Greg McCoach - Angel Publishing

Proof that Gold ETFs Are a Fraud

Over the course of the last eight years — since the creation of the precious metals ETFs — I have maintained and repeatedly stated my opinion that these gold and silver financial products were dangerous and a FRAUD.

I have also stated that those who hold these precious metals ETFs or certificate programs would sooner or later find out just how fraudulent these products are, and not reap the full benefits of rising gold or silver prices.

Several years ago, during the 2008 meltdown, the Perth Mint certificate program was exposed for not holding the gold they told their customers was backed by the Western Australian government.

And now, once again, precious metals fraud is in the media — this time with the ETFs and the MF Global situation.

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One of the victims of this scandal, popular trends forecaster Gerald Celente, joined Alex Jones on "Infowars Nightly News" to detail how a six-figure sum was looted from his gold futures account, which, unbeknownst to Celente, was being held under the auspices of an MF Global subsidy.

As the Financial Times reported, the hundreds of millions in looted funds from customers’ accounts later “turned up at JPMorgan Chase, the failed broker-dealer’s custody bank.”

What a surprise (NOT) that the name JP Morgan Chase would be at the epicenter of this latest criminal behavior!

Despite Mr. Celente’s account being fully funded, Celente was hit by a margin call as Chapter 11 trustees stepped in to take control of his funds, leaving his account empty... and thereby closing his positions and preventing him from taking physical delivery of his gold which was due in December.

When Celente rejected demands to transfer more money into the account, it was hastily closed.

Those words above in bold tell the real story, because they owed gold they didn’t have. So they resorted to theft of customers accounts. In my opinion, this is criminal behavior, pure and simple.

It’s horrifying.

Ann Barnhardt, a commercial hedge broker specializing in cattle and agriculture futures, eloquently explains the MF Global situation (she’s also getting a ton of publicity for closing down her operations):

The reason for my decision to pull the plug was excruciatingly simple: I could no longer tell my clients that their monies and positions were safe in the futures and options markets – because they are not. And this goes not just for my clients, but for every futures and options account in the United States. The entire system has been utterly destroyed by the MF Global collapse. Given this sad reality, I could not in good conscience take one more step as a commodity broker, soliciting trades that I knew were unsafe or holding funds that I knew to be in jeopardy.

Everything changed just a few short weeks ago. A firm, led by a crony of the Obama regime, stole all of the non-margined cash held by customers of his firm. Let’s not sugar-coat this or make this crime seem “complex” and “abstract” by drowning ourselves in six-dollar words and uber-technical jargon. Jon Corzine STOLE the customer cash at MF Global.

What was a surprise was the reaction of the exchanges and regulators. Their reaction has been to take a bad situation and make it orders of magnitude worse. Specifically, they froze customers out of their accounts WHILE THE MARKETS CONTINUED TO TRADE, refusing to even allow them to liquidate. This is unfathomable. The risk exposure precedent that has been set is completely intolerable and has destroyed the entire industry paradigm. No informed person can continue to engage these markets, and no moral person can continue to broker or facilitate customer engagement in what is now a massive game of Russian Roulette.

I have learned over the last week that MF Global is almost certainly the mere tip of the iceberg. There is massive industry-wide exposure to European sovereign junk debt. While other firms may not be as heavily leveraged as Corzine had MFG leveraged, and it is now thought that MFG’s leverage may have been in excess of 100:1...

Read that last sentence very closely.

If it’s true that MFG was leveraged 100:1, that’s suicide. It also means this crisis isn’t over by a long shot.

Back to Celente...

Speaking with Alex Jones, Celente expressed his fury at the move, labeling it an example of “economic martial law,” and speculating that the real reason for the looting was because the broker never had the gold and silver to deliver in the first place.

Celente encouraged Americans to cash out of all gold ETFs and withdraw their funds from the bank because “they are going to steal all our money.”

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The trends forecaster savaged MF Global CEO Jon Corzine, labeling him a “cheap S.O.B.” who was responsible for the collapse because of his using customer funds to bet on losing European bonds.

“How come he’s not in jail, because he’s one of the white shoe boys from the Goldman Sachs crowd,” Celente fumed, going so far as to say Corzine “should have died” in his recent car accident.

Celente said that he had sufficient funds stored in a safe place that could not be looted, and that if anyone did try to steal them and threaten his life, he wouldn’t hesitate to "blow their brains out."

Celente reiterated his plea to Americans to withdraw all their money from the banks and leave only operating capital in their accounts, warning that “the merger of state and corporate powers” has brought “fascism” to America.

You must take physical possession of your gold and silver if you want to have your assets protected from collapsing government fiat currencies and government sanctioned corporate theft like the MF Global example.

Time is running out, folks. Make your necessary arrangements while you still can.

Sincerely,

Greg McCoach
Editor, Wealth Daily

P.S. In the coming weeks, I’ll be releasing my full report on my August trip to the Yukon, where a historic gold rush is occurring as you read this. This is real gold — not an illusion like a gold or silver ETF. More ideas on places to invest below...

Options Made Easy: The Only Way to Trade in a Recession
It's won't be easy to walk away from this recession with gains in your bank account... but that's precisely what Ian Cooper's readers are doing right now. Imagine trading with a system that delivers 68% or more in less than a month. Find out how they're doing it with Ian's proven system.

The Crisis that will Dwarf the Debt and Financial Crisis: And How You Can Profit
Peak Oil is here. And current oil prices are very likely the lowest we will ever see. But you can nail down easy triple-digit gains — 153% or more — from the biggest American oil discovery in 50 years: the Bakken. Don't wait to get into these shale stocks before you can no longer afford them...

Pocket Full of Euro Gold: How Gold and Oil Will Fare against the Dollar and Euro
This is what a Transatlantic currency war will do to the price of gold and oil.

IEA Says Conventional Oil Has Peaked: $1.5 Trillion Per Year Needed to Combat Peak Oil
All these factors are combining to make a bullish oil investment scenario. I've been saying as much for a few months now.

Electric Car Investment Opportunities: Chevy Volt Bursts into Flames!
Editor Jeff Siegel discusses the future of electric cars.

