So, let’s look at techniques you can utilize to speculate in the resource exploration sector to  make unfathomable profits.

The vast majority of exploration companies are hazardous to your financial health. The key is to select only the finest companies. And in this sector, that means starting with the most talented and experienced management that are working on highly promising projects.

Your company must also be able to weather most any storm that comes its way. If I’m certain that a resource stock has the required long-term staying power I will put it in the “buy and accumulate” category.  That means I take an initial position, and then happily purchase more shares on any subsequent price weakness that has nothing to do with the company’s overall fundamentals. This is how you make volatility your friend.

You see, resource companies frequently sell off en masse. Healthy babies are routinely thrown out with the bath water. Let’s look at a stock called Impact Silver (AMEX:IPT) that is in the portfolio of my Resource Windfall Speculator service:

In this portfolio, we select stocks that relate to specific commodities that are in long term bull markets. Silver certainly qualifies on that count and we hold six total silver stocks in the portfolio right now.

To tell you the truth, Impact did not appear overpriced at the $1.50 Canadian range in early 2008. However, the global financial crash altered that perception — even though silver performed just fine last year. In fact, silver was up in 2008 and has been up nearly every year this decade. Impact silver has a 52 week high of $0.88 Canadian and a 52 week low of $0.175. How’s that for volatility?

Impact Silver has remained a buy for all of this time, because the company’s fundamentals were just fine. Their silver production and successful exploration remained on track. While the price fluctuated enormously, the value remained intact.

Again, we identify long-term value and take advantage of short-term price weaknesses when it is illogical. Anyone who had the courage to buy Impact Silver near $0.175 Canadian is pretty happy right now with its $.77 share price. That’s a 340% gain. They’ll be even happier when the company far surpasses its previous highs.

Yes, those who bought IPT near $1.50 still have some catching up to do. But that’s okay. If you want to speculate, you must be able to absorb some losses without sacrificing excessive sleep.

Another stock I personally own, Salazar Resources, has a 52 week low of $.12 Canadian and is now trading near $.80. Stock appreciations over the last eight months of 100 – 200% gains are commonplace.

The primary point is that bottom feeders can make astounding profits. We’re staring at another extreme opportunity in the coming weeks for rescuing babies from bath water.

•    Resource stocks are typically weak in late summer because the most influential players are on vacation.
•    Gold and silver get official spankings via government management with predictable regularity.
•    Resource stocks tend to sell off with the overall stock market, which now looks exceedingly vulnerable.

I’m convinced that $1,200 gold and $20 plus silver will soon be the floors under these precious metals. There will be few screaming bargains when these factors are in place. In the mean time we are probably heading for another bout of overall sector weakness that has next to nothing to do with individual company fundamentals. A banquet for bottom feeders is always a special occasion and we will be loading up in my advisory.

Are you hungry?

Invest Resourcefully,

Rusty

Source: A Banquet for Bottom Feeders

Small cap resource stocks have been absolutely trashed over the last 12 months. Many companies are running out of cash as well as credit and some are closing their doors. It’s Darwinism at its’ finest. The strongest companies, those with world-class management, strong balance sheets, and access to capital will survive and prosper. Those with little cash on hand, shaky prospects, and inexperienced management will disappear.  And now is the time to take positions in the most promising leaders who are positioned to directly benefit from the ongoing financial chaos.

A merger and acquisition mania is now underway. Take a quick look at some recent announcements:

• Canadian Gold Hunter (CGH:Toronto) is taking over Sanu Gold (SNU:Toronto).
• ATW Gold (ATW:Toronto) is merging with Kinbauri Gold (KNB:Toronto).
• New Gold (NGD:US) is combining their business with Western Goldfields (WGW:AMEX).
• IMA Exploration (IMR:AMEX), Kobex Resources (KBX:Toronto) and International Barytex (IBX:Toronto) are working on a merger.
• Linear Gold (LRR:Toronto) recently acquired GLR Resources (GLR:Toronto) Goldfields Project.
• Geoinformatics Exploration (GXL:toronto) is acquiring Rimfire Minerals (RFM:Toronto).

