Archive for August, 2014

Heads up… This could be the most important commodity news of the year

From Pierce Points:

A brief news item yesterday may be one of the most important happenings in commodities for years.

The coming shutdown of one of the largest uranium mines on the planet.

I noted a few weeks back that workers at Cameco’s McArthur River uranium mine in northern Canada were contemplating labour action. And yesterday that threat came to fruition ? with the major uranium company announcing that mineworkers’ unions have authorized a full strike.

It appears this action is going to bring McArthur River to a complete standstill. With Cameco saying it is now initiating shutdown activities at the mine, and the associated Key Lake uranium processing facility.

The strike is officially slated to begin on August 30. So it looks like production here will now taper off, leading up a full stop by that date.

As I mentioned previously, it’s hard to understate the effect this stoppage could have on uranium supply. Given that McArthur River is one of the world’s largest and richest uranium producers, currently putting out nearly 15% of global supply itself.

Interestingly, uranium prices have been rising the last few weeks. Up over 10% since the beginning of August, when news of the potential strike action at McArthur began to surface ? currently selling for $31 per pound.

This is the most notable increase in prices the uranium market has seen for years (albeit from a very low base, with prices having recently fallen to a near-decade low of $28). Suggesting that buyers are paying close attention to the events at McArthur, and the potential effects on global uranium supply.

Cameco noted that it is continuing discussions with mineworkers over the next 72 hours leading into the strike. So a last-minute solution is still a possibility.

But absent such a five-to-midnight deal, supply and demand is about to get much tighter in this space.

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on Heads up… This could be the most important commodity news of the year

The last two times this happened, small-cap stocks got crushed

From Chris Kimble at Kimble Charting Solutions:

When it comes to “monthly momentum” it can take a while to become very over bought or over sold.

The Russell 2000 monthly momentum reached lofty levels back in 1998 & 2007. Once momentum support broke at (1) & (2) in the Russell, it experienced declines ranging from 23% to 53%.

The opposite has taken place before strong bull markets. When monthly momentum reached oversold levels back in 2003 & 2009, strong rallies took place.

The rally off the 2009 lows now has monthly momentum higher than it was in 2007 and near the 1998 levels. Recently momentum is turning down and breaking support as the Russell is near a 14-year resistance line.

When lofty monthly momentum broke support in the past, small caps struggled to make much more upward progress. Is a slippery slope ahead for small caps? Will it be different this time? Stay tuned, this could be very important for small caps!

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Friday, August 29th, 2014 Invest, News, Wealth Comments Off on The last two times this happened, small-cap stocks got crushed

This is the “fatal flaw” that could bankrupt our country

From Bill Bonner, Chairman, Bonner & Partners:

We’re still in the lazy days of August, with little going on in the stock market. So let’s use this time to look at deeper trends.

We left off last week with discouraging words.

First, we noted that, according to Washington’s own budget people, Social Security is going broke 20 years sooner than forecast. It’s already $15 trillion in the hole, with a deficit that’s up 300% (mistakenly reported as 400%) in the last five years.

Second, we sympathized with our new dear readers of our new venture, The Bill Bonner Letter.

It must be difficult coming into a conversation that has been going on for so long. Especially when many of the ideas we are talking about are complex and confusing – at least to us!

Many are those who have tried to understand economics and markets in a simple and definitive way. They’ve laid out their diagrams and made their forecasts.

The graveyards and insane asylums are full of them. Because no matter how much you think you grasp… there is always more that gets away from you.

The Real Triumph of Civilization

To remind you, we were wondering why the Social Security system exists.

If government really were the parasitic zombie we think it is, why would it set up a retirement pension system that seems benign… and that now has the support of an overwhelming majority of Americans? (Especially those over 65!)

Is it possible that modern democratic government really is a different institution – of, by, and for the benefit of the people who are governed?

Does it represent real progress in the life of mankind?

The answer we came to was “sort of.”

Civilization (including the rules and customs we associate with modern, democratic governments) makes possible trade, commerce, and entrepreneurship. This allows people to become wealthy.