Gold and Silver Price Rally Imminent: Too Much Money, Not Enough Gold
Gold may surge, but you should buy silver now...

Shale Oil vs. Oil Shale: Blueprint for an Oil Fortune
Energy and Capital editor Keith Kohl clears the confusion over the differences between shale oil and oil shale. Plus a blueprint for the future of oil investing.

The Next Mega-Trend in Housing: This Trillion-Dollar Boom Has Just Begun
Editor Steve Christ discusses the next mega-trend in the housing market.

Anadarko Petroleum's Historic Oil Discovery: One of the Largest Finds in the World
Analyst Ian Cooper takes a look at Anadarko Petroleum's latest billion-barrel oil find in the Niobrara Shale in the Midwest United States.

Goldmine of the Future: Possibly the Largest Metals Mine on the Planet
When I recently discovered that some of the wealthiest and most successful resource investors in North America were putting their own money into this project, I hopped on a plane with Nick Hodge and Andrew Mickey to see it firsthand.

Keystone XL Pipeline Opportunities: 3 Stocks to Soar on Oil Pipeline Delays
Editor Jeff Siegel discusses the impact of delays on the Keystone XL pipeline.

Rare Earth Rebirth: China Cuts Supply, U.S. to Create Strategic Reserve
With less than a handful of rare earth mines in operation outside of China, continued price fixing games, and the growing use of handheld electronics, any company with access to supply is going to fetch a premium market price.

Precious Metals Investing

The past three trading days have been devastating to the precious metals and the mining shares leaving markets rattled and investors scrambling for the exits.

Why is this happening?

It all started last week with the latest desperate scheme of the Federal Reserve: Operation Twist. It was the biggest investing story of the week and its consequences thus far have been detrimental to markets worldwide.

Under this ridiculously stupid plan, the Federal Reserve will buy $400 billion of long-dated Treasuries, financed by selling bonds with three years to go or less. The idea is to try to drive long-term rates lower, which the Fed thinks will help the mortgage market.

The Fed unveiled this latest Keynesian economic insanity (QE3, aka Operation Twist) on Wednesday, and the market quickly tallied its opinion to the downside.

This proves my point that I have been making for the past year that these Federal Reserve pukes have no idea what to do about the current economic situation other than apply more failed Keynesian economic doctrine.

It is their failed policies that have caused the problems to begin with — yet investors still look to these idiots for solutions.

Unbelievable!

Let’s look at the Fed’s recent track record of providing a fix for what ails the economy. Those attempts were called QE1 and QE2, and we were told as recently as June — three months ago — that there would be no need for any other QE events.

This contradiction itself should tell investors these people have no idea what to do about the current mess.

During the first two rounds of QE, the Fed purchased $2.3 trillion worth of debt and kept interest rates at near zero for almost three years.

What has this accomplished?

The answer is nothing. It has actually made things worse, and yet they want to apply more of this failed thinking that has kept Japan in the dark for over 30 years.

Japan already went down this road and has proven this philosophy will not work.

In reality, QE3 is just another attempt at protecting the banks under the guise of supporting the housing market. In reality, these elitist banking bastards couldn’t care less about the housing market, since the banks end up with all the property and get either the Fed or the U.S. "Goobermint" to pay for it.

In the meantime, banking executives get huge bonuses for the whole insidious scam while the U.S. taxpayer ultimately gets to foot the bill. What a plan.

In my book, this is called the hijacking of America by the elitist banks for the elitist banks so they can get even more power and control.

But don’t worry; Americans will keep voting for Republicans or Democrats who are bought and paid for by these elitist banksters thinking that something will change.

~~wd_junior_gold~~

It makes one want to just scream in utter frustration.

In reality, nothing is going to change the course we are on. Citizens worldwide are going to pay the full price for all this economic and political stupidity. It is not going to be a pretty picture.

For the intelligent few (my subscribers) who do understand what is going on, what do we do?

Given the current prices of our juniors, we want to avoid panic at this point as demonstrated by a graphic (left, click to enlarge) sent to me by a colleague.

This spells it out better than I can describe with words.

For now, we must just hold on.

And whatever you do, don’t panic and sell at this point!

I wrote in recent weeks that investors who needed money should think about cashing up some in case things go south...

Well, things have gone south. Now we must just gut it out. It will get better.

Take another look at that graphic as your guide as to when to buy some low-priced stock. When you feel like capitulating and have utter despondency, then you know the time is right to buy. If you are able to do so, these will probably be some of your best buys ever, as I believe our market will recover in a big way.

I have been adamant in my belief that our markets would see extreme volatility in both directions. Well, we have just been hit by the downside volatility, which sets us up for a big upside volatility.

Remember that nothing fundamentally has changed. Governments and their central banks are more out of control now than they were last week, last month, or last year. Investors who don’t know what they are doing are being whipsawed around by these Keynesian jackals as they flee to what is perceived as the next best currency or the next best thing.

In the end, the only thing left standing will be the precious metals and their corresponding mining shares as one fiat currency after another implodes worldwide.

We are witnessing the final stages of what happens when fiat currencies go the way of the world...

For a good four-minute video on the subject of what a fiat currency is, please watch the following:

(Thanks to Scott R., a subscriber, for making me aware of this video. It is very well done and can be very useful in explaining to loved ones and others why you are investing in precious metals.)

I’ve never said that investing in precious metals and their mining would be easy, but I am on record that it will be worth it.

What lies between now and that moment is plenty of market volatility and all kinds of societal chaos.

You simply have to choose as an investor whether you want to be part of the slaughter, or be on top of the financial heap as the consequences for decades of economic and political stupidity come to full maturation.

I leave you with that choice and a quote below from Richard Russell. His words have guided me along the way when things have seemingly been at their worst for precious metals these past 11 years:

Remember, just as the bear wants to go down while taking the greatest number of stockholders with it, the bull wants to advance while taking the fewest investors with it. Therefore, this gold bull will try to shake as many gold investors off its back as possible as it rises.

