2009-03-18

Getting Rich On The Stock Market Trend of The Decade

You're going to have to see this to believe it.

First though, since it's so shocking — let me explain it in these terms…

Imagine if you could buy a Ferrari — for the price of a used Honda Civic. That scenario mirrors the opportunity that has me so excited to write to you about today: Incredible value and quality. Enormous benefit. At pennies on the dollar.

Of course, what you're about to read has nothing to do with buying Ferraris. But it could make you incredibly wealthy…this year.

Over the next two years, you'll witness the greatest surge in gold prices in market history - at least 100% above where gold sits today, as I write this.

I'm so convinced, I'll even make you a guarantee.

More on that guarantee in just a second.

But even better, I've just discovered a way for you to sneak into the soaring gold market for next to nothing, with what I call "penny-per-ounce" gold.

That is, doing this is a "backdoor" way to own as much of a position in gold as you like... for the equivalent of paying a single cent per ounce.

There's no alchemy involved. And no trick.

It's just a gold market "loophole" most investors know nothing about.

I'll show you here in this letter how it works.

It's no skin off my nose if you opt not to do this. I'd just hate to see you miss out. And even if you decide it's not for you, you'll still want to know about the astounding silver stock I'll name for you.

You can it pick up right now for a 40% discount to what it should be worth on Wall Street... plus, in this same letter, I'll show you the best way to play gold using the powerful new efficiency of gold-backed exchange-traded funds (ETFs)... not to mention, the single best gold stock to own right now and possibly for the next several years, if you choose to own only one.

Here's the clincher...

I'm going to give you all four of these recommendations... and all the information you need to act on them... FREE.

The symbols, the buy and sell targets, and specific step-by-step instructions on what to do. No charge.

Why would I do that? You'll see.

But first, let's dig in and get started...

Epic Boom Opportunity #1:HOW TO SNAP UP RAW GOLD...AT JUST ONE PENNY PER OUNCE!

What if, just before the biggest gold price surge in recent history, you could get your hands on a large stash of the yellow metal... for less than one penny per ounce?

There's no alchemy involved. No secret technology. And no smoke and mirrors. But a small, upstart new mining company is doing exactly that.

Its technique is simple.

But it's just about the only company across the entire mining industry that's able to do this, right now.

In 2005, it mined about 100,000 ounces this way. For 2006, it quadrupled that haul, using this same technique. Now it's on track to be a million-ounce producer... with at least 12 million ounces of gold still in the ground.

The math is simple...

Four Times Your Money Even if Gold Prices Don't Budge Another Inch

Think about it.

Anybody who can get gold out of the ground for a penny...

And sell it for even $500 per ounce or $400 per ounce, stands to make a handsome return. And so do their shareholders.

What I'll show you here is gold hitting as high as $700... a $1000... or even $2,000 per ounce... over the next 12—24 months.

Owning shares of this company could mean at least a 400% gain in that time period, even if only half of what we're calling for comes through.

So here's how this works.

For most miners, getting gold out of the ground is done pretty much the same, across the industry. But not for this wily little company I've been telling you about.

What it's done is invent a way to mine the gold — and rich veins of raw copper — at the same time.

The copper mining is so lucrative, the profits more than cover the cost of pulling the gold out of the same hole. And that means close to 100% upside potential on the gold, no matter what the current spot price on the market.

Any way you slice it, they're booking massive profit.

At Least 2 Years of Locked-in Value, No Matter How High Gold Actually Soars

Right now, this "little" undiscovered new mining company already has five mines up and running. Plus one more under construction. And three more projects after that heading into development.

It also has enormous land holdings with lots of undisclosed mineral potential. Plus, it just swallowed whole another holding with as much as 2 million more ounces of gold in the ground.

Add that to measured and recorded reserves of 12 million ounces... plus another 14 million ounces that are either "inferred" or "proven and probable."

Sound rich?

Don't forget, I haven't even said anything yet about the nearly 2 billion pounds of copper tucked under this company's territory. And copper is the key to this whole secret.

Because it's the steady flow of cash from the copper — remember, this company has innovated a way to get both the copper and gold out of the ground at the same time — that's making the gold production, in relative terms, possible for less than one penny per ounce.

Here's the best part...

This little company's savvy management had the foresight to hedge the entire copper reserve, by making deals that locked in its copper sales at record levels for essentially the next two years.

So even if the global economy keels over and copper prices in general fall, this company will keep on raking it in on their copper discoveries... which means it keeps on getting the gold out of the ground for next-to-nothing at the same time.

Did I mention?

This company has no debt. It's also sitting on a massive pile of cash. And that pile just keeps getting bigger. This is partly why the best stock not only has huge upward potential, but it also pays a dividend.

This is a powder keg waiting to pop. With gold prices creeping higher... and then accelerating... this isn't going to stay off mainstream radars for long. You'll need to make a move on this soon.

I want you to have everything you need to make the call, as educated about the pros and cons of this as possible.

So I've commissioned the best experts on my team of analysts to write it up, in a FREE special report I want to send you. It's called Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead!

I'd like to get this into your hands as soon as possible. At no charge. Inside, you'll find out everything you'd want to know about "penny-per-ounce gold." You'll also discover even more brilliant and innovative new ways to get in on the sudden new surge in the yellow metal, inside this same free report.

But maybe, you're already asking yourself...

Why Gold and Why Now?

Before I rush you that FREE report, let me ask you this...

Do you remember the last time gold sold for over $2,000 an ounce?

Of course you do. Maybe you didn't think of that way. But actually, gold has already sold for more than $2000 per ounce. Let me show you.

First, you have to think for a moment like it's 1971. Gold is selling for $35. This is the year Nixon breaks it from ties to the dollar. Gold prices start climbing. By 1975, it's hit $196. And by 1980, we're talking $850. Sure, you say, that I remember.

But maybe you also remember, back then you could also make $27,700 a year and it was a pretty decent living. About as good as making $100,000 per year today.

You could also buy a house for $50,000 then and, just on an inflation basis, it would be worth $250,000 today. (In real estate terms, it might sell now for $500,000 or more). And back then, you could retire on $270,000 in savings... and it would be as good, today, as being a millionaire.

So you can see, trying to compare yesterday's gold price to today's — on an even basis — is like trying to compare apples and armadillos!

In today's dollars, 1975 gold at $196 is more like $750 in the current market. And 1980 gold, the peak year at the historical price of $850, would now clock in closer to $2,176. And remember, this is only what you get using the most conservative market calculation of gold's worth. There are other, even more telling ways to value gold.

Try this on for size...

$38,349 per Ounce!

Remember, for a good part of America's history, every dollar in your pocket was a dollar backed by gold. So it's not so crazy to ask yourself... if America has 8,180 tons - or nearly 261.7 million ounces - of gold in reserve... how many dollars does that buy?

The answer will shock you.

When dollars became unhinged from gold, the printing presses at the Fed cranked up. By 1980, for every ounce of gold in America, the financial system carried $6,966 in cash. That's $1.8 trillion total. But get this, by the end of 2005, the total real money supply shot to over $10 trillion.

That's $38,349 in circulation for every ounce of gold in reserve!

Of course, it's even higher now. The printing presses are still cranking, well into 2008. Only now, it's much harder for you to know how fat the actual money supply has gotten. See, by March 23, 2006... the number had gotten so embarrassing... the Fed actually "retired" a number called "M3," which was the most broad-reaching measure of how much cash floats around in the system.

Yep. Instead of fixing the problem, the politicians just stopped talking about it. Is that any surprise? Fortunately, you don't need Washington's help to get the real picture of what's happening today in the economy... or to find out what's next for the price of gold.

Because you can just read on and see for yourself...

Precious Metals Megatrend: 3 Charts and the Truth

I'm about to show you three charts.

Take a look at these first two side by side...

A hundred different snapshots could show you the mess we're in. Soaring personal and government debt. A plunging savings rate. Record-high mortgages as a percentage of GDP. Plunging yields on 10-year Treasuries. Soaring but "hidden" unfunded government liabilities, to the tune of $53 trillion...

But none show it better — and more plainly — than these two I'm showing you right here, above. The first is our skyrocketing money supply. The second is our plummeting purchasing power. That's about as plain as you need to get.

How so?

Because this is the starkest vision you'll ever get of the absolute carnage that's piling up in a "secret war" Washington's fighting right now... and has fought, unsuccessfully, for the last 20 plus years. No, not the war in Iraq. Or Afghanistan. Or even some possible future conflict with Iran.

This is another kind of war... right here at home.

The enemy is the dark nemesis of a dead and stagnant economy. And the Fed secretly fights to hold it off desperately every single day. This is a worse enemy than recession. It's the enemy called deflation, an economy where nothing moves and nobody buys a thing.

The weapon of choice in this ongoing secret war is to flood the market with cash and easy credit. Because regular cash and credit injections make everyone feel rich. The theory goes, when you've got cash and low-priced credit, companies borrow and expand. Consumers borrow and spend. Families borrow and buy homes.

Which is why, since 1950, the total amount of money in circulation has soared well over 3,000%! And it's all good... or seems good... until it goes all wrong.