Wealth allows them to build new and better weapons. Less civilized governments (dictatorships, Communist countries and other basket cases) fall behind. Civilization triumphs because it pays.

Our modern, more or less consensual… more or less participatory… more or less respecting property rights… and more or less predictable government seems to have evolved along with an increase in firepower.

Firepower costs money. The freer (more civilized) an economy is, the more firepower it can produce.

Bullies, Bosses, and Blowhards

As Henry David Thoreau first observed (in an essay published in 1849 called “Civil Disobedience”), “That government is best which governs least.”

Civilized people neither want nor need much government. Instead, it gets in the way. The more they have of it, the less able they are to produce wealth. (And firepower.)

That leaves little for the bullies, bossies, and blowhards to do. So, they turn to Social Security… and Obamacare… and Homeland Security – programs that appear to be set up to benefit the ordinary citizen.

Instead of a barbaric institution of naked aggression and force, government is said to have no further point or purpose but to make citizens’ lives better.

That is why we have the Fed. It is really a cartel of bankers who make sure they protect and defend the right of bankers to make a lot of money.

But have you heard Janet Yellen lately? She says she is deeply… deeply… concerned about the plight of the unemployed!

Most of the public believes that modern government is merely a grand insurance program. It protects them. It defends them. It pays their medical bills. It provides an income during their working lives and a pension for their retirement.

More important, it flatters them. It convinces them they are the real deciders: the captains of a superior civilization, the citizens of an “indispensable nation,” without which the light of the world would be extinguished.

But there is a big flaw in this model.

The feds’ insurance business may be backed by firepower, but it is dependent on voter support. The voters want more and more benefits. And they are not too picky about financial standards.

The model works only so long as the economy and credit are both expanding. When those stop growing, the system goes broke.



Crux note: Below is an urgent message from S&A Founder Porter Stansberry. If you haven’t read it, we urge you to take a few moments to do so now:

Bill Bonner will be the first to admit he’s not a great businessman. Or a very good investor. And he’s probably an even worse manager.

Yet despite these “flaws,” Bill is one of the richest men in America ? worth nearly a billion dollars.

He owns nine houses… hundreds of thousands of acres of land… and has business operations in 18 countries. He’s a NY Times best-selling author… and was named a European “Honorary Ambassador” for his work.

Not many people know that, without Bill Bonner, Stansberry Research wouldn’t exist. And I almost certainly wouldn’t be nearly as successful.

You see, not only did Bill help me launch my company… He also taught me an incredible secret.

It’s a way of seeing things… A kind of wisdom that’s far beyond what others teach… what others even understand. And it has made him, his partners, many of his employees ? and basically anyone who listens to him ? rich.

For years I’ve been telling Bill to share this big idea with everyone… And he has finally done it. It’s in his latest, just published book.

Please understand… Bill’s unique philosophy isn’t merely about money. But it will allow you to understand the markets – and every other type of human endeavor in a whole new, and vastly more accurate way.

This idea completely changed the course of my life.

So, if you want to be a better investor, you must read this book. If you want to be a better parent… a better spouse… a smarter consumer… a better businessman, a better manager… read this book.

Like I said, Bill’s secret is about much more than making money…

* It’s a secret that helped me find an incredible wife, years ago ? and also helped me find other important people in my life, including my business partners, and people who manage my various assets.

* This secret also helped me build one of the biggest financial publishing businesses in the world ? using an approach that no one else in the industry had ever tried.

* Because of this secret, I’ve been invited backstage at rock concerts… gotten to meet my lifelong heroes like T. Boone Pickens… (and soon, Laird Hamilton)… Have had great investment deals and ideas essentially handed to me… Have been a guest at some of the most exclusive clubs in the world, including Augusta National, the Dallas Petroleum Club, and Nassau’s One and Only Club… and more.

Of course, I’m not the only one who has benefited from this secret.

Bill’s unique take on the world has helped dozens of people I know personally become millionaires. And now Bill is sharing his secret in a brand new book.

Please note: This book is not yet available on Amazon or anywhere else.