The best way to do that is to violate so-called support levels. Advice, take a gold position that you can sleep with and forget about trading gold.

How many times during this secular precious metals bull market have we heard of gold’s demise only to have gold hit yet another new high?

This time is no different — only the volatility is getting greater as we get close to the implosion of fiat currencies worldwide.

I choose gold, silver, and the precious metals mining shares for my financial salvation.

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator

$200 Silver as COMEX Faces Default

Close your browser... shut down your computer... and go buy silver!

The price of silver pulled back 8% yesterday afternoon, carving out a phenomenal investment opportunity for you right now.

At last look, spot silver stands at $39.21 an ounce. But the window to own silver below $40/oz will be open only for a short time, because silver prices are headed for an explosive breakout.

Silver will rebound to $60 an ounce following this correction on surging demand — and then quite possibly to $150-$200 an ounce amid growing concerns that the COMEX itself could default over critically low physical warehouse inventories.

Is There Such a Thing as Negative Unemployment?

There's a place in the heart of the United States where there are more jobs than people.

Where a teenager with a blank sheet for a resume can move — and a week later... be working a $90k/year job.

What's driving this boom is bigger than just a small town, a zip code, or a single state.

It's an industrial expansion the likes of which we haven't seen since the early 20th century.

And it's about to change everything.

Click here to learn more about it.

While gold continues to claim the media spotlight, silver investors will be cut the biggest paychecks.

You see, there's one thing they never tell you about gold: 95% of all the gold that has ever been produced is still around in one form or another in coins, bars, artifacts, and jewelry. In fact the same gold that was mined in Egypt 8,000 years ago could be in a piece of jewelry you own today.

Gold has been historically priced ten to twenty times more than silver. So the reclamation of silver is not a priority as it is with gold...

The universal and intrinsic value of gold ensures the yellow metal is saved and recycled to be used in different applications throughout time.

But silver is different. Silver disappears from the market over time; 95% of the silver that has ever been mined has already been consumed by industrial use. That silver is gone forever — unrecoverable at any price.

Silver Industrial Demand

Last year, electrical and electronics demand for silver reached an all-time high of 243 million ounces. In 2010 alone:

Cell phones used 13 million ounces of silver
Computers consumed another 22 million silver ounces
Solar photovoltaic panels needed 47 million ounces of silver

The global solar photovoltaic industry alone is expected to call for 70 million ounces this year, and expected to double again — reaching 150 million ounces per year — by 2015. And this demand does not include the other tens of millions of ounces needed for the automobile industry, water purification, medical applications, and nano-silver in goods packaging and hygiene...

Total industrial demand will rise from 487 million ounces in 2010 to 666 million ounces in 2015.

In 1950, there were 10 billion ounces of available silver above ground. By 1980, that number shrank to 3.5 billion ounces. Today that figure has fallen to about 700 million ounces of above-ground, refined silver.

Above Ground World Silver Resources

The limited availability of physical silver for the industrial markets alone is enough to rebound prices to another record, past $60 an ounce.

There are about 300 million ounces of physical silver in private hands around the world. The ETFs hold another 350 million. And that's just about it.

COMEX physical supplies are running critically low — so low, in fact, the exchange is actually faced with a default.

There are now less than 30 million ounces of physical silver held at COMEX warehouses. These silver-starved warehouses could prove to be the catalyst that propels the price of silver past $150 an ounce in the near term.

This CEO Accidentally Reveals a Big Secret

Experts say North Dakota's Bakken Oil Pool may hold 4-6 billion barrels of sweet, light crude.

But the CEO of the biggest Bakken oil company just let it slip that there's as much as 24 billion barrels.

The thing is, there's very little land left for drilling leases...

And that means Bakken oil companies may be worth 300%-400% more than most investors now believe.

You can watch this CEO's incredible video footage HERE.

Major COMEX Physical Silver Shortage Continues

Physical COMEX inventories of silver are now down to 27 million ounces. That's more than a 35% decrease since April — and down 48% in the last twelve months.

With so little inventory, it's likely that nine out of ten COMEX traders do not have their silver contracts backed by stockpiles of the physical metal. And at this point, COMEX itself could default if as few as 5,000 contracts stood for delivery.

But the chances of COMEX actually defaulting are slim. Bear Sterns, AIG, Freddie Mac, Fannie Mae, Ford, GM, CitiGroup, Bank of America — all of these companies were bailed out by the U.S. government... There's simply no way COMEX, the world's largest physical commodity futures exchange, is going to be allowed to go underwater. Not gonna happen.

Still, fears of a default will bubble as more investors realize the scarcity of silver relative to the paper that is representing it.

Something will have to be done. Unfortunately for the government, they don't have the physical silver resources anymore to cover a default on physical COMEX inventories. The Feds sold off the country's silver reserves decades ago, and the U.S. government's current stockpile is currently reported simply as "None."

If it comes down to it, the government will have to buy massive amounts of silver in the open market to supply COMEX with the bullion to cover contracts. This would lead to explosion in silver prices straight into triple-digit territory — past $150 an ounce, and I think even testing the $200/oz level.

We will see the price of silver rise to these levels in very short order.

So don't hesitate. Buy silver today.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Gold Spikes After Oslo Bombing

The price of gold spiked today immediately following a terrorist attack in Oslo, Norway. In the nation's worst attack since WWII, at least seven people have been confirmed dead with another 15 injured so far.

Concerns over future attacks pushed investors directly toward gold, surging prices back over the $1,600 level.

Gold prices have increased nearly 7% since the beginning of July as investors continue to swarm into the market seeking safe haven from global economic woes. Continued security fears may also add to gold's run in the short-term.

Here was the scene in Oslo moments after the attack:

- Greg McCoach

Iraqi Dinar Revaluation

U.S. national debt will exceed $14.5 trillion by the end of the summer.

The government has been underwater so long, it has gills...

But despite their desperate condition, the Feds still have a few tricks up their sleeve that will allow them to keep “kicking the can” down the road.

One of the gimmicks they've cooked up to stave the wolves off is becoming more and more evident: Iraqi Dinar Revaluation.