This is just for starters. The primary point I’m making is that M & A activity is on a massive upswing. This is rapidly changing the complexion of the sector and creating fabulous opportunities for investors.

This environment is ideal for selecting and riding the best run companies as the precious metal bull market continues to unfold. The companies leading the charge in this consolidation will emerge from this process stronger than ever. There are numerous advantages for shareholders:

• A superior management team typically results.
• Synergies are created.
• Overhead costs are lowered.
• The portfolio of properties and projects are increased which improves company diversification.
• More dollars are allocated for the most promising exploration targets.
• Larger companies attract the buying power of heavyweight financial institutions.

“Super Juniors” are being created. Companies with cash are marrying companies with exceptional projects in need of funding for advancement. Producers are gaining access to more reserves. Key technologies are being shared. These are clearly win-win situations.

We have long been acquiring the companies acting as resource consolidators in my Resource Windfall Speculator advisory. They are snapping up distressed bargains across the globe. Cash and connections are tough to beat these days.

Yes, size does matter. So does staying power. Personal fortunes will be made by savvy investors who now hitch their wagons to the talented and aggressive management teams constructing companies that will grow and dominate in the coming years and decades.

There is nothing quite like owning an un-expiring lottery ticket!

Source:  M & A: Resource Style

Our third President and signer of the Declaration of Independence, Thomas Jefferson, long ago stated …”Banking establishments are more dangerous than standing armies”.

He also declared …“If Americans ever allow banks to control the issue of their currency, first by inflation and then by deflation, the banks will deprive the people of all property until their children will wake up homeless.”

Hello.

A second American Revolution is now at least as necessary as the first one was though few citizens have an overall understanding of the problems we face. Anything short of a complete house cleaning will be mostly a waste of time and effort. The elitist banking entities running and ruining this country must be shown the highway. Nothing less will suffice!

Who exactly am I talking about? The Federal Reserve is exhibit one. Their partners in financial crime like Goldman Sachs (NYSE:GS), JP Morgan Chase (NYSE:JPM), et al absolutely must be excised like the cancer they are.

“Tea Parties” are once again on the horizon. Lots of citizens are awakening and protesting. How keen is their focus going to be?

Those that put the preponderance of blame on President Obama, ex-President Bush, the Liberals, the Conservatives, the Trial lawyers, the unions or any other distraction will never accomplish anything worthwhile. The rot is deep, systemic and centered on money and the banking system.

Those that demonize Republicans and worship Democrats, or vice versa, have been suckered into a divide and conquer plan. My expectation is to never again vote for a Republican or a Democrat in their present form. The Demopublicans must go.

The Fed is a serial bubble blower. Their funny money products initially line the pockets of their cronies closest to the trough. From there it is directed towards distorting prices in stocks, real estate or the latest manipulated craze. Economies without foundation inevitably collapse. Our central planners need to take an indefinite overseas vacation.

America’s biggest exports over the last decade have been toxic and fraudulent financial products. The creators of this crap are the ones who have brought us to the present disaster – yet they remain in charge of sweeping changes designed to perpetuate their power and imprison us.

All of these Wall Street entities and the lackey politicians who support them must hit the road. Those behind the scenes pulling the strings have to be stripped of their illicit power.

Surely you heard about Goldman Sachs’ record second-quarter earnings of $3.44 billion? Making money hand over fist comes fairly easy when you get to implement official policy. Records follow when front running is the name of the game. They may get their bonuses now but ours will be even larger when tar and feathers once again hold sway.

Congressman Ron Paul has sponsored a bill to audit and put congressional oversight on the Federal Reserve. 261 representatives have so far signed on to this meaningful element of true change. A similar Senate bill is just getting started. Knowledgeable citizens seriously doubt the Fed could withstand an audit because of its shady dealings. This is one bill that holds some promise.

The huge majority of US citizens are really peeved, justifiably so. That anger will certainly play out in the coming months and years. The tea parties could even spill into the streets. You can rest well assured that nothing will be accomplished without a purposeful and focused anger.

