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This Says Our Favorite Biotech Is Off to the Races

Shares of Inovio Pharmaceuticals Inc. (NYSE: INO) – a promising biotech we recommended back in February 2013 – jumped as much as 27% to a three-month high of $14.20 yesterday after the company said a new cancer drug met its main goal in a midstage clinical trial.

Inovio’s shares backtracked a bit as the day progressed but still closed 17.6% higher for the session. Inovio shares have advanced 361% since we first told you about them. The stock has generated a peak gain of 456%, making it one of the 31 recommendations we’ve made to you that have doubled or better since we launched Private Briefing in August 2011. (More on that later…)

  • Eurozone

  • Eurozone Debt Crisis: The Greek Elections are a Make or Break Moment What happens this Sunday, June 17 , may be the trigger for a final resolution of the Eurozone debt crisis.

    Now I understand that you probably don't follow Greek elections. But this is one you'll want to keep an eye on. At the moment, it dwarfs the contest between Mitt Romney and President Barack Obama.

    In fact, come Monday it will be what every banker, politician and trader is talking about.

    In the balance is the very fate of the Eurozone.
    The
    ripple effects could be enough to actually bring the EU down.

    That's the first part of the story. Admittedly, it's not a very pleasant one.

    The second part concerns your portfolio, since the solutions will involve more money-printing and, in the long run, more inflation.

    But you needn't worry. We've already read the central banker's playbook for you.

    In this case, the message is clear. Don't buy Europe. But do buy hard assets -- whether gold, oil, or other commodities.

    These safe-havens are one of the best ways to hedge yourself against these characters and their money printing schemes.

    Now that you know why Sunday is so important, here is how it will likely play out-in both the short term and in the long run.

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  • Why an Italy Bailout Package is on the Way With news of the Spain bailout package still fresh, and Greece's crucial elections on Sunday, the next event in the Eurozone debt crisis is already brewing.

    An Italy bailout package is likely to be the next costly move in the spiraling contagion.

    Italy on Thursday held its first bond auction since European finance ministers came to Spain's rescue, willing to give the ailing country up to 100 billion euro ($126 billion) to shore up its beleaguered banks.

    The auction raised a heap of concerns.

    Italy's borrowing costs soared following a Treasury sale of 4.5 billion euros of debt, including 3 billion euros of its 3-year benchmark bond that yields a lofty 5.3%. That was the highest yield since December and an increase of nearly 1.4 percentage points from the last sale just a month ago.

    In addition, Fitch Ratings reported May 23 that foreign ownership of Italian debt slipped from 50% in 2008 to a current 32%.

    "I think Italy could well be a problem, because its current government isn't very good and has no legitimacy, having been imposed by the EU - and it hasn't cut spending as it needs to," said Money Morning Global Investing Strategist Martin Hutchinson. "I'd put it a few weeks away though - market's focused on Greece and Spain at present."

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  • The 2012 IPO Calendar: How to Spot the Winners You might find yourself eyeing the 2012 IPO calendar with a bit more scrutiny after the Facebook (Nasdaq: FB) fiasco.

    Although Facebook has been nabbing the most attention for disappointing its investors, it's hardly the first IPO to do so. It's all part of the fickle IPO process.

    In fact, about 40% of the IPOs to hit the market over the past 12 months have seen their share prices fall below their IPO prices.

    Facebook isn't the only factor to blame -- U.S. unemployment is up, the Eurozone debt crisis is sapping bullish spirit, and the upcoming U.S. presidential elections in November are adding to market uncertainty.

    But avoiding IPOs altogether could also be a huge mistake.

    Just ask those who bought the Google (Nasdsaq: GOOG) initial public offering. The Google IPO priced at $85, started trading at $100, and now trades around $560.

    So how can you put yourself in the 60% group and earn a profit in the process?

    With the right research and guidance, you can spot winners just like Google.

    Do Your IPO Research

    Investing in IPOs is like buying and selling any asset: due diligence is required.

