Month: April 2012

Source: ForexYard

As the CHF/JPY fails to reach the 89.50 level, various indication for a bearish correction suggest that the bullish momentum might have reached its end.

• The chart below is the CHF/JPY 4-hour chart by ForexYard.

• The technical indicators used are the Bollinger Bands, the Slow Stochastic, the MACDOsMA and the Relative Strength Index (RSI). The Fibonacci Retracement lines are used as well.

• A continuous of bearish crosses on the Slow Stochastic suggests that the bullish trend is losing steam.

• A bearish cross on the MACD indicates that a bearish correction is about to appear on the chart.

• The RSI has picked at the over-bought zone and has now dropped below the 70 line, stating that a bearish reversal should be in place.

• The Fibonacci Retracement lines show that the pair failed to reach the 89.50 resistant level, and is now range-trading around the 89.00 level.

• It seems that if the pair will drop below the 88.80 level (i.e. drop below the 76.4% line), it might validate the bearish correction, with the potential to reach the 88.00 level).

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By TraderVox.com

Tradervox.com (Dublin) – The Reserve Bank of Australia is expected to leave the rates unchanged at its next meeting. The bank had reduced the interest rate in November and December but still remains the highest interest rate among the developed nations. However, according to Credit Suisse Group AG Index, traders are expecting a 0.74 percent cut on overnight swap rate. 

The speculation about the interest rate remaining unchanged and the favorable factory data from US have led to an increase in the value of the Australian dollar ahead of the meeting. The Aussie gained against most major currencies. The Australian dollar registered its highest intraday rise against the dollar after the US factory data reported and expansion from 52.4 in February to 53.4 in March. This is a higher than expected expansion as most analysts were expecting an expansion to 53. The New Zealand dollar also rose against the US dollar after the US manufacturing data was released.

The Australian dollar rose by 0.7 percent to exchange at $1.0419 from its opening day trading level of $1.0418. The Aussie registered an increase of about 1.2 percent against the greenback yesterday, which is the highest intraday increase since January 25. The other south pacific dollar –the Kiwi, was gaining against the greenback adding 0.6 percent to sell at 82.34 US cents.

There is a discrepancy in the expectation of traders and analysts on whether the RBA will hold its interest rate or it is going to reduce it. Most analysts are saying that the RBA meeting will resolve to hold the interest rates while a survey on traders’ sentiments indicate that they expect the RBA to reduce the interest rate by 74 basis points.

The Australian dollar is almost to six months low against the New Zealand dollar as traders expect the result of the RBA meeting today. The Australian dollar fell by 0.1 percent against the kiwi to exchange at NZ$1.2641 at early trading in Sydney. The Aussie was weakened against the yen by 0.3 percent to trade at 85.30 yen. The Aussie has also continued with its advance against the greenback adding 0.1 percent to trade at $1.0425.

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. 

Article provided by TraderVox.com
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By MoneyMorning.com.au

Kris asked me to write Money Morning for him over the next two days and I thought I should spend some time alerting you to the fact that the ASX 200 is about to hit the skids.

I think it is very interesting to note (for starters) that our stock market made yearly highs on the 15^th of April in 2010 and then the 11^th of April 2011. I would not usually place much weight on such things but it is quite striking when you look at the charts and see how dramatic the fall has been after mid-April over the past few years.

Click here to enlarge

Everyone knows the adage ‘Sell in May and go away’. I think we may be looking at another year where that saying proves its worth.

I wrote an article back in February prior to the second LTRO (Long Term Refinancing Operation) and said,

‘How the European bond markets react in the weeks following the second LTRO will be incredibly important. If Portuguese, Spanish and Italian bonds start selling off again even though banks are full to the brim with cheap cash then you can become very confident that the situation in Europe is going to unravel again.’

So let’s have a look at some European bonds and see how they are faring post LTRO2.

Notice the price action over the past few weeks. The yields on Spanish and Italian bonds are definitely starting to march higher.

European manufacturing activity is in contraction and unemployment is going through the roof. Reuters reports…

‘Unemployment in the euro zone reached its highest level in almost 15 years in February, with more than 17 million people out of work, and economists said they expected job office queues to grow even longer later this year.

‘Joblessness in the 17-nation currency zone rose to 10.8 percent – in line with a Reuters poll of economists – and 0.1 points worse than in January, Eurostat said on Monday.’

More austerity is in the pipeline and there is no way Germany can continue to hold its nose above water while the periphery is in free-fall.

