Gold

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It's Time to Invest in Canada

By , Money Morning -

This isn't the first time that I've written about Canada, a well-run country that has avoided many of the mistakes made by the United States. Its budget deficit is moderate, its balance-of-payments deficit is also small, its banking system is in pretty good shape and it faces very little inflation risk, since the country has maintained a reasonable monetary policy.

At this point, you might well be asking: Well, if you've said this all before, why does it bear repeating now?

The answer is simple: As I've hunted for attractive investments recently, I have noticed that a very high percentage of those companies are domiciled north of the border.

In short, it's time to invest in Canada.



To discover the profit opportunities available just north of the border, please read on...

The Scramble for Africa: Profiting From World's Largest Cache of Commodities

By , Money Morning -

In the quarter century stretching from the late-1880s to the First World War, there was a mad rush by the world's leading powers to occupy and annex African territory. Now, 100 years later, the world's elite again are scrambling to make their respective marks on the continent.

The methods of extraction have changed, but the end goal remains the same - to gain access to Africa's coveted bounty of commodities.

Most notably, Chinese interests have swarmed Africa, constructing roads, rail lines, municipal buildings, schools, ports, and pipelines in exchange for access to natural resources.

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Plummeting British Pound Leads to Worries of Another Currency Market "Black Wednesday"

By , Contributing Writer, Money Morning -

Outside of the earthquake rescue efforts in Chile and the Greek-rescue efforts in Brussels, the big news in the world economy last week occurred in currencies.

As you can see in the chart below, the plummeting British pound sterling has dropped even more than the beleaguered euro in the past month and a half, while the good old U.S. dollar has been as good as gold. (That last bit was a bit of currency irony; the dollar has actually been much better than gold, which has flat-lined in the past six weeks.)

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How the Looming "Debt Bomb" Will Crush the Dollar

By , Executive Editor, Money Morning -

The U.S. dollar has staged a short term rally against other currencies. But the U.S. is already gripped by hidden inflation and must refinance a mountain of short-term debt in just months.

Here's how to protect - and grow - your money, even as the debt bomb explodes...

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Will Copper Become the "New Gold?"

By , Money Morning -

The Statue of Liberty is one of the most recognizable American icons in the world.

And as she towers 305 feet above Ellis Island, what's Lady Liberty wearing? Copper - 60,000 pounds of it.

Clearly, copper's big in art. It's also a key metal that keeps the world economy humming. Copper consumption has grown at an average annual rate of 4% since 1900. China and India - which some analysts describe as the combined market of "Chindia" - where one of every three human beings resides, needs loads of this element to meet its modernization requirements for electricity and infrastructure.

Copper is also used in today's currency, where most U.S. coins are actually 92% copper, and 8% nickel.

But there's no denying that, given the choice, nearly everyone prefers gold. It's valuable, it's seductive and it's mystical.

Ancient kings fought wars to amass it. Yet, for thousands of years, its most enduring role has arguably been in the form of money - as a store of value.

That's because fiat-paper-currency experiments have never lasted, and always ended badly.

Increasingly, followers of the Austrian School of Economics are nostalgic for gold to regain its former glory, perhaps "backing" a new international currency.

But despite gold's much longer history as true money, some believe that copper - the much humbler metal - could be positioning itself to upstage gold.

To find out more about the forces that will transform copper into the "New Gold," read on...

If China Sneezes, Wall Street Will Catch A Cold

By , Contributing Writer, Money Morning -

Investors who needed proof of China's increased importance in the post-financial-crisis world only have to look at the nervousness of recent weeks to get a glimpse of the future.

When U.S. stocks fell sharply late Friday, they capped off a harrowing 10-day span that has seen the broad U.S. market benchmarks drop by nearly 7%. Emerging markets are down 9%. Not surprisingly, investor fear has sent volatility rocketing 40% - the largest two-week increase since the global financial crisis went nuclear back in October 2008. 
 
Complicating matters was the continued strengthening of the U.S. dollar - something we've been discussing and warning about for a few weeks. With fear on the rise among global investors, many are abandoning risky positions in emerging-market stocks and bonds and moving cash into the safety of U.S. Treasuries. This bolsters the dollar, which was up 4% in two weeks. That exerts a lot of pressure on commodities. Crude oil fell more than 7% during the week. Gold is down 5%. 

The corporate bond market - which has been red hot lately, helping to underpin stock-market gains - continued to advance, but slipped relative to ultra-safe government debt. Tim Backshall of Credit Derivatives Research wrote in a note to clients that both high-yield and investment-grade credits have been making the longest and most consistent run of lower lows versus ultra-safe U.S. Treasuries since February 2008. 

While government debt has the edge for the moment, the long-term corporate-credit bull market remains intact, according to WJB Capital Group Inc. strategist Brian Reynolds. He sees the credit bears making a run at credit-derivative products that insure against bond defaults, which are a cheap way to try to manipulate the market.