Concerned Americans have a critical choice. We can rid the system of all the parasites and malignancies or just stay home and continue to get our reality through television.

You know by now I’m also going to advise you to protect yourself and those you care about. The monetary metals, gold and silver, sniff out economic, financial and monetary chaos. They’ve had a massive snort lately and more is coming. These precious metals have appreciated nicely almost every year of this decade for good reason. They should still be purchased and the speculators amongst you may consider my Resource Windfall Speculator for leveraged gains in the resource sector.

Live Free and Resourcefully,

Rusty

Source: You Say You Want a Revolution?

It was a real mind blower for both of us to fathom the profound meaning of these disappearing earnings. Mr. Gordon (he is a tiny bit older than I am) subsequently e-mailed a confirming chart my way:

Turn Away if You Suffer from Vertigo

Please grab a sickness bag. While many investors follow the Dow, the S&P 500 provides the most accurate measure of the status of the overall US market. As Andy reported, S&P earnings have “nosedived from $80 to $7 – the biggest drop ever recorded.” Both Andy and I are putting an exclamation point on this pathetic event.

You, also, should be extremely wary. This chart indicates that the earnings on one of the world’s most important stock indices are pitiful and plummeting. Little wonder corporate insiders are selling their company stock en masse.

Without earnings stock prices are temporarily levitating. Earnings have gone up in smoke! Isn’t that the life you’ve personally experienced over the last year as budgets are reigned in and unemployment has become pervasive? The S&P index has traded sideways within a range for the past few weeks, but it is still extremely overbought.

Personally, I have been shorting the S&P, but it’s hard to glean any satisfaction from making money from this catastrophe. There is no reason to hold stocks without sufficient earnings. I continually claim we’ve long been in depression mode and this ugly chart screams the truth. A picture (chart) can be worth a thousand words.

What should you do about it? I’m afraid you’re going to have to escape the CNBC, Wall Street and nightly news cheerleaders. These are all inside the box players and you will never regain your lost wealth or become rich following these puppets.

It’s a major stretch to believe you can randomly buy the general market and make 10% per year, though that is a common misconception. Factor inflation into the equation and you clearly see the folly. Most investors will never regain their lost wealth from the 2008 historic carnage. Only those of you wise enough to seek unique and highly profitable investment earnings will become whole again. The opportunity for enviable riches is also present.

Your IDE pundits are, to a person outside the box, offering commentary and services designed to protect and enhance your wealth. You cannot buy general stocks with miniscule earnings and expect to do anything but lose more money. No earnings directly equates to no capital gains.

Nor can your portfolio sit idle as it will end up looking like the nasty graph you just inspected. Ninety nine percent of us must have income or capital gains especially in a hyperinflationary environment.

As you may know, I’m primarily a resource stock investor. I’m also utilizing the incredible IDE brain trust in all of my financial decision making processes. You should be as well. I like and have confidence in each of these experts. We offer a very diverse range of worthy services that are designed to enhance your profits and assist you in escaping the failing financial matrix.

Check them out and see which of us best fits your investment temperament. We cover the total investment spectrum from bonds, blue chip stocks, options and natural resource speculations. The S&P index is down approximately 4% year to date but the last 14 picks I recommended in my Resource Windfall Speculator are up an average of 44%. All of your IDE editors are dead serious about bringing heady profits your way.

You simply must find the right escape hatch out of this historic mess.

Invest Resourcefully,

Rusty

Source: Neither You or the Economy Can Survive Without Earnings

I wrote a silver article 4½ years ago entitled Silver: Anatomy of A CRIME(X). In that article I compared activities at the COMEX market to prior incidents at Long Term Capital Management, Enron and Arthur Anderson. I screamed from the rooftops that fraud and abuse had gone “metastatic”.

Bingo. Since early 2005 you’ve seen the cancer spread via Fannie (NYSE:FNM) and Freddie (NYSE:FRE), Bear Sterns, AIG, Lehman Brothers and others. Few people yet understand that the entire system is corrupt and failing. Band-Aids don’t fix train wrecks!

The present age of crooked markets really boil the blood!

