Captain Morgan, Guinness, Smirnoff, and Johnnie Walker - is the most obvious beneficiary of increased liquor sales.These are powerful brands that helped Diageo actually increase its cash flow during the recession. And now that consumers worldwide are in a slightly more festive mood, sales are set to take off.
Diageo, which produces about 28% of the spirits sold in the United States, reported a 5% increase in liquor sales in the U.S. and Canada in the second half of 2011.
More importantly, the company continued to expand its business in emerging markets.
While volumes were flat in North America and Europe, Diageo generated 14% volume growth in Latin America, 7% in Africa, and 5% in the Asia-Pacific region.
And that's just the beginning for a company that has made developing markets the focus of its growth strategy.
To continue reading, please click here...
| 90% in One Year, 32% in 16 Days Our Chief Investment Strategist Keith Fitz-Gerald told Private Briefing subscribers last month about a biotech stock that could gain 90% in one year. Keith said this company has three key ingredients for a skyrocketing share price: it's a multinational company, selling in a growing market, to a large-and-growing population. As of Feb. 7 this investment was up 32% from when we recommended it, and 46% year-to-date. In fact, this stock could surpass the 90% price target and join Keith's long list of triple-digit gainers. It's already a hit with Private Briefing subscribers. "I am really pleased with your recommendations. All six of my investments are up, especially [Keith's biotech stock]. Your e-mail is the first I go to every morning for your sage advice." - Reader B.Q. Click here to get the scoop on this biotech stock, detailed Jan 13 in our Private Briefing investment service. You'll also gain access to all our past Private Briefing columns and receive new ones in your inbox every day. |
The ECB's Long Term Refinancing Operation (LTRO) is Bullish for Stocks
By Jack Barnes, Global Macro Trends Specialist
If you listen to the talking heads, there is no end in sight to the Euro crisis.
Even with the European Central Bank's (ECB) recent Long Term Refinancing Operation (LTRO), Greece is still making all the headlines.
As of late last week, a possible new deal has been made in Greece. However, the finance ministers that are responsible for the deal are not sure it will be enough to release the second bailout of Greece.
The ECB has been demanding that debt it bought at a discount be honored at full par value. It is now reported that the ECB will sell these debts at cost, and allow the debt to be retired.
This is a huge first step in the process of getting Greek debt levels low enough to be sustainable.
Yet, we are still well into the second year of this crisis and the market is growing tired of endless European emergency meetings.
It reminds me of the period around January 2009.
The reality is Europe needs to go through a hard, brutal adjustment period, where the weak states that cannot handle being in the European Union (EU) leave.
While a New Greek deal has been announced, few people believe it will be the last deal, or the best deal. That is, if it is even ratified in the end.
"It's up to the Greek government to provide concrete actions through legislation and other actions to convince its European partners that a second program can be made to work," EU Economic and Monetary Affairs Commissioner Olli Rehn said.
The rolling bailout process appears to be set up to happen this spring, as the ECB pumps fresh liquidity into its banks for unlimited dollar amounts. The drain on the balance sheets of Euro banks appears to be ending.
The ironic angle few people are tracking is that U.S. banks have been helping to drive Europe's big banks into this crisis.
By Jack Barnes, Global Macro Trends Specialist
If you listen to the talking heads, there is no end in sight to the Euro crisis.
Even with the European Central Bank's (ECB) recent Long Term Refinancing Operation (LTRO), Greece is still making all the headlines.
As of late last week, a possible new deal has been made in Greece. However, the finance ministers that are responsible for the deal are not sure it will be enough to release the second bailout of Greece.
The ECB has been demanding that debt it bought at a discount be honored at full par value. It is now reported that the ECB will sell these debts at cost, and allow the debt to be retired.
This is a huge first step in the process of getting Greek debt levels low enough to be sustainable.
Yet, we are still well into the second year of this crisis and the market is growing tired of endless European emergency meetings.
It reminds me of the period around January 2009.
The reality is Europe needs to go through a hard, brutal adjustment period, where the weak states that cannot handle being in the European Union (EU) leave.
While a New Greek deal has been announced, few people believe it will be the last deal, or the best deal. That is, if it is even ratified in the end.
"It's up to the Greek government to provide concrete actions through legislation and other actions to convince its European partners that a second program can be made to work," EU Economic and Monetary Affairs Commissioner Olli Rehn said.
The rolling bailout process appears to be set up to happen this spring, as the ECB pumps fresh liquidity into its banks for unlimited dollar amounts. The drain on the balance sheets of Euro banks appears to be ending.
The ironic angle few people are tracking is that U.S. banks have been helping to drive Europe's big banks into this crisis.
Setting the Stage for the Second LTRO
Let me explain.U.S. banks have loaned money to European banks via our money market accounts for periods between seven and 270 days on average.
So when you left cash in your money market account, a significant portion of that cash was actually being invested in unsecured loans to European banks in a search for higher yield.
These funds were typically rolled over at the current market rates, allowing Euro banks access to shorter-term liquidity. However, that began to change in July 2011 when U.S. banks started shortening the terms of the funds or flat out began to repatriate them.
This shift by American banks caused European banks to lose access to what they were using for near-term liquidity. European banks were using short-term loans to make longer-term loans to their clients.
The process of paying back their short-term funding, while still holding onto longer term loans has stretched their balance sheets even more.
This reversal of funding caused an expansion of the leverage at the banks, as they have loans outstanding but have to pay back the source of them.
As result of this liquidity crunch, the ECB rolled out a program to allow banks to recapitalize themselves.
It's called the LTRO (Long-Term Refinancing Operation).
To continue reading, please click here...
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