See, the trouble is even money can't escape the natural law of supply and demand. When there's too much of it floating around, each dollar is worth that much less relative to the whole. Suddenly, you've got price inflation.

Suddenly, every dollar you have in the bank is worth less.

Hemingway called it the "first panacea of a mismanaged nation."

And in our case, it's helped plummet the purchasing power of our dollars by a mind-blowing 96%. The dollar's worth today is just pennies compared with what it bought a century ago. In fact, its worth is just a fraction now — as we just demonstrated — compared to the last time gold prices boomed, in the 1970s and early 1980s.

Only now, unlike then, the "wiggle room" we have left now between us and a complete dollar implosion is so thin it's practically transparent. Could total implosion actually happen? Absolutely.

Take what relatively new Fed Chairman professor Ben Bernanke famously said in a speech at the National Economists Club in Washington, in November 2002...

Like gold, U.S. dollars have value only to the extent that they are strictly limited in supply. But the U.S. government has a technology, called a printing press (or, today, its electronic equivalent) that allows it to produce as many U.S. dollars as it wishes at essentially no cost... We conclude that under a paper-money system, a determined government can always generate higher spending and hence positive inflation.

In other words, if you want to juice an economy... turn on the printing presses and make it as easy as all get-out to borrow money at a low, low rate of interest. Bernake and others in the Fed think that's no problem. They think they can handle it, just so long as short-term interest rates don't go to zero.

But a brilliant and famous colleague of mine — someone I'll introduce you to in just a second — completely disagrees. Flooding the market with easy money, he recently told me in private, is more like burning your furniture to keep warm. It cannot last as a stopgap measure. It's courting disaster.

He and I both like to think an even smarter economist, Ludwig von Mises, got it right instead, when he said...

There is no means of avoiding the final collapse of a boom brought about by credit expansion. The alternative is only whether the crisis should come sooner as a result of the voluntary abandonment of further credit expansion, or later as a final and total catastrophe of the currency system involved.

See, thanks to all that Fed-driven loose credit, consumer debt has soared. It's never been higher. In 1987, when Alan Greenspan first took his job in Washington, consumers where in the hole by about $10 trillion. Where are they now? An unbelievable $37.3 trillion in the red - or nearly 350% of GDP!

Think about that.

As a whole, Americans owe 3½ times more than the entire U.S. economy — the largest in history — produces in a year. If you or I owed that much on a personal level, we'd be suicidal.

Meanwhile, the government doesn't seem to worry. It spends money even faster. It borrows even deeper. Even this administration now, with full knowledge of the implications of a credit disaster, has already borrowed more money since 2000 than every White House since the time of Washington!

By 2017 - says the Heritage Foundation - our federal deficits should be soaring by at least $1 trillion per year. After that, it will jump to $2 trillion. That's not how much we'll owe. It's how much we'll add to what we owe... every 12 months, for as far as the eye can see.

Doesn't that sound, to you, like we're at a turning point?

Then, they had Paul Volker, who crushed inflation. Today, we've got Ben Bernanke, who embraces it. Then, they had a national debt of just $845 billion. Today, it's between $8.2 trillion and $53 trillion, depending on who you believe.

Then, we had a hostage crisis in Iran. It ended. Today, we've got Iraq, Iran, North Korea, Nigeria, Afghanistan... and an unending "war on terror." Plus bin Laden still hiding in caves and Chavez mouthing off in oil-rich Venezuela.Then, you paid 78 cents for gas. It recently hit the highest recorded price at $4.05. Oil then cost $38 per barrel. Today, it's closer to $130. Then, the oil shortage was political. Today, it's physical - supply just can't meet higher demand.

Then, the weak dollar still bought more than the dollar today. And our only real economic competitor was Japan. Now you've got China, India, the euro... and a resurgence in Japan.

Brace yourself. Because while this might spell doom for most Wall Street stocks, it virtually guarantees a global resurgence for resource investments, silver and especially gold. Protect your wealth and grow your riches with the cutting-edge resource recommendations in Outstanding Investments.

Read on for more details...

If There's a Crossroad on The Way to Catastrophe...This Is It!

Here's the third chart I promised you.

And though you might not know it at first glance, this one is a doozy...

This is what's called a "yield-curve inversion."

The recent one you're looking at above first happened on Dec. 28, 2005... and it has remained inverted... on this last occasion, it's basically been upside-down for the last few months. This is bad. How bad?

Think dynamite and a tripwire.

See, normally a yield-curve inversion should be an extremely rare event. Until very recently, it's only happened six times since 1970. And guess what... five out of those six times, a major recession followed within the year.

This is so precise an indicator of recession, in fact, that it has only been wrong once in the past 40 years. One study published by the New York Federal Reserve pegged it as a better measure of what will happen to the U.S. economy than the U.S. stock market or any other general index of other leading indicators.

Translation: When the curve flips, we'd better listen.

On the day of this inversion above - practically at the moment the lines crossed - the Dow plunged 105 points. What happens the next time, when the curve inverts not just for an afternoon, but for a week or more? Or months at a time?

This is like holding back a flood with a cork. The longer the yield curve is out of balance, the bigger the disaster that follows. And there's only one way to stop a yield-curve inversion from happening.

The Fed has to slash short-term rates. Will they?

Bernanke would love to. In fact, he's done some cutting already.

But he's trapped between a rock and a hard place.

Slashing the rates means an even bigger dollar collapse. And even higher credit debt, at a time when few Americans can afford it. It would also mean less overseas confidence in the U.S. economy. And that alone could spark a whole new wave of disaster.

See, when all those overseas bondholders out there see the United States disintegrating its economic base, that's all she wrote! They'll start dumping the dollar and our debt investments with abandon. I'm sure you're smart enough to see where this is headed...

That kind of unraveling is the perfect recipe for $2,000 gold. Which is why I want to make sure you're in a good strong position before this next radical power move in gold unfolds...

Epic Boom Opportunity #2: "MORE GOLD THAN FORT KNOX..." AND THE WORLD'S EASIEST 94% GAIN

This next move is easily one of the best ways anybody can double their money in 2008. You rarely see something this close to a pure play.

At the center is a town so tiny, it may as well be the end of the world. And what, just seven years ago, used to be one of the tiniest junior mining companies in the industry.

Today, both are suddenly sitting on what could be $27 billion worth of unprocessed gold — "that's like finding more gold than the government stores in Fort Knox, all in one location" says one of my smartest investment research colleagues.

Nobody imagined it was down there.

At best, they all thought, they've got just 7 million ounces.

Not only were they wrong, but suddenly this junior miner doesn't look so "junior" any more. Because it now owns one of the largest single gold deposits in the world, with as much as 33 million ounces underground.

Thanks to a partnership with one of the world's largest senior mining companies, this once-undiscovered firm can get that gold out of the ground for about $233 per ounce.

At today's gold prices, that's pure profit of as much as $700 or more.

Here's what's truly incredible...

The $40 Billion Treasure Wall Street Forgot

This same firm has another 13 billion pounds of copper tucked underground, just south of the border of the Yukon, deep in the north of British Columbia.

Up until recently, it cost too much in water and electricity to get that copper out of the ground. And that knocked the wind out of this firm's share price when investors figured costs would spiral out of control.

I don't know if you've paid attention, but copper demand — and prices — have exploded in recent months. That's completely changed the equation.

One of the massive gold miners — I can't say which one or it would give away too much — offered $16 per share just to buy this company and their options on these two mineral-rich properties outright.

If they just made that offer again, without any other changes in the company's outlook, you're talking an instant 94% gain in the shares just since the start of this year.

That alone is enough to nearly double every dollar invested.

Before the end of 2008.

But feel free to expect a much bigger move this year, especially as those 33 million ounces of gold and 13 billion pounds of copper come online.

While you can't wait too long on this second move, you can still read the full story for yourself before you decide. It's all in the FREE copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead! that I want to send.

All I need is your permission to put it in the mail... or you can download it yourself, five minutes from now, from a link I'll give you at the end of this letter.

But before I show you how...

Allow Me to Come Clean: Why I'm in Love...With Gold

My name is Addison Wiggin.

I'm sure you've guessed, gold is more than a "fad" investing idea for me.

I've followed these market forces behind the yellow metal for years. I've even written about it, in a New York Times best seller that maybe you've read, called Financial Reckoning Day.

I wrote about these forces again in a second New York Times best-seller, Empire of Debt. And again in a quick little book, also a best-seller, called The Demise of the Dollar.

This is not, in short, new territory for me.

I've hit the radio circuit to talk about this too, appearing on over 350 local and national interview shows. Maybe you've also seen me talking it up on television, from ABC News and Forbes on Fox to Bloomberg Television.

I've even just put the wraps on a new feature-length documentary called I.O.U.S.A. — with a team from Hollywood — to get this message out to the public. It debuted at Sundance just recently. And should be in theaters very soon.

And at least part of that documentary should give viewers all the reasons I'm giving you here, about why a major move into gold will be essential for growing and safeguarding your wealth over the years ahead.

I don't say this to brag. I just want you to be clear, this isn't coming from out of the blue. In fact, I also head a multi-million dollar international research organization that's very much focused right now on exactly the same opportunities we've just talked about.

