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Saturday, April 19, 2014

Gold World News Flash

Gold World News Flash


The Dark Side Of The Silver Mining Industry

Posted: 18 Apr 2014 11:00 PM PDT

by Steven St. Angelo, SRS Rocco:

There is an insidious Dark Side to the silver mining industry that goes unnoticed by the majority of investors and analysts.  Actually, I haven't come across one miniyng analyst who puts out comprehensive data on this very subject for the silver mining industry.

According to my figures for 2013, the top primary silver miners suffered the lowest average silver yield ever.  That's correct… another year of declining ore grades and yields.

Looking at the chart below, the top 6 primary silver miners average yield for 2013 was 7.6 ounce a tonne (oz/t) compared to the 8.1 oz/t recorded in 2012.  Thus, the top miners shed another half ounce of silver yield… falling 6% in 2013.

Read More @ SRSroccoReport.com

How To Predict an Economic Collapse

Posted: 18 Apr 2014 10:30 PM PDT

U.S. Dollar is Going to Die

Posted: 18 Apr 2014 09:40 PM PDT

SPX Topping Valuations 3

Posted: 18 Apr 2014 08:40 PM PDT

by Adam Hamilton, Gold Seek:

The lofty stock markets are starting to wobble, with selloffs' frequency and sharpness increasing. The dominant reason the Fed's stock levitation is running out of steam is severe overvaluation. Stocks are just far too expensive today compared to historic precedent, a dangerous state seen when bull markets are topping. Rampant overvaluation is a glaring warning sign to investors that selling is just beginning.

Investing is all about buying low then selling high. So the price paid for any particular stock is the most-important and often dominating factor in its ultimate price-appreciation success. The surest way to grow rich in the stock markets is to buy good companies at low prices, the prudent contrarian approach. Even buying great companies at high prices leaves little room for those stocks to run higher, so they rarely do.

Read More @ GoldSeek.com

Goldman Sachs Is Highly Motivated To Low-Ball Gold Price

Posted: 18 Apr 2014 08:34 PM PDT

The distinguished analysts from Goldman Sachs reiterated their 2014 forecast for gold to hit $1,050 by the end of the year.  They believe the paper price of gold will continue to decline as the supposed "Powerhouse" U.S. economy picks up speed and accelerates growth. If someone recently had a frontal lobotomy... this forecast might make perfect sense.  On the other hand, if a person belongs to the 95-99% group of Americans who believe everything coming from the Boob Tube, this forecast is exactly what the doctor ordered.

Russia, China likely to stop buying Treasuries, ex-White House financial aide says

Posted: 18 Apr 2014 05:58 PM PDT

9p ET Friday, April 18, 2014

Dear Friend of GATA and Gold:

Former Bush administration financial aide Philippa Malmgren tells King World News that Russia and China are likely to stop buying U.S. Treasuries altogether and that separatism is rampant around the world, not peculiar to Ukraine:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/4/18_Ex...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.



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Join GATA here:

Porter Stansberry Natural Resources Conference
AT&T Performing Arts Center
Margot and Bill Winspear Opera House
2403 Flora St., Dallas, Texas
Saturday, May 31, 2014

http://stansberrydallas.com/

Committee for Monetary Research and Education
Spring Dinner Meeting
Union League Club, New York City
Thursday, May 22, 2014

http://www.cmre.org/news/spring-meeting-2014/

Canadian Investor Conference 2014
Vancouver Convention Centre West
1055 Canada Place, Vancouver, British Columbia
Sunday and Monday, June 1 and 2, 2014

http://cambridgehouse.com/event/25/canadian-investor-conference-2014-inc...

New Orleans Investment Conference
Wednesday-Saturday, October 22-25, 2014
Hilton New Orleans Riverside Hotel
New Orleans, Louisiana

https://jeffersoncompanies.com/new-orleans-investment-conference/home

* * *

Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16



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Silver mining stock report for 2014 comes with 1-ounce silver round

Future Money Trends is offering a special 18-page silver mining stock report about how to profit with the monetary and industrial metal in 2014, and it comes with a free 1-ounce silver round. Proceeds from the report's sales are shared with the Gold Anti-Trust Action Committee to support its efforts to expose manipulation in the monetary metals markets. To learn about this report, please visit:

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Merger talks between gold giants Barrick and Newmont break down

Posted: 18 Apr 2014 05:51 PM PDT

By Gillian Tan, Alistair MacDonald, and Dana Mattioli
The Wall Street Journal
Friday, April 18, 2014

Barrick Gold Corp. and Newmont Mining Corp. recently held abortive talks over a deal that would have combined the world's two largest gold producers at a time when they are battling a sharp drop in the price of gold, according to people familiar with the matter.