Let’s face it, the only reason the equity markets are going up at all is due to the immense amount of monetary stimulus being shoved down its throat. Have a look at this chart I found on Zerohedge this morning.

Central bank stimulus vs MSCI world

It’s quite clear from this chart that if the Fed doesn’t take the baton from the ECB then equities are in for a rough ride.

Last night we saw the minutes from the FOMC’s previous meeting. The market was surprised to see that there was little appetite for more Quantitative Easing any time soon. Equities, commodities and bonds all sold off hard. We will see more of the same over the next few weeks if the market feels that the punch bowl is being taken away.

Another interesting development over the past few weeks is the rising divergence between equity markets and high-yield debt markets. They usually trade in lock step with each other and when they diverge it is often a great warning sign to tread carefully in equities.

So from here we have to turn to our charts and see if there are any possible signs of failure in the wings. When I look at my chart of the ASX 200 I have to say that the current set up is one of the best that I have seen in many months.

ASX 200 daily chart

Click here to enlarge

Many commentators have been discussing the 4350 zone in the ASX 200 as being very strong resistance. The way I look at it is that the 4350 zone in the ASX 200 is actually the top of a distribution that we have been in for eight months. This distribution has a Point of Control (POC) at 4200 (the dotted blue line in the chart). You can think of the Point of Control as the gravitational point around which the price action oscillates.

If prices fall back within this distribution then there is a very high probability that prices will fall to the POC at least and perhaps all the way to the bottom of the range.

Notice how many times in the past eight months we have seen a sharp price fall to either the bottom of the range or the POC once prices have re-entered the range.

Also notice how the 35-day moving average remains below the 200-day moving average. This is my definition for the long-term trend so we are still in long-term downtrend. A long-term sell signal is generated when price closes back below the 35-day moving average after having a false break of the 200-day moving average in a long-term downtrend.

Therefore if you look at the chart again you can see that if prices close below 4266 in the ASX 200 in the next few weeks then that will be a long-term sell signal and a return to the distribution that I have been talking about. In other words watch out below.

Murray Dawes
Slipstream Trader

The Conference of the Year “After America” DVD

The Unstable Chinese Bubble Australia is Hostage To

The Stock Market Financial Winter is Coming

ASX 200: This Market is Toast

By MoneyMorning.com.au

Financial repression. A few years ago when a few people (Gillian Tett, Russell Napier, etc) started predicting that it would be the thing that made our crisis go away, not many were convinced. The phrase refers to the various methods that hideously indebted governments use to channel the money knocking around an economy to itself rather than anywhere else.

It can include anything from capping interest rates on government debt or deposit rates (as seen all over the world at the moment); forcing institutions to buy government debt; or, at its most obvious, putting in capital controls to prevent anyone taking their money out of the country.

All these things have the same effective result: by taking away other investment options they allow governments to issue sovereign debt with much lower interest rates than they would otherwise be able to. That brings down the cost of debt nicely. But if you then chuck in a little inflation you can make the real value of the debt come down too. Keep that up for a couple of decades and you can repress your way out of trouble.

Financial Repression

This, of course, is exactly how many countries dealt with their horrible post-war debts: let’s not forget that the UK was subject to capital controls until 1979. However, even a few years back, there was a general view that in our new deregulated world, it wouldn’t be possible for governments to use these time-tested methods to get themselves out of trouble. Turns out that it is entirely possible. As Edward Chancellor pointed out in the FT, even in a time of apparently free capital movement, financial repression is entirely possible if everyone does it at the same time.

And doing it they are. “Negative real interest rates are to be found not only in the US but also in China, Europe, Canada and the UK”, where headline inflation is running at 3.4%, “far above both short and long-term interest rates… Western governments have learnt the lessons of history”, so they are all maintaining interest rates at levels well below inflation. At the same time, inflation is pushing up nominal GDP, and will in time “reduce the real value of outstanding debts, both public and private”.

But the authorities aren’t leaving it there. Far from it; they are going for more explicit repression as well. At the same time, everyone is pushing for their banks to hold more debt for “macro prudential reasons”.

And even when regulation isn’t actually put in place, political pressure is. An article in the Wall Street Journal late last year noted that “senior bank executives” from Italy and Portugal said they were being cajoled into buying government debt. Last year, the idea started circulating in Ireland that pension funds should be forced to sell foreign assets and buy Irish government debt. It makes no sense, said one commentator, that pension funds should hold bunds yielding 2-3% when they could hold Irish debt on 6-10%.