The dinar collapsed after the United States invaded Iraq and toppled Saddam. Prior to U.S. invasion, the Iraqi currency was trading over USD3 to one Iraqi dinar on the strength of the country's massive oil industry.

After the collapse, the dinar was trading significantly lower. At one point, a single dollar purchased one thousand Iraqi dinar.

Speculators began to take positions in 2004 hoping someday, the dinar would recover and the UN economic sanctions would be lifted, allowing the currency to be revalued. Since then, there has been much speculation regarding how and when that would occur.

But here's the really interesting part...

The U.S. Government is the Largest Holder of Iraqi Dinar Outside of Iraq

Does that really come as a surprise?

The U.S. Treasury does not officially list the Iraqi dinar as part of the country's forex reserves.

New Iraqi Dinar

see detail of 50 dinar bill

However, the Treasure does say it did an initial currency swap with Iraq to fund their government and Ministries...

Exactly how many dinars were traded is not mentioned, but it does make reference to “billions of U.S. dollars” traded to Iraq.

About two months ago, Iraqi dinars could no longer be purchased; the recent Dodd Frank bill appears to have legislation related to the revaluation of a foreign currency and preventing mass hysteria.

From what I have been able to gather, it sounds like this plan was originally put together by George Bush, Dick Cheney, Alan Greenspan, and others years ago as a way for the U.S. government to be repaid (read: get kickbacks) for their efforts in Iraq.

Experts speculate the U.S. government received nearly 4 trillion Iraqi dinars at an exchange rate of 4,000 dinar to USD1.

If this is even close to true — and the UN allows Iraq to revalue their currency up to USD1: one Iraqi dinar — the U.S. government would stand to profit in trillions... as would anyone else who speculated on the dinar over the years.

Bush’s statement, “This is a war that will pay for itself,” will be true 10 times over.

Check out how the House of Saud got taken for $267 billion of their own crude oil.

~~SIGNUP_WD~~

Speculating on these matters, however, is essentially useless. There is little to nothing that can be done to change it now.

Rather, our attention should be focused on what we can do to protect ourselves and establish security for the future before the house of cards finally topples.

And I maintain the best place for investors right now is portfolio positions in physical precious metals, quality mining and mineral exploration stocks, and more recently, cash.

I typically don't keep a lot of cash in my trading accounts. But I think it's important to keep a little cash in your portfolios right now, because I believe we will see some exceptional buying opportunities within the junior mining sector in the next six to eight weeks.

Significant Buying Opportunity Coming in Junior Mining Stocks

There is still a very limited market for junior mining stocks among large financial institutions as seasonal traders have left for the summer — and the retail market still hasn't figured it out yet.

The junior mining sector, despite the high metals prices across the board, is getting very little attention from mainstream investors. This will cause even the best companies to weaken as the summer months slumber along.

You can clearly see this in the TSX Venture, which comprises about 50% junior mining companies:

From the recent high of over 3,400, we are now below 2,000. I believe we may test the 1,700 level before we begin to solidify toward the end of summer.

But these next six weeks or so will provide us with some great opportunities to look for real value within our market.

The only thing that will buck this downward trend in the coming weeks is individual junior mining companies that announce exceptional news, such as great drill results or a press release of a joint-venture agreement, merger and/or acquisition news.

In general, it looks like the balance of the summer will be tough overall for our junior mining shares.

Junior mining stocks — particularly junior gold stocks — have been underperforming their respective metals.

In the past 18 months, gold prices have increased over 35%, yet gold equities have had difficulty keeping up.

CIBC Analyst Barry Cooper recently wrote, “The net result is that gold companies can now be purchased for about their intrinsic value for the spot price of bullion.”

This lag in junior gold stocks, as well as in the overall junior mining stock market, will carve out a beautiful buying opportunity for investors to take a position at historically low prices compared to bullion.

When all is said and done, I believe 2011 will be another banner year for precious metals and their respective mining and exploration shares.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Buy The Dip In Gold Miners

Volatility is the undersong of the summer.

The wild swings we've recently seen in the markets — in silver prices, the Dow, currencies, oil, etc. — have been a fulfillment of what we've been predicting for quite some time...

And we can expect this kind of market volatility, both up and down, to become much more pronounced in the coming months.

I maintain that the long-term direction of precious metals — and their corresponding mining and exploration stocks — remains bullish. But short-term bloodletting is going to occur from time to time that could break weak-kneed investors.

I have been recommending ownership of physical gold and silver with nothing but absolute confidence for over 13 years now.

Those who have listened during that time have done phenomenally well with very little risk, especially early investors. At my bullion dealership, AmeriGold.com, we have zero clients who have lost money during that 13-year period.

How many financial institutions can say this?

We were simply at the right place at the right time.

And, though we have been through plenty of ups and downs, precious metals prices kept moving higher...

Junior mining stocks — which represent more risk than ownership of physical metals — have also certainly had their ups and downs. But they've also been the source of our biggest paychecks.

Over the past three months, share prices of junior gold companies have taken quite a hit.

Canada's TSX Venture Exchange, composed of ~50% junior mineral firms, has dropped over 20% since March:

But this pullback is ultimately of little to no concern, and it will really serve to create a buying opportunity for us.

The fact is these types of pullbacks are common — and temporary. The junior market experienced similar setbacks in 2010 and 2009 before rebounding and breaking into new highs.

Take a look at a chart of the TSX Venture since 2009:

Despite these short-term selloffs, gold stocks have climbed 1,400% off of 2000 lows, while the S&P 500 Index has experienced an 11% decline, according to J.P. Morgan.

As CEO and Chief Investment Officer of U.S. Global Investors Frank Holmes noted in an article on MineWeb.com last week:

Gold stocks have historically outperformed the gold price by roughly a 3-to-1 ratio. This means that a 5 percent rise in the price of gold generally translated into a 15 percent rise in the miners. Recently, this leverage has eroded to about a 1-to-1 ratio, or lower at times, according to BofA-Merrill Lynch.