    An IPO, like a credit-default swap or subprime mortgage, is the ideal financial instrument for a limited set of circumstances. It is up to the individual or the institution to determine if the IPO they are considering is suitable for a long-term investment or a short-term flip.

    If it qualifies as just a short-term flips, that is enough to tell you not to buy.

    Whatever the investment objective, however, information is readily available for the necessary and needed due diligence.

    For example, on March 17, 2011 Michael J. De La Merced wrote an article in The New York Times about the IPO of FriendFinder Networks (NYSE: FFN).

    In his Timespiece,"FriendFinder Braves Choppy Market with IPO, Again," De La Merced did an excellent job of detailing his concerns with the stock, ranging from the disposition of the proceeds of the IPO to the accounting at the company to the number of times it had attempted to go public before and had to withdraw the offering.

    FriendFinder Network IPO priced at $10 a share last year; it's now selling for around $1.15.

    Other times an IPO can be hurt by factors having nothing to do with the financials of the company or the overall economic situation.

    Take the Carlyle Group (Nasdaq: CG), a Washington, DC-based private equity group, which went public in May. Until Election Day in November, private equity groups will be vilified by the Obama Administration, unions and others due to Republican presidential candidate Mitt Romney's work with Bain Capital.

    There is no way that can aid the share price of Carlyle Group. Now trading around $21 a share, Carlye Group has slipped from its IPO high of $22.45.

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  • The Three Big Factors Weighing on Oil Prices Oil prices this week have been pressured by a trio of global factors: OPEC, Iran, and the Eurozone debt crisis.

    Crude experienced wide swings on Tuesday, sinking as low as $81 a barrel, a new eight-month low. Prices bounced back later in the day and finished moderately higher at $83.34.

    Over the last year, oil prices have fluctuated between $74.95 and $110.55 - with more volatility expected.

    Oil's recent wide price swings highlight the market's uncertainty over changes in global supply and demand.

    "Oil has given up the ghost, the overriding concern is for global demand to moderate or even come off quite a bit in Europe, the United States and even China and India," David Morrison at GFT Global told Reuters.

    Oil Prices and the OPEC Summit

    Weighing on crude oil prices this week were words Monday from Saudi Arabia's oil minister as he arrived in Vienna for Thursday's OPEC summit.

    The Saudi minister remarked that OPEC production quotas may be too low. The suggestion could move OPEC members such as Iran and Venezuela to shy away from a production cut.

    In a research note Tuesday, analysts at energy focused investment bank Simmons and Company wrote, "This position is an indication that Saudi is not overly concerned about the recent pullback in oil prices. It is not yet anxious to aggressively cut supply."

    As a matter of fact, Saudi Arabia has actually been increasing its oil supply over the last few months in an effort to pick up the slack from Iran's declining output, which experienced a slump in exports on the heels of tightening U.S. sanctions.

    Iran is the No. 2 oil producer in OPEC's exporting countries, earning more than half of government revenue from oil sales, according to the International Monetary Fund (IMF). Its oil output has slipped more than 40% this year, the International Energy Agency (IEA) reported Wednesday.

    The IEA report could influence OPEC's decision on production quotas. At OPEC's last meeting in December the members decided to maintain actual output at 30 million barrels per day.

    Iran Sanctions Approaching

    Also influencing oil prices was a report from the Obama administration on Monday that noted seven countries, including India and South Korea (sizable importers of Iranian crude), have sufficiently reduced their oil imports from Iran and will not be subject to sanctions from the U.S., set to take effect at the end of June.

    "By reducing Iran's oil sales, we are sending a decisive message to Iran's leaders: until they take concrete actions to satisfy the concerns of the international community, they will continue to face increasing isolation and pressure," U.S. Secretary of State Hillary Clinton said in a statement Monday.

    Oil prices have slipped as markets expect the U.S. exemptions will prevent major supply disruptions.

    China, the leading Iranian crude importer in the first half of last year, has not yet been granted an exemption. U.S. officials said talks were ongoing and that status could change before the June 28 deadline to impose sanctions.