Hmmm. This year, Irish prime minister Enda Kenny is about to make it “easier” for pension fund managers to shift from bunds to Irish debt – by transferring the risk of holding it from the pension fund to the pensioner. Hungary has gone the whole hog and annexed pension funds. In 2010, for example, in an effective nationalisation of their private pension fund system, Hungarians were told to hand their private pension fund assets to the state or lose their state pension.

And capital controls? The idea sounds extreme to modern consumers, but they are certainly back under discussion (see Gillian Tett on them), and you could even argue that, in some ways, they are already with us.

The Long Reach of Uncle Sam

Those who work in the investment business will know of a new US regulation known as ‘Fatca‘ (Foreign Account Tax Compliance Act). Fatca is an extraordinarily wide-ranging, arrogant and intrusive piece of legislation (enacted in 2010) that requires all “foreign financial institutions” – that’s non-US banks, fund managers, custodians and so on, to tell the US taxman about all US taxpayers they deal with both directly and indirectly by the middle of next year.

This is quite clearly an admin nightmare (what is an ‘indirect client’?) so you might think that most non-US institutions would simply ignore it. After all, what jurisdiction does the US have over them? You’d think wrong. No one can ignore it: if they do, the Internal Revenue Service (IRS) will charge them a 30% withholding tax on all dividends, interest and sales proceeds made in the US.

The tax will begin to be deducted at the beginning of 2014. There will be no refunds. Failure to comply will also be a criminal offence under US law. How is this repression? It makes it harder for US citizens to invest abroad – already institutions, wary of the fact that they aren’t or can’t be compliant, are turning down US business until they see how the whole thing shakes down (how can you find out all you need to about all your clients and ‘sort of clients’ without running into confidentiality problems, for starters?).

The whole thing very dramatically changes the investing and tax landscape for Americans with money abroad. Worse, the crazy US rules won’t be the end of it. No, read this piece by William Hutchings in Financial News, and you will see that Fatca is about to go global.

Watch Your Back

“In the last three years, the Federal Reserve, Bank of England, European Central Bank and Bank of Japan have taken on an extra $10 trillion of debt, according to risk management consultancy CheckRisk, taking their collective balance sheet to $15 trillion.

“They are looking at every possible way to help pay it off. Ramping up their powers of tax collection is one of the few things they can do to help themselves. It is not such a big jump from there to the introduction of a global Fatca, an international framework obliging foreign financial institutions everywhere to act as tax collector for every government.”

John Redwood pointed out in his blog this week that the UK state is currently spending around 48% of GDP a year. Yet the maximum ever tax take is 38%. The gap has to be made up by someone – just as it does in every other Western country.

Financial repression creates that someone – by making a population hold debt that loses them money in real terms be it via their pension funds or banks, by cutting the return they get on their deposits, by upping their taxes and by letting inflation chip away at their assets. That someone is you.

Merryn Somerset Webb
Editor-in-Chief, MoneyWeek (UK)

Publisher’s Note: This article originally appeared in MoneyWeek (UK).

From the Archives…

Why Spain’s Economy is the Next Big Problem for the Eurozone
2012-03-30 – John Stepek

Water: A Long Term Trend to Follow
2012-03-29 – Patrick Vail

How to Avoid the Welfare State Hunger Games
2012-03-28 – Kris Sayce

What Happens When You Put Someone With No Market Experience in the Top Job?
2012-03-27 – Dr. Alex Cowie

The Star Stocks of the Resource Sector
2012-03-26 – Dr. Alex Cowie

Financial Repression: Why Every Bank Will Soon Be a Tax Collector for Every Government Everywhere

Source: ForexYard

The Greenback made some gains over its currency rivals after minutes from the FOMC Meeting in March showed signs that Monetary officials were moving away from the idea of additional easing.Prior to the FOMC meeting minutes, the greenback was trading slightly down

The Euro fell to its biggest loss since early March versus the U.S Dollar as it dropped approximately 0.8 percent to $1,3231.

The other Major making moves was the Australian Dollar, after news that the Royal Bank of Australia decided to leave interest rates unchanged.This outcome had a negative impact on the Aussie and as a result, weakened against the U.S Dollar dropping to $1,0309 which was a 1.1 percent decline.

According to reports out of Australia, growth was moving at a slower rate than expected,therefore prompting the RBA not to tamper with the interest rates, thus causing the Aussie Dollar to show some downward movements.