With the general junior mineral market currently being undervalued, I believe today's investors will be exceedingly rewarded as the share prices of junior firms recover from the sell-off and quickly catch up to rising metal prices.

~~SIGNUP_WD~~

Our constant message to subscribers has been to own a combination of the physical precious metals and quality junior mining shares as the best way to protect yourself from the ills of big, bad government and all their fiat currency lies and B.S.

In recent years, as things have progressively become worse, we have also advocated the need to keep our money in currencies other than U.S. Dollars (the Canadian Dollar), and the necessity of starting and maintaining food and weapon storage of significant size.

I fear civil unrest and chaos will spread to the United States and Canada as the global fiat currency nightmare finally implodes. Organized uprisings are already starting to occur.

There's a hot new trend in civil unrest, called Mob Robs, when a mob of people swarm into a store and take everything in sight. The store workers become completely overwhelmed and can do nothing to stop it.

These mob robs sound frightening similar to the food riots happening around the world. And the really disturbing part is that they're happening more and more frequently...

Teenage 'flash mob' robberies on the rise in the U.S.
The Herald

June 19, 2011 — The same technologies that for years have brought together the mostly benign and goofy "flash mobs," in which groups suddenly break into dance at a mall or stumble around like zombies at train stations, are being used to plan and execute bold robberies.

Police say the suspects select a time and place and enter the store in droves, taking what they want and leaving before security or police can catch them.

Some of the most brazen robberies take place in the light of day and on busy streets despite all the security cameras and the watchful eyes of workers.

Here's what a mob rob looks like:

This is just the beginning.

Can you imagine what will happen when Social Security and welfare checks go out, but can’t buy a fraction of what they buy today?

Be Prepared

I believe we will continue to see wild fluctuations in all markets with increasing occurrence. This will be directly caused by governments and their central banks, which are completely out of control. They have no idea what to do other than dump more fiat money into the system and hope for a different result...

As the quote goes, “Those who don’t know or understand history are doomed to repeat it.”

If you understand this, you should have absolute confidence in what you are doing. And I tell you this today because in the coming months and years, you are going to need this confidence to stay the course.

We are very close to the final consequence phase of fiat currency madness. Chaotic volatility up and down is coming worldwide to all markets.

Get used to it; take it in stride. It is going to get a lot worse.

I believe being prepared with a significant cache of physical precious metals, land, food, and weapons is the best way to manage and survive with the least amount of problems.

But each one of us will have to choose which preparations make the most sense for ourselves and for our families...

I'm ready. Are you?

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Yukon to Deliver the Gold This Summer

Untitled document

Dear Reader,

I wanted to make sure you were aware of a special resource available to members of Wealth Daily. In addition to the videos we share with you via e-mail, we also have an entire library of free videos available for you to help hone your wealth-building skills and knowledge.

This morning we posted a new video to that page from editor Adam Lass. It's about how certain ideas become popular in society and how you can profit from them, with special attention paid to gold.

We'll be producing more and more of these informational videos for you every week. Make sure you watch them all. Now on to today's Wealth Daily...

To your wealth,

Steve Christ
Managing Editor, Wealth Daily

The junior gold stock market has seen the typical downward bias during the month of May, as investors took money off the table with expectations of a slow summer.

In particular, fickle hedge funds managers who are known to dart in and out of the junior gold companies have left the table for the moment seeking better returns elsewhere.

You can see this “Sell in May and Go Away” effect in the HUI and XAU six-month charts — both of which have taken a hit from recent highs.

click to enlarge

But not all junior gold stocks are experiencing a lull right now.

A particular group of gold stocks is faring very well, despite the pull back in precious metal prices and the "Sell in May" effect. And this small group of junior explorers is just getting started...

Junior gold firms with assets in Canada's Yukon Territory have held up rather well compared to the overall junior mining shares indexes.

The reason for this is the $600–$800 million dollars expected be spent on exploration and development work over the next six months in the Yukon. That's a lot of money going into the ground, and highly prospective for new discoveries.

And it leads me to believe we'll see a few big new discoveries in the Yukon this year that will show the world what a modern gold rush looks like.

When gold fever really hits the mainstream, the Yukon gold rush be like nothing we've seen in our lifetime...

New Exploration Techniques and Modern Tools are Rapidly Advancing Yukon Gold Exploration
Powerful high-mobility drill rig working on Radius Gold's 60-Mile project. click to enlarge	Ultra light-weight and portable excavator trenching Kamanik Gold's Coffee project. click to enlarge

I believe interest in Yukon gold stocks could be a catalyst to bring a whole new set of investors to our junior gold stock arena, something our market has desperately needed for quite some time. Or it may be as simple as precious metals prices reaching for new highs in the coming months, bringing a greater portion of the investing public into our market.

Either way, I am optimistic for our market in the short, mid-, and long terms. I expected gold and silver prices to rebound from the latest correction rather quickly.

I believe gold will push through the $1,600 level — and possibly higher, depending on the state of the economy over the course of the next seven months.

The silver story will be bigger.

~~SIGNUP_WD~~

I now see silver prices pushing past $50 towards $75 an ounce before year-end.

A Quick Word on Silver

The most important thing we're seeing in the precious metal rebound is that silver is out performing gold. What this tells us is silver will now be the leader in the secular bull market for precious metals moving forward...

Gold was the best performing asset for the last ten years. But silver will be the best performing asset for the next ten.

This is not to say that gold will not perform well. It will; it’s just that silver is going to perform better.

I firmly believe the Fed will try to do QE 3... 4... 5... 6... to infinity if they could, as the only tool they have left in their arsenal of economic destruction. This will be highly inflationary, and silver will again act (like gold) as a currency.

Those who are long-term bearish on silver will be slaughtered.

The fundamentals and dynamics in both metals is rock solid for much higher prices for a long time to come.

Ownership of the physical metals is one of the best assets to protect yourself from the terrible and unfortunate events that loom in our near future.

And as precious metals prices continue to push for higher and higher new highs, our quality junior mining shares are going to perform exceptionally well.