It won’t be for sale on Amazon till sometime next month. And when it does first go on sale at Amazon, you’ll only be able to get a paperback version.

But I figured out a way for you to get a hardback copy, plus a huge special bonus (which might even be worth more than the book), through a limited-time special offer.

No, I’m not giving this book away. It’s not part of any free offer or anything like that. You’ve got to buy it with your own money.

But I promise you, it’s worth much, much more than the small price you have to pay.

To see my full summary of Bill Bonner’s brand-new book, and to get your own hardback copy, plus something from Bill that might be even more valuable than this new book, go here


Porter Stansberry
Founder, S&A Investment Research

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on This is the “fatal flaw” that could bankrupt our country

Doc Eifrig: Stop wasting your hard-earned money. Do this instead.

From Dr. David Eifrig, MD, MBA, editor, Retirement Millionaire:

Stop wasting your money on bottled water…

Last year, the average American drank about 32 gallons of bottled water, according to the consulting and research firm Beverage Marketing Corp. At about $1.22 per gallon, the average person spends $39.04 on bottled water per year. For people who drink several gallons per week, this number could easily be in the hundreds. That $1.22 per gallon of bottled water could get you more than 500 gallons of tap water, according to the Environmental Protection Agency.

The people paying for bottled water might as well flush their money down the toilet. Most people who prefer bottled water think it’s healthier than tap water. It’s not. The filtering process in water-treatment plants is similar to what companies use when bottling water. And the regulations are nearly identical.

Some people like bottled water for its convenience. Some say it just tastes better than tap water. But chemicals used to make the plastic – like BPA – can leach into the water. Longtime subscribers recall that BPA – bisphenol-A – is linked to prostate and breast cancers, diabetes, and heart disease. Tap water can also have its risks – like the pills your neighbors flush down the toilet. But there are ways to alleviate most of them.

So save your wallet and your health… Use at-home water-filter systems like Brita. You can buy a faucet system or a pitcher for around $30. Brita filters get rid of chlorine and pharmaceutical particles (like the particles from your neighbors flushing their Advil).

My assistant used to buy a case or two of water every week. Now, she uses a Brita filter to get rid of some the contaminants, and save money. She says it has saved her more than $200 per year.

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Friday, August 29th, 2014 Invest, News, Wealth Comments Off on Doc Eifrig: Stop wasting your hard-earned money. Do this instead.

Not just Burger King… Why more companies could soon be “fleeing” to Canada

From Bloomberg: 

Canada has become the latest frontier for U.S. companies fleeing the high cost of business, spurred by low corporate taxes and a policy that keeps international earnings out of the clutches of the Internal Revenue Service.

Burger King Worldwide Inc. (BKW), the second-largest U.S. burger chain, agreed to buy coffee-and-doughnut company Tim Hortons Inc. today for about C$12.5 billion ($11.4 billion) and move the headquarters of the combined company to Canada. It’s “not fair” that companies can renounce their U.S. citizenship by filling out paperwork, a White House spokesman said yesterday.

The deal, which is still subject to the standard approvals, for Oakville, Ontario-based Tim Hortons follows Valeant Pharmaceuticals International Inc.’s merger with Canada’s Biovail Corp. in 2010, which sparked the latest so-called tax-inversion wave.

Burger King is unlikely to be the last U.S. company to consider moving north even as President Barack Obama and his aides try to curb the practice, tax experts say. In addition to avoiding U.S. taxes on global earnings, companies like Burger King can take advantage of Canadian tax rates that have been cut by about a quarter in the past eight years.

“We have now made it a lot more attractive for companies to say Canada is a good place to set up shop,” said Jack Mintz, director of the University of Calgary’s School of Public Policy.

Only income earned within Canada is taxed by the government, said Alex Edwards, assistant professor at the University of Toronto’s Rotman School of Management, noting this territorial system is the more common form of corporate taxation. In the U.S., profits from foreign operations in lower-tax regions are topped up to the federal rate when they’re repatriated, he said.