As we move into the middle of the trading week, a number of economic calendar events are due for release including Europe’s Interest Rate Decision,ECB Press Conference, ADP Non-farm Employment Change.

Forex Market Analysis provided by ForexYard.

© 2006 by FxYard Ltd

Disclaimer: Trading Foreign Exchange carries a high level of risk and may not be suitable for all investors. There is a possibility that you could sustain a loss of all of your investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with Foreign Exchange trading.

By The Sizemore Letter

The European sovereign debt crisis has evolved into something resembling a persistent case of athlete’s foot.  Just about the time you think it’s cleared up, you get that nagging itch again.

Just weeks after the event that we had all feared—the sovereign default by Greece—came and went with barely a stir from the capital markets, Europe is again emerging as a preoccupation for investors.

This time it is Spain in the news.  Immediately after taking office, Mariano Rajoy, Spain’s new prime minister, rattled the markets by announcing that Spain would not meet its deficit reduction targets for 2012.  And this was even after enacting the harshest austerity measures since the Franco era.

With Spain’s unemployment rate now over 23% and its economy looking to join those of Ireland and Portugal in sinking back into recession, it should come as no surprise that Spanish bond yields are rising (see chart).  At 5.3%, the Spanish 10-year bond is now above the psychologically important 5% mark.

Source: Bloomberg

Still, it’s important to keep a little perspective here.  Though they are higher than they were a month ago, Spanish yields are still well below the crisis highs of 2011.  And importantly, the rest of the Eurozone remains quiet.  There is no talk at this time of “contagion,” and European equities remain in a multi-month bull market.  In fact, Spain’s market is the only European major bourse to not see positive returns in the first quarter.

For all of the wailing and gnashing of teeth in the financial press, I do not see Europe as being at risk of another 2011-style panic.  To start, now that investors have seen what a sovereign default looks like, the mystique is gone.  We’ve been there and done that, and the world didn’t stop spinning.

Furthermore, another sovereign default is unlikely at this time.  European policymakers have made a clear distinction between countries that are basically solvent but illiquid—such as Spain and Italy—and those that are fundamentally insolvent and incapable of ever paying back their debts—such as Greece.   If the European Central Bank’s open market operations prove to be insufficient in maintaining confidence, we may see Spanish yields continue to rise in the short term pending more aggressive action.  But I would view this as little more than the natural ebb and flow of investor sentiment and not as a sign of impending doom.

Investors no doubt remember that 2011, like this year, started out with a great first quarter before falling into a trap of on again / off again volatility for the remainder of the year.

Could this happen again in 2012?  Perhaps.  But investors should also remember that the periodic bouts of volatility last year proved to be fantastic buying opportunities.

I continue to view European equities in general and Spanish equities in particular as an attractive contrarian value play; Spanish stocks enjoy some of the cheapest pricing and highest dividend yields in the world at current levels, and many Spanish companies—including long-time Sizemore Investment Letter recommendation Telefonica (NYSE:$TEF)—get a large percentage of their revenues from outside of Spain.

The iShares MSCI Spain ETF (NYSE:$EWP) is the easiest way to get access to the Spanish market.  At current levels, the ETF is priced at 9 times the earnings of its constituent companies and yields 9%.

Disclosures: TEF and EWP are held by Sizemore Capital Clients

By Central Bank News
Here's today's Central Bank News link list, click through if you missed the previous central bank news link list.  Remember, if you want to submit links for inclusion in the daily link list, just email them through to us or post them in the comments section below.

Article by Investment U

Tenders and calls are one of the best ways to beat this market. If someone is willing to pay you more than they have to, take the money and run.

It isn’t often someone pays you more than they’re legally obligated to pay. But that’s exactly what’s happening more and more often in this bond market.

It’s called a “tender offer,” and since interest rates have dropped to record lows there have been a growing number of them, and they’ve worked out very nicely for the bondholders. They’re also one way to beat both the stock and bond market.

Here’s how a tender offer works.

Whenever a bond is issued, in this case a corporate bond, the company usually builds in safety valves for future use. These are used to save the company money on their debt obligations. These safety valves are called “call dates.”

Not to be confused with call options, bond calls are set dates when the company has the right to buy back a bond. These dates are always before maturity, at a set price, usually at a premium over par, and greater than $1,000 per bond.

In our current interest rate environment, lots of bonds are being called. It just makes sense to reissue or refinance a bond that was issued at a higher interest rate. The owner makes money and the company saves a ton of money on interest when they refinance at the current historic low rates.

