The United Nations' Food and Agricultural Organization (FAO) yesterday (Wednesday) warned that food prices could rise through 2011 unless production of major crops rises significantly, outlining a situation reminiscent of 2008's "silent tsunami" food crisis.
The FAO announced in its twice-yearly Food Outlook report that global food import costs will jump 15% in 2010 to $1.026 trillion – dangerously close to the 2008 crisis level of $1.031 trillion. The world food import outlook was revised up from a June estimate of $921 billion.
Increasing global demand is boosting the food bill, and price climbs in grain and sugar – which recently passed its 30-year peak – have signaled even higher prices ahead.
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How to Profit From Europe's Stealthy Resurgence
European countries - both inside and outside the Eurozone - are slashing their budget deficits. Sure, some - like Greece and Spain, have to. But others are too. And here's the surprising reality: Europe may gain from its fiscal pain - and its deficit-trimming actions offer the best hope for a lengthy recovery. Find out how, in this free report.
Author Chat: Money Morning's Martin Hutchinson Talks About "Alchemists of Loss"
The Nobel Prize panel granted its top award to seven leading economists - whose theories went on to cost investors trillions of dollars in losses.
This story - as well as some of the other top financial fiascos through the ages - is detailed in the new book, "Alchemists of Loss: How Modern Finance and Government Intervention Crashed the Financial System," which was written by Martin Hutchinson, a former merchant banker and Money Morning columnist, and Kevin Dowd, an economist and respected academic.
Money Morning Executive Editor William Patalon III recently sat down with Hutchinson, to talk about the book. Here are some excerpts from that discussion.
This story - as well as some of the other top financial fiascos through the ages - is detailed in the new book, "Alchemists of Loss: How Modern Finance and Government Intervention Crashed the Financial System," which was written by Martin Hutchinson, a former merchant banker and Money Morning columnist, and Kevin Dowd, an economist and respected academic.
Money Morning Executive Editor William Patalon III recently sat down with Hutchinson, to talk about the book. Here are some excerpts from that discussion.
The Jobs Market May Look Bleak, But Your Investments Don't Have To
There's no getting around the fact that the U.S. jobs market is bleak. Ultimately, though, it's a stark reminder that as investors, we should be looking abroad for maximum profits.
Indeed, investors must turn to countries where the number of people working is rising along with standards of living and consumption.
But that's not all.
There are a few companies that have been performing exceptionally well and are poised to bring investors some joy this holiday season. Before we get to those, though, let's take a quick look at the job market.
Indeed, investors must turn to countries where the number of people working is rising along with standards of living and consumption.
But that's not all.
There are a few companies that have been performing exceptionally well and are poised to bring investors some joy this holiday season. Before we get to those, though, let's take a quick look at the job market.
M&A Frenzy Stays Hot With Pfizer's $3.6 Billion Deal for King Pharmaceuticals
The frenzy of activity in mergers and acquisitions (M&A) continued yesterday (Tuesday), when Pfizer Inc. (NYSE: PFE) agreed to pay $3.6 billion in cash to buy King Pharmaceuticals Inc. (NYSE: KG).
Pfizer, the world's largest drugmaker, is paying $14.25 per share for King. That's a premium of 40% to the stock's Monday closing price of $10.15. As part of the deal, Pfizer will receive such products as Avinza and EpiPen, a pre-filled injection designed to quickly treat serious allergic reactions.
King also gives Pfizer access to the Flector pain patch and morphine pill Embeda. Pfizer has been looking to expand its pain products beyond the arthritis treatment Celebrex and nerve pain remedy Lyrica. King had $1.78 billion in revenue last year and is focused on making pain medications that patients can't abuse.
Pfizer needs new products to help offset revenue losses expected next year when generic copies of its top-selling drug, the Lipitor cholesterol pill, enter the market. Lipitor sales topped $11.4 billion last year.
Pfizer, the world's largest drugmaker, is paying $14.25 per share for King. That's a premium of 40% to the stock's Monday closing price of $10.15. As part of the deal, Pfizer will receive such products as Avinza and EpiPen, a pre-filled injection designed to quickly treat serious allergic reactions.
King also gives Pfizer access to the Flector pain patch and morphine pill Embeda. Pfizer has been looking to expand its pain products beyond the arthritis treatment Celebrex and nerve pain remedy Lyrica. King had $1.78 billion in revenue last year and is focused on making pain medications that patients can't abuse.
Pfizer needs new products to help offset revenue losses expected next year when generic copies of its top-selling drug, the Lipitor cholesterol pill, enter the market. Lipitor sales topped $11.4 billion last year.
Four Emerging Markets Making Waves Around the World
I'm focused like a laser beam on emerging markets this year, because there is much more at play than just relative strength. This is where the economic growth in the world is occurring.
