InvestMacro FX

In trading on Wednesday, semiconductors shares were relative leaders, up on the day by about 0.6%. Leading the group were shares of Nxp Semiconductors NV (NXPI), up about 7% and shares of Tower Semiconductor Limited (TSEM) up about 4.8% on the day.

Alaska could become the eight-largest oil producer in the world, and these oil companies are gearing up to profit from it.

It’s one for the record books…

But hardly anyone is talking about it… yet.

According to the U.S. Geological Survey, Alaska’s North Slope shale formation could hold as much as 80 trillion cubic feet of natural gas and two billion barrels of crude oil.

BusinessWeek says it could be “the second-largest U.S. deposit of unconventional crude after the Bakken in North Dakota and… the fourth-largest gas-shale deposit after Marcellus in the Northeast, Haynesville in Texas and Louisiana, and the Eagle Ford…”

By itself, this is already a major discovery. But here’s where things get really interesting…

The USGS is only talking about onshore oil and gas potential.

Royal Dutch Shell (NYSE: RDSA) released its own statement pointing out Alaska’s offshore oil and gas estimates.

Alaska’s Outer Continental Shelf

Shell executive David Lawrence revealed to Rigzone.com last week, “When you look at offshore, you’re looking at 25 billion barrels of oil [and] 120 trillion cubic feet of gas, so it’s a major resource that can compete in any arena we look at globally.”

In fact, Alaska’s Outer Continental Shelf (OCS) alone may hold more oil than the Pacific and Atlantic OCS combined.

And CNS News reports, “A new study says drilling on Alaska’s Outer Continental Shelf (OCS) could make Alaska the eighth-largest oil resource province in the world – ahead of Nigeria, Libya, Russia and Norway.”

The state’s 200 trillion cubic feet of potential offshore natural gas, while less than the Marcellus and Haynesville shale formations, is still a major find.

Quietly, Exxon Mobil (NYSE: XOM), ConocoPhillips (NYSE: COP) and many other major players from around the world are gearing up to drill.

Shell has already spent over $4 billion researching Alaska’s OCS over the past several years. And it hasn’t even started drilling yet. It won’t likely begin until July.

And here’s the best part…

Easy Drilling Makes for Safer Drilling

The Wall Street Journal reports Lawrence also mentioned, “…drilling in the Alaskan Arctic is ‘relatively easy’ because it’s done in relatively shallow waters and under relative low pressure and Shell already knows a lot about the region’s geology.”

The easier it is to drill, the safer it is, and the more likely it is for oil and gas companies to turn a huge profit.

It’s also worth mentioning the Trans-Alaska oil pipeline already runs from the Alaska North Slope region and is fully operational.

On the other hand, TransCanada (NYSE: TRP) and Exxon still need to secure a natural gas pipeline that will run from Prudhoe Bay to the United States and then later split to Canada. This project likely won’t be complete until 2018 and is expected to cost as much as $26 billion.

President Obama, the state of Alaska, and the U.S. Department of the Interior are all fully supportive of this energy initiative. And despite potential risks and challenges, this opportunity is simply too important for the United States to pass up.

We’ll definitely be talking more about this development in Investment U as it unfolds. So just be sure to keep checking your inbox for potential opportunities.

Good Investing,

Mike Kapsch

Article by Investment U

By CountingPips

The EUR/CHF came alive this morning and trades at its highest level in over month. This pair has been more or less dormant for the last month as the Swiss National Bank (SNB) has vowed to keep the pair above 1.20 to stem too much strength in the franc (hurting Swiss exports). The EUR/CHF continued to stall just above the 1.20 level lately as traders have anticipated intervention by the Swiss Bank.

Although today’s bullish action is very unlikely due to SNB buying, it will be interesting to see if the move will be sustained and present higher levels into play or will be beaten back down and perhaps testing the SNB’s resolve in keeping the pair above 1.20.

EUR/CHF – Breaking out of its recent range on the 4-hour chart

Urban Outfitters (NASDAQ:URBN) who reported earnings after bell yesterday saw shares fall in premarket trading this morning.The company reported Q4 EPS of $0.27 and revenues of $731 million, missing by $10 million.Urban Outfitters (NASDAQ:URBN) has potential upside of 4.2% based on a current price of $28.11 and an average consensus analyst price target of $29.3.Urban Outfitters is currently above its 50-day moving average (MA) of $27.46 and above its 200-day of $27.32.In the last five trading sessions, the 50-day MA has climbed 0.38% while the 200-day MA has remained constant.Urban Outfitters, Inc. operates retail stores and direct response, including a catalog and Web sites. The Company’s Urban Outfitters and Anthropologie retail concepts sell fashion apparel, accessories, and household and gift merchandise. Urban also designs and markets young women’s casual wear which it provides to the Company’s retail operations and sells to retailers worldwide.