    Talks over Iran's nuclear programs will restart this weekend in Moscow. It'll likely be the final round of discussion before the sanctions and before a ban on importing Iranian oil into Europe is set in motion.

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  • Why the Spain Bailout Package Won't Work The pricey Spain bailout package convinced markets it could fix the Eurozone debt crisis for only a moment Monday, before reality set in that the plan was far from ideal.

    Following the announcement of a $126 billion (100 billion euro) bank rescue package, markets rose briefly. But the relief was short-lived as investors hastily refocused and remembered that the struggling Eurozone still faces a number of key obstacles.

    The Dow Jones Industrial Average lost 142.97 points, or 1.14%, to close at 12,411.23.

    Spain's bailout package was assembled swiftly as EU officials attempt to stave off suppositions about the country's sickly banks with crucial Greek elections just a few days away.

    But it falls short of resolving what the Eurozone as a whole is up against.

    Banking analysts at Societe Generale summed up in a note to clients, "The plan looks like a classic Eurozone fudge."

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  • Eurozone Debt Crisis: Why the Next Three Months are Crucial Many people wonder how much longer the Eurozone can survive as it struggles to deal with its plaguing debt crisis.

    Well, billionaire investor George Soros has the answer.

    On Saturday, in a thorough and enlightening speech made at the Festival of Economics in Trento, Italy, Soros gave the region a deadline for resolving its debt debacle.

    "In my judgment the authorities have a three months' window during which they could still correct their mistakes and... Read More...
  • No Bull: Could the 10-Year Note Hit 1%? In the wake of Friday's disastrous jobs number, 10-year Treasury Note yields finally fell through the 1.5% level, trading as low 1.44% on the day.

    That plunge took many traders, talking heads and politicians by surprise.

    Our "leaders" in Washington D.C. were heard to say: "Nobody saw this coming."

    Well, that's just not true. Not one iota.

    If you've been reading Money Morning you saw this coming. So did tens of thousands of our Money Map Report subscribers.

    I've been warning that 10 year yields would drop below 2% then hit 1.5% for more than 2 years now.

    In fact, our readers had the opportunity to profit handsomely on our bond related recommendations that have earned them 30%-71% so far.

    What does this mean for you?

    First questions first...

    Now that we've busted 1.5%, the next stop is 1%.

    I can even see negative yields ahead, meaning that investors who buy Treasuries will actually be paying the government to keep their money.

    Be prepared. I'm going to show you here what to do and - yes -how you can profit from this move-- even at this stage of the global financial crisis.

    Why Bond Yields Will Continue to Fall

    First off, 10-year yields dropping to 1% means several things:

    • Bond prices go even higher. Rates and prices go in opposite directions. Therefore when you hear that yields are falling, this means that bonds are in rally mode.
    • The world is more concerned with the return of its money than the return on its money. You can take your pick why. Personally I think it comes down to two things above all else: the looming disintegration of the Eurozone and the fact that our country is $212 trillion in the hole and warming up for another infantile debt ceiling debate instead of reining in spending.
    • More stimulus. Probably in the form of a perverse worldwide effort coordinated by central bankers as part of the greatest Ponzi scheme in recorded history.
    But zero percent or negative yields - right here in the US of A?

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  • EU Calls for "Banking Union" to Ease Eurozone Debt Crisis

    Blame the tumultuous tumble in equities Wednesday on Europe.

    World markets were shaken as worries over the Eurozone debt crisis, in particular the Spanish banking system, again rattled investor confidence.

    The Dow Jones was down 160 points, the S&P 500 fell 19 and the Nasdaq lost 34.

    Sending shivers through markets Wednesday was a statement from the European Central Bank (ECB) saying it had not been consulted on the bailout for Spain's No.4 bank Bankia, and that such a recapitalization could not be provided by the Eurosystem. Spanish lender Bankia announced last week it needs $23.8 billion in state aid.

    Also weighing on markets was Spain's debt downgrade late Tuesday by independent ratings agency Egan Jones. The move sparked more questions about the ailing country's ability to fund bank bailouts that could balloon to some 100 billion euro.