The two companies had intended to announce a deal as early as Tuesday, one of the people said. They have discussed combining a number of times before, people familiar with the matter have said, and it is possible they could do so again.

The deal talks come as the companies try to adapt to lower gold prices. The precious metal's futures fell 28 percent last year, their biggest annual price drop since 1981. ...

... For the full story:

http://online.wsj.com/news/articles/SB1000142405270230462630457950983405...



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Join GATA here:

Porter Stansberry Natural Resources Conference
AT&T Performing Arts Center
Margot and Bill Winspear Opera House
2403 Flora St., Dallas, Texas
Saturday, May 31, 2014

http://stansberrydallas.com/

Committee for Monetary Research and Education
Spring Dinner Meeting
Union League Club, New York City
Thursday, May 22, 2014

http://www.cmre.org/news/spring-meeting-2014/

Canadian Investor Conference 2014
Vancouver Convention Centre West
1055 Canada Place, Vancouver, British Columbia
Sunday and Monday, June 1 and 2, 2014

http://cambridgehouse.com/event/25/canadian-investor-conference-2014-inc...

New Orleans Investment Conference
Wednesday-Saturday, October 22-25, 2014
Hilton New Orleans Riverside Hotel
New Orleans, Louisiana

https://jeffersoncompanies.com/new-orleans-investment-conference/home

* * *

Support GATA by purchasing DVDs of our London conference in August 2011 or our Dawson City conference in August 2006:

http://www.goldrush21.com/order.html

Or by purchasing a colorful GATA T-shirt:

http://gata.org/tshirts

Or a colorful poster of GATA's full-page ad in The Wall Street Journal on January 31, 2009:

http://gata.org/node/wallstreetjournal

Help keep GATA going

GATA is a civil rights and educational organization based in the United States and tax-exempt under the U.S. Internal Revenue Code. Its e-mail dispatches are free, and you can subscribe at:

http://www.gata.org

To contribute to GATA, please visit:

http://www.gata.org/node/16



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Hyper-Sensitive Illinois Mayor Orders Police Raid Over Parody Twitter Account

Posted: 18 Apr 2014 03:24 PM PDT

Submitted by Mike Krieger of Liberty Blitzkrieg blog,

Just yesterday, I wrote a post about how a South Carolina construction worker was fined $525 and lost his job for not paying $0.89 for a drink refill while working at the Ralph H. Johnson VA Medical Center in downtown Charleston. The point was to emphasize how the law comes down with a devastating vengeance when an average citizen commits a minor crime, yet allows the super rich to loot and pillage with zero repercussions. There is now a systemic two-tier justice system operating in these United States, and the result will unquestionably be tyranny if the trend continues unabated.

The latest example of a lowly citizen being subject to a disproportionate use of the law, is Jon Daniel of Peoria, Illinois. Jon was behind a parody Twitter account that mocked Peoria mayor Jim Ardis, and his biggest mistake was not making it clear that it was a parody. As a result, Twitter had already suspended the account weeks ago. Problem solved, right? Wrong.

The tough guy mayor was so offended that a plebe would dare criticize his royal highness that he ordered a police raid on the home of Jon Daniel and his roommates. Peoria native, Justin Glawe wrote an excellent article on the subject for Vice. He writes:

Jon Daniel woke up on Thursday morning to a news crew in his living room, which was a welcome change from the company he had on Tuesday night, when the Peoria, Illinois, police came crashing through the door. The officers tore the 28-year-old’s home apart, seizing electronics and taking several of his roommates in for questioning; one woman who lived there spent three hours in an interrogation room. All for a parody Twitter account.

 

Yes, the cops raided Daniel’s home because they wanted to find out who was behind @peoriamayor, an account that had been shut down weeks ago by Twitter. When it was active, Daniel used it to portray Jim Ardis, the mayor of Peoria, as a weed-smoking, stripper-loving, Midwestern answer to Rob Ford. The account never had more than 50 followers, and Twitter had killed it because it wasn’t clearly marked as a parody. It was a joke, a lark—but it brought the police to Daniel’s door. The cops even took Daniel and one of his housemates in for in-depth questioning—they showed up at their jobs, cuffed them, and confiscated their phones—because of a bunch of Twitter jokes.

 

So the police raid on Daniel’s house wasn’t an isolated incident; it was just another case of the cops acting shady—and naturally, many in this town are raising serious questions and concerns over the use of taxpayer resources and manpower to find out who ran @peoriamayor.