Dividend aristocrats allow investors to harness compounding returns of both capital gains and continually increasing dividends.

I couldn’t believe the returns I was seeing. Could investors really generate this much money by using this strategy?

I emailed Wall Street Daily’s Matt Weinschenk, my go-to guy when I have questions about quantitative or mathematical issues. “Can you check these numbers? They seem a bit high to me,” I wrote.

I was using a financial model on an Excel spreadsheet to figure out a way that investors could generate double-digit yields and returns over the long term. The theoretical returns that the model said were possible were enough to satisfy nearly any investor.

A short time later, Matt emailed me back. “Yes, these numbers are accurate. And they’re not just theoretical. Check out the attached.” Matt was referring to a screen shot he attached to the email that showed some startling figures.

Using this strategy, an investment in Southern Company (NYSE: SO) 10 years ago had an average annual return of 11.4%. That compares to the S&P 500, which only rose 9.5% over the entire decade.

If you go back 20 years, the returns were even more impressive. A $10,000 purchase of Colgate-Palmolive (NYSE: CL) grew to $102,190 – a return of over 900%.

It’s why I call this investment methodology “The Only Investing Strategy You’ll Ever Need to Become a Millionaire (or Stay One).” It’s the topic of my presentation next week at the Investment U 14^th Annual Conference in San Diego.

One thing you’ll notice about the two stocks mentioned so far, they’re not exactly exciting names. You won’t find them on anyone’s hot lists or must-buys for 2012. Yet these companies and others like them outperform the market year after year, decade after decade, because they have one thing in common: They pay dividends and raise them every year.

I looked at hundreds of stocks. Most of them are what you’d consider boring companies. Companies such as Coca-Cola (NYSE: KO) and McDonald’s (NYSE: MCD) – they all produced stunning results when you invest over many years. And if you reinvest the dividend over those years, look out, your returns really get amplified.

That’s because of the power of compounding. When you reinvest your dividends, you buy more shares, which spin off more income, enabling you to buy more shares, which spin off more income…

“The Most Powerful Force in the Universe”

Albert Einstein said that compound interest is “the most powerful force in the universe.”  Whether we’re talking about interest or dividends, it’s obvious that compounding really picks up momentum after several years.

For example, let’s look at Kimberly-Clark (NYSE: KMB) – another stock that isn’t going to get anyone’s adrenalin pumping. I mean, you can only get so excited about Huggies, Kleenex and Scott paper towels.

But Kimberly-Clark pays a healthy 4.1% dividend yield, or $2.96 per share. If you bought $10,000 worth of stock, reinvested the dividends, and the dividend grew 9% per year like it has for the past 10 years, in 2022 your stock would yield nearly 14% on your original investment. Instead of $416 in income that you receive the first year, you’d get paid $1,388.

And if you could keep on reinvesting the dividends, the compounding machine kicks into overdrive the longer it goes. In 15 years, you’d receive $2,900 per year in dividends, or a 29% yield on your original cost. And in 20 years, $6,482 for a ridiculous 65% yield. So you’d make your original investment back every 18 months at that point.

These numbers assume the stock price rises 5% per year.

I call these kinds of stocks Perpetual Dividend Raisers – and will be talking about my specific strategy for how to invest in Perpetual Dividend Raisers at the conference in two weeks… It will be the first time I’m revealing this strategy to the general public.

But even if you need income today and won’t be reinvesting dividends, Perpetual Dividend Raisers can ensure that you stay ahead of inflation by receiving more income every year from the same stocks.

The best part is that these stocks tend to have lower volatility, and can even be safer than the broad market. And certainly more so than any hot stocks you may have been chasing to try to boost up your portfolio.

Don’t Trust Wall Street

I believe so strongly in this method of investing that I’m setting up my kids in Perpetual Dividend Raisers.

