September 2010 - Page 4 of 9 - Money Morning - Only the News You Can Profit From

Five Ways to Profit as Coffee Prices Soar

If you're anything like me, you can't resist stopping in for a "cup of Joe" every morning. If so, you're probably also like me in that you're experiencing a bit of pain in the wallet right now, given the steady increase in coffee prices we've see over the last year (and especially in the last few months).

If you want physical proof that we're operating in a truly global economy these days, just look at how these three factors have creamed your coffee budget:

  • Lousy weather in Latin America is threatening a big chunk of the worldwide coffee crop.
  • U.S. coffee stockpiles are reportedly at a 10-year low.
  • And Vietnam and Brazil – two of the world's Top 3 exporters – are scheming to hoard their stockpiles.

Little wonder coffee prices are at 13-year highs, and coffee futures have zoomed 44% since June.

Expect the trend to continue.

This may be bad news for your pocketbook – but it's great news for your portfolio. Coffee prices are going to rocket another 30% from here.

And with the strategy we're about to show you, this run-up in prices will be truly good 'til the last drop.

To learn more about how to profit from the global bull run in coffee, please read on…

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Leaders Emerging as the U.S. Economy Shakes Off Its Stupor

The past five days added more color to the emerging picture of U.S. economic growth that is slow and unsteady — but still in gear. Investors decided that was good enough, and bid up risky assets. The Standard & Poor's 500 Index rose 1.4%, emerging markets rose 1.8%, gold rose 2.2% and bonds fell.

Underlying breadth modestly weakened, as the market is primarily being propelled now by a withdrawal of sellers — not an increase in buyers. News late in the week typified the entire span, as it mostly favored bulls.

Indeed, the U.S. economy faces an uphill climb but some companies are emerging as market leaders.

To find out which companies are dragging the economy forward read on…

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More Americans Tapping Into Entitlement Programs Swells Budget Deficit

As many U.S. citizens continue to rail against the ballooning budget deficit, the reality is that most Americans are unwilling to swallow the bitter pill it will take to tame it. 

Perhaps that's because nearly half of all Americans live in a household in which someone receives government benefits, more than at any time in history, according to a report from The Wall Street Journal.

At the same time, the number of American households not paying federal income taxes has grown to an estimated 45% in 2010, up from 39% five years ago, according to the Tax Policy Center, a nonpartisan research organization.

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Investors Flock to Gold and Silver on Recovery Worries

Investors worried about the global economic recovery pushed gold prices to fresh highs on Friday, marking the third time in a week the shiny metal set a new record. Silver also climbed to its highest price in thirty years.

Spot gold climbed above $1,282 an ounce in New York and London as a weakening dollar spurred demand from investors for wealth protection, while silver rose to $21.44 an ounce, its highest level since 1980.

Bullion, which usually moves inversely to the dollar, posted its biggest weekly gain since May as the greenback touched a five-week low against the euro.

Holdings in gold- backed exchange-traded products (ETP) reached a record this month as investors sought protection from financial turmoil and the prospect of slowing economic growth.

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Cashing in on Canada: Four Ways to Profit – Big – From the World's "Safest Economy"

Canada is more than just back bacon, maple syrup, and hardscrabble-mining claims. It's a leader in natural resources, precious metals, and such alternative-energy investments as oil sands. In fact, Canada right now boasts one of the world's most compelling targets for investors' hard-earned money. In this free report, find out exactly how you could be making a fortune in what is widely considered the world's "safest" economy…

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Money Morning Mailbag: With Many Ways To Hold It, Investors Need To Get Their Hands on Silver

A couple weeks ago, Money Morning Guest Writer Jack Barnes examined the last major commodity to enjoy a true price breakout: silver.

Barnes detailed why silver is poised for a breakout, based on its current price surge underway in India, the price run up of gold – a leading indicator of silver prices – and the fact that the white metal has yet to set a new nominal record price in U.S. dollars.

Barnes outlined the actions investors should take to involve silver in their investment plans, offering three strategies: physical acquisition and accumulation, exchange-traded funds (ETFs) and stocks, and options on futures.

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What's In a Name: Can the U.S. Afford to Call China a Currency Manipulator?

It seems like every six months the debate over China's currency, the yuan, reaches a fevered pitch: The Washington bureaucrats threaten to label China a "currency manipulator" and Beijing threatens to dump its U.S. debt holdings.

Then, with the imminent approach of a major inflection point – be it a key international summit or major financial report – both sides grudgingly agree that a modest appreciation of the yuan would be mutually beneficial.

However, things could be slightly different this time around. China has routinely ducked calls to revalue its currency, and in doing so greatly agitated the West.

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The Defeat of the "Shadow Shogun" Means it's Time to Buy Japanese Stocks

Japanese Prime Minister Naoto Kan's narrow Tuesday victory over Ichiro Ozawa for the leadership of the Democratic Party of Japan wouldn't normally get investor pulses racing – after all Japan has had five prime ministers in four years.

However, the Bank of Japan's heavy intervention in the currency markets this week confirmed my view that this political twitch was really very different.

The upshot: As investors, we should pay attention … and should look to increase our allocation to Japanese stocks.

To understand why it may be time to buy Japanese stocks (and to see what stocks to buy), please read on...

Senate Hearing on Covered Bonds Highlights Wall Street's Resistance to Transparency

The Senate Banking Committee held a hearing Wednesday to further examine the uses and regulatory issues associated with covered bonds, to decide if they are a viable alternative to stimulate the U.S. economy and contribute to sustained growth.

Money Morning Contributing Editor Shah Gilani explained the benefits of a U.S. covered bond market in a story Wednesday.  Covered bonds are debt securities backed by the cash flows from public-sector loans or from real-estate mortgages. They resemble other asset-backed securities (ABS) created through the process known as "securitization," but have one big difference: Covered-bond assets must remain on the issuer's consolidated balance sheet.

"A robust covered bond market offers many solutions to the problems that currently ail the U.S. economy, as well as its underlying financial system," said Gilani. "A covered bond market would jump-start needed lending by creating a healthy, transparent and "honest" securitization market. It would also enable the United States to regain its title as the financing center for the global economy."

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