Fortunately, this story does have a silver lining. Daniel’s original Twitter account was actually pretty unsuccessful, with only 50 followers by the time it was shut down. Mayor Jim Ardis should’ve just left well enough alone, but he couldn’t do that, and as a result of all the attention this story has received in the blogosphere, new parody accounts have emerged. The most successful one is @NotPeoriaMayor and the avatar is Jim Ardis with a Hitler mustache. See below:

Screen Shot 2014-04-18 at 2.02.57 PM

The best part is this account already has 7x the followers of the other one.

Lesson Learned: Don’t fuck with the Internet.

Full Vice article here.

The LA Times also covered the story, here.

18 Stats That Prove That Government Dependence Has Reached Epidemic Levels

Posted: 18 Apr 2014 12:21 PM PDT

Submitted by Michael Snyder of The American Dream blog,

Did you know that the number of Americans getting benefits from the federal government each month exceeds the number of full-time workers in the private sector by more than 60 million?  In other words, the number of people that are taking money out of the system is far greater than the number of people that are putting money into the system.  And did you know that nearly 70 percent of all of the money that the federal government spends goes toward entitlement and welfare programs?  When it comes to the transfer of wealth, nobody does it on a grander scale than the U.S. government.  Most of what the government does involves taking money from some people and giving it to other people.  In fact, at this point that is the primary function of the federal government.

Just check out the chart below.  It comes from the Heritage Foundation, and it shows that 69 percent of all federal money is spent either on entitlements or on welfare programs…

Heritage Foundation

So when people tell you that the main reason why we are being taxed into oblivion is so that we can “build roads” and provide “public services”, they are lying to you.  The main reason why the government taxes you so much is so that they can take your money and give it to someone else.

We have become a nation that is completely and totally addicted to government money.  The following are 18 stats that prove that government dependence has reached epidemic levels…

#1 According to an analysis of U.S. government numbers conducted by Terrence P. Jeffrey, there are 86 million full-time private sector workers in the United States paying taxes to support the government, and nearly 148 million Americans that are receiving benefits from the government each month.  How long can such a lopsided system possibly continue?

#2 Ten years ago, the number of women in the U.S. that had jobs outnumbered the number of women in the U.S. on food stamps by more than a 2 to 1 margin.  But now the number of women in the U.S. on food stamps actually exceeds the number of women that have jobs.

#3 The U.S. government has spent an astounding 3.7 trillion dollars on welfare programs over the past five years.

#4 Today, the federal government runs about 80 different “means-tested welfare programs”, and almost all of those programs have experienced substantial growth in recent years.

#5 Back in 1960, the ratio of social welfare benefits to salaries and wages was approximately 10 percent.  In the year 2000, the ratio of social welfare benefits to salaries and wages was approximately 21 percent.  Today, the ratio of social welfare benefits to salaries and wages is approximately 35 percent.

#6 While Barack Obama has been in the White House, the total number of Americans on food stamps has gone from 32 million to nearly 47 million.

#7 Back in the 1970s, about one out of every 50 Americans was on food stamps.  Today, about one out of every 6.5 Americans is on food stamps.

#8 It sounds crazy, but the number of Americans on food stamps now exceeds the entire population of the nation of Spain.

#9 According to one calculation, the number of Americans on food stamps is now greater than the combined populations of “Alaska, Arkansas, Connecticut, Delaware, District of Columbia, Hawaii, Idaho, Iowa, Kansas, Maine, Mississippi, Montana, Nebraska, Nevada, New Hampshire, New Mexico, North Dakota, Oklahoma, Oregon, Rhode Island, South Dakota, Utah, Vermont, West Virginia, and Wyoming.”

#10 According to a report from the Center for Immigration Studies, 43 percent of all immigrants that have been in the United States for at least 20 years are still on welfare.

#11 Back in 1965, only one out of every 50 Americans was on Medicaid.  Today, more than 70 million Americans are on Medicaid, and it is being projected that Obamacare will add 16 million more Americans to the Medicaid rolls.

#12 The number of Americans on Medicare is projected to grow from a little bit more than 50 million today to 73.2 million in 2025.

#13 Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years.  That comes to approximately $328,404 for each and every household in the United States.

#14 If the number of Americans enrolled in the Social Security disability program were gathered into a single state, it would be the 8th largest state in the entire country.

#15 In 1968, there were 51 full-time workers for every American on disability.  Today, there are just 13 full-time workers for every American on disability.

#16 It is being projected that the number of Americans on Social Security will rise from about 62 million today to more than 100 million in 25 years.

#17 Overall, the Social Security system is facing a 134 trillion dollar shortfall over the next 75 years.

#18 According to the most recent numbers from the U.S. Census Bureau, an all-time record 49.2 percent of all Americans are receiving benefits from at least one government program each month.  Back in 1983, less than a third of all Americans lived in a home that received direct monetary benefits from the federal government.