I’m no longer trusting their college educations to Wall Street professionals like mutual fund managers. Last year 84% of stock mutual funds underperformed the market, according to Standard & Poor’s. Over the past 10 years, more than half of all stock funds didn’t perform as well as the overall market.

So why would I trust my kids’ money to people with an established track record of underperformance, when I can instead invest in stocks and a strategy with a long history of producing strong returns?

For decades, dividend paying stocks have outperformed the general market. Perpetual Dividend Raisers even more so. And when you reinvest the dividends, the total returns compete with and in most cases far outpace nearly all Wall Street pros.

Good Investing,

Marc Lichtenfeld

P.S. Marc will be making his presentation, “The Only Investing Strategy You’ll Ever Need to Become a Millionaire (or Stay One),” in a closed-door meeting next week at an undisclosed San Diego resort.

There are no more seats available, but you can still gain access to Marc’s presentation along with an absolute wealth of investment ideas and strategies from our experts. To find out how you can access this event from almost any location, click here.

Article by Investment U

London Gold Market Report
from Ben Traynor
BullionVault
Wednesday 14 March 2012, 09:15 EDT

WHOLESALE MARKET gold prices dropped to their lowest level in 8-weeks, hitting $1641 an ounce shortly after US markets opened on Wednesday – 4.4% down on the week so far.

Stock markets gained while US Treasury bonds fell, following yesterday’s news that US Federal Reserve policy will remain unchanged this month.

The Dollar meantime added to recent gains, with the US Dollar Index – which measures the Dollar’s strength against a basket of major currencies – hitting its highest level in nearly 8 weeks on Wednesday.

Silver prices dropped to $32.77 per ounce as the US opened – just above last week’s low – while other industrial commodity prices also ticked lower.

As well as hitting their lowest level since January, gold prices also fell back through their 200-day moving average, which by PM London Fix prices was $1677 on Tuesday.

“Gold remains vulnerable to the downside,” says the latest technical analysis from bullion bank Scotia Mocatta.

The Federal Open Market Committee voted Tuesday by a majority of nine to one in favor of holding its main policy interest rate at 0.25%. Yesterday’s FOMC statement also noted that the Fed “expects moderate growth over coming quarters”.

“Knowing how dovish the Fed – especially [chairman Ben] Bernanke – is, for him to say we’re seeing growth is surprising,” says Ole Hansen, senior manager at Saxo Bank.

“Removal of [a potential increase in] quantitative easing and a higher rates forecast is not good for gold in the near term.”

The Fed also published the results of its annual bank stress tests yesterday, two days ahead of schedule. Based on the tests, the Fed says that 15 of the 19 banks tested would maintain their capital levels above the regulatory minimum of 5% of risk-weighted assets in an extreme scenario; specifically a rise in the unemployment rate to 13%, a 50% fall in stock prices and a 21% fall in house prices.

JPMorgan Chase, one of the 15 banks that passed the test, yesterday announced it is increasing the dividend it pays to stockholders by 20%. Shares in the bank gained 7% in US trading.

US stock markets rallied, with the S&P 500 hitting its highest level in four years, while the Dow hit levels not seen since late 2007.

“The froth is leaving gold to go into stocks,” one precious metals trader told newswire Reuters this morning.

“[Investors] see an opportunity there due to a slight improvement in the data. It’s not over yet, but overall sentiment seems to be turning.”

Britain’s chancellor George Osborne, who makes his latest Budget speech next Wednesday, is expected to ask the Debt Management Office to explore the possibility of offering 100-Year Gilts, which would potentially lock in prevailing low interest rates. Osborne is also expected to moot the possibility of so-called ‘perpetual gilts’, UK government bonds that have no maturity date.

Perpetuals were “first used in the wake of the 1720 South Sea Bubble crisis, to allow the government to borrow for as long as possible at record low rates”, newswire Bloomberg reports.

The longest-dated bond issued by the DMO during financial year 2011-12 was a 50-Year index-linked gilt. Britain tried issuing perpertuals to deal with its debt following the Second World War, though FT Alphaville reports that the so-called Dalton Bonds, named after the chancellor at the time, “flopped”.

“The political winds in countries with central banks are a long way from blowing in the direction of fiscal rectitude,” says today’s commentary from Societe Generale strategist Dylan Grice.

Grice contrasts countries like the UK and US with those like Ireland, which gave up its monetary sovereignty to join the Euro and which, he argues, has experienced a sufficiently severe crisis for people to accept the need for “draconian fiscal policies”.