And really, that's why I'm writing to you today.

See, finding and assembling the world's best experts in this field is what I do. It's my life calling. I've been at this for the last 15 years. And in that time, nothing makes me more proud than what we've managed to do with one of those ventures, a powerful, major force in the resource advisory industry called Outstanding Investments.

Maybe you've heard of it...

Outstanding Investments was ranked by respected and impartial industry watchdog Mark Hulbert as the No. 1 performing advisory letter over a five-year period in 2005 and again in 2006. That's quite an honor. Here's a glimpse at how we did it...

 In 2002, our readers locked in 84% gains on Corner Bay... 96% gains on EOG Resources... 75% gains on American Water Works... 136% gains on R.J. Reynolds... and 137% gains on KeyWest Energy.... plus another 151% gain on Wheaton River Minerals... 162% gains on Intrepid Minerals... a solid 332% gain on Glamis/Francisco Gold... and 668% gains on Metallica Resources

 In 2003, our readers socked away another 88% gains on Northgate Exploration... plus 105% gains on Gentry Resources... 151% gains on Tocqueville Gold... 235% gains on Niko Resources... and 249% gains on Coeur d'Alene Mines... just to name a few

 In 2004, Outstanding Investments readers closed out PetroChina with a solid 174% gain... plus another 55% on Atacama Minerals... 116% gains on Cameco... 24% gains on the Canadian Oil Sands Trust... 32% gains on Southwest Water... and 270% gains on the July 2005 silver calls... plus a slew of small and fast winners

 In 2005, we took in another 43%, 44% and 45% gains on Harmony Gold, Schlumberger and PetroKazakhstan Inc. and posted 50% gains on CONSOL Energy just a few weeks later. We hit with a fat 55% gain on both Suez SA and Petro-Canada... and 73% gains on Wheaton River Minerals and Anadarko Petroleum Corp., plus 85% on Precision Drilling... 86% on Kerr-McGee... 88% on the INVESCO Energy Fund... 101% gains on the ICON Energy Fund...107% gains on Norsk Hydro... 108% gains on Anglo American PLC... 160% gains on Western Oil Sands.... and an impressive 179% gain on Talisman Energy

 In 2006 and 2007, we hauled in another 83% on Placer Dome... 147% gains on BG Group PLC... 78% gains on OMM... 87% returns on Walter Industries... and a hefty 177% on Coeur d'Alene Mines...in fact, in 2007 alone, we averaged 79% gains across the board and scored a cumulative gain of 317%.

 And so far in 2008, we're already up 255% on Foundation Coal Holdings... 165% on Goldcorp... 164% on Newmont Mining... 369% on EnCana Corp... 358% on Velero... 509% on American Century Global Gold... 1,011% on Suncor Energy... just to name a few.

I'd like to send you a FREE report so you can see what I'm recommending you do right now. Read on for more details... then click the button at the end of this letter to send for your FREE report.

Like I said, I couldn't be more proud...

Mark Hulbert, the no-nonsense industry watchdog, recently ranked Outstanding Investments as the No.1 performing investment advisory letter over a five-year period in 2005. In 2006, he put us among his top-ranked performers yet again.

And it's no wonder. Especially with the winners you could have found in the Outstanding Investments over these last several years...

Like the 332% we logged on Glamis/Francisco Gold... 668% gains on Metallica Resources... 249% gains on Coeur d'Alene Mines... 83% gains on Placer Dome... 156% already on Newmont... and 540% gains already on American Century Global Gold...

Plus plenty of non-gold gains, too.

Like 137% on KeyWest Energy... 174% on PetroChina... 270% gains on the July 2005 silver call options... 160% gains on Western Oil Sands... and 179% gains on Talisman Energy...

One of the biggest reasons for our success is the string of brilliant analysts we've been able to entice on board to lead Outstanding Investments readers to that top-performance position.

Maybe you've already heard of our current top analyst, Byron King.

When it comes to gold and other metals, oil, gas, energy — even the politics and trends that move resource markets — there's a good chance nobody is as qualified as Byron.

See, unlike most market analysts, Byron actually has in-the-field experience.

He's even what you might call a "rock-hound."

Byron's a geologist with a degree from Harvard.

After graduating with honors in the 1970s, he broke into the oil industry. Byron worked as a geologist in the exploration and production division of a major oil company — one of the Fortune Top 20.

When he got tired of that, he did what no other analyst would do — and joined the U.S. Navy, logging over 1,000 hours flying navy bombers as a tailhook aviator... including more than 127 death-defying carrier landings.

(Ask your broker if he has that on his resume!)

Not one to sit still, after leaving the Navy, Byron worked as a practicing attorney in Pennsylvania for 17 years, during which time he became one of the most sought-after resource experts in the country.

He's been invited to give speeches across the U.S. and Canada, he's written countless articles for major publications, and he's been interviewed by even more, from small town journals to national newspapers like The Globe & Mail and the Los Angeles Times.

Byron once even met with M. King Hubbert himself, the genius who discovered the "Peak Oil" crisis that would plague world petroleum... 20 years before it actually happened. Again, that's not a claim your average energy market analyst can make.

You couldn't ask for a better pedigree.

What's Byron saying right now?

Byron and I are both pretty excited about the future of most commodities. But we're very excited, right now, by the future of gold.

In your FREE copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead, you can see what Byron and his Outstanding Investments team are recommending right now to readers.

Just give me permission to send you a copy.

And then, I'll ask you to do something for me. With your permission, I'll ask you to let me also start sending you — at no risk to you — up to a full year of FREE issues of Outstanding Investments too.

Inside those issues, you'll read about all kinds of ways to make money — not just on gold, but surging new alternative energy investments, oil and gas, corn, sugar, and soybeans, and the China-driven resource boom... plus plenty more.

All FREE for up to a full year. You can find all the details at the end of this letter. The thing is, however, Byron and his readers are already moving on these opportunities I'm telling you about. So time is of the essence.

Let me at least rush you a FREE copy of this groundbreaking report, Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead!... so you can look over these simple recommendations and see for yourself.

All five picks are geared for 2008 and beyond. And you'll find all the information you need on each of them packed into the report. Which is, as I've said, yours free just as soon as you tell me you're ready. Just follow the steps at the end of this letter.

But don't wait too long.

If only because the pressure behind gold prices just keeps increasing by the hour. For instance, take a look at this...

Precious Metals Megatrend: China's Secret Endgame

Fan Gang, director of China's National Economic Research Institute, stood in front of a standing-room-only crowd at the World Economic Forum in Davos, Switzerland.

In tortured English, he said...

The U.S. dollar is no longer, in our opinion, is no longer a stable currency. It is devaluating all the time, and that's [making] troubles all the time. So the real issue is how to change the regime from a U.S. dollar pegging to a more manageable reference, say, euros, yen... those kinds of more diversified systems...

And it's not just China. Malaysia is also shifting from the dollar. So is Indonesia. And Thailand. And possibly Japan. But who could blame them?

China and Japan alone own about $906 billion of the $1.1 trillion of U.S. Treasuries held overseas.

But a weak dollar is a wasting asset. To the Chinese, it's starting to look like a giant pile of liabilities. Yu Yongding, who sits on the Chinese central bank monetary policy committee, told the China Securities Journal he was worried America would drop interest rates in 2006, putting pressure on the dollar and the yuan.

"More seriously," he said, "China's economy would take a big hit if the U.S. dollar weakened sharply due to such factors as a bursting of the U.S. property bubble. The loss for China's foreign exchange reserves would be extremely serious."

They won't hang on for long.

Publicly, the talk is of China moving more of its currency reserves away from the dollar and to the euro. And that might happen. But the euro is only paper too, backed by its own debt problems at home.

The real story is China quietly converting those dollars into... you guessed it... GOLD.

China just recently cashed in about 2.4% of its dollar reserves to buy gold. It has a better track record than the dollar. In fact, gold has a better track record - historically - than any paper currency.

On Dec. 28, 2005 - the same day as the first in a series of recent U.S. yield-curve inversions that we just talked about, an economist at China's biggest brokerage firm, China Galaxy Securities, quietly hinted China's central bank should quadruple its gold reserves in the very near future.

Japan's central bank has also talked about cranking up its gold reserves. So have the central banks of South Africa, Argentina and Russia. In November 2005, Russia said it would hike up its gold reserves from 5% of total financial reserves to 10%.

That's double what it's already holding now.

To get it, Russia would have to absorb its own entire gold output for the next three years. That's a long time for the rest of the world to go without Russian gold production.

Any more whispers on the news about this or the China gold reserve hike could send gold prices skyrocketing overnight. You'll want to be ready to profit on this surge as soon as you can.

Here's another way most other investors will miss...

Epic Boom Opportunity #3: The "Blue Chip" Gold Mining Share Nobody's Talking About

When gold takes off, major "blue chip" gold producers like Newmont, Barrick, and AngloGold grab lots of headlines. But there's another of the top 10 producers that's not getting nearly as much attention — yet.

Now is your chance to grab it before soaring gold prices push it higher.

This company owns one of the five largest inventories of gold deposits. Plus it owns nine operating mines in five different countries, including the U.S., Canada, Brazil, Chile, and even Russia.