Many will read this and will assume that I am against helping the poor.  That is completely and totally not true.  There will always be people that are impoverished, and this happens for many reasons.  In many cases, people simply lack the capacity to take care of themselves.  It is a good thing to take care of such people, whether the money comes from public or private sources.  In every society, those that are the most vulnerable need to be looked after.

But it is a very troubling sign that the number of people on government assistance is now far, far greater than the number of people with full-time jobs.  This is not a sustainable situation.  The federal government is already drowning in debt, and yet more people become dependent on the government with each passing day.

The long-term solution is to get more Americans working or starting their own businesses, but the federal government continues to pursue policies that are absolutely killing the creation of jobs and the creation of small businesses in this country.  So our epidemic of government dependence is going to continue to get worse.

And many of these programs are absolutely riddled with fraud and corruption.  Just check out the following excerpt from a recent Natural News article

To understand the extent of this fraudulent waste, go no further than Dr. Salomon Melgen, a Florida ophthalmologist who raked in $20.8 million from Medicare in 2012 alone. Dr. Melgen isn’t the only one bathing in the fraud of this crony government program. Medicare dished out over $1 million to almost 4,000 doctors in 2012, according to the new data release analyzed by The Washington Post.

 

Jonathan Blum, principal deputy administrator for the Centers for Medicare and Medicaid Services, is calling on the public for help in identifying fraud. He says, “The program is funded by and large by taxpayer dollars. The public has a right to know what it is paying for. We know there is fraud in the system. We are asking for the public’s help to check, to find waste, and to find potential fraud.”

Instead of fixing their own problems, they want us to help them do it.

Just great.

And of course they always want more of our money to help fund these programs.  In fact, according to Americans for Tax Reform, Barack Obama has proposed 442 tax increases since entering the White House…

-79 tax increases for FY 2010
-52 tax increases for FY 2011
-47 tax increases for FY 2012
-34 tax increases for FY 2013
-137 tax increases for FY 2014
-93 tax increases for FY 2015

 

Perhaps not coincidentally, the Obama budget with the lowest number of proposed tax increases was released during an election year: In February 2012, Obama released his FY 2013 budget, with “only” 34 proposed tax increases. Once safely re-elected, Obama came back with a vengeance, proposing 137 tax increases, a personal record high for the 44th President.

The more we feed the monster, the larger and larger it grows.

And yet poverty is not decreasing.  In fact, the poverty rate has been at 15 percent or greater for three years in a row.  That is the first time that has happened in decades.

Barack Obama promised to “transform” America, and yet poverty and government dependence have just continued to grow during his presidency.

Not that anyone really believes anything that he has to say at this point.  In fact, one recent survey found that only 15 percent of Americans believe that Barack Obama always tells the truth and 37 percent believe that he lies “most of the time”…

A Fox News poll released Wednesday shows that six out of every ten Americans believes that President Barack Obama lies to the American people, at least some of the time. A plurality – 37% – say that he lies “most of the time,” while another 24% say he lies “some of the time.” Another 20% say he lies once in awhile, while only 15% say that he never lies.

So what do you think?

How To Predict an Economic Collapse -- Mark Skousen

Posted: 18 Apr 2014 12:10 PM PDT

Do you think the current economic recovery is sustainable or a collapse waiting to happen? Mark Skousen shares his views In his recently released book, A Viennese Waltz Down Wall Street, Mark Skousen explains what triggered 2008 financial crisis, why you should be wary of the artificial boom...

[[ This is a content summary only. Visit http://www.GoldSilverNewsBlog.com or http://www.newsbooze.com or http://www.figanews.com for full links, other content, and more! ]]

How to Predict an Economic Collapse

Posted: 18 Apr 2014 11:05 AM PDT

Well, I think you have to look at it in the context of how it all got started and you look back at the financial crisis of 2008, and the Austrian School would say that was inevitable. We may not have been prescient in picking the exact top or when it was gonna happen. Certain Austrian economists did do a good job of selecting.

And I talk about some of those people. The Austrian School, Mises and Hayek for example, predicted the 1929 crash and the Great Depression, and got quite a bit of notoriety as a result of that. And in 2008, a number of economists like Peter Shiff, who uses Austrian economics, or Harry Veryser, who has written a book recently – he’s an economist at the University of Detroit Mercy, who used some Austrian tools on the interest rates and money supply figures to figure out when the top was being reached – recognized that the government, the Federal Reserve in particular, but also the federal government encouraging excessive home ownership created an elixir, a combination that was – it blew up on us, to create this artificial boom, followed by collapse. So the Keynesians and the Monetarists, the standard neoclassical model was inject liquidity.

