Month: May 2013

By MoneyMorning.com.au

We may have not seen the day when we have flying cars…but damn, are we getting close!

Early last year, for example, Google started testing self-driving cars. With Nevada taking the first leap of faith by giving them licenses, now they’re legal in Florida, California and Texas as well.

As of August 2012, over 300,000 autonomous hours are logged so far with a flawless safely record, unless you count the two accidents that happened when they were manually piloted.

This is just one example of how we have reached a tipping point.

Science and Technology is Changing the World…

Yet most people aren’t paying attention.

When the right minds and the right capital get behind such ambitious dreams, science fiction can become science fact. To see what I really mean, consider this…

You know about 3-D printing. But did you know that an Italian by the name of Enrico Dini has created a 3-D printer that’s capable of printing a two-story building?

Complete with rooms, stairs, pipes and partitions, the resulting material is as durable as reinforced concrete and has the look of sculptured marble.

According to him, similar structures can be built in a fourth the time as traditional buildings and without specialist knowledge. Imagine the impact on the construction industry…

Sound scary? Not if you’re on the team doing the disruption…

How about genetically modified silk that’s stronger than steel?

At University of Wyoming, scientists modified a group of silkworms to produce silk that is, weight for weight, stronger than steel. That could mean stronger sutures for the medical community, biodegradable alternatives to plastics or lightweight armour for our military.

Speaking of the military, did you know British Columbia Company HyperStealth has built a functioning prototype of an invisibility cloak for the U.S. and Canadian militaries this year?

I know that sounds like something straight out of the Harry Potter books your children and grandchildren read. And maybe you have to see (or not) to believe, but do you think the militaries of sovereign nations would seriously consider science fiction?

I didn’t think so. It’s called Quantum Stealth, and it works by bending light waves around the wearer without the use of batteries, mirrors or cameras. It blocks the subject from being seen visually, and also keeps them hidden from thermal scans and infrared.

Driving the Point Home

Consider how the invisible is being made visible…in Outer Space. Voyager 1 was launched in 1977 as the first man-made object, and while it was originally intended to fly to Saturn and Jupiter and send home images, NASA scientists soon realized the probe would venture into the unknown blackness of deep space.

So the team showed their playful side for any potentially friendly aliens out there. They placed recordings on Voyager I with sounds ranging from music to whale calls and greetings in 55 languages… just to give a sample of intelligent life on Earth… for anyone listening.

And while James Cameron was making sci-fi movies like Avatar about far off planets with forests filled with blue people, he was also scheming to accomplish a 2.5-hour voyage 6.8 miles deep to the Mariana Trench, the deepest known point in our oceans.

As you may have guessed, he did it. And in so doing was the first solo human – in his 2.5-story ‘vertical torpedo’ submarine – to witness the exotic life within those great depths, collecting various samples along the ocean floor.

It makes you salivate as an investor.

Josh Grasmick
Contributing Editor, Money Morning

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From the Archives…

The Day Japan and China Shook the Aussie Market

24-05-2013 – Kris Sayce

Why the Only Thing That Matters in the Markets is Japan
23-05-2013 – Murray Dawes

When Soros Buys Gold Stocks, You Better Take Note…
22-05-2013 – Dr Alex Cowie

Look for Small-Cap Resource Stocks with Plenty of Cash
21-05-2013 – Dr Alex Cowie

Why Bank Stocks have Outperformed Resource Stocks…
20-05-2013 – Kris Sayce

By www.CentralBankNews.info   Brazil’s central bank raised its benchmark Selic rate by 50 basis points to 8.0 percent to help bring down inflation and “ensure that this trend will continue next year.”
    In a brief statement, the Central Bank of Brazil said its policy committee, known as Copom, had agreed on the rate rise unanimously and it did not issue a bias about the future trend of policy.
    It is the second consecutive rate rise by Brazil’s central bank following a 25 basis point rise in April, bringing this year’s total rate increase to 75 basis points. In 2012 the central bank cut rates by 375 basis points in response to declining economic growth before freezing rates from November through March.
    Today’s rate rise was largely expected and follows recent warnings by the central bank’s governor that he would do “what is needed, in a timely manner, to ensure inflation declines.”
    Brazil’s inflation rate eased to 6.46 percent in the rolling one-month period through May 15 from 6.49 percent in April, close to the upper limit of the central bank’s target range of 4.5 percent, plus/minus two percentage points. It was first decline since inflation started to accelerate in July 2012.