    A number of other Spanish banks have recently been downgraded by various rating agencies. The woes hanging over Spain and its sickly banking system shoved the euro down to a near two-year low Wednesday of around $1.24.

    "I believe that the markets have not yet fully priced in a Greek exit, nor the full implications of a Spanish default - both of which remain distinct possibilities in my mind," said Money Morning Chief Investment Strategist Keith Fitz-Gerald. "Until they do, expect trading to be an unholy mess of rallies driven by hopes for further bailouts, and short, sharp declines driven by the absence of the same."

    Now the EU has a new bailout plan.

    To continue reading, please click here...

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  • Eurozone Descends into a Farce as "Grexit" Looms Large The elections on May 6 only made the Eurozone's problems even worse. The French and the Greeks have rejected sensible policies in favor of self-delusion.

    Those elections, and the failure of Greece to form a government, have actually moved the Eurozone crisis one step further - from potential tragedy into a complete farce.

    As investors, we can only watch horrified, knowing that a really bad outcome would seriously damage our own wealth.

    But at this point, a Greek exit - or "Grexit" as it has come to be known - from the Eurozone would be the best thing that could happen.

    Confusion Surrounds the "Grexit"

    The Greek election produced a very confused result. But one thing was clear: the Greek electorate has decisively rejected the rescue plan the outgoing government had so painstakingly negotiated with the EU.

    The previous ruling party's joint support declined to just 32% of the vote. That might be thought of as just retribution, since those parties produced Greece's appalling fiscal mess by lying for decades about the true position of Greece's public finances. (And let us not forget being abetted by Goldman Sachs in doing so).

    However, the winners were not some new paragons of fiscal responsibility and free market government. They were anti-German Nazis (a peculiar combination when you think about it), communists and a truly unpleasant new leftist party, SYRIZA, led by the 37-year-old Alexis Tsipras.

    SYRIZA's politics, in that one can fathom them, spell nothing but trouble.

    To continue reading, please click here...

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  • The Fate of the Eurozone Hangs on Sunday's French Elections It now looks as though Nicolas Sarkozy's days are numbered. In the balance lies the fate of the Eurozone itself.

    It appears Socialist Francois Hollande will win the French election runoff on Sunday and that June's legislative elections will give the Socialists a powerful position in France's parliament.

    Added to these developments is the good chance that both the major existing parties in Greece's parliament, which had jointly agreed to the bailout deal, will be voted out of office on Sunday as well and replaced by a motley set of far-lefties.

    So while the Eurozone has been quiet this week, the calm is deceptive with the elections on Sunday.

    Meanwhile, most of the worry in the Eurozone centers on Spain - which is quite foolish.

    Spain recently elected a center-right government with a large majority, which is clearing up the mess left by its predecessors. The country does have a 25% unemployment rate, but that's a function of Spanish labor law and excessive welfare payments, both of which the current government is addressing.

    Spain's budget deficit is also smaller than France's, as is its debt level. In fact, Spain's debt and deficit burdens are lower than both Britain and the United States. Spain is not the issue.

    Considerable Danger in the Eurozone

    As for Greece, it is a shambles.

    The truth is it should have been chucked out of the Eurozone two years ago, when it was first revealed that its governments had been consistently lying about its budget numbers.

    Had that happened, the new drachma would have sunk to about a third of its former value, and Greek living standards would have reduced by half, all without anything but market forces to be blamed.

    Now hundreds of billions of euros have been poured into the country, and its ungrateful electorate is determined to elect every nut-job it can rake up. The whole Greek rescue project has been a complete waste of time and money, and should be ended forthwith.

    Fortunately, throwing Greece out of the Eurozone will not destroy the euro - after all, nobody was relying on the strength of the Greek economy in their calculations of the euro's value.

    However, France is a different matter entirely.

    Unlike Greece, if France gets into serious trouble, the remaining "solid" euro economies led by Germany are not big enough to save it.