But here's where it has its biggest "undiscovered" edge.

This major miner has three very promising projects in development that could easily up its output to levels 60% above where they are right now. That's a lot of new gold. And coming on line over the next two years.

What's more, this company does it all with an extremely tight rein on costs, with profit margins running an impressive 18%.

And by the way, this company is also one of a few beneficiaries of a 131-year old federal law that literally gives it the U.S. land it mines and all the deposits underneath for only $10 per acre.

That's given this company more mineral-rich land holdings than 99.5% of their competitors. At the same time, this company trades for $174 of market capitalization per ounce of gold reserves, which is one of the lowest premiums among major mining companies.

Call it "cheap gold."

Especially considering what you would have to pay for those other major gold stocks I mentioned.

It's no wonder this one company recently attracted some of the top talent from every corner of the industry. It's also no wonder that more than 57% of this company's shares are in the clutches of institutional investors.

And that trend is only going to speed up, given the top-quality deals and acquisitions this company has already cooked up, which should send its total gold production soaring even faster over the next three years.

You can read all about this "undiscovered" mining major, along with all the other opportunities we've already talked about, in your free copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead!

Here's something else you'll find inside...

Epic Boom Opportunity #4: THE SAFEST WAY TO OWN GOLD

What's the safest way to own gold today?

It has to be the new gold-backed exchange-traded funds (ETFs).

These did not exist two decades ago, the first time legal gold investing in the United States set the markets on fire. And now they've completely revolutionized the market for gold, in more ways than one.

The way they work, you buy shares. Just like you would in a mutual fund. Each share is as good as holding a title to real gold. When you put money in, the gold ETF buys physical metal and stores it, to back your shares.

As if you had the gold itself in your own safety deposit box. Only the ETF saves you the trouble of ever storing, transporting or insuring the metal.

I recommended my Outstanding Investments readers get in the more liquid of the two main gold ETFs on the market. And I've got some recommendations to share with you on how to get started on this yourself, in your FREE copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead!

But here's something you might not know about ETFs.

By cracking open the gold market to more marginal metal investors, all the fundamentals of gold investing have changed forever.

Suddenly, pension funds, young investors and retirees who want to dabble in metals can do so. More easily than they ever could before. But all these millions of dollars in new electronic gold transactions have to be backed — by law — with real gold.

So the success of the gold ETF is a self-fulfilling prophecy.

The more investors it attracts, the more gold it buys. That cranks up pressure on the rest of the gold market. And gold prices tick higher, making the ETF look even more attractive all over again.

Take the ETF we have in our Outstanding Investments portfolio.

It first came out in October 2004, with a float of about $200 million worth of gold holdings in its portfolio. In the first year, the total float ballooned to $1 billion worth of bullion.

Now it's over $9.94 billion!

That's $9.94 billion worth of physical gold that has to come off the market, just to back the fund's investors. The bigger that fund gets, the higher the gold price rises. And around we go.

If you don't own a chunk of this ETF, now would be a good time to get in.

Meanwhile, we're tracking another gold fund right now — not an ETF — that you should also own. Since it was first added to our Outstanding Investments portfolio, it's already up 509%. But you can still get in now and watch it go still higher. This select fund has averaged 77% gains over the last seven years. In one recent year, it soared 81.2% in less than 12 months.

Buying it now may be the simplest and safest way for you to take up positions in all the biggest gold shares — like Newmont, Barrick and Placer Dome — without paying commissions on all those separate trades.

Plus, this particular fund also takes a stake in physical gold. So this is a way for you to safely take a position in bullion too.

Read all about it in upcoming issues of Outstanding Investments. But be sure first to send for your FREE copy of the report, Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead!

I can drop this report into the mail for you immediately. Or you can download it for yourself right now, just by following the steps at the end of this letter. No charge.

But first, here's something else most investors don't know about...

Precious Metals Megatrend: The Hidden Cost of Terror

The Milken Institute did a study that estimated the short- and long-term costs of Sept. 11.

Outside of the loss of human life, the immediate hit was about $53 billion. In the weeks that followed, another $47 billion disappeared thanks to lost economic output in the U.S. economy. Plus another $1.7 trillion that disappeared from the U.S. stock market.

Then the costs REALLY started to add up...

Airlines and aerospace, tourism and travel, hotels and motels, restaurants, the Postal Service and the insurance industry all suffered. Just in the first month, at least 125,000 people lost their jobs. Another 1.6 million jobs evaporated over the next year. And businesses retooling for the new "terror economy" had to spend an extra $151 billion.

This is where what's called the cost of distortion comes into play - the ripple effect from a shock event like this can cause people to behave in strange ways for a long time to come.

Think about it.

Governments wasting billions they otherwise couldn't have, because every new security bill gets passed. Nations fighting battles they otherwise wouldn't have, because every conflict suddenly looks connected to the war on terror. Individuals and businesses not spending money in ways they otherwise would have, because they're afraid to take the risk.

Air travel falls. Tourism falls. Trade suffers and foreign investment dries up. In 2002, 29 ports on the U.S. West Coast shut down for two weeks. Two hundred ships, carrying over 300,000 shipment containers, just sat in the water.

Waiting.

Railcars and warehouses all over the country waited too. Along with freezers and grain elevators and companies who had to shut down their production lines. More jobs disappeared. And the added insurance costs against security shutdowns tacked on another $30 billion to the cost of doing business in America.

You might remember pundits having plenty to say about how we recovered so quickly from the attacks. Yet new estimates put the uncovered costs, so far... at close to $2 trillion!

And remember, this is only one event we're talking about.

You and your family pay roughly $450 extra every year in taxes to cover the cost of a bloated Homeland Security agency. The same agency, by the way, whose air marshals have been caught sleeping on planes... and who hold up flights with huge security lines... and whose airport inspectors still let weapons and even dummy explosives slip through security.

You can never know how much a "war on terror" will cost.

Because fighting terrorism is like fighting a hurricane. You can see it forming on the radar screen. You know when it's headed your way. But you don't know what to expect when it lands. Or how much it will cost you over time.

Every enhanced cockpit door on a plane costs $30,000 to 50,000. Screening every bag carried by airline passengers will cost taxpayers an extra $4.7 billion just for this year.

Ten million dollars to teach bus drivers how to deal with terrorist passengers. Twenty-two million dollars to teach terrorism safety techniques to truck drivers...

Two and a half billion dollars for highway security. Seventy million dollars for a student Homeland Security fellowship program. Twenty million dollars to renovate Homeland Security headquarters.

As I said, it all starts to add up. Along with the undetermined future costs of Iraq... Afghanistan... and now maybe Iran... over the next decade, could set us back as much as $5.7 trillion!

Nobody knows for sure.

But the true hidden cost is the risk premium this creates for the foreign investors who lend us money for all this extra spending. This is how instability destroys faith in the dollar.

It's also why, in unstable times, the value of hard assets like gold, oil, and other real resources are even more likely to take off. Here's one more way for you to get rich on that reality...

Epic Boom Opportunity #5: THE SINGLE BEST GOLD STOCK TO OWN IF YOU'RE ONLY BUYING ONE

Which gold stock would you buy if you only wanted to own one? Well, so far our Outstanding Investments readers have already seen 163% gains on Newmont Mining so far.

They've seen another 249% gain on Coeur d'Alene Mines... 332% gains on Glamis Gold... and 668% gains on Metallica Resources. Just to name a few. But these opportunities have already sailed by.

Your best bet is the gold company I'll tell you about right now. It's not small. In fact, it's one of the mega-producers I'm sure you already know by name.

What you might not know is this one gold producer will land leagues beyond competitors for 2008 and beyond...

Turn Every $1000 Into $30,000

See, just a couple years ago, this company was on its back. Mines were dying. Gold production had collapsed.

Then this company did something.

With just a little under $600,000 invested in a whole new wave of gold exploration technology... they took the entire mining industry into the innovation age.

Applying new discoveries in applied math, advanced physics, and computer graphics... to the age old business of digging holes in the earth and calling them mines... it got its payoff.

Within months, this company discovered 110 new pockets of undiscovered gold on property their own geologists has once given up for dead.

A shocking 80% of those new deposits turned out to be jammed with gold. Enough to crank out over $3 billion in new discoveries over the years that followed.

Once again, you can do the math. Any way you slice it, turning a half-million dollars in R&D costs into over $3 billion is stunning. But that wasn't all of it.

The shares in the company also took off.

Every $1,000 invested in this company's stock soared, over that same period, to a stunning $30,000. That's impressive. But here's why this one innovative little mining company is just beginning to hit its stride...

Ten Steps Ahead of Every Other Gold Producer

There's already the usual stuff going for this company that you'd imagine for any world class mining share. For instance, it has no company debt. Zilch. It also has $300 million in cash sitting in its bank accounts.

But it's this company's surprising move to "new tech" mining innovation that's really given it the edge. And, quietly, put it ahead of just about all of its mining competitors.

Take what it costs this company to get the gold out of the ground ­ just half what major mining companies like Newmont, Anglogold, Barrick, and Harmony pay for the same product.