Indeed, the cost to protect against default at banks like JPMorgan Chase & Co. (NYSE: JPM) and Goldman Sachs Group Inc. (NYSE: GS), not to mention Greece, jumped noticeably last week. But the damage has been limited as bears have failed to get traction against the instruments that they used to catalyze the 2008 credit crisis.

This lays the groundwork for a powerful snapback rally for stocks.

To find out more about the China Surprise, read on ...

Wall Street's Stranglehold on the Economy Is Choking Americans

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

America's Founding Fathers were afraid of any concentration of power in the republic. They were particularly afraid that banking interests could hijack our fledgling democracy.

And yet today, 234 years later, our Founding Fathers' worst fears have come true. Wall Street's stranglehold on the economy threatens our very prosperity, and the future of a truly democratic republic.

It's high time we address the truth about Wall Street's tyranny and set a course for a more secure economic future - one that's anchored by a safe banking system, not a system rigged by banks.

How Wall Street is Choking America? Read on...

Why the Gold Bubble Will Peak at $2,000 in 2010

By , Money Morning -

Gold surged over 60% in 2009, hitting new highs practically every week. But, we haven't seen anything yet. This is just the beginning of one of the biggest gold rallies in history. Find out why gold will easily hit $2,000 this year in this report.

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Why Gold Beats the Market Manipulators

By , Money Morning -

There's one investment that Wall Street manipulators can't touch - and neither can the Fed or the U.S. government. Right now, that investment is gold. Taking a stake in a hard asset like gold may well be the surest way to make some money for yourself despite the shenanigans on Wall Street.

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The Five Reasons Gold Will Hit $5,000

By , Money Morning -

Let me get right to the point. Gold's going to $5,000 an ounce.

I know that sounds preposterous to most people. In fact, some of you probably think I'm crazy.

But for a whole host of reasons, $5,000 may well end up being a conservative estimate.

So before you start posting comments that I've gone bonkers, hear me out...



For more on gold’s looming "superspike," read on...

Why Gold Will be the "Greatest Trade Ever"

By , Money Morning -

Forget about all the forecasts being made for 2010. Here's my prediction for 2015: An entirely new name - John A. Paulson - will grace the coveted top of the annual Forbes billionaires list.

And the gap between Paulson and the runner-up billionaire will be huge.

Everyone knows that Bill Gates and Warren Buffet are America's - and the world's - two richest men. But the financial crisis of 2008 and 2009 was not kind to either of them, eradicating $17 billion of their combined net worth.

On that famed list, at No. 33, is where you'll find Paulson today.  The hedge-fund manager's financial acumen led to what is now being called the "the greatest trade ever." By shorting the subprime mortgage market, Paulson & Co. Inc. generated a $15 billion gain. 

Paulson's personal net worth of $6 billion is impressive in its own right. But over the next several years, I believe that Paulson's trading savvy will vault him into the top spot.

And the vehicle that will take him there is gold.

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Investment News Briefs

By , Money Morning -

With our investment news briefs, Money Morning provides investors with a quick overview of the most important investing news stories from all around the world.

GM Hires Former Microsoft CFO; French Drug Maker Buys U.S. OTC Firm; Ford Looks to Reduce Workforce by 41,000; Galleon's Rajaratnam Pleads Innocent; China Backs Out of Investment In U.S. Gold Miner; Gold Falls Amid Interest-Rate Speculation; Recovery Hopes Send Treasury Yield Curve to Record High

  • General Motors Co. hired Microsoft Corp. (Nasdaq: MSFT) Chief Financial Officer Chris Liddell to the same position, GM said yesterday (Monday). Liddell replaces Ray Young, who will be transferred to China as the automaker's vice president of international operations. "Chris will lead our financial and accounting operations on a global basis and will report directly to me," said GM Chairman and Interim Chief Executive Officer Ed Whitacre."We're also looking to his experience and insights in corporate strategy as a member of the senior leadership team in helping our restructuring efforts." Liddell, who already announced his Dec. 31 departure from Microsoft, will begin at GM sometime next month.
  • French drug maker Sanofi-Aventis SA (NYSE ADR: SNY) has agreed to buy U.S. consumer healthcare group Chattem Inc. (Nasdaq: CHTT) in a deal valued at roughly $1.9 billion in cash, or $93.50 per share, a premium of 34% to Chattem's Friday closing price. The deal should give Sanofi a presence in the over-the-counter U.S. drug market. "It looks for me an interesting deal to generate a lot of synergies," Landesbank Baden- Wü rttemberg analyst Timo Kuerschner, told Reuters.

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Buy Sell or Hold: The SPDR Gold Trust ETF Will Rally in 2010, as Recent Dollar Strengthening Loses Steam

By , Contributing Editor, Money Morning -

Gold prices surged to a record high $1226.10 an ounce on Dec. 3, but have since retreated. Meanwhile, the U.S. dollar has been weak for many months, but shown signs of strength in the past week.

So what's next for the dollar and the price of commodities like gold?

In order to answer that question we must look at the factors that brought us here: loose monetary policy and government stimulus.

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