I maintain that investors will continue to do very well this summer in the precious metal and junior mineral exploration markets.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Housing Market Will Weigh on US Economy For Years

The S&P/Case-Shiller Home Price Indices are the leading measures for the residential housing market in the United States, tracking changes in the value of residential real estate both nationally as well as in 20 metropolitan regions.

The indices are calculated monthly and published with a two-month lag.

New index levels are released at 9am Eastern Standard Time on the last Tuesday of every month.

Data through February 2011, released last week by S&P — the leading measure of U.S. home prices — show prices for the 10- and 20-city composites are lower than a year ago, but still slightly above their April 2009 bottom.

According to the Case-Shiller report:

The National Index hit a new recession low with the first quarter’s data and posted an annual decline of 5.1% versus the first quarter of 2010. Nationally, home prices are back to their mid-2002 levels.

As of March 2011, 19 of the 20 MSAs covered by S&P/Case-Shiller Home Price Indices and both monthly composites were down compared to March 2010. Twelve of the 20 MSAs and the 20-City Composite also posted new index lows in March.

With an index value of 138.16, the 20-City Composite fell below its earlier reported April 2009 low of 139.26.

David M. Blitzer, Chairman of the Index Committee at S&P Indices, was pretty blunt about the report, saying: “There is very little, if any, good news about housing. Prices continue to weaken, trends in sales and construction are disappointing.”

If you want the best barometer on the state of the economy, there it is!

This index is dropping like a rock through the floorboards.

The Fed has thrown the kitchen sink in an attempt to reflate the economy and get real estate prices moving.

Why? Because the banks are in desperate straits, and the Fed is more concerned about the banks than they are the people.

But it’s not working for them — and they know it. In other words, QE1 and QE2 have not worked as they had hoped.

And here's the proof:

So expect even more Quantitative Easing (I love the deceptive term they came up with to describe the debasement of our money), because they don’t know what else to do but throw more money created out of thin air at the problem.

And they have no other viable options.

Twenty years from now, people will look back and wonder how we could have let our leaders put us on this path. The price that all of us will have to pay for this insanity is going to be severe.

All you can do is prepare as best you can for the economic debacle of all time.

Ownership of the physical metals, a safe haven place far away from the big cities, and long-term storage of food and essentials is what you can do to protect yourself from the terrible and unfortunate events that loom in our near future.

And as precious metals prices continue to push for higher and higher new highs, our quality junior mining shares are going to perform exceptionally well...

Based on physical buying pressures we've already seen this year, I feel we could still see gold and silver running to yet more new highs.

We are destined to see $50 silver again, while I think gold will probably blast through $1,700 an ounce by year-end.

We won’t have long to wait to see if I am right or wrong...

In either case, the storyline for the precious metals remains extremely bullish for the long term.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

My Favorite Silver Trading ETF

As we expected, the price of silver is rapidly recovering after the brutal correction we experienced earlier this month.

And now, the next phase of the silver bull market looks like it will open with a healthy bang, taking prices much higher.

In today's Wealth Daily, I'll detail for you one of my favorite silver trades — one that I've personally made money with at least a dozen times in the past year.

After shedding some 31% of its value, the price of silver has bounced off its monthly low of about $33.50 an ounce.

This morning, silver prices opened around $37.50 an ounce.

This month's silver sell-off puzzled many investors, especially those who truly understand the intrinsic value of the white metal and have a clear perception of its supply/demand fundamentals.

But the fact is silver was ripe for profit taking after swiftly moving from $30 to $50 an ounce in a matter of weeks.

No market goes up in a straight line, and we were due for consolidation at some point...

Nevertheless, I believe we'll see the price of silver steadily rise throughout the rest of the year, with moderate corrections along the way.

The upward volatility will become greater as more and more investors and institutional funds wake up to the fact that they need to diversify away from the depreciating dollar.

Overall, I expect the silver prices to be closing back in the $50 level over the next few weeks as the dollar continues to wane in value. After that, I believe silver could even hit $70 an ounce by Labor Day.

World Silver Demand Facts

Investment demand for silver has skyrocketed 522% since 2007.
World governments are hoarding silver; official sales have plummeted 83% in the past three years.
Above-ground silver supplies dropped 86% last year.
Industrial demand for silver has increased over the past decade, despite a 236% increase in prices.

Investment demand will remain key to silver's price. Higher demand will be required from investors because silver's supply/demand fundamentals are expected to deteriorate, with an expected surge in mine production and lower fabrication demand.

And as gold prices approach $2,000 an ounce, I believe silver will be preferred by many — if not most — retail customers as a cheaper alternative that provides the level of wealth protection investors might be looking for.

Gold is moving up against all currencies worldwide. And while some may flee the dollar to go into the euro or some other fiat currency for a time, most will eventually come to both gold and silver as the only true safe haven for their savings.

Add on top of all these events the next wave of derivative problems that are soon to hit the market, and we have the making of the perfect financial storm worldwide.

Owning the physical precious metals and quality junior mining stocks is the only insurance one can have against the financial insanity that's about to be unleashed on a worldwide basis.

Get your house in order and prepare while you still can.

Here's one great way to do exactly that...

~~SIGNUP_WD~~

ProShares Ultra Silver ETF

Symbol:	NYSE: AGQ
Price:	$195.70

The ProShares Ultra Silver ETF (NYSE: AGQ) is designed to track double the daily market performance of silver.

The ETF seeks daily investment results that correspond to twice (or 200%) the daily performance of silver bullion, as measured by the U.S. dollar fixing price for delivery in London.

In other words, AQG is designed to increase 2% when the daily London fixed price of silver increases 1%. And of course, this works both ways: When silver prices decrease 1%, AQG is designed to lose 2%.

But this is very important...

The ProShares Ultra Silver ETF does not directly or physically hold the underlying silver bullion. Instead, the ETF seeks exposure to silver through derivatives.

Typically, I avoid investing in any kind of derivative like the plague. But the ProShares Ultra Silver ETF isn't really an investment instrument; it's really best used for trading.

As the price of silver retraced its steps earlier this month, I wrote to my subscribers urgently telling them these are the dip moments I have been talking about where you want to be a heavy silver buyer.

