How Warren Buffett Wins From Bank of America’s Capital Plan

By Jordan Wathen March 19, 2015 Warren Buffett has a sizable stake in Bank of America (NYSE: BAC  ) , even if it’s hidden from plain view. Berkshire Hathaway (NYSE: BRK-A  ) (NYSE: BRK-B  ) owns warrants that entitle it to purchase 700 million Bank of America shares for $7.14 each at any time before 2021. At the current price, it’s as if Berkshire has an $11.2 billion stake in Bank of America, making it one of Buffett’s largest investments. Owning warrants is not exactly like owning stock, however. Because Buffett hasn’t exercised his right to buy the shares, Berkshire Hathaway isn’t entitled to any dividends Bank of America pays on its common stock. In fact, every time Bank of America pays its quarterly dividend of $0.05 per share, Buffett gives up a little bit of a return. Berkshire Hathaway is missing out on $140 million in annual dividends by holding on to the warrants. Buffett contends this is a good … Continue reading

The Titanic Sinks At Dawn

Posted on March 19, 2015 by Gary Christenson TheDeviantInvestor.com What Titanic?  The RMS Titanic, or any of the following: A titanic quantity of derivatives – say 1,000 Trillion dollars. A derivative crash was at the center of the 2008 market meltdown.  It could happen again since there is now more debt, leverage, and risk than in 2008. A titanic accumulation of debt – global debt is approximately $200 Trillion. Global population is about 7,000,000,000 so there is about $28,000 in debt per living human being.  If global debt were backed by all the gold mined in the history of the world, an ounce of gold would back $36,000 in debt.  Gold currently sells for less than $1,200.  Gold is undervalued and there is an excess of debt. A titanic increase in debt in the past decade. Official US debt increased by over $10,000,000,000,000 in the past ten years.  What did … Continue reading

Silver Poised to Surge

Adam Hamilton Mar 20, 2015 Silver is scraping major support again, after a rough couple months where speculators left it for dead. But today’s brutal lows and extreme universal bearishness are the perfect breeding ground for silver’s next big rally. Investors are very underexposed, while speculators have big short positions that will have to be covered. So as gold reverses decisively and paves the way, capital is going to flood back into silver. Silver’s great allure today when it is down and out is hard for most to understand. That’s because most traders mistakenly make linear assumptions in a nonlinear world. They expect today’s market conditions to persist indefinitely. But that’s not the way markets work, they are forever cyclical. The best times to buy low before later selling high are when assets are universally despised and trading at super-low prices. And once silver inevitably reverts back to bull mode, … Continue reading

Why Aren’t These Investors Worried About The Gold Price?

  Why Aren’t These Investors Worried About The Gold Price? By Jeff Clark, Senior Precious Metals Analyst Have you noticed that some gold investors don’t seem very concerned about the current behavior of gold? While the price remains weak and range-bound, some gold investors don’t seem worried about it at all. The natural reaction to an asset you own losing a third of its value, with seemingly little motivation to move higher, is cheerless and maybe even depressing. So why aren’t they? Are they out of touch? Perhaps have nothing at stake? Are they the kind of investors that would go down with the ship? Or do they know something we don’t? Gold’s Cycles The resource markets are well known for moving in cycles, probably more than most other markets. Raging bull market, crippling bear market, repeat. This includes gold and silver. Yes, catalysts can impact the price along the … Continue reading

Reality Always Wins… But Never on Schedule

Reality Always Wins… But Never on Schedule By Louis James, Chief Metals & Mining Investment Strategist “Expect the worst and you won’t be disappointed” is true enough, but it’s a miserable way to go through life. For investors, expecting the worst is paralyzing, a reason to do nothing. But when a market gets beaten up the way the natural-resource sector has been over the last few years, pessimism comes to dominate the chatter in boardrooms, blogs, and cocktail parties the way mold takes over a shower. It’s a blight. “There are no buyers left in the market; it will take years to recover.” “There’s no financing available, so everything will grind to a halt for years to come.” “Don’t step on that black spot.” Recent experience in the resource sector has been so bruising that the wounded have turned to pessimism as a psychological defense, to feel wise and experienced, … Continue reading