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Tax Layers

“The real bang for the buck here is potential tax savings on Burger King’s non-U.S. earnings,” Edwards said by phone yesterday. “It’s not just the earnings in Canada, it’s the earnings everywhere in the world that might be able to escape that second layer of U.S. tax.”

As a result, Canada is primed for more of these tax inversion deals before the U.S. Congress makes a decision on whether to block them, he said. He noted there was a wave of similar inversion deals in the late 1990s and early 2000s where U.S. companies were domiciling in foreign jurisdictions with holding companies, including in Canada, to get around U.S. tax laws before Congress moved to end those activities.

“What’s driving this is not so much the Canadian tax code but the U.S. tax code,” Edwards said.

Companies that consider actions like an inversion continue to benefit from all of the resources of the U.S., White House spokesman Josh Earnest told reporters yesterday in Washington.

File Paperwork

“It’s not fair for them to just fill out some paperwork that would allow them to just renounce their citizenship” and their tax rate, he said.

Under Canadian law, any foreign investment transaction above C$354 million ($322 million) is reviewed based on the long-term interest of the economy, said Jake Enwright, a spokesman for Industry Canada Minister James Moore.

David Baskin, president of Baskin Financial Services Inc. in Toronto, said he didn’t expect any Canadian government intervention in a deal between Burger King and Tim Hortons because the latter was already owned at one point by Wendy’s Co.

“I can’t see that it’s bad for Canada or Canadians. I don’t see the government stopping this one,” he said in a telephone interview yesterday. Baskin owns Tim Hortons shares, which soared 19 percent yesterday. “If it was good enough for Wendy’s it’s good enough for Burger King.”

Magna Target

Tim Hortons climbed 8.1 percent to C$88.71 at 4 p.m. in Toronto for a market value of C$11.8 billion, after closing 19 percent higher yesterday.

Companies need scale for the transaction to make sense, which limits the options for additional inversions involving Canadian firms, Baskin said.

“You can’t have Wal-Mart taking over a corner grocery store to do a tax inversion and there just aren’t that many sizable Canadian companies,” he said.

Magna International Inc. (MG), North America’s biggest auto parts supplier, might be another inversion target, he said.

Lower corporate taxes may also be an attraction for foreign companies. Canada began cutting its federal corporate tax rate in 2001 under the previous Liberal government. Prime Minister Stephen Harper then took up the baton, dropping the rate in several steps to 15 percent in 2012. Combined with provincial rates averaging 11.5 percent, Canada’s rate of 27 percent is now the second-lowest in the Group of Seven countries behind the U.K.’s 21 percent, according to auditing and tax firm KPMG.

Global Ranking

Canada’s combined rate is still above the 24 percent average for the Organisation for Economic Co-operation and Development, according to the report.

Low corporate tax rates helped the country rise to second place in a Bloomberg ranking of best countries for doing business in January, behind only Hong Kong.

“We are proud that our low tax environment in Canada attracts businesses,” Carl Vallee, a spokesman for Harper, said by e-mail yesterday.

The actual tax savings from a union between Burger King and Tim Hortons is not very big, according to a report from Catharine Sterritt and Bank of Nova Scotia’s Arbitrage Group. Effective tax rates for Tim Hortons and Burger King were 26.8 percent and 27.5 percent respectively in 2013. Burger King gets about 42 percent of its revenue from outside the U.S. and Canada, according to data compiled by Bloomberg.

Obama Criticism

Between mid-June and late-July, when U.S. President Barack Obama began criticizing inversion deals at least five large American firms have announced plans to make such a move, including AbbVie Inc. (ABBV) and Medtronic Inc. (MDT)

Since the start of 2012, at least 21 U.S. companies have announced or completed the deals, comprising almost half the total of 51 such transactions in the past three decades.

Tim Hortons even did an inversion of its own when it incorporated in Canada in 2009 in order to take advantage of the lower tax rate after being spun off from Wendy’s three years earlier.

Canada has taken steps in the past to curb a decline in corporate tax revenue. The government introduced a tax on income trusts in 2006 after companies including Telus Corp. and BCE Inc. tried to join a wave of companies converting to the equity structure to lower their taxes by paying out more of their earnings to shareholders through dividends.