You have this collapse. Inject liquidity. Keep it from turning into a Great Depression. And they were successful in doing that, but it’s been a very slow recovery, and the – most of the new money that’s being created – see the Ludwig von Mises always said who gets the money first? You have this new money coming in, the easy money; where is it going?

And it appears it’s going into the stock market, and it’s creating this artificial boom in the recovery, and it’s largely going into the stock markets, gone into treasuries. It’s gone into gold and silver to some extent, although the last couple of years haven’t been very good on gold, but there has been a renewed interest in gold at these lower prices. So the Austrians are looking at that, saying this is an artificial bubble. You can play that bubble. I’ve been fully invested. But at some point, this market is going to top out and probably when interest rates rise sharply, this should be a critical factor as interest rates is something the Austrian School really looks at very closely.

We look at the money supply, which is what the Chicago School does. They have a fairly simple system. But the Austrian School has a little more sophisticated system, and we would argue, yes, it’s artificial; we’ve been playing that market, but at some point, we’ve got to use our stop orders. We’ve got to protect our profits, and we have to recognize that there could be another crash, another bear market sometime down in the future. I’m not predicting it any time right away. Yes, we’ve had a five-year recovery in the market. But until interest rates really spike, I just don’t think you’re going to see an end to it.

How to Invest in China’s Middle-Class Boom… on the Nasdaq

Posted: 18 Apr 2014 09:15 AM PDT

Dear Reader,

It was an abject failure.

In 2006, after conquering the US home improvement market, Home Depot (NYSE:HD) ventured into China to claim its share of the Chinese middle class’s exploding growth.

It bought 12 stores from local Chinese firm The Home Way, turned them into Home Depots, and waited for voracious middle-class consumers to swarm its aisles, just like they had in the US.

But they never came. By 2012, Home Depot had closed its last big box store in China and retreated with its tail between its legs.

The business merits of expanding to China seemed ironclad. Hundreds of millions of Chinese people were climbing into the middle class. Homeownership rose from virtually nil 15 years ago to 70% today. Who doesn’t like to personalize their brand-new digs?

What Home Depot’s management didn’t understand is that Chinese people aren’t do-it-yourself types. Almost no one in China owned their own home until recently, so furnishing a home was a new concept. They’d never done it before. They needed guidance.

Which is exactly why Ikea has been so successful there. The Swedish furniture giant arranges its stores into model rooms that showcase furniture combinations and color schemes. Chinese people love it because it helps them visualize how components fit together to make a complete room.

To a home improvement novice, that’s much more useful than the stacks of lumber and 47 varieties of faucets that Home Depot offers. Plus Ikea’s merchandise is easy to buy and put together. No caulk, molding, or power tools necessary. All you need are the instructions, an Allen wrench, and a few hours.

Having spent the last two months studying China’s booming smartphone market in search of an investment opportunity for The Casey Report, I appreciate that subtle cultural differences can make or break a company’s bid to transfer its business model to a foreign country. Every smartphone maker wants a piece of China’s huge pie, but the mighty international brands like Apple, Nokia, and LG are struggling to capture it. Tiny upstart Chinese manufacturers, with just a fraction of the resources but a huge advantage in local knowledge, are kicking their butts.

I’ll let Adam Crawford, Casey Research technology analyst, elaborate.

How to Invest in the Great Upgrade

Most people think the smartphone was an overnight success made possible by a sudden technological leap from Apple.

Not so. Eddie Cantor had it right 50 years ago when he said, “It takes 20 years to be an overnight success.”


Rise to Fame

Visionaries first conceptualized the smartphone way back in the 1970s. In the 1990s, that concept became reality when IBM released the Simon Personal Communicator: a cellphone that, in addition to its telephonic capability, could send and receive faxes and emails and featured a touchscreen display. Many consider the Simon the first commercial device that could legitimately be called a smartphone.

After Simon came a decade of rapid evolution. Smartphone functionality expanded to include video cameras, GPS features, and web browsing. Processing power, storage capacity, and battery life grew geometrically to accommodate the added functionality.

Meanwhile, the telecoms were doing their part to coax the smartphone caterpillar out of its cocoon. In 2001, they launched 3G networks that achieved data-transfer speeds four times that of 2G networks. Suddenly, media streaming and/or downloading from the web became practical mobile functions.

Finally in 2007, Steve Jobs and Apple—acting more like Great Synthesizers than Great Innovators—integrated all these converging elements into the iPhone. Then Apple added two important things to the mix…

  1. A unique talent for designing intuitive, user-friendly devices, and
  2. A robust ecosystem with thousands of apps.

Boom. The smartphone butterfly emerged and took flight. The sales trajectory has been astounding…

After seven years of sustained and explosive growth, is the smartphone market reaching saturation?