    And, led by Hollande, France looks to be in considerable danger.

    To continue reading, please click here... Read More...
  • Why Wall Street Can't Escape the Eurozone Despite all of its best hopes, Wall Street will never escape what's happening in the Eurozone.

    The 1 trillion euro ($1.3 trillion) slush fund created to keep the chaos at bay is not big enough. And it never was.

    Spanish banks are now up to their proverbial eyeballs in debt and the austerity everybody thinks is working so great in Greece will eventually push Spain over the edge.

    Spanish unemployment is already at 23% and climbing while the official Spanish government projections call for an economic contraction of 1.7% this year. Spain appears to be falling into its second recession in three years.

    I'm not trying to ruin your day with this. But ignore what is going on in Spain at your own risk.

    Or else you could go buy a bridge from the parade of Spanish officials being trotted out to assure the world that the markets somehow have it all wrong.

    But the truth is they don't.

    EU banks are more vulnerable now than they were at the beginning of this crisis and risks are tremendously concentrated rather than diffused.

    You will hear more about this in the weeks to come as the mainstream media begins to focus on what I am sharing with you today.

    The Tyranny of Numbers in the Eurozone

    Here is the cold hard truth about the Eurozone.

    To continue reading, please click here... Read More...
  • The Greek Bailout: Why I'm Mostly Bullish about the Eurozone Last week's news that Eurozone GDP declined by 0.3% in the fourth quarter of 2011 set all the usual pundits moaning about the inevitable decline of Europe.

    Even Andrew Roberts, a wonderful historian with whom I almost always agree, wrote in the Financial Times that "Europe's fire has gone out."

    Today, the markets may welcome the Greek bailout deal, but behind the scenes they still dread the fact it won't work.

    Meanwhile, hushed whispers are still being muttered about a Greek default as being "worse than Lehman."

    On this subject I am a firm contrarian.

    If Greece does default and is thrown out of the Eurozone, then I think Europe is actually due for a rebound - not a collapse.

    It's only if they decide to bail out Greece again that I would become less optimistic.

    If that is the case, they would be devoting hundreds of billions of taxpayer dollars (or euros, as it were) to propping up an inevitable failure. Even then, Greece is relatively small compared to the growth drivers in the Eurozone, which are strong.

    The Problem with the Greek Bailout

    What the Greek crisis has shown is that European leaders in Germany and Scandinavia have their heads properly screwed on, but they are not yet a majority of EU opinion.

    The EU bureaucracy simply gave in far too easily to Greece's first demand for a bailout, then suggested further bailouts for the entire Mediterranean littoral, all of which had over-expanded their governments on the back of low interest rates in the first decade of the euro.

    Now reality is returning rapidly to the discussion.

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  • Three Doomsday Scenarios: What Happens If the Eurozone Breaks Up? The time has come to confront an ugly truth: The possibility that the Eurozone will break up, or rather fall apart, is growing increasingly likely.

    In fact, I'd say given recent developments in Italy the probability of a breakup is as high as 40%.

    Indeed, if a country as small as Greece or Portugal were to default or abandon the euro, the effect on the Eurozone would be manageable. The debts of those countries are too small to make more than minor dents in the international financial system, and they represent too small a share of the Eurozone economy for their departure to have much impact.

    The psychological effect of their departure would be considerable - if only because Eurozone leaders have expended so much money and effort to bail them out. However, devastated credibility among the major Eurozone leaders is more of a political problem than an economic one.

    But now that the markets' focus has moved to Italy and Spain, the Eurozone is really in trouble.

    Asking for Trouble

    Part of the problem is that in arranging the partial write-down of Greek debt, authorities made it "voluntary," thereby avoiding triggering the $3.8 billion of Greek credit default swaps (CDS) outstanding. Of course, this caused a run on Italian, Spanish, and French debt, as banks that thought they were hedged through CDS have begun selling frantically, since their CDS may not protect them.

    Honestly, how stupid can you get! I don't like CDS, but fiddling the system to invalidate them is just asking for trouble. And so far, the only effect has been a considerable increase in the likelihood of a Eurozone breakup.