   The central bank has forecast inflation of 5.7 percent this year and 5.3 percent in 2014.
    Brazil’s Gross Domestic Product expanded by 0.6 percent in the first quarter, the same quarterly rate as in the fourth quarter, for annual growth of 1.9 percent, up from 1.4 percent in the fourth quarter, continuing a rebound since hitting a recent low of 0.5 percent in the second quarter of 2012.
    Nevertheless, growth in the first quarter was below expectations as industrial output dropped, driven by a 6.6 percent drop in mining, along with lower construction activity.
    Earlier today, the central bank lowered its 2013 growth forecast to 2.93 percent from 2.98 percent but maintained the 2014 forecast at 3.5 percent. In 2012 the economy expanded by only 0.9 percent.

    www.CentralBankNews.info

By www.CentralBankNews.info Here’s today’s Central Bank News’ link list, click through if you missed the previous link list. The list comprises news about central banks that is not covered by Central Bank News. The list is updated during the day with the latest developments so readers don’t miss any important news.

By WallStreetDaily.com

As part of Wall Street Daily’s Keynote Speaker Series, I have a real treat for you today.

I scored an exclusive interview with two people that have unique insights into an aspect of life that impacts every last one of us – food safety.

• Rich McKeown, former Chief of Staff for the U.S. Department of Health and Human Services. He’s currently the President and CEO of the internationally known healthcare and food safety consulting firm, Leavitt Partners.
• Jennifer McEntire, Ph.D., former Senior Staff Scientist at the Institute of Food Technologists (IFT). She’s now the Senior Director of Food and Import Safety Practice at Leavitt.

Allow me to set the stage for you, as you’ll get more out of the interview by knowing the quick backstory…

Each year, approximately 48 million people suffer from foodborne illnesses. Of that total, 128,000 are hospitalized and 3,000 die, according to the CDC.

That’s just unacceptable, which is why Congress passed the Food Safety Modernization Act (FSMA) in January, 2011.

It represented the most sweeping reform to our food safety laws in almost a century.

In fact, the legislation went as far as granting the Food and Drug Administration (FDA) authority to recall contaminated food, as well as the power to regulate many aspects of food production.

In our conversation, Mr. McKeown and Dr. McEntire reveal…

• The market conditions that prompted such decisive legislation.
• Why we could be approaching the “tipping point” for the entire food industry to take action. Just in the United States, we’re talking about two million farmers; 570,000 facilities in the food service segment; and 167,000 manufacturers, processors and warehouses.
• An innovative technology developed by Park City Group (PCYG) – and adapted with insight from Leavitt Partners – that could improve visibility in the food supply system.

To hear for yourself, all you have to do is click on the image below. Enjoy!

Ahead of the tape,

Louis Basenese

Article By WallStreetDaily.com

Original Article: Experts Share Critical Insight into Food Safety Drivers

The bond market, dear reader, is becoming vulnerable. By keeping interest rates so low and by the Federal Reserve actually buying U.S. Treasuries, bond prices have climbed and climbed…and the low yields on U.S. Treasuries have sent investors to the stock market and junk bonds. Any tightening in monetary policy will send the bond market into a tailspin.

But there’s more…

Next, the stock market rose to atmospheric levels as easy monetary policy remained in effect. Even I’m surprised at just how high this market has gone. But at the very moment the Federal Reserve shifts its monetary policy towards normalization, the market will be in jeopardy. We saw a slight episode of this in a sell-off in the key stock indices last week, when the Federal Open Market Committee’s (FOMC) meeting minutes suggested some members of the committee think the Federal Reserve should start to slow the rate of its quantitative easing. (Source: Federal Reserve, May 22, 2013.)

Moving on, public companies are borrowing money cheaply as a result of the favorable monetary policy environment, but these companies are not putting the borrowed money to good use. Instead of making investments in plant, equipment, and people, companies are buying back their shares to eventually make their corporate earnings look better.

In 2012, American companies spent $400 billion to buy back their shares; a startling 2.6% of the gross domestic product (GDP) of the U.S. economy is going to buy stock? Something’s not right with this. Since the beginning of the year to March 7, American companies have announced share buybacks worth a total of $111.6 billion—an increase of 96% from the same year-ago period. (Source: The Economist, April 6, 2013.)

Last but not least, pension funds are falling victim to easy monetary policy. One of the most basic principles of calculating pension obligation is identifying future values. Because of lax monetary policy, namely low interest rates, pension funds need more capital to fulfill their obligations. (Source: Washington Post, May 24, 2013.) The longer interest rates remain low, the bigger pension deficits will become, not just for insurance companies, but for union, private company, and government pension funds as well.