You should expect CRIMEX to join the long list of failed and disgraced financial institutions. There are incredible strains on this market right now as month to month delivery battles transpire.

In the silver article from 2005 I stated … “I don’t believe that complaining, pleading, documenting, reasoning, letter writing or mounting campaigns with this particular institution will ever bring it back to what could legitimately be called an honest market. Sorry. They had every chance under the sun to do the right thing and clean up the mess.”

It will never be the SEC or the CFTC that cleans up CRIMEX. You can pen pal with these blokes forever and it will do little more good than scolding the mafia. The leopard doesn’t change its spots. There is a very realistic opportunity, however, to now end the decades of abuse by this market. It is happening as you read.

Large international players are now engaged in calling the bluff of this New York market. They have caught on to the scam and are totally peeved. COMEX silver is largely a “paper” exchange with only small amounts of physical metal being taken delivery of on an historic basis. That is now changing as more and more players insist on physical silver and gold instead of risky promises.

You have to be incredibly naïve or just plain dumb to trust these crony capitalists gone wild. It is just a matter of time until CRIMEX defaults or implodes. Gold and silver prices will soar when they are freed of the manipulation.

Why would anyone put money into a manipulated market? Good question. Manipulations against long term trends are pure folly. Take a look at how silver has performed over the last six years:

Silver was under containment in the $4 range early this decade but managed to hit a high over $20. Holding silver down near the current $14 area will be just as fruitless over time. Silver will either continue to grind higher or it will explode higher when the official suppression ends.

More and more people are using my CRIMEX moniker all the time. Make sure you have plenty of physical metal before this scathing term is in the national news

Sure, I’m irate over the ongoing silver manipulation but I’m also licking my chops for the inevitable profits coming our way because of the manipulation.

ETFs are only trading vehicles not a substitute for physical silver. Precious metal certificates are suspect at best. Get the real stuff and make sure you’re in position before CRIMEX cracks.

Invest Resourcefully,

Rusty

Source: The Silver Market: Some Call it CRIMEX

Many gold stocks are presently priced as though gold was a mere $500 due to the carnage. Excellent companies with proven and growing resources are being largely ignored. This represents nothing short of an opportunity to buy gold at a discount.

I’m not in the habit of making gold price projections but this is not the time to abstain. I expect gold to take out $1000 and touch $1200 per ounce this year. $1200 is “only” a 26% increase from the current price. That’s certainly attractive but nowhere near where the price is ultimately headed. Few have any idea how $1200 gold will play out in the small cap resource stocks.

As mentioned, there is presently a huge disparity between the gold price and gold stocks. A gold price well north of $1000 will bring so much attention to the sector that gold shares will, once again, show leverage to the price of gold. This is an opportunity you can count on.

Resource stocks were indiscriminately thrown away late last year as hedge funds and overleveraged players were caught in a liquidity vice. The bottom came around mid-October. You would be hard pressed to find another market sector that received anywhere near the damage of small cap resource stocks. The larger stocks have rebounded nicely since that time frame but they are just getting warmed up. Practically no one yet has any interest in the smaller gold exploration or development companies.

The resource market is set to change. Company fundamentals, higher gold prices and a return of speculative money to the markets will bring gold related companies back into focus. The downside risk is much better protected on all of these stocks that have been mindlessly trashed. The upside is better than ever.

The companies that survive this carnage are going to be the ones that will bring in gaudy profits in the coming years. This is exactly what happened ten years ago in the resource sector but there is one key difference … gold and silver prices are much higher now than earlier this decade and they are just getting warmed up!

Crisis always presents opportunity. We have been focusing primarily on larger gold stocks since last fall but my Resource Windfall Speculator also has numerous smaller companies. Their time will come again and I doubt it will be far off. Rest assured that $1200 gold will do the trick.

Any market that can give you 2X, 5X, 10X or even 100X on your money can also cut your account in half. That’s the nature of the beast. The best time to enter such a market is after capital has received a haircut. This is a very cyclical market.