Meanwhile, this company is also producing gold faster than its competitors too. More than 10 times faster than Newmont... triple the production rate of Newcrest... and better than five times the rate of Anglogold or Gold Fields.

In short, this one company crushes the nearest competitor.

Which makes it a perfect share for you to own as gold soars over the 12—24 months ahead. Political risk for this company is minimal. And all their gold is what you call "unhedged" — which basically means they'll start reaping even greater rewards as gold values go up.

And did I mention? The best stock also pays a dividend.

Annually, 18 cents per share. And the company promises to hike up that rate even higher as the gold price goes up. It's like getting paid to own one of the best and safest gold stocks in the entire industry.

Just send for your FREE copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead! to find out more.

So now let's get to brass tacks...

Here's How to Get a FREE Copy of This Report

Inside the FREE copy of Bullion and Beyond: Five Stunning Ways to Get Richer on the Epic Metals Boom Ahead! you'll get...

A nearly undiscovered and unique way to snap up a position in gold for less than a single penny per ounce. And this advantage is pretty much locked in for the next two years, no matter how high gold prices fly

An early chance to lock in 94% or better on the junior miner that just found 33 million ounces of gold — catapulting it to become one of the most important gold finds in history

The easiest money-doubling gain you'll make on the world's "other" precious metal... using a stock you can quietly pick up right now for nearly half what it's actually worth

An easy way to buy a stake in virtually all of the most stable and well-known gold companies... with a savvy move that's already given my readers hefty gains of 509%

The one best gold stock to own right now and for the long term if you're set on only buying a single gold share. It'll churn out more gold at a lower cost, faster, than just about any producer in the world — plus this one stock pays a handsome dividend.

Getting a copy of this FREE report sent to you is easy.

I can rush it to you in the mail. You can even download it right now. For either option, just click on the special order button below.

But there's still more...

Every week, I'd also like to send you a FREE personal commodities investment update, straight to your e-mail account. You'll read about the top stocks in Byron's Outstanding Investments portfolio. Plus other hot opportunities I have percolating on the stove. No charge whatsoever

I also want to give you FREE access to our 24-hour Outstanding Investments Web site. This site is strictly "member's only" and password protected. I'm inviting you to use it whenever you'd like to look up Byron's newest picks, latest news or more. Also yours at no charge

If you're not a subscriber already, I'll give you a FREE subscription to the highly praised and widely read Agora Financial Executive Series, which includes two profit-laden e-mails, the Rude Awakening and the 5 Min. Forecast and another FREE subscription to the shocking twice-weekly e-letter Whiskey & Gunpowder - one of the most colorful, controversial and insightful sources on economics, politics and resource investing out there.

Why just give all this away?

Because, naturally, there's something I want you to do for me in return...

I Also Want You to Try Byron's Best Picks FREE For Up To a Full Year

I believe you are like me.

I believe you know, as I do, that while $1 million worth of dot-com stock certificates isn't worth much more than kindling these days...

Raw real resources like copper... cotton... platinum... silver... natural gas... steel... oil... coal... and especially gold hold real and tangible value for civilization.

And that's what Outstanding Investments is all about.

While some stock investments can crash and fall to zero... we cannot exist or do business more than a few weeks, a few days or even in some cases a few hours... without the commodities that matter...

Oil to burn... land to stand on... copper pipes and wires in our walls... circuitry in our computers... electricity to power our lights, our appliances, the Internet... lumber, steel and grain... and precious metals like gold and silver to help us protect our wealth.

We've always stood for making a fortune in rich resource plays, even when it wasn't popular. But over time, the strategy has consistently paid off...

With a 151% gain on Wheaton River Minerals... 162% gains on Intrepid Minerals... a solid 332% gain on Glamis/Francisco Gold... and 668% gains on Metallica Resources, all in 2002...

Plus another plus 105% gain on Gentry Resources... 151% gains on Tocqueville Gold... 235% gains on Niko Resources... and 249% gains on Coeur d'Alene Mines, all in 2003...

116% gains on Cameco... 174% gains on PetroChina... and 270% gains on the July silver calls, all in 2004...

In 2005, 107% gains on Norsk Hydro... 108% gains on Anglo American PLC... 160% gains on Western Oil Sands.... and an impressive 179% gain on Talisman Energy...

And in 2006 and 2007, we locked in 83% on Placer Dome... 147% gains on BG Group PLC... 78% gains on OMM... 87% returns on Walter Industries... and a solid 177% on Coeur d'Alene Mines...in fact, in 2007 alone, we averaged 79% gains across the board and scored a cumulative gain of 317%.

And so far in 2008, we're already up 255% on Foundation Coal Holdings... 165% on Goldcorp... 164% on Newmont Mining... 369% on EnCana Corp... 358% on Valero... 509% on American Century Global Gold... 1,011% on Suncor Energy... just to name a few.

What I'd like to ask you to do — in return for giving you all five FREE picks in the Outstanding Investments "Bullion and Beyond" Library... plus all the other gifts we've talked about... is simply agree to give the award-winning Outstanding Investments monthly advisory letter itself a try.

Like I said, right now you can have this trial subscription FREE for up to a full year. FREE. I'll show you month to month what Byron's watching, what he's recommending and what to do next with the holdings we'll track in each issue in our highly ranked, resource-focused Outstanding Investments portfolio.

FREE, you'll find out how to shore up your wealth safely with bullion investments. And FREE, Byron will also walk you through even better and easier ways to get in on the same mega-trends.

You'll get to keep all this at no charge. Along with everything else I'll send. No questions asked. But in order to make this possible, there's only one small thing more I'll need you to do for me.

(Yes, there's a catch. But it's one I'm confident you'll like very much.)

See, it's not free — on my end — to send out these newsletters. Or to put together, print, and mail out the library of five special investing picks I'll be giving you at no cost to you.

So, just to be sure you're as committed to these ideas as I am... here's what we're going to do. I'm making this possible by simply slashing the subscription rate I'll offer you by half.

So, let's say you sign on for a year's worth of Outstanding Investments. It's like getting six full months of issues, FREE. Gratis.

What you pay to sign on need only cover the second half — by which time, you'll have had six FREE issues, all the FREE picks, and the rest of my gifts to you, to make money and to decide if this is for you.

Doesn't that sound fair?

And then, if you decide right away to sign on for two full years of issues, the same kind of deal applies — you get the whole first half of your subscription, or 12 full issues, FREE. You're getting a two-year membership, but at only the one year price.

What's that price?

Normally, others would pay $99 to get 12 months of issues. You'll pay only $49 — half price — which means you're getting six of your 12 issues absolutely FREE.

To get 24 months of issues — two years of Outstanding Investments — others would normally pay $198. You'll pay only $89 — actually LESS than half price — which means you'll get 12 of your 24 issues absolutely FREE.

I can't think of a better deal. Or a better way for you to get plugged in fast to all the opportunities both Byron and I see playing out over the coming year and well into 2009.

But there's still more...

My Revolutionary "'Double-the-Value' Guarantee"

At the very start of this letter, I told you I would make you a guarantee that gold would soar at least 100% above today's price levels, or you pay nothing. Let me be more precise.

Gold prices, obviously, change every day.

When I first made Outstanding Investments' "gold at $2000" prediction public, it would have had to soar 257% to hit that mark.

Now that margin is narrowing.

As of this writing, it's now only a 100% move. That would mean double the value of an ounce of gold today. And that, you might say, is still a big jump. But I'm so sure the Outstanding Investments call is right on the money, I'm willing to back it myself, with my own reputation on the line.

That is, if gold doesn't close that 100% gap by the time your Outstanding Investments subscription — both the trial and paid parts — is finished, then I'll eat my words. Your entire sign up costs are on me. I'll refund every penny, if you feel that's what's due.

All I ask is you read the issues... study the picks... visit the website and dig into the archives and extra materials... and then decide for yourself what Outstanding Investments can do.

In fact, if you decide to cancel for any reason, even up to the very last day of your very last issue... you just let me know and I'll still give you a full refund. Even if gold has crossed the milestone mark Byron and I say it will.

Why?

Because I know already it's no accident Outstanding Investments wins awards. And it's no accident Hulbert ranked it the No. 1 performing advisory letter of the last five years in 2005 and again in 2006, either. We're onto something. And I'm confident, after you give Outstanding Investments an honest try, you'll think so too.

You won't want to cancel, at the end of the subscription period. In fact, I'm confident you'll beg to renew. Because you'll have the chance to make too much money on these opportunities not to.

Sign up, read and profit, share what you find with your family.

Then wait. Watch the gold cycle. Watch the other rich resource opportunities we'll talk about in upcoming issues. And then you decide what you'd like to do.

You risk nothing by giving this a try. Your only risk is sitting on the sidelines. Even if you don't decide to stay on, everything we send is yours to keep. This is entirely up to you.

I hope that sounds fair.

More importantly, I hope this sounds like something you're ready to do. Byron's other readers are already locking into these soaring trends for the long term. I hope you'll decide to act on them sooner rather than later, too.

2009-03-17

How any government can issue silver as currency

There are basically two ways for a government to issue silver as currency.  One relies on force, or government decree, and is easier and more profitable for the government.  The other way is the honest free market way.