Not even close. Smartphones are ubiquitous in the US and Western Europe, but that’s not the case everywhere. Old-fashioned feature phones still dominate in many emerging countries. But as incomes rise and smartphone prices fall, legions of consumers will upgrade from feature phones to smartphones.

Indeed, the great upgrade is already under way. In China alone, almost 300 people will purchase smartphones in 2014.

The smartphone megaboom is far from over—it’s just moved to the East... and has a much different look than in the West.


Commodity Boom

Price is paramount in emerging markets, including the biggest emerging market of them all… China. Lower- to middle-class Chinese can only afford to pay about $150 for a handset. 35% of smartphones sold in China are priced below $150, and almost 60% are priced below $330…

Companies are desperate to capture this huge and growing piece of the low-end pie, and so they’re rolling out new, cheap smartphones every month.

That’s great news for consumers. But here’s the rub: in order to hit low price points, handset manufacturers are stripping out features that differentiate their products. Low-end smartphones are essentially becoming commodities.

That opens the field up to a slew of competitors. There are literally hundreds of small handset manufacturers in China trying to undercut each other for a piece of this lucrative market.


How to Invest

Handset manufacturers and proprietary chip makers are not the way to play the Great Upgrade. For handset manufacturers, competition is simply too fierce—margins, if they exist at all, will be razor thin. And brand loyalty will be almost impossible to achieve.

The same goes for proprietary chip makers—there’s simply no demand for their products in low-end devices. Such are the problems in a commodity-based market.

Fortunately, the clever minds at The Casey Report have discovered a way to play this trend. It’s a “picks and shovels” company that supplies Chinese smartphone manufacturers with a trendy, ever-expanding software product that they wouldn’t be able to do without—and it’s beating the competition by having formed strategic alliances with China’s top three wireless service providers.

What we love most about this pick is that this is one of the few companies (if not the only one) in this massive market that is nearly certain to profit from the smartphone megatrend. Let the handset manufacturers cannibalize each other—this company will cash in by selling them its services, regardless of who ultimately wins the smartphone wars.

We expect to double our money on this one within the next two years. But best of all, this stock trades on the Nasdaq—that means no dealing with foreign stock exchanges, no complicated transactions. You can profit from China’s middle-class boom and the “Great Upgrade” with just a few mouse clicks.

You can find the full investment story, including a comprehensive analysis of the Chinese smartphone market, in the newest edition of The Casey Report.

Dan again. Note that today is the last day to take advantage of our special offer—get The Casey Report for just $298, (a 15% savings) plus receive our special report Going Global 2014 for free.

Usually we sell this book-length report for $99, and I think it’s worth every penny. If you’ve ever thought of internationalizing your assets (and maybe yourself), Going Global 2014 is an absolute must-read. Put together by our top experts, it shows you strategies to get your money to safety—from very simple steps to more complex plans.

As always, you have 90 days to test-drive The Casey Report. If you decide it’s not for you, no problem—just let us know within that time and receive a full and prompt refund. Click here to learn more, or go directly to the order form to get started right now.

Next up is Doug French, with an unglamorous but lucrative investment idea that you’ve probably never considered.


Betting on a Poorer America

By Doug French

Here at Casey Research, we believe what Doug Casey calls the “Greater Depression” is coming, and that it will be here sooner rather than later.

Americans will get poorer. Not that they’re doing so hot right now:

  • Baby boomers, 10,000 of whom turn 60 every day, have saved nothing.
  • Pension plans are broke, and the average 401(k) balance is just $84,300.
  • 46.5 million Americans are on food stamps.

That all adds up to a bull market in low-cost housing, especially for retirees on fixed incomes and the working poor. Such housing exists, but is in short supply.

Granted, this is not a glamorous sector. But it has the ingredients for investment success—growing demand and restricted supply. Some of the best-known and richest investors in the US already have huge investments in trailer parks.

You might be scared to enter one of these developments. Don’t be. Go ahead and drive through a mobile home park near you. Get comfortable. It might be the investing opportunity you’ve been looking for.


Falling Supply, Plenty of Demand

Mobile homes are universally hated—except by people who actually live in and own them.

There are 8.6 million mobile homes in the US, and 12 million people live in them. “That number is not likely to grow,” writes Gary Rivlin for the New York Times Magazine. “We learned in Southern California, given restrictive zoning laws and the prohibitive cost of building a new park in the boonies, meaning supply is static even as demand for cheap places to live is high.”

“Since peaking at 374,000 units in 1998, manufactured home placements have fallen by nearly 90 percent,” Fannie Mae Housing Insights reported in June of last year. “During the last four years, manufactured housing placements have averaged 51,000 units per year, one quarter of average annual production during the last three decades.”