Readers of Profit Confidential know where I stand; keeping interest rates artificially low and printing lots of paper money can only go so far to help a company before these actions actually hurt the economy.

Remember, dear reader, back in 2007, when the housing market was the sole catalyst of the financial crisis that hit America. Today, thanks to a $7.0-trillion increase in the national debt under President Obama and the $3.0-trillion balance sheet of the Federal Reserve, several catalysts have been created—none less important than a bloated, overvalued stock market and inflation knocking at the door.

Michael’s Personal Notes:

Yes, the amount of pessimism towards gold bullion is increasing daily. Data from Commodity Futures Trading Commission showed there were 79,416 short contracts (bets on the price falling) for gold bullion for the week ended May 21.

But while speculators increase their bets that gold bullion is going down in price, according to the International Monetary Fund (IMF), central banks from countries like Russia, Kazakhstan, Turkey, and Azerbaijan added gold bullion to their reserves in April in spite of falling gold bullion prices.

In April, the central bank of Russia added 269,000 troy ounces of gold bullion to its reserves, bringing its total holdings to 31.8 million ounces.

In the same month, gold bullion holdings at Turkey’s central bank grew by 586,000 ounces. The central bank of Azerbaijan bought the yellow metal for the fourth consecutive month in April—in December of 2012, this central bank didn’t have any gold bullion holdings at all.

The central bank of Kazakhstan has been accumulating gold bullion too. It bought more in April—adding another 85,000 ounces. The central bank of Kazakhstan now holds four million ounces of gold bullion in its reserves.

In the first quarter of 2013, central banks added a total of 109 tonnes of gold bullion to their reserves. What’s more interesting is that this first quarter was the seventh consecutive quarter central banks purchased more than 100 tonnes of gold bullion to add to their official holdings. (Source: World Gold Council, May 16, 2013.)

When I look at all this, it makes me more bullish towards gold bullion. As I have been harping on about in these pages for quite some time, through their actions, central banks will ultimately cause gold bullion prices to soar higher.

Central banks are considered to be the most conservative of all investors. As volatility in the foreign exchange market rises and the fundamentals of the world reserve currency (the U.S. dollar) come into question, why wouldn’t they buy even more gold bullion?

Central banks buying gold bullion in such high quantities shows me that they are losing trust in the fiat currency they usually hold in their reserves. They are looking for alternative ways to maintain their wealth, and gold bullion looks to be the only solution, as bonds are yielding next to nothing.

When it comes to gold bullion prices, I am not too concerned about daily fluctuations. I am keeping my focus on the long term, and as it stands right now, it’s bright.

What He Said:

“The Dow Jones Industrial Average, the S&P 500 and the other major stock market indices finished yesterday with the best two-day showing since 2002. I’m looking at the market rally of the past two days as a classic stock market bear trap. As the economy gets closer to contraction, 2008 will likely be a most challenging economic year for America.” Michael Lombardi in Profit Confidential, November 29, 2007. The Dow Jones Industrial Average peaked at 14,279 in October 2007. A sucker’s rally developed in November 2007, which Michael quickly classified as a bear trap for his readers. By mid-November 2008, the Dow Jones Industrial Average was at 8,726.

Article by profitconfidential.com

By www.CentralBankNews.info     The Bank of Canada (BOC) maintained its target for the overnight rate at 1.0 percent, as expected, and said “the considerable monetary stimulus currently in place will likely remain appropriate for a period of time after which some modest withdrawal will likely be required” due to continued economic slack, a muted outlook for inflation and a continued improvement in household imbalances.
    The BOC’s forward guidance is exactly the same as in April.
    Although Canada’s first quarter economic growth is expected to be stronger than the central bank projected in April, the BOC added that growth this year is expected to remain broadly in line wit its forecast from last month.

Yes, the amount of pessimism towards gold bullion is increasing daily. Data from Commodity Futures Trading Commission showed there were 79,416 short contracts (bets on the price falling) for gold bullion for the week ended May 21.

But while speculators increase their bets that gold bullion is going down in price, according to the International Monetary Fund (IMF), central banks from countries like Russia, Kazakhstan, Turkey, and Azerbaijan added gold bullion to their reserves in April in spite of falling gold bullion prices.

In April, the central bank of Russia added 269,000 troy ounces of gold bullion to its reserves, bringing its total holdings to 31.8 million ounces.

In the same month, gold bullion holdings at Turkey’s central bank grew by 586,000 ounces. The central bank of Azerbaijan bought the yellow metal for the fourth consecutive month in April—in December of 2012, this central bank didn’t have any gold bullion holdings at all.