Let's start with the first way; through government decree.  This way, the government buys silver on the open market, mints it into coinage (or contracts that out), and spends that silver into circulation by adding a 50% to 500% fee called seniorage. 

Thus, a government would buy silver at roughly $13/oz., and stamp on it a nice round number, something like $20 to $50 on each 1 troy oz. coin, and force the market to value it at the new level, using that silver to pay government employees or contractors, or welfare recipients, etc.

The benefits and problems with this method are clear.

The benefits are that this "coin making business" is extremely profitable for the government, and it can issue ever more silver into circulation using this method, because it is always profitable to force other market participants to over value the silver being issued.

The problem is the flip side.  People don't like to receive silver when it is over valued, and so this kind of silver is not easily accepted by the people, because the people are basically being stolen from, through the excessive profits that go to the government.  Over valued silver is also quickly spent, or "dumped" by people, and so it cannot be successfully used as a store of savings for the people for long term wealth creation.

The second problem is that silver tends to rise in value, higher than what is stamped upon it.  So, if silver is stamped with $20, then when silver costs more than $20/oz., that silver is then hoarded, and it does not circulate as money, because it's more profitable to hold it, than to spend it, so the entire reason for issuing silver as money is then ended. 

So, what about the honest method?  How would any government honestly issue silver as honest money?  Basically, the government would buy silver on the open market at $13/oz., and not mark any currency value on it.  Instead, they would mark it only with what it is, such as the purity and weight, such as "1 troy ounce of .999 fine silver" and then offer it, as a payment option, to all who wanted it, at a relative value of no more than the cost of it, and to make it. 

Then, people who choose to take silver, can spend it, or hold it, as they wish.  Prices in society may slowly begin to be quoted in terms of government currency, or silver ounces, or both. 

The job of the central bank, under those conditions, would be to make silver available to anyone they pay, and even investors who wanted to convert currency to silver.  Also, the government would need to accept and take in silver and give out the old paper currency, as needed or desired by the people of the nation.  In such a way, silver would be able to circulate side by side with paper currency, as the market chooses, or not.

Such silver would always be able to be traded or hoarded, (and not just hoarded) because it is valued by a different measurement method, as an ounce, and its value would change according to market demand.

If the government were to try to encourage and support silver as money, to encourage the use of silver as money, the government could do two things, both of which tend to interfere with the free market, and thus, have slight drawbacks. 

First, a government could help narrow, or even eliminate, the spread on trading silver.  Thus, if the government noted that the "free market price" of silver is $15/oz. after minting fees and replacement prices, then that would be the government fixed price, whether a person was buying silver, or selling silver.

But that is a slight problem as people would tend to want to exchange worn out coins with less silver in them, for new coins.  And so, perhaps a slight fee should be charged, based on the weight, and a reasonable re-coinage fee.

Second, a government could help reduce silver's price volatility.  So if the silver price rose to $50/oz. very quickly, and then dropped, the government could hold silver's price steady for redemptions, so that people could still trade silver back to the government always at a floor price that never declined.  Hugo Salinas Price in Mexico is a champion of this idea.  This is similar to stamping a currency value on the coin itself.  When that is done, the value of that silver in trade is never lower than the price on the coin.  So, even in a "free market" changing price for silver, the new silver currency's price should never be allowed to go down in terms of the issuing nation's paper currency.  By reducing the price changes, by letting every price change only be upwards, and always be a new floor price, and never letting the price go down, a government would encourage people to trust and use silver as money.

That method also creates a slight problem, as the government might have to print up a lot of paper money in case silver's price dropped dramatically, and the government might end up with a lot of over valued silver that their own population does not want.  Thus, I consider that method to be like price fixing, which does not work, or, at least, has drawbacks.

But this would be a mix of the two methods, one part government decree, and one part the free market approach, which is why it has a slight problem.

The specifics on how to implement any of these methods require buying silver coins from a mint, or building your own mint and buying silver bars from a refiner.  The challenges there are basically trying to avoid default of your suppliers, as refiners and mints have gone bankrupt in the past, and currently, some refiners and mints are in trouble today, as they have long delivery times.  Fortunately, there are several silver minting experts to consult with to avoid such problems, such as:

Or, contact the owner of any successful coin shop which manages to maintain an ample inventory of product available for immediate delivery on a "cash and carry" basis.

Some of the main reasons why the U.S. Silver Eagle program have failed to cause silver to be circulated as currency in the U.S. are as follows.

1.  The U.S. Mint stamps the 1 troy oz. coins with $1, which is confusing.

2.  The U.S. Mint does not issue the silver coins as currency to anyone that they pay in the normal course of activity, meaning that they do not offer them as a means of payment to any government employees or contractors.

3.  The U.S. Government does not accept their own silver coins as a means of payment for taxes or fees.

Lately, the U.S. Mint has created another opportunity, by another failure.

4.  The U.S. Mint has been rationing silver coins, as their own suppliers, the mints they are contracting with to make blanks, cannot make enough blanks to meet demand.  This last problem has raised the cost of obtaining U.S. Minted silver coins, which means that anyone else who can issue silver coins can make a greater profit by doing so, even at market rates.

Which ever method any government decides to use to issue silver currency, their central bank has to essentially do two things.

1.  Mint silver into 1 oz. silver pieces and "spend" them into circulation.

2.  Redeem and buy back the silver pieces when people pay taxes or desire to engage in world trade with other nations that do not accept silver as money.

And finally, I believe it would be best to make silver coins that are the world standard weight, which is the 1 troy ounce weight, and to avoid marking them with any paper currency value. 

Later, as silver rises in value, it becomes more practical to start making fractional ounce coins, but today, that's just not really needed yet.

There are other bigger problems, of course.  The biggest problem is that such a nation would have to risk being branded as a member of the "axis of evil" by nations such as the U.S. government, who is currently being ruled by the paper money mob of world bankers, who hope to strip all nations of their sovereignty, and bring about a world government.

Then again, perhaps the ultimate goal of the paper money mob is to bring about a world government by bankrupting the nations, and by bringing back silver and gold as money, which would tend to unite the people of the world, until they could be enslaved by usury again, one last time. 

Sweden's Supercharged ETF

In a recession, boring is best...

We're in a world where soup isn't just food for sick people―Campbell's stock (NYSE:CPB) has soothed many aching portfolios as financial contagion spread.

And far from being mocked as chumps while the market roared forward, U.S. Treasury bond investors have had the last laugh as a decade of S&P gains deflated.

When it comes to international stocks, boring old Sweden has beaten emerging bulls ― like Brazil, most recently ― as this chart of the iShares Sweden ETF (NYSE:EWD) shows:

sweden etf chart

Even though some Swedish banks served as outposts of financial access to now-troubled eastern European economies like Latvia, EWD has withstood systemic shocks and beaten its Brazilian counterpart (NYSE:EWZ). With a combination of industrial strength and top international management, Swedish companies merit a spot in your recession-fighting portfolio.

Stocking up on Stockholm Stocks

Sweden's top stocks aren't necessarily household names outside of northern Europe, at least not the way they're listed in iShares filings...

For example, shoppers may not recognize Stockholm-traded Hennes & Mauritz shares, but retail customers in nearly 30 countries can be found carrying bags with H&M emblazoned on the side! H&M is one of EWD's top holdings, and the ETF is the easiest way for U.S.-based investors to grab that company's shares.

Same goes for Sandvik AB, the world's top producer of metalworking tools that will be essential to any industrial recovery.

Sandvik is part of a heavy industrial allocation in the Swedish ETF (over 26%). Automaker Volvo is in there too, rounding out EWD's top ten holdings.

Nevertheless, many of Scandinavia's star stocks come from tech-heavy sectors like telecommunications.

Telecom equipment maker Ericsson (NASDAQ:ERIC) has made its mark from frosty northern Europe all the way to balmy Charlotte, North Carolina―the city's football stadium was known as Ericsson Stadium from 1996-2006. TeliaSonera, another Swedish telecoms company in the EWD fund, is becoming a prominent player in wireless and broadband internet solutions, but it still has a much lower profile than Ericsson.

Ericsson claims customers in 175 countries. That's just 5 short of the 180 countries the World Bank recognizes... not a bad reach from a base near the Arctic Circle!

Since Ericsson makes up 17% of EWD's total allocation, the ETF can inflate and deflate with the fortunes of that one company. Fortunately, Ericsson has given EWD a big boost in 2009. ERIC shares are up 15% through mid-March, compared to a drop of almost the same amount in the S&P and 10% swoon among Ericsson's Nasdaq tech peers. Ericsson's newest move is a pending $2 billion network outsourcing deal with Kansas City's Sprint Nextel (NYSE:S), which has been hemorrhaging customers on complaints of shoddy service.

That should save Sprint money and bring Ericsson new opportunities in the U.S. market.

High Taxes... Lower Risk?

Now, you shouldn't think Sweden is totally immune to global financial market mayhem or high volatility when it hits. But what we look for as international stock investors are those country-to-country differences that can help our investments survive.

Perhaps ironically, the main capitalist qualm when it comes to Sweden―its taxation system in which the top marginal rate is 65%―may now be a buttress against fiscal chaos.