New parks are scarce no matter where you look. Planning boards and city councils are shy to approve land use for them. They’re ugly and have a bad reputation for squalor and attracting police activity. No one wants to stick their neck out for more of that.

A bank I worked for in Las Vegas financed the construction of a new park, but that was back in the late 1980s. The town has quadrupled in population since, and I never heard of another new park in the area. But I did see a number of parks bulldozed to make way for more houses, when residential land prices increased tenfold.

In talking to a couple of my appraiser contacts recently, one said he hadn’t appraised a park in eight years, and the other said he couldn’t remember the last time he appraised a park, but it was at least five years ago.


Like Being Chained to a Booth at Waffle House

Unlike apartment projects, where only a security deposit and maybe first and last month’s rent prevent tenants from skipping out, rolling a trailer into or out of a space costs around $5,000. Also, many people own their coaches and don’t want to walk away from that equity. Once a coach is set, park owners have a paying tenant who isn’t likely to go anywhere, even if they bump rents up $10 or $20 a month each year.

The Nevada Legislature considers a mobile home park rent-control bill every two years, evidence that landlords aren’t shy about jacking up rents. Frank Rolfe, longtime park investor and teacher for Mobile Home University, says tenants get used to annual increases, just like they do with their cable bills. Rolfe has raised the rent in one particular park 30% in just three years. He quips, “We’re like a Waffle House where everyone is chained to the booths.”

With thousands of veterans going to college after WWII on the G.I. Bill, trailer parks appeared around college campuses all over the US to accommodate ex-soldiers looking for cheap housing. I reside in the college town of Auburn, Alabama, and trailer parks here are both numerous and in great demand.

A friend has lived in a park on the west side of town since 2006 when he enrolled at Auburn. His rent has risen from $175 to $255 since he moved in, and management just emailed him to say it’s upping his rent again. His rent will double each month if he doesn’t sign the new lease with higher rent. With Auburn University’s vet school just down the road, management can play hardball.

The good news is that my friend can sell his coach for what he paid for it anytime he wants.


Trailer Park Moguls

Sam Zell is known as the savviest real estate investor in the US. Nicknamed “the grave dancer,” Zell has bought all types of real estate low and sells most of it high.

But trailer parks? He hangs on to them.

Zell is chairman of Equity LifeStyle Properties, formerly known as Manufactured Home Communities, a company he took public in the early 1990s. The company is the mobile home industry’s largest landlord, with 370 communities containing close to 140,000 lots.

Zell said at a conference of Equity LifeStyle Properties Inc. in 2012, “We like the oligopoly nature of our business.”

Zell isn’t the only big shot in the mobile home industry. In 2003, the Oracle of Omaha himself, Warren Buffett, bought Clayton Homes, one of the country’s largest mobile home manufacturers, for $1.7 billion.

Buffett says the manufactured housing industry, from the production side, has “endured a veritable depression,” with no recovery apparent. According to Berkshire Hathaway, US manufactured housing sales were 49,789 in 2009, 50,046 in 2010, and 51,606 in 2011. That’s compared to 146,744 homes sold during the housing boom of 2005. But Clayton is still making money.

Private equity companies are also becoming interested in mobile home parks. Carlyle Group purchased two parks last October for a combined price of $31 million. Both are higher-end senior parks where tenants have to be 55 or older.


Not Sexy, But Profitable

Dan Weissman and David Shlachter wanted to own a business that wasn’t sexy but was fragmented. “The litmus test was if we told someone at a cocktail party what we do and their response was a grimace, we were on the right track,” Shlachter told Bloomberg. “It’s hairy, and it’s colorful, and it’s sometimes scary.”

For instance, two hours after they closed on the purchase of their second park, a SWAT team descended on the property in Indianapolis, looking for one of the park’s tenants who would eventually be charged with arson and murder.

The partners, both in their thirties, found small parks for sale around the country with deferred maintenance and vacancies. “When you stop maintaining anything, it goes bad,” Shlachter says. “When you stop maintaining a mobile home park, it goes real bad, real fast.” These are the kinds of situations where new owners can create value.

In one case, Weissman and Shlachter paid $485,000 for a park and invested another $250,000 toward improvements. This year they think they’ll earn $150,000 from the park, with the project only 40% full.

Mobile home park pros say buyers should look for parks with a master water meter, which means the current owner is paying for their tenants’ water. The first thing savvy new owners do is install meters for each trailer so renters can pay their own water bills.