Our opportunity is two fold. Many stocks have been thrashed. Gold and silver, the monetary metals, are at attractive prices now but are also ready for a rocket launch. This is as good as speculation gets. The market carnage of 2008 will be a distant memory at some point.

Yes, you should consider what $1200 gold and even much higher levels will bring our way. Resource stocks are supposed to be leveraged to their underlying commodities. That leverage has been missing for an extended period of time now but it will no doubt return. $1200 will be an absolute catalyst if this doesn’t transpire before then.

I hear a lot of pundits project significantly higher gold prices but somehow fail to project how this will play out in the exploration sector. There is no way that the greed factor will not kick in as gold leaves $1000 in the dust. Human nature has not changed. Small cap stocks will be a rage once more. Smart money has already taken up positions.

Our market is prone to official interventions. It is a “managed” market but there is extraordinary stress built up in it projecting to take it much higher over time. A managed market needn’t frighten you away. No market can be suppressed long term against its fundamentals. It’s a failed strategy. It’s also an unbelievable opportunity for those with the courage and understanding required.

Gold is under no more suppression now than it was at $250. The end results will be the same.

Why is $1200 gold in sight this year? The simple answer is that ongoing monetary events have baked this result into the cake. Almost all countries are eroding the value of their respective currencies through extremely high use of the printing press. Gold sniffs out monetary chaos.

We are now moving to a multi-polar world where currencies from other countries or regions will be used in international trade, thus bypassing the US Dollar. There is also a distinct possibility that gold and/or oil will be used to back currencies once again.

Debt levels are beyond the point they can be serviced on national, state and local levels. Defaults are inevitable. The problems are too big to be papered over. The feds can engineer bank earnings or even an impressive stock market rally. They can’t solve the deeper underlying structural problems by attempting to rescue their foolish and nonviable banking buddies.

Buying gold (and silver) for your back yard is strongly encouraged. You have to pay retail for that privilege. You can, however, still buy gold in the ground on the cheap through gold producers and explorers. The same holds true for numerous other resources that remain in a long term bull market.

One of the tiniest explorers in my Resource Windfall Speculator has documented one million ounces of gold on just one project in their vast portfolio. The entire company is valued at $7.18 million Canadian in the present market. They hold over $4 million in cash! You get a million ounces (and growing) of gold, exceptional management and a terrific portfolio of projects for a little over $3 million.

That’s a mere $3 or less for an ounce of gold through this company. Yes, much work needs to be done to bring this project into economic production but this is the type of anomaly found in the disparaged resource sector at the present time. This Scotsman loves a discount!

Buy Resourcefully,

Rusty

Source: You Can Buy Gold at a Discount

There are bigger fish being fried. The entire American nation is in the crosshairs and will be severely tested like never before.

Very few people comprehend the scope of the problems that continue to unfold. The Dow is up a couple of thousand points so everything must be normalizing, no?

No! Look deeper.

The US Hits the Treadmill

The core of our problems lies deep in the roots of the overall system.

• The US economic model has been extremely flawed for more than an entire generation. Our “money” holds no intrinsic value. We follow the consumption mantra instead of the production model. The good times come only when credit expands in bubblical proportions (don’t look that one up in Webster’s). Credit contractions, like the historical one we’re now in, threaten to implode the entire edifice. The Fed is the master of the boom and bust cycle and they have really overdone it this time.
• Low interest rates are damaging to the key individuals that can rescue us … savers. Save the savers!
• There are consequences to failed economics. Our central planners are a scant few decades following in the footsteps of the Ruskies. It is definitely not free market capitalism that is crumbling. Ignorance, greed and fraud are simply meeting their inevitable demise.

Results- The patient literally fell off the treadmill.

The Telling Electrocardiogram (ECG)

There are some really weird heart rhythms on this now intensive care patient.