Interest-rate loosening and budget shuffling are making national leaders and central bankers all over the world look like Benny Hill these days. It would be comical if it weren't all so frighteningly serious and urgent.

In Sweden, they're walking the tightrope between having a robust state welfare system that also takes in one of the world's highest proportions of asylum-seekers and the need to maintain growth potential and a healthy trade surplus. Investors are attracted to that balance, but only as long as it's there.

Balance is key for EWD, too.

With 31% of its holdings split between just two companies―Ericsson and H&M―EWD investors should watch those firms carefully. However, country ETFs have become the best option for quick international diversification and a way to spread your bets around not only companies but also economies.

So far this year, the market likes what it sees in Sweden. Keep EWD on your radar throughout 2009.

Fear and Lust on Wall Street

I've had this ongoing project of reading as much as I can about the 1930s and the Great Depression. I favor the first-person accounts, stuff written by people who were there ― like Damon Runyon.

Some of his early stories written in the 1930s reflect on the mood of the era. And even if you don't care for reading about the 1930s, you've got to love Runyon's way of capturing the voices of the times. For instance, "I put the old convincer on him by letting him peek down the snozzle of my John Roscoe." That's a pretty colorful way of saying you stuck a gun in somebody's face.

In these stories, there is also that undercurrent of bad times. You never forget it. People view anybody who looks well with suspicion. Prosperity of any kind is seen as unreal in some way. As Runyon writes:

"You cannot tell by the way a party looks or how he lives in this town if he has any scratch, because many a party who is around in automobiles, and wearing good clothes, and chucking quite a swell is nothing but the phonus bolonus and does not have any real scratch whatever."

There is also a macabre sense of humor. In one story, Runyon writes of being at a track in Miami. He's having a run of bad luck. It goes on awhile and gets worse. "I wonder if I will not be better off if I buy myself a rope and end it all on a palm tree in the park on Biscayne Boulevard," he writes. "But the only trouble with the idea is I do not have the price of a rope, and anyway I hear most of the palm trees in the park are already spoken for by guys who have the same notion."

It was an era with an undercurrent of playful meanness, too. For example, look at the nicknames of some of the baseball players in the 1930s. Author Bill James wrote about this years ago. "In the '30s, nicknames turned nasty," he wrote. If you had a big nose, you were "Schnozz" ― a nickname earned by Hall of Fame catcher Ernie Lombardi. If you were overweight, your nickname was "Blimp," as in Frankie "Blimp" Hayes. Or just "Fats," the nickname pinned on poor Bob Fothergill.

Some other nicknames used by journalists and forever affixed to players' names in the registers: "Stinky" "Boob" "Boom Boom" (for a pitcher with a 38-69 career record) and "Suitcase" for anybody who had trouble sticking with a team. Joe Medwick walked with his toes pointed out and got stuck with "Ducky." An outfield named Cuyler stuttered and they called him "Kiki" Cuyler. It was a brutal era.

I guess with bread lines, shantytowns and so many people out of work, no one cared about playing nice. In 1930s, you had to have thick skin.

Floyd Odlum: Making the Best of Bad Times

And more than just reading about the 1930s out of my own personal fascination with the period, there are also some practical benefits. There were people who made a lot of money in the Great Depression doing legal things. There is Floyd Odlum, for instance. He is sometimes described as the only guy to make a fortune in the Great Depression. (He wasn't.)

I've written to you about him before. The reason to revisit him briefly is that James Grant also wrote a little about him in a recent Grant's Interest Rate Observer. Grant calls him a "salvage artist par excellence." "None of us can know the future," Grant writes. "But like Odlum, we can make the best of a sometimes unappetizing present."

Grant also managed to scrounge up a pretty good anecdote on Odlum. In the summer of 1933, when all the world seemed to be in pieces, Odlum strolled into his office, looked at his glum partners and said: "I believe there's a better chance to make money now than ever before."

Odlum liked poking around in the smoking wreckage of the 1930s. Bad times create wonderful pricing. I suspect if Odlum were still alive, he'd find himself very busy. There is a lot to look at now.

Scared? Read This

A friend of mine recently wrote to me about how he was looking at Potash (POT: NYSE) with "fear and lust." It was a Hunter Thompson moment, and I knew exactly what he meant. Everything feels a little scary right now. At the same time, your rational brain gets excited about the great prices you see dancing on your screen.

"Fear and lust" sums up what it feels like investing in stocks market these days…

Every investor will have to overcome fear to buy anything today. I hate to try to call a bottom. But remember that even in bad times, the stock market can put up stunning rallies. Jeremy Grantham at GMO makes the point about sitting on cash too long:

"In June 1933, long before all the banks had failed or unemployment had peaked, the S&P rallied 105% in six months. Similarly, in 1974, it rallied 148% in five months in the U.K.! How would you have felt then with your large and beloved cash reserves? Finally, be aware that the market does not turn when it sees light at the end of the tunnel. It turns when all looks black, but just a subtle shade less black than the day before."

Backlash from the CVR Energy Sell

I'll end this week's note with a quick word on CVR Energy, which we parted with after a little more than a year with a terrible loss. I always get lots of e-mail after every sell, no matter whether it was up or down.

I'll reprint one of those e-mails…from my father:

"Your great analysis costs us $7,200 if we sell now. What happened to all that good stuff you wrote about it as far as the fertilizer plant and using its coke to run it? I thought (you thought) it was going to save it money, etc., on running the plant and make money on the fertilizer.

"Love, Dad"

Guess that will come out of my inheritance, assuming there is any. Well, a lot changed. Fertilizer prices tanked. Natural gas prices tanked, thereby making the company's use of pet coke less appealing with all this cheap gas around. And gasoline demand fell, as did prices, thereby hurting the refinery. On top of that, there is the seeming inability of the company to get it together and deliver a clean set of results.

I suppose CVR Energy will bounce back from these lows at some point. If you want to hold out for a better price, that seems reasonable. But I'd rather own other things in this environment. Sorry, Pop. We'll hit the next one!

 

Buy Project Better Place Stock

We may not be able to buy Project Better Place stock...

But a slew of publicly traded companies are playing an integral role in the world's most ambitious electric vehicle plan.

In fact, corporate campuses and employee homes at 19 of Israel's top companies will become testing grounds for advanced EV infrastructure.

And from these Middle Eastern hubs, multinational companies can spread and adapt their EV strategies around the world.

For instance, charging stations will be installed at the headquarters of Teva Pharmaceuticals (NASDAQ:TEVA), the world's top generic drug maker.

What's key here is that Teva also has offices in Mexico, Singapore, Brazil, Kenya, and dozens of other countries. And in all of those places, Teva's corporate strategy could mean spreading Better Place's EV infrastructure.

In 2009, Project Better Place is being propagated through the business world with the same sort of seeding strategy that Better Place CEO Shai Agassi first took to governments from Israel to Australia to Hawaii.

Among the other U.S.-listed partners for Better Place in Israel are Partner Communications (NASDAQ:PTNR), Orbotech Ltd. (NASDAQ:ORBK) and the local divisions of Nike and employment services giant Manpower (NYSE:MAN).

Car-Sharing and Electric Vehicles―Powerful Twin Trends

Corporate car sharing is an accelerating trend by itself, and EV plug-in stations make perfect sense as a twin technology. Pay-per-use services like Zipcar are becoming more and more ubiquitous, and traditional car rental companies like Hertz now moving into that market. Hertz spokeswoman Paula Rivera told the Boston Globe this week that car sharing is a "$1 billion market with potential to grow."

Shai Agassi put it this way:

"We are today seeing the certification that there is real market demand for electric cars that will use Better Place's grid. We expect demand to grow as Israeli companies join in the vision, as well as in other countries, which together represent a potential global market of 50 million cars. We see today the tip of the iceberg of global demand."

What Agassi didn't say is that we are at a time where demand is supercharged by policy around the world.

Israel wants to end its use of foreign oil by 2020. The Obama Administration wants 1 million plug-in cars on the road by 2015. The Danish government, one of Project Better Place's early partners, has brought in IBM, Siemens, and national energy company DONG to make 10% of Danish cars plug-ins within the next decade.

Bringing car-sharing and EV infrastructure together means cars with higher emissions will increasingly be taken off the road, increasing the proportion of electric vehicles as international research projects and corporate EV fleets advance.

We're bullish on Project Better Place, but until we can buy stock in that one, we'll keep an eye out for more companies like Teva that will benefit from growing EV fleets and Better Place's ever-growing resources and research.

There are also other companies around the world making high-efficiency vehicle batteries. Though they may be seen as competitors to Better Place once it goes public, a rising tide lifts all ships.

Green Chip International subscribers are already riding the wave.

A Stock Market Rebound?

Gird up your loins, dear reader. Put wax in your ears and lash yourself to the mast. You are about to be tempted.

"Lead us not into temptation," says the famous prayer. The old timers knew we were weak. They knew we couldn't resist. They didn't pray that we would "just say no" to temptation. They knew that wouldn't happen. Instead, they prayed to God to keep temptation away from us.

There's nothing like a little temptation to get the juices flowing. A roulette wheel that seems to stop just where you thought it would...a pretty woman who smiles at you on the cross-town bus...a pastry as big as a sombrero and as rich as El Dorado - oh...Heaven forefend!

