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International M&A Boom Fueled by Global Currency War

By , Contributing Writer, Money Morning -

A binge of mergers and acquisitions (M&A) is being fueled by the global currency war, which has increased the value of emerging market currencies.
The value of worldwide M&A totaled $1.75 trillion during the first nine months of 2010, a 21% increase from comparable 2009 levels and the strongest nine month period for M&A since 2008, according to Thomson Reuters.

But mergers and acquisitions involving companies located in the emerging markets skyrocketed by 62.9% during the same period over 2009, totaling $480.7 billion.  During the first three quarters of 2010, emerging markets accounted for 27.4% of worldwide M&A volume compared to 21% during the comparable period in 2009.
And companies are showing more willingness to venture across borders to find the resources they're after.

M&A activity in deals across international borders has surged during the first nine months of 2010, totaling $723 billion accounting for 41.2% of overall M&A volume, compared to 26.1% last year at this time.

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Smaller U.S. Regional Banks Fast Becoming Takeover Targets

By , Contributing Writer, Money Morning -

Sharks are circling the beleaguered financial services industry and the upshot may well be a wave of mergers and acquisitions (M&A) that analysts say could lead to higher valuations, especially for smaller, regional banks.

Activity in the financial services industry has been subdued for the past three years as weak loan growth, shrinking profit margins, increased regulation and low valuations kept investors at bay. But now forces pressuring the industry to contract "will create more willingness to sell from bank management teams and board of directors over the next year," and drive consolidation, according to the report by Credit Suisse Equity Research.

Specifically, weak U.S. regional banks could be attractive targets for Canadian banks looking to expand their U.S. holdings, the report said.

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

By , Resource Specialist, Money Morning -

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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Investing in Canada: The World's Safest Economy

By , Global Investing Specialist, Money Morning -

I've said it once, and I'll doubtless say it a few dozen more times before the U.S. economy returns to health: Just because you have to endure recessionary conditions doesn't mean that your money has to.

That's the argument I make when I urge Americans to search for investments outside U.S. borders. Ironically, your money doesn't have to travel all that far: What's arguably the world's "safest economy" is actually located just north of the border.

I'm talking, of course, about investing in Canada.



For the five ways to profit from Canada, please read on...

Let's Make a Deal: How the Mergers-and-Acquisitions Boom Will Hurt the U.S. Economy

By , Global Investing Specialist, Money Morning -

With its $39 billion hostile bid for Canada's Potash Corp. (NYSE: POT), mining giant BHP Billiton Ltd. (NYSE ADR: BHP) capped an active August in the mergers-and-acquisitions market.

With the moribund growth prospects of the U.S. economy, there would seem to be no great urgency for companies to go on an M&A spree, yet the total value of announced buyout deals for August alone has topped $175 billion.

Cynics are reaching only one conclusion: With interest rates so low and corporations so cash-rich, it seems that company management teams would rather do anything with that cash than to give it back to shareholders via stock buybacks or boosted dividends.

And those deals signal additional trouble ahead for the U.S. economy.



To understand the problems that this rampant dealmaking figures to cause, please read on...

Buy, Sell or Hold: BCE Inc. (NYSE: BCE) Has Canada Covered

By , Contributing Editor, Money Morning -

The market right now is torn between data that suggests the U.S. is waning and reports that many companies are increasing guidance and beating earnings estimates.

This has created a lot of volatility, and if you already have enough strong growth plays in your portfolio, adding some large, established companies with stable cashflows and hefty dividend yields could ease some of the anxiety you may be feeling.

Such an approach in my opinion is superior to bonds, since bond yields are just too low at these levels. That means you actually risk capital losses if they go up. In addition, safe dividends paid by leading companies are higher than bond yields. And unlike bonds, big companies usually can adjust prices in accordance with inflation.

There are a lot of companies for an investor to choose from, but BCE Inc. (NYSE: BCE) jumps out at me immediately. It is a dominant, well-managed company, and it has strong upside potential.

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

By , Resource Specialist, Money Morning -

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. Consider that:

  • Through 2008, Canada enjoyed 12 straight years of budget surpluses.
  • Since the outset of the global financial crisis, not a single Canadian bank failed.
  • Canada was the first G-7 nation to raise interest rates.
  • And while Canada has already reaped the benefits of a full 10 years worth of a full-blown bull market in commodities, there are at least 10 years more to go.
Added together, this points to a major potential payoff for those who invest in Canada right now.

For the four best profit plays in the world's safest economy, please read on...