Sometimes bond owners don’t see them as such a good deal. They may have a high coupon bond called that they might not have wanted to lose. But I say, take the money and run, it may not be there tomorrow.

“Free Money”

Never complain if someone is giving you free money.

Not all bonds have call dates, but in this rate environment, all bond issuers wish they did. So, when a company wants to get their high-cost bonds off the market and they can’t call them, they make a special tender offer – which is usually a really good offer – to buy back their bonds.

Sometimes it’s a great deal, sometimes it’s just ok. A lot depends on how much you paid for the bond. This is one of the many instances where my “buy at a discount” discipline comes in very handy.

The higher the coupon of the bond, the bigger the tender offer has to be to get owners of the bonds to sell them to the issuer. It’s just a matter of numbers; it costs more to buy back an 8% coupon bond before maturity than a 4% or 5% bond.

A Recent Example

Here’s a bond I recommended last year that has a current tender offer:

Cenveo – We bought it for around 98 in June of last year. This was one of those “pucker bonds.” It isn’t a well-known company, and for the average stock head, it wasn’t the best fit because it’s privately owned, and that sends up red flags all over the place for stock jockeys. They don’t trust companies that aren’t listed on the exchanges.

But bonds from privately owned companies pay more then public companies’ bonds and are just fine. More at another time on why privately owned companies’ bonds are good deals.

Our minimum expected annual return (MEAR) when we purchased the bond was around 9.46%. Not a huge return, but very respectable. But if the holders accept the current tender offer of 111, $1,110 per bond, they’ll make out like bandits.

We paid around 98 for the bond, $980, so just in capital gains we get $130 per bond, or 13.26%, in about nine months, plus our interest of 7.875%.

Oh, and accrued interest. I don’t usually talk about AI as it can be very confusing for the uninitiated, but in this case, it’s important.

When you own a dividend stock, you must own it on the ex-dividend date or you don’t get paid any interest for the preceding quarter. But with a bond, you’re paid from the moment the bond shows up in your account until it matures, you sell it, or in this case until the tender offer is paid.

So our real return was $130 in capital gains, plus an interest payment on December 1 of $39.37, plus AI for the period from December 1 to about April 1 in the amount of $26.35. (That’s an estimate for a holding period of about 10 months which gives us an annual return of 23.96%: $39.37 + $26.25 + $130 / 980/ 10 months x 12 = 23.96%.)

In any comparison, that’s a great return.

Take the Money and Run

Since interest rates dropped to their ridiculously low levels, tender offers have been coming out of the woodwork and bonds are being called and tendered at an unusually high rate. In almost all cases they’ve been great deals for the bond holders.

Still, many stockbrokers won’t buy bonds that can be called. They see the call as a negative. The same is true for tender offers. It’s rare a stockbroker will advise their clients to accept a tender offer. They view it as a loss if they give up a high coupon bond.

But, that’s why they’re called stockbrokers and not bond brokers. They have a much greater understanding of stocks than bonds.

Tenders and calls are one of the best ways to beat this market. If someone is willing to pay you more than they have to, take the money and run.

Good Investing,

Steve McDonald

Article by Investment U

Article by Investment U

In this incredibly low interest rate environment, there are some investments you'll probably want to avoid, as well as some better choices for where to invest.

For the last year, the effective federal funds interest rate has been 0.25%. The federal funds rate is considered one of the most important interest rates in the U.S. markets.

The federal funds rate is used to control the supply of available funds and hence, inflation and other interest rates. Raising the rate makes it more expensive to borrow. That lowers the supply of available money, which increases the short-term interest rates and helps keep inflation in check. Lowering the rate has the opposite effect, bringing short-term interest rates down.

In this incredibly low interest rate environment, there are some investments you’ll probably want to avoid, as well as some better choices for where to invest.

Long-Term CDs or Bonds Aren’t the Way

The average one-year CD is around 0.34%. If you go with a longer-term five-year CD, you may get 1.14%. We know rates are locked for the next few years, but the one-year is nowhere near inflation. With the rate so close to zero, buying a long-term CD locks in long-term to really low rates. Nobody wants to find himself in that predicament.

One thing taught in college finance 101 is that bonds have a strong inverse link to interest rates. That is, when market interest rates increase, the prices of existing bond issues decrease. In addition, the longer it is to the bond’s maturity, the more sensitive its price is to changes in the market interest rate. The longer you’re exposed to the market, the more risk you take on.