Trading the parabolic dollar

Adam Hamilton – Zeal Intelligence | March 14, 2015 The mighty US dollar has been red-hot in March, rocketing higher on the incredible divergence of major central-bank policies.  While the Federal Reserve’s first rate-hike cycle in 9 years looms, the European Central Bank has started aggressively monetizing sovereign debt for the first time ever.  The resulting yield differential has catapulted the dollar parabolic, portending a major reversal and fantastic trading opportunity. Currency trading is the biggest financial market in the world, with trillions of dollars changing hands every day.  Yet since major currency price levels generally meander slowly, this massive market lurks beneath the surface with scant limelight.  But this month the soaring US dollar and plummeting euro have utterly dominated mainstream financial news.  These warring currencies’ huge price moves have been epic. The dollar and euro are opposite sides of the same coin.  When one rallies the other necessarily falls, and vice … Continue reading

How To Invest With $5,000 to $10,000

How To Invest With $5,000 to $10,000 Thursday March 12, 2015 14:43 By Dudley Pierce Baker Investing with limited funds can present many challenges. Let’s face it, if you had $1,000,000 to work with the number of opportunities and a reasonable dollar allocation would be much easier. Who would not like to have this problem? Reality is that many, especially younger investors, are eager to participate in the markets but are at a loss as to how to proceed with $5,000 or $10,000. Timing Your Entrance However, before one invests there needs to be an expectation of success. The timing of the investment is of major importance. I realize this seems very simple but don’t forget that most investors love to buy at the highs of the markets or individual shares and are doomed from the start and of course they are scared to death to buy (like now) when … Continue reading

How to Get Struck by Lightning

How to Get Struck by Lightning By Louis James, Chief Metals & Mining Investment Strategist Two M&A deals have already delivered paydays for investors in junior mining stocks this year: Goldcorp’s half-billion-dollar purchase of Probe Mines in Canada, and Tahoe Resources’ billion-dollar acquisition of Rio Alto Mining, a Peruvian gold producer. Now the arrival of a new, well-capitalized bidder for mining properties—X2 Resources—has raised prospects for more blockbuster deals like last year’s $3-billion takeover of Osisko Mining by Agnico Eagle and Yamana Gold. X2—a still-private UK company headed by Mick Davis, former CEO of mining giant Xstrata—has raised $5.6 billion to buy up “blue chip” assets in the mining sector. Given Xstrata’s pedigree as a base metals company, I don’t expect X2 to go stalking any of our favorite gold exploration juniors—or even base metals juniors, for that matter. The company is more likely to buy deposits and operations from … Continue reading

The Most Likely Stocks to Give You Vertical Profits

The Most Likely Stocks to Give You Vertical Profits By Casey Research “This is a historical opportunity,” says Pierre Lassonde, co-founder and chairman of gold royalty company Franco-Nevada. Right now, gold stocks are so beaten down and undervalued that they have nowhere to go but up. And once the gold market rallies again, the best of the best mining companies—those with proven management teams and high-grade ounces in the ground—will simply go vertical.   Find out how to prepare your portfolio to get a shot at the jackpot. In GOING VERTICAL, Casey Research’s timely online event, on Tuesday, March 10, at 2 p.m. EST, eight of the world’s top industry experts tell you everything you need to know—including some of their favorite stocks to own now. Register here to watch—it’s free.   The article The Most Likely Stocks to Give You Vertical Profits was originally published at caseyresearch.com. Advertisement: Join … Continue reading

What Top Hedge Fund Managers Really Think About Gold

What Top Hedge Fund Managers Really Think About Gold By Jeff Clark, Senior Precious Metals Analyst In the January BIG GOLD, I interviewed a plethora of experts on their views about gold for this year. The issue was so popular that we decided to republish a portion of the edition here. Given their level of success, these fund managers are worth listening to: James Rickards, Chris Martenson, Steve Henningsen, Grant Williams, and Brent Johnson. Some questions are the same, while others were tailored to their particular expertise. I hope you find their comments as insightful and useful as I did… James Rickards is chief global strategist at the West Shore Funds, editor of Strategic Intelligence, a monthly newsletter, and director of the James Rickards Project, an inquiry into the complex dynamics of geopolitics and global capital. He is the author of the New York Times best-seller The Death of Money … Continue reading