Canada: The World's Economic Compass

By , Contributing Writer, Money Morning -

If you're looking for a reliable investment, look no further than our neighbor to the north. This oft-overlooked country is quickly emerging as one of the world's strongest economies. Find out why in this report...

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Canada's Economy Casts a Long Shadow Over its U.S. Counterpart

By , Managing Editor, Money Morning -

Canada's economy has consistently outperformed that of the United States since the beginning of the financial crisis. And while it's showing signs of slowing down, Canada's pending decline will be far shallower than that of the United States, and its rebound more dynamic.

Canada's gross domestic product (GDP) expanded by 6.1% in the first quarter of the year - the highest rate of growth among developed nations - and the country is expected to lead Group Seven (G7) nations in economic growth for at least the next two years.

The reasons are many:

  • Canada's banking system is sound.
  • It has a generous bounty of resources.
  • Its economy is more service-based than it's been in years past.
  • Corporate interests have less influence over government policy.
  • And it has far less government debt.

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Canada: The World's Economic Compass

By , Contributing Writer, Money Morning -

If you're looking for a reliable investment, look no further than Canada.

It's strange, but with so much talk about troubles in the United States, Europe, China and the Middle East these days, one of the best-performing economies in the world is often overlooked.

Of course, that's finally started to change since the financial crisis has exposed our northern neighbor as a model economy - something the Group of 20 (G20) summit highlighted last weekend.

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Canada Leads Developed Nations in Emerging From the Great Recession

By , Contributing Writer, Money Morning -

The Bank of Canada (BOC) today (Tuesday) raised its key interest rate, becoming the first Group of Seven (G7) central bank to raise rates since the global recession started in 2007.

Indeed, Canada with its rich cache of commodities is ahead of most other developed economies still struggling to emerge from the economic downturn. In fact, it is one of the "winners" in the "commodities new world order" recently outlined by Money Morning Contributing Editor Martin Hutchinson.

"The principal winners among the world's 'rich' economies are Canada and Australia - each of them well-managed, financially wealthy countries with abundant commodity resources," said Hutchinson. "Australia has particular strategic importance as supplier of iron ore and coal to China, while Canada is even more crucial to U.S. oil security through the Athabasca tar sands.

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By Failing to Lock Up Canadian Oil Supplies, U.S. Exposes National Energy Plan Flaws

By , Resource Specialist, Money Morning -

Under new U.S. President Barack Obama, it was all supposed to be different. The new administration had vowed to deliver a national energy plan that would guarantee this country's future energy security. The rich and geographically nearby Canadian oil sands should have been part of that plan.

At the end of the day, the United States dropped the ball on the oil sands, meaning Americans are stuck with yet another pieced-together national energy plan that has more sizzle than steak.

Unfortunately, the cost of this misstep will be higher than ever.



For a detailed look at America's latest energy miscues, please read on...

The Winners and Losers in the 'Commodities New World Order'

By , Global Investing Specialist, Money Morning -

In the "commodities new world order," commodity producers will be king.

Investors who need proof need only consider recent events. Iron ore prices are at record levels, and the annual-price-setting arrangement has broken down. Venezuela President Hugo Chávez has signed "dark side" agreements with Russian Prime Minister Vladimir Putin for Russian companies to develop Venezuela's oil-and-mineral resources. China may have invested $1 trillion or so in U.S. Treasuries, but the Asian giant's only truly successful investment so far has been the 17% stake it took in Canadian-resources player Teck Resources Ltd. (NYSE: TCK).

Welcome to the commodities new world order. These events serve notice that - as we put the global financial crisis behind us - the commodity "haves" will set the agenda ... while the commodity "have nots" will fall farther and farther behind.

To discover the identities of the new-world-order winners – and losers – please read on...

Money Morning Mailbag: The Capital Wave That Could Blunt the U.S. Recovery

By , Chief Investment Strategist, Money Morning • @ShahGilani_TW -

Question: How can banks justify not giving out mortgage money in light of the fact that they can now qualify their applicants to a level not previously seen? I am talking about literally millions of people applying for loans with 800-plus FICO scores and Loan-to-Value (LTV) Ratios that are better than ever before.

How can banks and lending institutions take our money and then turn around and shut nearly everyone out - which simply prolongs this recession? Can anyone explain why the present administration and regulatory bodies are not forcing the banks to loan monies to qualified applicants?

At this rate, we will be dead soon.   Without borrowing, we will die.  

•  (Signed) Living in Costa Rica

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