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on Not just Burger King… Why more companies could soon be “fleeing” to Canada

This powerful indicator says stocks are headed higher from here

From Brett Eversole, analyst, True Wealth Systems:

Right now, a stock market extreme is pointing to higher stock prices from here…

As you’ll see in a moment, this “extreme” reading is a very reliable indicator. Like many of my favorite indicators, this one tells us to buy stocks when most people don’t want them.

Three weeks ago, it correctly showed that the market’s mini-correction was likely over. And today, it says higher prices should continue.

Let me explain…

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The National Association of Active Investment Managers (NAAIM) Exposure Index is an investor survey that includes hedge-fund and mutual-fund managers.

These folks actively invest on behalf of their clients, with the goal of beating the market. The NAAIM ranges from 0-100 based on the average exposure these investors have to U.S. stocks.

A reading of 100 is fully invested and a reading of zero is fully out of the U.S. market. As longtime readers would expect, these folks are often wrong when they agree.

The NAAIM Exposure Index plummeted in early August. And it recently began climbing higher. Based on history, that means new highs in stocks should continue from here.

You see, since 2011, the NAAIM has bottomed below a reading of 52 only eight times. Each of these bottoms did a great job of catching the bottom in stocks. Take a look…

The gray guidelines show the bottom in the NAAIM Exposure Index. As you can see, it has done a great job catching the mini-corrections in U.S. stocks we’ve seen over the past four years.

The NAAIM caught the exact bottom in half of these eight occurrences. And most importantly, the largest post-signal loss was just 4.5%. Take a look…

NAAIM Signal
Remaining Downside
Three-Month Return

On average, stocks fell just 1.4% more after the NAAIM bottomed. And three months later, stocks increased around 6%, on average.

Importantly, as of last week, the NAAIM has ticked higher off the bottom we saw earlier this month. History shows that we should expect new highs from here… not continued losses.

The NAAIM has one of the best track records I’ve seen. And today, the NAAIM has bottomed from the recent mini-correction and bounced higher.

History is clear. When this happens, stocks move higher over the next few months. I expect that to continue from here.

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on This powerful indicator says stocks are headed higher from here

Is this good time to invest in gold? –
Is this good time to invest in gold?
With gold acting as both an investment as well as an insurance product against falling equity prices countering any massive lows and recession periods, investment in gold is always given due thought by each investor. Gold prices have eased off in

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on Is this good time to invest in gold? –

Gold bullion worth £10000 buried on Folkestone beach – BBC News

BBC News
Gold bullion worth £10000 buried on Folkestone beach
BBC News
A gold-rush has started at a beach in Kent where a German artist buried £10,000 worth of bullion as part of an arts festival. Michael Sailstorfer has hidden 30 24-carat gold bars on Folkestone's Outer Harbour beach. More than 150 people started digging
Gold bullion buried on Folkestone beach – hidden bounty draws crowdsThe Guardian
Artist Hid $16000 Worth of Gold on a Beach, and You Have to Find ItTIME
Hunt for gold bullion hidden on Kent beach by German artist Michael SailstorferDaily Mail –Kent News
all 38 news articles »
Friday, August 29th, 2014 Invest, News, Wealth Comments Off on Gold bullion worth £10000 buried on Folkestone beach – BBC News

The golden sands of Folkestone: artist buries £10000 of bullion on beach – The Guardian

The Guardian
The golden sands of Folkestone: artist buries £10000 of bullion on beach
The Guardian
The bars are of different sizes and standard gold bullion marked Made in London, although anyone expecting the kind of gold bars you see in heist films may be disappointed. Nevertheless, each bar could be worth several hundred pounds and if you find

Friday, August 29th, 2014 Invest, News, Wealth Comments Off on The golden sands of Folkestone: artist buries £10000 of bullion on beach – The Guardian

Shocking new report: The “lost” IRS emails have been found. You may not believe where.