The central bank of Kazakhstan has been accumulating gold bullion too. It bought more in April—adding another 85,000 ounces. The central bank of Kazakhstan now holds four million ounces of gold bullion in its reserves.

In the first quarter of 2013, central banks added a total of 109 tonnes of gold bullion to their reserves. What’s more interesting is that this first quarter was the seventh consecutive quarter central banks purchased more than 100 tonnes of gold bullion to add to their official holdings. (Source: World Gold Council, May 16, 2013.)

When I look at all this, it makes me more bullish towards gold bullion. As I have been harping on about in these pages for quite some time, through their actions, central banks will ultimately cause gold bullion prices to soar higher.

Central banks are considered to be the most conservative of all investors. As volatility in the foreign exchange market rises and the fundamentals of the world reserve currency (the U.S. dollar) come into question, why wouldn’t they buy even more gold bullion?

Central banks buying gold bullion in such high quantities shows me that they are losing trust in the fiat currency they usually hold in their reserves. They are looking for alternative ways to maintain their wealth, and gold bullion looks to be the only solution, as bonds are yielding next to nothing.

When it comes to gold bullion prices, I am not too concerned about daily fluctuations. I am keeping my focus on the long term, and as it stands right now, it’s bright.

What He Said:

“The Dow Jones Industrial Average, the S&P 500 and the other major stock market indices finished yesterday with the best two-day showing since 2002. I’m looking at the market rally of the past two days as a classic stock market bear trap. As the economy gets closer to contraction, 2008 will likely be a most challenging economic year for America.” Michael Lombardi in Profit Confidential, November 29, 2007. The Dow Jones Industrial Average peaked at 14,279 in October 2007. A sucker’s rally developed in November 2007, which Michael quickly classified as a bear trap for his readers. By mid-November 2008, the Dow Jones Industrial Average was at 8,726.

Article by profitconfidential.com

By www.CentralBankNews.info     Tunisia’s central bank held its key interest rate steady at 4.0 percent to help create an environment that can stimulate economic activity, in particular the export sector.
    The Central Bank of Tunisia, which raised its rate by 25 basis points in March, said growth estimates for the first quarter showed annual growth of 2.7 percent, down from 4.0 percent in the fourth quarter of 2012, below the planned 4.0 percent growth for 2013.
   In 2012 Tunisia’s Gross Domestic Product expanded by 3.6 percent, reversing a 1.9 percent contraction in 2011 when the economy suffered from political upheaval, known as the Arab Spring that began in Tunisia in December 2010.
    The decline in first quarter growth was due to lower output from agriculture, fishing and non-manufacturing such as mining, while manufacturing, transport and telecommunications showed a positive trend. Tourism, however, continues its decline since the beginning of the year.
    The dinar’s exchange rate “has faced some tensions” since early May, falling 4.1 percent against the euro and 6.1 percent against the U.S. dollar by mid-May due to demand from some firms for foreign exchange for import settlements or profit transfer, the central bank said in a statement after a meeting of its executive board on May 27.

     However, the bank added it had intervened to fine-tune the foreign exchange market to ease these pressures and by May 24 the rate had returned to a more normal rate of 2.139 dinars to the euro and 1.65 to the U.S. dollar.
    Tunisia’s inflation rate eased slightly in April to 6.4 percent from 6.5 percent in March but the central bank, which also raised its key interest rate by 25 basis points in 2012, said the monthly rise in inflation of 0.7 percent “confirms persisting inflationary pressure for most consumer products despite a decrease in fresh food prices.”
    Despite a decline in Tunisia’s current account deficit fell to 2.5 percent of GDP in the first four months, down from 2.8 percent in the same period last year, the central bank said pressure on the balance of payments persisted due to a drop in the surplus of financial operations with other countries, in line with a tightening of income from foreign direct investment and drawings on medium and long term borrowing.
    The level of foreign currency reserves fell to the equivalent of 95 days of imports per May 24, down from 101 days a year earlier and 119 days at the end of 2012.
   
    www.CentralBankNews.info

London Gold Market Report
from Adrian Ash
BullionVault
Weds 29 May, 08:10 EST

WHOLESALE PRICES for physical gold rose Wednesday morning in London, hitting almost $1395 per ounce to gain 0.5% for the week so far.

Silver lagged gold, trading in line with last week’s finish at $22.42 per ounce, while world stock markets fell together with commodities and major government bond prices.