But the hardest temptation to resist is the temptation of getting something for nothing.

"Investors begin dipping toes back into stocks," reports a Reuter's article.

"While economies keep contracting, stocks may have already started pricing in the end of recession and the beginning of a recovery."

Last week, the stock market showed a little leg. Yes, prices rose 12% over a 4-day period - teasing us with the prospect of a little fun. Finally - a rebound. Maybe.
The Dow rose again on Friday - up 53 points. The index is still down more than 15% for the year...and down more than 50% from its all time high. It is rare to see such big losses without a major rebound. Our guess is that we're finally ready for one.

On that basis, we have taken down our "Crash Alert" flag. If we're right, we're going to see stocks go up 20% to 50%. And we're going to hear more people talking about the end of the recession...and a new bull stock market.

GM said it really didn't need an extra $2 billion last week. Two of America's biggest banks said they were running in the black again. Even the retail sales figures were not as bad as people expected.

Houses in some communities - such as Riverside, California and Miami, Florida - are selling for only about half of what they brought three years ago. Surely this is the bottom of the housing slump, right? And sales of existing houses - at bargain prices - rose almost 50% in January, from a year before.

Our advice is to listen politely - but don't take it too seriously. This is a depression. If it follows the form of previous depressions, it will seem for a while that it is not a depression at all...but a recession, and one that is ending.

Many - probably most - people still believe that the crisis is merely a pause in an otherwise healthy economic model. They wait for the bailouts to take effect...and for the U.S. consumer to begin buying again. That is the fondest hope, by the way, of the Chinese government. The Chinese hold $1.4 trillion worth of U.S. dollar assets. They're worried that their stash of cash may lose value. But, so far, it is the only thing that is NOT losing value.

The poor Chinese began spreading their cash around just before Humpty Dumpty fell off the wall. A number of their high-profile deals went bad:

"China loses billions on equities bets ahead of markets' collapse," says an awkward headline in the Financial Times. By the end of June '08, the Chinese held more than $100 billion worth of U.S. equities. Bad timing. But the collapse of the U.S. stock market makes Beijing's other dollar holdings look good. The dollar has gone up. So, the lesson the Chinese have learned is this: the safest thing you can do is to continue lending to your biggest deadbeat customer.

It is a dangerous strategy. But the Chinese think that if they extend enough credit to the U.S. consumer, he'll come back in the shop. And Ben Bernanke, another dreamer, said last week that the recession could end this year.

Stocks will probably rise for a few months. The economic news will be better. The Dow could rise to above 10,000. Then, we will be tempted to think that all the king's horses and all the king's men are actually better at putting things back together than their reputation suggests. We'll be tempted to think that those bailouts and giveaways actually did the job...and that now, rather than turn our backs on temptation...we can safely give in to it.

Be careful, dear reader. Be careful. And keep in mind...no matter how tempting stocks may be looking in the near future, you can make major gains - without having to touch a single stock!

All it takes is 5 minutes a day, and you could be raking in triple- digit gains. And judging from this service's track record - no losing picks in over two years - triple-digit gains isn't much of a stretch. See for yourself here.

More news from today's issue of Agora Financial's 5 Min. Forecast...

"The flailing consumer economy in the United States has caused a nasty decline in the amount of money foreign workers ship back to their families at home," writes Addison Wiggin. Just take a look at this chart:

phpL3VPmU

"Still," he writes, "according to the World Bank, 'remittances', as those payments are called, exceeded $300 billion in 2008. That money 'accounts for 45% of GDP in Tajikistan, 38% in Moldova and 24% in Lebanon and Guyana,' says the Economist.

Addison writes every day for The 5 Min Forecast, an executive series e- letter that provides a quick and dirty analysis of daily economic and financial developments-in five minutes or less. It's a free service available only to subscribers of Agora Financial's paid publications, such as the Hulbert #1 Performing Investment Letter, Outstanding Investments.

*** The sentiment-du-jour is outrage. AIG has gotten about $160 billion in bailouts from the feds. Much of this money has been paid out to various counterparties. We're not supposed to know who the counterparties are, but the word on the street is that billions have gone to Merrill Lynch, Goldman Sachs and two French banks, including Societe Generale. Why the taxpayer should be protecting Wall Street and foreign banks from their own errors is a subject for another day...

And now word has gotten to the press that AIG will pay out $165 million in bonuses. Top executives, for example, will get $6.5 million each. The company president defended the bonuses on two grounds.

First, he said, the execs were entitled to their bonuses by contracts made before the feds put in any money. The company couldn't unilaterally break its contracts.

Second, the firm needed to maintain the quality of its management. Especially, now that it is owned by the government, it needs good people to make sure the taxpayers get a good return on their stock investments.

The first argument seems to us watertight. He should have stopped there. The second leaks like a Baltimore water main. The easy retort is that given the quality of the top fellows at AIG bad management would be an improvement. But here at The Daily Reckoning we always forgo the cheap shots. Instead, we'll take a shot from the foul line:

What makes people think that they get better management by paying more money?

In the world at large, the difference in salary levels is shocking. At the top in Japan, the average executive earns only 3 times as much as the average salaryman. In Britain, top executives earn more than 10 times as much as their Japanese counterparts - or 39 times the average guy on the shop floor. And in America, the poor working stiff supports an executive who earns more than 300 times more than he does.

Is the American worth 10 times as much as his British confrere? Is he worth 100 times his Japanese competition? Is his business run better than either of theirs?

Don't make us laugh, dear reader. The only reason American executives earn so much is that they've conned the lumpeninvestoriat into believing that if they are paid more they will produce more. In fact, they're rarely the person actually responsible for output or innovation...and there is no evidence that we've ever seen to suggest that they do better at their jobs when they are paid more.

*** We spent the weekend working with the gardener again. We were joined by a neighbor, Paul, a round fellow, 75 years old - cutting firewood, splitting it, hauling it, stacking it.

Both Damien and Paul worked with cigarettes in their mouths. And both worked hard. Damien rarely says anything. But Paul never stopped talking.

"He's trying to kill us both," he said, pointing at Damien.

"Damien really knows how to work. He's been working hard all his life. Well, just try to find someone like Damien today. Young people don't want to work at all. And if they get a job, they expect a machine to do all the hard work. They don't know what a shovel is. You'd have a hard time getting a young person out to help us do this work...

"Everything has changed so much since I was young. You know, I was here in Normandy when the Americans landed. I remember seeing them go by. I was only 10 years old. But it made quite an impression on me. They had so many machines...tanks...trucks...jeeps. I had never seen so many vehicles.

"When I was ready to go to work, I went to work as a gardener. We worked by hand... We didn't have mechanical cultivators or garden tractors. We turned the ground with a spade. It was hard work...but I liked it.

"Then, I got into an argument with the boss. It was over nothing really. He told me to put up some cold frames...you know, for starting out the plants in the early spring. So they won't freeze. Then, he went off. He was a rascal. He didn't really do anything. He'd just tell us what to do and leave. And then he'd come back drunk later in the day and yell at us.

"So I put up the cold frames. And he came back and yelled at me:

"'What do you think you're doing... Don't you know how to put up cold frames correctly... My old crew could do this right. They were great workers. How come you don't know how to set up a cold frame?' He went on and on. So I just took of my apron and threw it at him.

"'Here...' I said, 'then let your old buzzards to it.' And I started to walk off. And he tried to stop me. What was I doing...who did I think I was, he said. Then, he even offered me more money to stay - another 50 centimes per hour.

"You laugh. But that was real money back then. And then, we got paid by the hour. We worked by the hour...as many hours as we wanted... and that was all there was to it.

"And I'll tell you something else. It wasn't like today. If you're starting out today, you have a hard time getting a job. You have to go to the right school and then get a trial period...and have the right training and get into the right program. And then, they interview you for days. Everybody is afraid to hire anyone because it so hard to fire them.

"It wasn't like that when I was starting out. You could just walk onto almost any jobsite and ask. If they needed help, you could start working the same day. I did a lot of things - I drove a truck, ran a café, worked for a food delivery service. If I didn't like the boss, I just quit. I always worked hard. Some bosses like that. Some don't. And I never minded saying what was on my mind. So when I saw something that didn't add up, I said so. And sometimes, I lost my job because of it. But it didn't matter, because there were plenty of jobs for someone who was willing to work.

"It's not like that now... That guy, what's his name, George...you know, the one who comes to help over here from time to time. He's on 'permanent disability' because he hurt his back. He can still walk. He can still talk. But he's considered permanently disabled because he was a mason...and now he can't carry heavy bags of cement. It's ridiculous. He could just go do something else. He's only about 40 years old. Instead, he does nothing - and we taxpayers support him.

"You know, they say that this financial crisis is going to be the end of capitalism. I don't think so. I think it's going to be the end of socialism...this kind of socialism we've had in France for the past 20 years. We can't afford it. There are too many people not working. Too many rules. Too much interference. A third of the country works. Another third tries to stop them from working. And the final third does nothing at all.

"I think the financial crisis is going to put an end to it... we can't afford it anymore."