And the ProShares Ultra Silver ETF was the perfect trade.

It has already been a wild ride, but one that has brought great satisfaction to me in helping others to make money. What's even better is that the best is yet to come for the precious metals and the mining shares.

Stay tuned, stay focused, and don't let this bull toss you off its back. It's kicking and bucking to knock as many of you off as possible...

Hang tight. It will be worth the ride in the end.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Gold Aimed at $6,500/oz, Silver... $600/oz

Get ready. We are now entering the final stages in the collapse of the U.S. dollar...

And it's not going to be pretty.

The massive increases in money supplies will tank the value of the dollar and erode the very fabric of America's economic security.

As a result, gold and silver prices are will no doubt skyrocket, despite the short-term major volatility we've recently seen.

Many investors have been rushing to me asking if it's too late to buy precious metals with gold in the $1,500/oz range and recently spiking to nearly $50/oz. I keep telling them the same thing...

Despite whatever the price of gold or silver is today, both metals will be worth more than twice as much within 12 months.

That means $3,000 gold this time next year! After that, I think gold could break $6,500 an ounce.

And as you know, silver's gains will be much greater. When the bull market is all said and done, there's no doubt we could be looking at silver prices exceeding $600 an ounce.

And we can all thank the crooks in D.C. for it...

In his first ever press conference after a policy meeting two weeks ago, Bernanke told us all the ways he has saved our economy.

What a crock!

The Federal Reserve can't prevent the coming financial meltdown.

So far this year, the U.S. Treasury has raised $293 billion in net cash by selling debt securities. And so far this year, the Federal Reserve has purchased a net $330 billion of Treasury notes and bonds.

This translates to the Fed providing 100% of the net new cash the Treasury has raised this year — plus another $37 billion needed to mop up even more mess!

But who will buy Treasuries when the Fed doesn’t? China? Germany? Japan? You? Me?

~~SIGNUP_WD~~

Going to Hell in a Hand Basket

We are now getting very close and even accelerating toward the end game for the U.S. dollar and the American Empire as we know it. Have your life boats ready.

It won't be much longer before people really start buying both gold and silver to protect themselves from this enviable collapse.

The only way out of our dilemma, absent very large entitlement cuts, is to default in one (or a combination) of four ways:

Outright via contractual abrogation (surely unthinkable)
Surreptitiously via accelerating and unexpectedly higher inflation (likely, but not significant in its impact)
Deceptively via a declining dollar (currently taking place in front of our very eyes)
Stealthily via policy rates and Treasury yields far below historical levels (paying savers less on their money and hoping they won’t complain)

I would bet on a combination of deception, betrayal, and trickery.

Following the Smart Money

This past month, the University of Texas bought a billion dollars' worth of gold and is having it stored in a private depository. This is huge news.

More and more, the intelligent group of our population is starting to figure things out. Unfortunately, however, the unsuspecting masses are being led perfectly by the well-oiled government/media propaganda machine like sheep to the slaughter.

This is going to be a terrible reality for so many unfortunate Americans who have no idea as to what is coming shortly down the road.

And you can rest assured the politicos in Washington will do what all politicians do when they are trapped in such a manner: lie, cheat, steal, spin the facts, cover their asses at all costs, abuse their power, and misinform on a massive scale.

But even with the help of the government-controlled media, the time of consequences can no longer be held at bay.

Free market forces will win; governments, banksters, and their power structures will come tumbling down just as we have been seeing elsewhere around the world these past six months.

The spoils will go to those who were prepared and understood the debacle years before it hit.

The precious metals and the junior mining shares will reward those who understood, and punish those who didn’t.

Yes, the precious metals market will be extremely volatile in both directions at times, but buy the dips as gold and silver will keep heading to higher and higher ground.

As long as the Fed and U.S. government follow the course of “Quantitative Easing” or anything like it, you can rest assured that gold and silver prices will soar!

If you leave your money in U.S. banks in dollars, you will lose most of the purchasing power of your money.

Use the downside volatility to buy any dips you see in the metals. Whether you bought gold at $600, $1,000, or $1,500 an ounce, it really won’t matter much when gold is trading at $6,500 an ounce or more.

The same thing can be said for silver. Don’t worry so much whether you bought at $25 or $50; silver will be priced in the hundreds of dollars an ounce, possibly $600 or more as the silver to gold ratio descends to 15 to 1, and possibly even 10 to 1.

In fact I believe silver stocks will actually be one of the biggest winners over the next 24 months.

Time is of the essence.

The lies of the Fed and the U.S. gov't are becoming bigger and more complex, their noses growing longer and longer as the fiat currency-economic-insanity comes to a head.

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Are Silver Prices Collapsing?

The price of silver has really taken a haircut over the past several days.

Silver prices have fallen some 27% since the beginning of the month, and is now leading commodities to the downside.

The sell-off has been dramatic, to say the least. Gold has been hit as well, but not anywhere near as badly as silver has...

Word on the street is that several large hedge funds have been liquidating commodity positions across the board over the past few weeks.

The Wall Street Journal reported last Tuesday:

George Soros's big hedge fund, a firm operated by high-profile investor John Burbank and some other leading firms have been selling gold and silver, according to people close to the matter, after furiously accumulating precious metals for much of the past two years.

I suspect Soros was holding more silver than gold, considering its price volatility...

Last week, silver prices suffered their worst one-day drop in dollar terms in three decades. And with such a stir in the market, the iShares Silver Trust (NYSE: SLV) was one of the most actively traded investments on the U.S. market on several days last week.

This extreme volatility is setting us up for the ever-increasing moves to the upside in precious metals — and in commodities in general.

And this is really a short-term pullback and buying opportunity.

I expect precious metal prices to settle down in the next few days and begin to form a new base. From there, we'll launch to the next set of new highs in gold and silver.

Expect for this to occur. Plan your buys and sells accordingly as we head into the next rally.

The big boys like Soros will continue to sell into the short-term rallies with their paper profits, just as they have this past week or so. But the rallies will continue to higher and higher levels.