I hope you are participating. And if you're not, don't worry - there's still time to get in and make a profit before the mainstream catches on.
Let's take a look at a few of my favorite plays right now, beginning with Singapore and Thailand - two economies I told investors to keep an eye on earlier this month.
I hope you are participating. And if you're not, don't worry - there's still time to get in and make a profit before the mainstream catches on.
Let's take a look at a few of my favorite plays right now, beginning with Singapore and Thailand - two economies I told investors to keep an eye on earlier this month.
Investing in Cotton: The New "King" of the Commodities Sector
Gold is grabbing the headlines setting daily record highs. Silver is setting an-even-more-torrid pace. Wheat and coffee - American breakfast table staples - are surging due to bad weather around the world.
But there's another commodity that's up big: It's surged as much as 55% in the last 12 months to reach its highest price level in 15 years. And there's plenty more to come: Global demand far outstrips supply, creating an imbalance that won't be solved anytime soon.
I'm talking about cotton, the "new" king of the commodities sector.
"We have an extremely bullish situation," Mississippi State University Prof. Emeritus O.A. Cleveland said during a recent Ag Market Network conference call. Cleveland, a noted agricultural market economist, said prices could climb another 30% or more due to the ongoing supply/demand imbalances in play worldwide.
But there's another commodity that's up big: It's surged as much as 55% in the last 12 months to reach its highest price level in 15 years. And there's plenty more to come: Global demand far outstrips supply, creating an imbalance that won't be solved anytime soon.
I'm talking about cotton, the "new" king of the commodities sector.
"We have an extremely bullish situation," Mississippi State University Prof. Emeritus O.A. Cleveland said during a recent Ag Market Network conference call. Cleveland, a noted agricultural market economist, said prices could climb another 30% or more due to the ongoing supply/demand imbalances in play worldwide.
For three ways to profit from the continued rally in cotton, please read on...
Europe: The Investor Escape Hatch From the U.S. Recession
When I speak with the U.S. subscribers to my Permanent Wealth Investor advisory service, there's one bit of wisdom that I repeat time and again: Just because you're living through a recession doesn't mean that your money has to.
If that's a high-falutin way of telling folks to invest globally, so be it. The reality is that there are other places to invest than in the U.S. economy - and many of those "other" spots offer much better returns.
Take Europe...
If that's a high-falutin way of telling folks to invest globally, so be it. The reality is that there are other places to invest than in the U.S. economy - and many of those "other" spots offer much better returns.
Take Europe...
Keeping Tabs on Thailand: An Asian Tiger Lurking Low in the Reeds
Last week we talked about Singapore and Thailand - two Asian economies that are quietly taking off. Today I want to add to those thoughts with a few more key points that opportunistic U.S. investors should know about Thailand, in particular.
Over the weekend, the Thai currency, the baht, rose to its highest level since 1997 due to an improved outlook for economic growth and expectations of more investor inflows. A current-account surplus of $5.42 billion this year through July and the fact that the Bank of Thailand has raised its benchmark interest rate twice this year have also helped the baht post the second-best performance among Asia's most-traded currencies excluding the yen.
"There has been quite a lot of demand to buy the baht from offshore, probably from foreigners to buy Thai stocks and bonds," Kozo Hasegawa, a Bangkok-based foreign-exchange trader at Sumitomo Mitsui Banking Corp., told Bloomberg News. "Money is flowing into Asia on the region's strong economic outlook."
The rise in the currency has coincided with a 30% advance in Thailand's SET Index since May, when government troops smashed anti-government protests.
Over the weekend, the Thai currency, the baht, rose to its highest level since 1997 due to an improved outlook for economic growth and expectations of more investor inflows. A current-account surplus of $5.42 billion this year through July and the fact that the Bank of Thailand has raised its benchmark interest rate twice this year have also helped the baht post the second-best performance among Asia's most-traded currencies excluding the yen.
"There has been quite a lot of demand to buy the baht from offshore, probably from foreigners to buy Thai stocks and bonds," Kozo Hasegawa, a Bangkok-based foreign-exchange trader at Sumitomo Mitsui Banking Corp., told Bloomberg News. "Money is flowing into Asia on the region's strong economic outlook."
The rise in the currency has coincided with a 30% advance in Thailand's SET Index since May, when government troops smashed anti-government protests.
Three Ways to Brace for a Double-Dip Recession
Economists are torn... Is the U.S. economy on the upswing? Or are we facing the dreaded "double dip recession"? Either way, there are a few things every smart investor needs to do now to protect their nest eggs. Find out what you should do in this free report.
Two Asian Economies Flying Under the Radar
You know about China, India, and maybe even Korea, but there are two other Asian economies making waves in the South China Sea.
