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2 ETFs and 4 Mining Stocks to Profit from $1,500 Gold

Martin Hutchinson in Money Morning says that over the long-term oil and agricultural commodities are likely to deflate.

This is because, once the threat posed by the U.S. housing crisis has passed, the Federal Reserve will be forced to increase interest rates to fight inflation. Other countries will follow, which will deflate the commodities boom.

However, over the short-term, gold, whose movements are directly linked to inflation, is likely to bounce. Martin reckons a price tag of $1,500 an ounce for the yellow metal is entirely possible. He recommends two ETFs and four gold miners to profit from this situation…

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Byron King Says Commodities in a Short-Term Correction

It’s a difficult time for commodities bulls. Crude oil is off more than 20% from its July peak. Gold is going for about $830 an ounce, way off its Spring highs. And the Reuters/Jefferies CRB Index is down 19% from its June high.

Energy expert Byron King says investors shouldn’t panic over the drop in prices. For a start, August is a notoriously poor month for commodities. It tends to be a month of net selling.

Despite some demand issues caused by the global slowdown, Byron says commodities are in a short-term correction. And that means plenty of great bargains on offer…

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Buy Fannie and Freddie Debt Now at Record Yield Spreads

The U.S. banking system is in hot water. According to the Federal Deposit Insurance Corporation (FDIC), a total of nine banks have failed this year. Five folded in July alone.

To stabilize the situation, the U.S. government is poised to bail out Freddie Mac (NYSE:FRE) and Fannie Mae (NYSE:FNM). This opens up a great opportunity for investor, says Eric Roseman in The Sovereign Society.

He is buying Fannie and Freddie short-term and intermediate-term debt up to a maximum of five years. Yields are at historic highs and the government won’t allow these institutions to fail.

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Real Inflation of 13.6% and Failing Euro Mean Gold Will Soar

If you own gold or are thinking of buying gold, David Galland’s latest article for The Daily Reckoning is a must-read.

Gold is starting to climb northwards from its nine-month low reached on August 15. But at just under $832 an ounce this morning in London trade, the yellow metal is still way off its March high of  $1,032.70.

Dave says two important events mean the recent setback in gold prices will not last long. The first of these is soaring inflation in the U.S. - which, if calculated by pre-Clinton metrics, is now running at 13.6%. The second is the failure of the euro as an alternative to the dollar…

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BHP Billiton (BHP): Painting a Happy Face on Iron Ore

So you’re watching the Olympic Games and the usual suspects appear as advertisers… There’s Visa, Coca-Cola, McDonald’s…and BHP Billiton (NYSE ADR:BHP)? Who are those guys, anyway?

It does seem unusual for one of the biggest mining companies to sponsor the Beijing Games.

But as it turns out, this massive marketing campaign wasn’t targeted at Joe Sixpack watching the Olympics.

It was payback to Beijing, says Irwin Greenstein, writing for Contrarian Profits.

About this Site

ContrarianProfits.com is a financial news and opinion website with a twist. As investment guru Rick Rule puts it, “You are either a contrarian or a victim.” In the financial world, most people are losers because they just don’t know what game they’re playing. They think they can just get “into the market” along with everyone else, do what everyone else does, and they will make money. Not likely. By the time you’ve paid commissions, spreads, fees, taxes – and suffered the consequences of inflation – you’ll be very lucky just to have as much money as you started with.

Latest Views

Buy Oil Refinery Stocks if China Halts Fuel Imports

By Stephanie Grimmett | Emerging Markets | Today's Financial News

We’ve heard from Andrew Gordon about a potential resurgence in Chinese energy demand as factories get back to work following the Olympics. But Stephanie Grimmett at Today’s Financial News says China stockpiled too much gas and diesel before the games, and will not be importing fuel in the next month. Stephanie says this should keep crude oil prices subdued, but creates a good profit opportunity in oil refinery stocks

Sara Nunnally’s Investment Picks in Britain and Dubai

By Sara Nunnally | International | Taipan Daily

Sara Nunnally says oil is having a major influence in Britain and Dubai, and creating new investment opportunities in both. One is running out of supplies, the other can’t spend its income fast enough. In Britain, this has prompted a new round of exploration permits, with Egdon Resources (LON:EDR) leading the chase. Meanwhile, Dubai’s venture into the luxury international hotel market could see considerable expansion in the sector. More from Sara…

The Dangers of Dubai’s Real Estate Bubble

By Joel Bowman | International | The Rude Awakening

The Rude Awakening’s Joel Bowman says the real estate bubble in his new home of Dubai is unsustainable. Unimaginable oil riches are being spent at unimaginable speeds, sending house and rental prices through the roof. But if the lesson from the U.S. has taught us anything, it is that property speculators aren’t going to win forever. More from Joel…

And Then There’s This… Wednesday August 27, 2008

By Ed Steer | Gold & Resources | Casey Research

Neither gold nor silver did much of anything until shortly after London opened for business. Then the roof caved in. The bottom for gold came exactly two hours later…and silver was about a half hour later than that.

Naked Greed Behind this Housing Crisis

By Andrew Gordon | Real Estate | Investor's Daily Edge

Andrew Gordon at Investor’s Daily Edge responds to his readers’ comments about the U.S. housing crisis and the fate of Freddie Mac (NYSE:FRE) and Fannie Mae (NYSE:FNM). Banks, mortgage financers, lawyers, speculative buyers, no comes out looking good in this mess. How could such widescale deceit be allowed to happen? Naked greed, says Andrew…

America’s Economic Mistakes Will Take Time and Money to Correct

By Bill Bonner | Politics & Economics | The Daily Reckoning

The Daily Reckoning’s Bill Bonner says the biggest credit expansion ever could now be turning into the largest credit contraction. Big mistakes were made in all quarters of the economy, and these take time to correct. Bill says he still favors gold over other asset classes, given the enormous downside potential for the U.S. dollar.

China’s Domestic Market to Pick Up Slack from Slower Exports

By Ben Traynor | Emerging Markets | Fleet Street Daily

Fleet Street Letter’s Ben Traynor says China’s domestic market will insulate the economy from a fall in demand for its exports. Strong local consumer and investor confidence undermine the theory that China will be shot down by the global downturn. Ben says this is good news for Western investors looking for growth while their local economies stagnate.

Profit Opportunity as America Movil (AMX) Rolls Out iPhone Across Latin America

By Irwin Greenstein | Emerging Markets | Contrarian Profits

Soaring sales of Apple’s iPhone 3G in Latin America reveal an investment opportunity with one of the most overlooked telecom providers in the world. America Movil (NYSE: AMX) already has a waiting list of consumers waiting to buy the Apple iPhone 3G — indicating that strong future sales could propel the Latin American carrier to new highs.

The Truth Behind U.S. Housing Market Headlines

By Chuck Butler | Real Estate | The Daily Reckoning

The latest round of U.S. housing market data is prompting another round of claims that “the worst is over.” Howver, The Daily Reckoning’s Chuck Butler says the nuances in the latest data paint an altogether more gloomy picture.

How ECB Lending Changes Could Ruin Spanish Banking Sector

By David Stevenson | International | Money Week

A seemingly innocuous news story in the Financial Times could spell disaster for some European banks, says David Stevenson in Money Week. The ECB is looking to clamp down on struggling European banks that have become dependent on the cheap finance made available by Brussels. David says the alarm bells will be ringing loudest in Spain, where the banking sector is falling foul of a property market slump.

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