From Mac Slavo at SHTFplan:

For weeks the IRS and Obama Administration told the American people a carefully crafted narrative regarding the whereabouts of emails containing information surrounding the targeting of specific groups and individuals based on their political party. The Obama administration vehemently denied that such targeting had taken place or that they had any involvement whatsoever. For their part, IRS heads testified that the thousands of emails belonging to director Lois Lerner, who headed the IRS Exempt Organizations Unit, simply disappeared when her hard drive was thrown away.

Most Americans simply couldn’t believe it. How could an agency that deals with billions of pages worth of tax returns simply lose emails, especially from a department head? Moreover, how is it possible that these emails were not backed up somewhere?

In June we opined that there must be secondary copies of these emails, simply because the government keeps records of everything. Could you imagine what would happen to the IRS if their main email or data server was destroyed by some far off event, and all of the government’s tax revenues for an entire year were lost? Of course not! It’s simply not a reasonable scenario.

It turns out, according to a new report, that the government does have backups.

The Department of Justice has confirmed it.

But there’s a catch. DOJ attorneys and the IRS are now scrambling to offer up an excuse for why they shouldn’t have to show them to the American public.

If you’re not upset at government overreach and lack of transparency yet, then this should seal the deal.

The government says that the problem with accessing the emails is that it would be too “onerous” of a task. Yes, you read that right. They do not want to source the emails because it would be difficult and burdensome.

Or, is there a second possible explanation for their lack of motivation? Could it be that pulling the emails would result in handcuffs and stiff prison sentences for officials involved in the conspiracy at not only the IRS, but the Treasury Department, the Department of Justice, the Federal Elections Committee, and even the White House?

The records exist. Now they need to be shown to the American public, and if there was any wrongdoing, people need to be sent to prison, up to and including the President of the United States.

The full report is posted below courtesy of Lily Dane and The Daily Sheeple.

Lies Exposed: DOJ Admits “Missing” IRS Emails DO Exist

By Lily Dane (The Daily Sheeple)

In a stunning turn of events, Department of Justice attorneys for the IRS admitted that Lois Lerner’s emails DO exist on a backup server, but said they would be hard to find.

Judicial Watch President Tom Fitton broke the news today:

Department of Justice attorneys for the Internal Revenue Service told Judicial Watch on Friday that Lois Lerner’s emails, indeed all government computer records, are backed up by the federal government in case of a government-wide catastrophe. The Obama administration attorneys said that this back-up system would be too onerous to search. The DOJ attorneys also acknowledged that the Treasury Inspector General for Tax Administration (TIGTA) is investigating this back-up system.

We obviously disagree that disclosing the emails as required would be onerous, and plan to raise this new development with Judge Sullivan.

This is a jaw-dropping revelation. The Obama administration had been lying to the American people about Lois Lerner’s missing emails. There are no “missing” Lois Lerner emails – nor missing emails of any of the other top IRS or other government officials whose emails seem to be disappearing at increasingly alarming rate. All the focus on missing hard drives has been a diversion. The Obama administration has known all along where the email records could be – but dishonestly withheld this information. You can bet we are going to ask the court for immediate assistance in cutting through this massive obstruction of justice.

Remember, back in June, IRS officials told Congress that the emails were lost and that the agency had gone to “great lengths” to try to retrieve them.

Conveniently, the emails lost were mainly ones to and from people outside the IRS, such as the White House, Treasury, Department of Justice, FEC, or Democrat offices.

The shocking information was provided to Judicial Watch by order of U.S. District Judge Emmet G. Sullivan, who, back in July, ordered the IRS to provide a declaration explaining exactly how the agency managed to “lose” two years’ worth of emails belonging to Lois Lerner.

Fitton spoke to Fox News about the revelation:


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To see the set of sworn declarations from IRS officials, click here.

Hey, remember when Obama told Bill O’Reilly that there’s “not even a smidgen of corruption” in the IRS?

Those words are coming back to haunt him.

Delivered by The Daily Sheeple

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Thursday, August 28th, 2014 Invest, News, Wealth Comments Off on Shocking new report: The “lost” IRS emails have been found. You may not believe where.