Equities and Short-Term Bonds…

Low rates are loved by the markets – look at the way they react to any hint of quantitative easing. In theory, if you can borrow money at lower rates, you’re more willing to be a player and grow. Hopefully this action translates into earnings and a rising stock price.

As Investment U bond expert Steve McDonald preaches, short-term bonds work because they’re much less sensitive to changes in rates. Better yet, if you hold it to maturity, the bond’s price becomes less important because you get back the principal. Due to its nature, short-term bond rates aren’t that high, but a modest return still beats one that causes you to lose spending power.

The Interesting Twist

The Fed, as I mentioned before, intends to keep money artificially cheap – keep low rates so that it’ll be easier for people to borrow money, invest it in expensive things of lasting value that require long-term financing, and keep your fingers crossed that this will be a catalyst for a stronger recovery.

But it hasn’t worked out that way. Unemployment hovers at historic highs, so it’s hard to take advantage of these rates when you’re not sure about your income. This isn’t so much of an issue of liquidity but one of confidence.

Despite the uncertainties involved, equities remain one of the better choices if you like other fundamental indicators in the economy. They give a chance to benefit from low interest rates, and generally aren’t expected to decline sharply when interest rates rise.

Good Investing,

Jason Jenkins

Article by Investment U

Article by Investment U

Emerging markets like Vietnam and Cambodia are full of rich opportunities for both value and growth investors.

Imagine waking up one morning and turning on the news to hear that interest rates are rising again to slow down growth…

It’s something we heard in the United States a long time ago.

Nowadays those types of announcements are still being heard, but in places that you may not have on your radar. While most people think that rising interest rates are a bad thing, that’s not always the case. If rates rise for the right reasons it means that growth is strong – maybe too strong.

Lately, I have found myself in many such places. Places where waking up in the morning means facing the din of noise, endless activity on the street, vibrancy the likes of which we experienced here in the United States decades ago. It’s the sound of growth, the sound of money…you can almost smell the profits at times!

On one of my recent trips to Asia, specifically Vietnam and Cambodia, the wheels of commerce were churning at high speed. By 7:30 AM, the streets were clogged with trucks, cars, scooters and rickshaws. Goods of all sorts were packed to the point of bursting on the beds of small pick-up trucks. Sidewalk vendors had set up shop, peddling breakfast to the passersby. Crossing the street amidst this controlled chaos was an adventure in itself. This is what 8% to 10% annual GDP growth looks like.

Shanghai, another one of my stops last year, as a guest of the Consul General of Canada, was another eye opener. The city boasts a population of 125,000 millionaires, all of which seem bent on spending like it’s going out of style. Rolls Royce, Bentley, Porsche, BMW, Mercedes and Range Rovers are the wheels of choice and plentiful, with the odd Ferrari and Lamborghini thrown in for good measure. A burger at the Long Bar will set you back US$18… if you can get a table. Things are so good that the Chinese government is sending out private messages to the big spenders to buy things that are less ostentatious so as not to look “so rich!”

In Mumbai, the financial capital of India, you can’t touch an apartment in town for less than $400 per square foot. This is a country where annual per capita income is less than the average American earns in a month. But, with a middle class approaching 300 million people, that number is skewed by the other 900 million who aren’t yet participating fully in the boom.

Fast forward 10 years and the world’s top 20 economies will be comprised of more countries that were once considered backwaters. Therein lies the opportunity. Places like Turkey, Chile, Vietnam, Cambodia, South Africa and Uruguay may not be on the top of your shopping list, yet, but these are the places that money is flowing to for growth.

Twenty years ago, when I first began my journey to these emerging markets, it was a different story. Sure, there was growth, and many of my readers profited handsomely from picks like Malaysia’s Sime Darby or Indonesia’s Semen Gresik or even Hong Kong’s Jardine Matheson. Today, it’s even better because it’s also easier…

Now, you can trade companies in Asia as easily as you can trade a U.S.-listed stock, online and at a discount. You just have to know where to look, what to buy and when to buy it.

In my new book, Where in the World Should I Invest: An Insiders Guide to Making Money Around the Globe, you can start participating in this boom of mammoth proportions with a reliable guidebook that takes to you street level.

You’ll learn about the specific types of investment vehicles that can get you into places like Vietnam, Eastern Europe, China and many other places at a discount. And, as a bonus, you’ll also learn about what it’s like to travel and spend time in places like India, South America, North Africa and of course, Asia.

Good Investing,

Karim Rahemtulla

Article by Investment U