Grice, who last year made a case for gold at $10,000 an ounce, goes on to argue that the time to sell gold will be when “majority opinion [accepts] the painful contractionary medicine”.

Elsewhere in Europe, Greece’s €130 billion second bailout was formally approved today.

Ben Traynor
BullionVault

Gold value calculator   |   Buy gold online at live prices

Editor of Gold News, the analysis and investment research site from world-leading gold ownership service BullionVault, Ben Traynor was formerly editor of the Fleet Street Letter, the UK’s longest-running investment letter. A Cambridge economics graduate, he is a professional writer and editor with a specialist interest in monetary economics.

(c) BullionVault 2011

Please Note: This article is to inform your thinking, not lead it. Only you can decide the best place for your money, and any decision you make will put your money at risk. Information or data included here may have already been overtaken by events – and must be verified elsewhere – should you choose to act on it.

By TraderVox.com

Tradervox (Dublin) – After the FOMC announced its decision on Tuesday, it dampened the prospects of another round of bond purchases causes the dollar to rise against the south pacific currencies. However, this has not been the case with the yen. BOJ Governor commented that the plan for more asset purchases was still on the table. This caused the yen to depreciate against the south pacific currencies. The Australian dollar was at 10-month high against the yen as commodity prices boosted prospects for the export industry.

The New Zealand dollar was at 7-month high against the yen as Asian stocks offered support for riskier assets. However, the two south pacific dollars were not strong enough to reverse their losses against the US dollar. After the FOMC decision the greenback rose against both currencies. Investors have interpreted the decision to mean that the Fed is reluctant to go ahead with the next round of quantitative easing.

Adam Carr a Senior Economist in Sydney indicated that the rebound in commodity prices may keep the Australian dollar stronger against the yen. On the Kiwi, Carr said that positive global economic data and increase in commodities prices may make kiwi stronger against the yen. He added that the New Zealand dollar may even increase on the sentiments alone.

In the Sydney trading session, the Australian dollar rose by 0.2 percent against the yen to settle at 87.71 yen. The increase comes after the comments by the BOJ governor on the possibility of another QE. The Aussie had increased to 88.01 yen on March 2 the highest it has been since May 11. The New Zealand dollar traded at 68.28 yen yesterday but edged a little to 68.26 yen today maintaining its 1.5 percent increase from yesterday. Both south pacific dollars reduced against the dollar with Aussie declining by 0.1 percent to trade at $1.0544 while the kiwi declined by 0.3 percent to trade at 82.06 US cents.

Disclaimer
Tradervox.com is not giving advice nor is qualified or licensed to provide financial advice. You must seek guidance from your personal advisors before acting on this information. While we try to ensure that all of the information provided on this website is kept up-to-date and accurate we accept no responsibility for any use made of the information provided. Opinions expressed at Tradervox.com are those of the individual authors and do not necessarily represent the opinion of Tradervox.com or its management. 

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Good Afternoon, You are watching the financial news network online, I am Ian Temple.Today and Precious MetalsWhat to Expect, and How To ProtectWith the Dow Jones getting bashful about the number thirteen-thousand while the fed pumps money like there’s no tomorrow, it’s only natural to wonder, ‘what am I supposed to do?’ It’s times like this that test our Metal.But is it Gold, or Silver? Silver tends to fare better in the early stages of an inflationary boom because it trades as an industrial metal more than it does as a precious metal, and as such will be strongly in demand.However—it’s a good deal more volatile, so take your Dramamine with your shares of SLV if you get motion sickness.Gold is a bit more stable—some folks even suggest that the price of Gold doesn’t move at all—merely the price of everything else moves around it. That may be giving our little yellow friend a little too much credit, but Gold without a doubt fares better during periods of high inflation than your 2-percent government savings bonds ever will. And with a decreased industrial demand, Silver will take a hit.Now if things get bad—and I mean REAL bad– Silver’s gonna outperform Gold heavily. Why? Because the value of Gold is impractically high. You or I could never exchange an ounce of Gold for a bag of groceries. Not inless you’re Jabba the Hutt, anyways… But with Silver which trades around thirty dollars an ounce, in today’s dollars, you could. And with more and more middle class people looking to ride out the inflationary storm, Silver just may be the only game in town.You are watching the financial news network online. For more updates, stay tuned, I’m Ian Temple.

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