• This decade has been one of depression only disguised by official lies and distortions (altered statistics). A sustained recession is, in fact, a depression. The sustained recession started in 2001, with a brief interlude in 2004 and I’m sticking with that opinion regardless of how few see it. Check out the GDP chart at www.shadowstats.com for yourself. Any analysis is only as good as the documentation used.
• The collateral foundation is crumbling out from under all American banks. Real estate continues to deflate and this directly impacts the viability of banks. Their ability to lend disappears with foreclosed homes and non-performing shopping centers. Home prices were down 14% during the first quarter of this year compared to the first quarter of 2008. At least 30% of US households owe more on their homes than they’re worth. Real estate has not bottomed.
• Joblessness goes hand in hand with real estate failures. The Labor Department just fessed up to a 9% unemployment rate. The rule of thumb is to roughly double the propaganda figures that come out of DC/NY. We’re heading next for 20% unemployment and all but the most gullible know it. More reliable reporting, again, comes out of the Shadow Stats website.
• American debts are way, way past the point of ever being repaid. They will be defaulted on. I won’t bore you with excessive numbers here because eyes tend to glaze over. Our economic leaders are throwing down multiple trillions of dollars in between shots of tequila. Practically none of this funding is aimed at Main Street. Recent “stimulus” spending and desperate promises come to $29 trillion per Bill Buckler of the esteemed Privateer.
• Tax receipts for fiscal 2008-2009 are down 31% for individuals and 58% for corporations. Meanwhile, government is vastly expanding its spending and a collision is inevitable.
• Foreigners are balking at purchasing more American debt and the Fed, in an end game strategy, has stepped into the gap. Don’t try this at home.

Results- There is a dangerous cardiac arrest in progress. One more test to go.

The Dreaded Proctologist

This test is the most revealing one of all. You will need more than a Valium just to review these results. The creatures that have brought us to this fateful moment show no signs of seeing daylight anytime soon.

• Failed entities should be purged from the system. Fraud requires punishment. Instead, incestuous entities like Freddie Mac, Fannie Mae, AIG, Goldman Sachs, JP Morgan and others were and are deemed too well connected to fail. A financial coup d’etat has transpired as Goldman Sachs refugees have overtly grabbed the ring of power. The banking elite continue to clutch their power.
• The shadow banking system that directly caused this American catastrophe continues to bring forth more and more derivatives. The BIS, the bankers’ bank in Switzerland, reports $684 trillion in these hidden, unregulated and dangerous instruments. Other sources report them as high as one quadrillion dollars. There’s a Zimbabwean number if there ever was one. There can be little doubt derivatives are continuing to fail behind the scenes, further compounding all these issues.
• The printing press is also found with this scoping exam and it’s obviously turned to malignant mode. How do you cure a problem caused by extreme amounts of credit and debt with unfathomable amounts of the same?
• No observed green objects resembled “shoots”.

Results- A massive surgical resection is mandated. Today.

Test Results and Prognosis

Grievously, this patient has abused its heart and lost its soul. It is unrecognizable from its original Constitutional form and very unlikely to revert back to it. It exhibits no free markets, no honest money and few brave and rational leaders. Short of a miracle, you’re looking at a terminal case.

The banks passed their stress test but you dare not rest easy. Al Capone would have given himself a glowing report card if given the opportunity. The times remain extremely precarious. Protect yourself by staying away from the Kool-Aid and heading for the precious metals.

Source: A National “Stress Test”

]]> http://www.contrarianprofits.com/articles/a-national-%e2%80%9cstress-test%e2%80%9d/17040/feed 0 http://www.contrarianprofits.com/articles/why-is-the-fed-bailing-out-foreigners/15759 http://www.contrarianprofits.com/articles/why-is-the-fed-bailing-out-foreigners/15759#comments Mon, 20 Apr 2009 17:45:44 +0000 Russell McDougal http://www.contrarianprofits.com/?p=15759 You may have noticed that most of my articles are pretty in depth and lengthy. A fellow IDE editor recently pointed that out and issued a challenge … “I bet you ten bucks you can’t write a one page essay.”

While no names will be mentioned I will soon document receipt of a $10 Federal Reserve Note (while it still holds value).

You know I write about the Fed a lot. They are at the epicenter of the American and global economic and monetary crisis. These same elitist powers now want to take their act world wide. The Fed’s 100-year reign has all but ruined this country. Only a second American Revolution that totally dismantles this monstrosity and strips away the…