    Italy, Spain, and France are too big to bail out without the European Central Bank (ECB) simply printing euros and buying up those countries' debt. However, if the ECB adopted the latter approach, hyperinflation would almost certainly ensue. Furthermore, the ECB itself would quickly default, since its capital is only $14.6 billion (10.8 billion euros) - a pathetically small amount if it's to start arranging bailouts.

    Of course, Europe's taxpayers could then bail out the ECB by lending the money needed to recapitalize the bank, but a moment's thought shows that the natural result of such a policy is ruin.

    So what would a breakup of the Eurozone look like? Basically, there are three possibilities.

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  • The One Country That Could Take Down the Eurozone – And It's Not Greece It's been a rough few weeks for the Eurozone.

    Portugal is still in trouble, Spain will be back on the coals after its Nov. 20 election, and if I were a bond trader, I would be shorting Belgium, which has serious deficit and debt problems, runs for months at a time without a government and is in some danger of splitting apart into its French and Flemish bits.

    A bailout package for Greece has been agreed to, but the Greeks are struggling to form a government to implement it. And yields on Italian bonds are moving ominously higher, rising above the 7% that some think marks a point of no return.

    So does this mean that a euro breakup and a Eurozone economic collapse are inevitable?

    Not really.

    In fact, of all the European nations in crisis, only Italy has the potential to take down either the euro or the global economy.

    Just take a look for yourself.

    Getting Rid of Greece

    At this point, Greece obviously is a goner as far as the Eurozone is concerned.

    Really, it should have been pushed out 18 months ago, when it was first revealed that the country falsified its figures to gain acceptance into the Eurozone in the first place. Its government deficit at the time was 12% of gross domestic product (GDP) - not the 6% it claimed, let alone the 3% it had agreed to abide to on its entry.

    French President Nicolas Sarkozy already has admitted it was a mistake to let Greece into the Eurozone, because the gap between its economy and the well-managed polities of Northern Europe was much larger than the area's other members.

    Former communist countries like Slovenia and Slovakia have integrated quite smoothly into the Eurozone, because their governments and people had already acquired the discipline necessary for membership. But since its entry into the European Union (EU) in 1981, Greece has lived on handouts, and raised its living standards artificially to a level two- or three-times the market value of its output. Exit from the euro is inevitable; Greece's problem cannot be solved in any other way.

    In fact, the sooner Greece exits the euro, the better. As it stands now, it's rapidly becoming impossible for Greece to get its debt down to a manageable level, since the country's official debt has been deemed untouchable.

    Once the EU leaders acknowledge the need to remove Greece from the Eurozone, the country's exit will be neither difficult nor damaging. The process of recreating the drachma will be similar to that followed in Slovenia, Croatia, and other ex-Yugoslav republics which abandoned the Yugoslav dinar in the 1990s.

    Inevitably, Greece will have to default on much of its debt, but it's already doing that now.

    So if it's handled correctly, Greece should not be a problem for the Eurozone or the world economy.

    The PIIG Pen

    The other smaller Eurozone weaklings aren't major problems, either.

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  • Does the Eurozone Have Its Own Lehman Bros? Does the Eurozone have its own American International Group Inc. (NYSE: AIG), or worse, its own Lehman Bros. when it comes to Greece?

    I believe it does.

    Why else would the European Union have bent over backwards to "save" a member nation that: A) Accounts for 2.01% of the EU by trade volume; and B) Would essentially be like letting Montana go out of business - no offense to Montanans or Montana!

    More to the point, if things really were under control, why would European Central Bank President Jean-Claude Trichet say that risk signals for financial stability in the euro area are flashing "red" as he did following a meeting of the European Systemic Risk Board in Frankfurt?

    The short answer: Because he knows what the European banks are desperately trying to hide from the rest of the world - that there are still enormous risks and they're even more concentrated now than they were in 2008 at the start of the financial crisis.

    Click here to continue reading...

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