Mr. Rolfe says investors should steer away from tenant-friendly states like California and New York, where it takes too much time and money to evict deadbeats. He won’t touch Las Vegas or Phoenix, believing distressed home prices are low enough to compete with parks. However, both housing markets have rebounded sharply and, I believe, will offer opportunities.

The guiding sales metric for real estate purchases is cap rate. A project generating $50,000 in annual net income changing hands for $500,000 equates to a 10% cap rate. Low interest rates have brought cap rates down, but Rolfe and Reynolds still look for 9% to 10% caps when they buy.

Lot rent should top out at half of what a decent two-bedroom apartment in a particular area goes for. However, the sweet spot for lot rent is $495 a month. Go over that and it “could mean death.” Nationwide, rents average about $390 per pad per month, according to real estate researcher JLT & Associates.

While Sam Zell’s parks offer swimming pools and clubhouses, Rolfe says, “We don’t like amenities of any kind.” Rolfe and his partner Dave Reynolds understand mobile home living is the last chance for many people, and he keeps expenses and rent as low as possible. If he buys a park with a swimming pool, he shuts it down to save on expenses and liability insurance. Laundry rooms and vending machines? Forget it. Rolfe and Reynolds fill vacant spaces with used trailers they can rent out cheaply.

Rolfe says he and his partner are making a “contrarian bet on a poorer America.” The bet is paying off handsomely so far, with annual returns of 25%. “By catering to those living on the economic margins,” writes the New York Times’ Rivlin about Rolfe and Reynolds, “their parks generated more than $30 million in revenue last year. More than half of that was profit.”

This is not coupon clipping. But if you’re interested in potentially great returns, a great place to start is MobileHomeParkStore, which has “for sale” park listings located all over the country: all shapes, sizes, cap rates, and price ranges.

Just remember: as the economy gets worse, this bet may go from contrary to expensive. Good luck and happy hunting in the trailerhood.

Poverty in America is almost sure to rise in the next few years, as the United States slides nearer to the brink of economic collapse. Don’t believe it could happen here? Watch our new documentary, Meltdown America. Using the harrowing stories of three survivors from Zimbabwe, Serbia, and Argentina, it shows how stealthily a major crisis can creep up on you—and why the US may well be the next domino to fall. If you haven’t yet, watch it here.


Friday Funnies

Subscriber Robert Lynn submitted the following short piece to our recently completed Casey Research storytelling contest. I thought his satirical and hilarious take on the erosion of personal responsibility fit best in the Friday Funnies. Take it away, Robert…


Sue Me

By Robert Lynn

I am going to be rich.

You see, people and companies are committing unconscionable acts, and they are going to pay dearly for them.

For instance, last week I was performing basic ballet moves on the top step of a ladder, and I fell. How could a company manufacture a hazardous product like this and not properly inform the consumer of the risks involved in dancing on it? Oh, sure, the ladder is covered with warning labels, and any idiot should know how to safely use a ladder, but they didn’t tell me not to do a pir

Former presidential aide acknowledges causes for gold price suppression

Posted: 18 Apr 2014 05:12 AM PDT

8:12a ET Friday, April 18, 2014

Dear Friend of GATA and Gold:

Philippa Malmgren, financial counselor to President George W. Bush, tells King World News today that it's easy for governments to influence the gold price, that they have motive to suppress it, and that governments that hold U.S. dollars and fear their devaluation have motive to accumulate gold to hedge their dollar exposure. Malmgren says she finds it "extraordinary" that countries seeking to hedge their dollar exposure "can increase their holdings of gold so dramatically and yet the price goes down." Her comments are posted at the King World News blog here:

http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2014/4/18_Fo...

CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.



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Join GATA here:

Porter Stansberry Natural Resources Conference
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From Monroe to the Bush-Obama Doctrines, American KARMA is Long Overdue

Posted: 18 Apr 2014 03:04 AM PDT

I wait for the first domino to fall on Empire. Will it be a bond collapse? Another total market meltdown? A right-wing/NRA/neo-Confederate fight to the finish against "central government" (Washington) and subsequent martial law? A cathartic race war in New York or Chicago or Detroit or LA against police violence, corrupt politicians, angry white men, phony liberals and decades of exploitation by the middle and upper classes who salute themselves for electing the first African-American president while continuing to institutionalize racism and poverty?

Silver Conspiracy Fact Versus Conspiracy Theory

Posted: 18 Apr 2014 12:45 AM PDT

“The few who understand the system will either be so interested from its profits, or so dependent on its favors that there will be no opposition from that class.” -Rothschild Brothers of London, 1863 The mainstream is on an academically-driven mission to politicize conspiracy theories and lump them all into the same category. While gold and silver manipulation is an ancient conspiracy fact, eyes are wide shut to the general awareness in the face of one revelation after another.

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