The US Dollar eased 0.5% on the currency markets, capping the price to buy gold below €1075 and £924 per ounce for Eurozone and UK investors respectively.

Tuesday’s expiry of US June gold futures contracts “made for some vicious price moves in both directions,” notes trading house Mitsui, pointing to the jump from $1375 to above $1400 as New York trade began.

“But ultimately the yellow metal remained firmly penned within its recent range,” the note adds, and the action was “far less significant for those with a longer focus.”

Yesterday also saw 10-year US Treasury yields jump as government bond prices fell, hitting a 14-month high above 2.2% and outpacing the latest Consumer Price Inflation reading by the widest margin since February 2011.

Ten-year UK gilt yields rose today above 2.0% for the first time in two months. They still lag UK inflation by 0.4% per year, however.

“We can see some Shanghai futures buying interest pushing the market higher,” Reuters quotes Peter Fung at Wing Fung dealers in Hong Kong, also noting the $25 premium to international spot prices for Chinese gold futures.

“Singapore is still facing a shortage,” said a local dealer to the newswire overnight, adding that customers wanting to buy gold must now wait until July for delivery.

Singapore premiums – over and above the international benchmark price, typically quoted for London delivery – have shot to a record $7 per ounce.

Some retail dealers are charging four times as much, however, asking 2% over spot prices for gold kilobars in Singapore according to wire reports.

“Premiums [in India] have dropped to $5-$7 an ounce this week,” the Wall Street Journal quotes Ketan Shroff, director at Penta Gold in Mumbai.

That’s half the levels seen last week in India, the world’s heaviest gold-buying nation.

After imposing new restrictions on consumer loans raised using gold trust funds and gold coins on Monday, the Reserve Bank of India said Tuesday that it won’t seek to stop consumers being able to buy gold coins from commercial banks.

However, “Some more steps, if necessary, would have to be taken,” the finance minister P.Chidambaram said at the same conference yesterday in Pune, pointing again to the role of gold imports in India’s large trade deficit.

“I appeal to the people of India to contain their passion for gold,” Chidambaram said.

On the economic front meantime, both the Organization for Economic Co-Operation & Development and the International Monetary Fund today released new forecasts for 2013.

Washington’s IMF trimmed its prediction for China’s GDP growth from 8.0% to 7.75%.

The Paris-based OECD said the Eurozone – the world’s largest single-currency economy – will shrink by 0.6%.

“Protracted weakness,” says the think tank, “could evolve into stagnation with negative implications for the global economy.”

An economics book called Why We Should Leave the Euro has leapt to top the bestseller list in Portugal, which received a €78 billion bail-out from its Euro partners and the IMF in 2011.

The European Commission in Brussels is expected today to allow 3 of the region’s 5 largest economies to overshoot their budget deficit targets.

New data Wednesday morning showed the 330-million citizen Eurozone’s broad money supply growing 3.2% in April from a year earlier.

Private-sector loans, however, contracted by 0.9%.

Adrian Ash

BullionVault

Gold price chart, no delay | Buy gold online

Adrian Ash is head of research at BullionVault, the secure, low-cost gold and silver market for private investors online, where you can buy gold and silver in Zurich, Switzerland for just 0.5% commission.

(c) BullionVault 2013

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 HY Markets Forex Blog

The rate of unemployment in Germany has risen by 21,000 to 2.96 million in May, according to reports from the Nuremberg-based Federal Labor Agency. Analysts and economists are expecting an increase by 5,000, according to a news survey taken by Bloomberg. The adjusted unemployment rate seized at 6.9 percent.

The figures for the German unemployment rate were increased after unemployment fell in the course of spring growth, rising by a rate of 6,000 every month. Germany’s Ifo index measured the economic sentiment and expectation rose to 105.7 in May from 104.4.

The German gross product advanced  by 0.1 percent in the first quarter after 0.7 percent fall in the previous three months. The German-adjusted GDP slipped 1.4%in the first quarter, according to reports from the German’s statistical office Destatis.

The GDP is predicted to increase by 0.4%in 2013 and by 1.8% the year after. Exportation is expected to have improved and move at a faster pace then its current slow state, despite the fall in external orders for industrial goods.

Some of the major companies are benefiting from the high demand in the rapid economic growth. Such as Beiersdorf AG (BEI), reported that the first-profit quarter profits that exceeded analysts’ estimate as higher market sales offset a drop in Europe. While Heidelberg Cement AG (HEI), the third-largest cement maker said that the first quarter profits increased by 3.3 as the growth and job cuts in North America offset the effect of the weather conditions in the market.

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