I'm talking about Singapore and Thailand.
While the U.S. economy would be really lucky to poke along at a 3% annualized rate this year and next, the fast-growing countries on the other side of the globe are ripping higher.
Regional analysts surveyed by Bloomberg News survey said they see Singapore expanding at a record pace this year of 14.9% due to improving demand for the city-state's exports. That's up from an estimate of 9% published three months ago. Singapore's economy relies on trade, finance and tourism. Its central bank said the surge would be led by a 29% expansion of manufacturing.
I'm talking about Singapore and Thailand.
While the U.S. economy would be really lucky to poke along at a 3% annualized rate this year and next, the fast-growing countries on the other side of the globe are ripping higher.
Regional analysts surveyed by Bloomberg News survey said they see Singapore expanding at a record pace this year of 14.9% due to improving demand for the city-state's exports. That's up from an estimate of 9% published three months ago. Singapore's economy relies on trade, finance and tourism. Its central bank said the surge would be led by a 29% expansion of manufacturing.
Three Ways to Brace for a Double-Dip Recession: Recession-Proof Stocks
Today (Friday) we conclude our series on bracing for a double-dip recession.
In Part I of this investment series, "Three Ways to Brace for a Double-Dip Recession: Going for the Gold," we discussed ways investors could safeguard against the imminent decline of the U.S. dollar by buying gold.
In Part II, "Three Ways to Brace for a Double-Dip Recession: Going Global," we explored potential investments in foreign countries that have more stable economies and better growth prospects.
And today, we're going to conclude by looking at "recession-proof" stocks right here in the United States.
In Part I of this investment series, "Three Ways to Brace for a Double-Dip Recession: Going for the Gold," we discussed ways investors could safeguard against the imminent decline of the U.S. dollar by buying gold.
In Part II, "Three Ways to Brace for a Double-Dip Recession: Going Global," we explored potential investments in foreign countries that have more stable economies and better growth prospects.
And today, we're going to conclude by looking at "recession-proof" stocks right here in the United States.
Germany's Export Reliance Edges Out European Neighbors
By relying on exports and not promoting domestic demand, Germany is creating a lopsided recovery that is hurting retailers and foreign exporters.
While Germany's exports continue to surge, its consumers are refusing to spend. The government has failed to raise wages or encourage consumption and says it has few plans to do so.
"By cutting its budget deficit and resisting a rise in wages to compensate for a decline in the purchasing power of the euro, Germany is actually making it more difficult for other countries to regain competitiveness," billionaire investor and cofounder of the Quantum Fund George Soros said in a speech on June 23 in Berlin. Germany is "the main protagonist" for Europe's debt crisis, he added.
Germany's economy - four times more reliant on exports than is the United States - posted the highest second-quarter growth in the Eurozone, growing by 2.2% in the second quarter from the first. The country is headed for about 9% growth this year.
While Germany's exports continue to surge, its consumers are refusing to spend. The government has failed to raise wages or encourage consumption and says it has few plans to do so.
"By cutting its budget deficit and resisting a rise in wages to compensate for a decline in the purchasing power of the euro, Germany is actually making it more difficult for other countries to regain competitiveness," billionaire investor and cofounder of the Quantum Fund George Soros said in a speech on June 23 in Berlin. Germany is "the main protagonist" for Europe's debt crisis, he added.
Germany's economy - four times more reliant on exports than is the United States - posted the highest second-quarter growth in the Eurozone, growing by 2.2% in the second quarter from the first. The country is headed for about 9% growth this year.
The Headline You Never Expected: Foreign Growth Could Bail Out the U.S. Economy
During a period of increasingly worrisome headlines about the U.S. economy, there is one bright spot.
The rest of the world appears to be doing much better than we are.
In the long run, that's good news for the United States. Rapid world growth will eventually rekindle the economic fires here, producing a growth that is more balanced than the bubbles of 1995-2008.
Still, getting to that point will be a challenge, since - economically speaking - the home fires don't appear to be burning all that brightly.
To see how foreign growth could bail out the U.S. economy, please read on...
The rest of the world appears to be doing much better than we are.
In the long run, that's good news for the United States. Rapid world growth will eventually rekindle the economic fires here, producing a growth that is more balanced than the bubbles of 1995-2008.
Still, getting to that point will be a challenge, since - economically speaking - the home fires don't appear to be burning all that brightly.
To see how foreign growth could bail out the U.S. economy, please read on...
The CIVETS: Windfall Wealth From the 'New' BRIC Economies
Forget the BRICs. There's a brand new set of emerging market economies set to make investors windfall profits... but only if you know which ones to pick - and which to avoid completely! Read on to find out which new emerging market is worthy of your investing dollar...