We should just start factoring this type of market behavior into our thinking from here on out. It's going to get extremely volatile, which will push our markets into parabolic levels. I suspect money flow to pour back in at some point.

But the question now becomes How long does the exodus last, and how long will the big boys who have left the trade sit on the sidelines?

Jim Sinclair said the other day, “The drop at this time will in retrospect be seen as the foundation for gold trading not at $1,650, but rather at $5,000 an ounce.”

Central banks around the world have become net buyers of gold after two decades of heavy selling pressure. There is not a week that goes by anymore without news of major physical buying of gold or silver by "this country" or "that group".

These are the signs that gold is once again considered the ultimate form of money.

The physical silver market is still extremely tight despite the heavy selling on the paper side, which has severely impacted our market in the short term. But I don’t think this will last long...

Gold and silver are not in a bubble; the U.S. dollar and United States bonds are in a bubble!

For now, precious metal prices have taken it on the chin. But the fight is far from over...

In the end, it will be gold and silver as the last men standing.

So watch carefully as things once again go our way. I don’t think we will have to wait too long.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator

"It Could Completely Kill China's Solar Industry!"

It's the new, American-made solar window...

And it could put every Chinese solar manufacturer out of business in less than five years.

Don't believe it? Check out this American ingenuity for yourself!

Click here.

~~SIGNUP_WD~~

Silver to Soar as the Gold to Silver Ratio Stabilizes

During precious metal bull markets, gold usually gets all the media attention. But as investors are quickly learning, the biggest gains go to silver.

Truth is, silver prices have consistently outperformed gold during bull markets — doubling, tripling, even quadrupling the price of the yellow metal.

In the past 12 months, for instance, the price of gold has increased 27%; silver has climbed 164% over the same time.

Yet despite the recent swell in prices, silver should continue increasing, doubling within the next few weeks and vaulting the price of the white metal over $100 an ounce.

Here's exactly how that's going to happen...

4,500-year-old Ratio Shows Silver Will Catch Up to Gold

For gold bugs and other hard-asset investors, the gold-to-silver price ratio is well known. But most investors are unfamiliar with this metric.

In short, the gold-to-silver ratio represents the number of silver ounces it takes to buy a single ounce of gold.

Since silver is approximately 16 times more abundant than gold on Earth, markets have set silver prices at 1/16th of the price of gold in the past. And that gives us the historic gold-to-silver ratio of 1:16.

To calculate the current gold-to-silver price ratio, simply divide the current price of gold by the current price of silver.

Markets have used this 1:16 ratio to price silver for over 4,500 years. But there are periods when the gold-to-silver ratio gets thrown out of whack and rises or falls to extreme levels.

For example, at the beginning of the current precious metal bull market, the gold-to-silver ratio was over 1:60.

But these periods of statistically extreme gold-to-silver ratio levels don't last. And sooner or later, the time-tested ratio returns to the historic 1:16 level.

Just last summer, the gold-to-silver ratio expanded to 1:66. Gold was over $1,200/oz; silver sat at $18/oz.

However, the gap between gold and silver prices has rapidly begun to close...

Silver to Soar as the Gold-to-Silver Ratio Stabilizes

By the beginning of the year, the gold-to-silver price ratio had narrowed to 1:48.

Today, the ratio sits at 1:32, with gold at $1,534/oz and silver trading at $48.25/oz. But the metric is rapidly approaching its historic 1:16 level.

If the price of silver would catch up to the historic gold-to-silver ratio today, the price of silver would be $95.87/oz. And as gold prices continue to rise, the price of silver would easily exceed $100/oz.

Before this secular bull market for precious metals is all said and done, I think the ratio will not only return to its historic 1:16 level; but it will actually move toward 1:10 or even 1:5.

That would push the price of silver toward $200 or $300 an ounce.

Think I am crazy?

That’s okay. I’ve gotten used to it over the years...

But I've also been proven right time and time again on most (not all) of my calls for precious metals prices, going back 12 years.

The hard truth is the world is about to face an unprecedented period in its history as it relates to fiat currencies.

There are oceans of fiat money across the planet that will suddenly be rendered worthless... As the fiat currency dominoes begin to fall, it is not difficult to imagine the pandemonium that will take place as investors attempt to flood into the only currency known to protect one’s savings at such a time: gold and silver.

~~SIGNUP_WD~~

Be Prepared

The amount of fiat money in existence is absolutely staggering. Yet the precious metals markets are tiny. There simply aren't enough of these metals for everyone.

A major upheaval is already underway. But it's about to get much, much worse.

It's going to be a difficult time for all of us. Those who are prepared will not suffer as much as those who are not. And I need to remind everyone not to listen to the constant media buzz that silver and gold are in a bubble.

They are not in a bubble.

This is just another attempt by the deceptive media, doing what they always do to keep you from what you should be doing — which, in this case, is buying gold and silver.

From what I have seen in the markets since the beginning of the year, it appears both gold and silver have been given a green light because the worldwide economic plight has suddenly accelerated.

The slight downside market action in precious metal prices is short and very brief, so I continue my mantra to buy on the dip days or dip mornings.

By afternoon in many cases, the metals are already in recovery mode as major physical buying comes into the market.

I expect we will be pushing for higher highs for all precious metals, with the occasional pullback for the balance of the year if the fiat currencies don’t implode in 2011...

When they do implode, it will be off to the races for gold and silver.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

This Ain't Your Father's America

The recent bickering between the two parties in Washington over the national budget all but proves one thing: honor has completely disappeared from our nation’s capital.

Listening to these sell out jackals – who are fighting over pennies when they need to cut more than $1 trillion from the annual budget – proves to me they couldn't care less about the deficit, their out of control spending, or the American people in general.

The big loud debate that's going on right now is just political maneuvering.

The next presidential election is only 19 months away. And they have to put on the regular dog and pony show for you.

They want to convince you they're actually doing something to help.

But the truth is, no single politician or administration can fix America's budget problem.

Moreover, the real problem lies in the fact that no single politician or administration wants to fix America's budget problem.

Let's face it, both parties represent the same thing: protection of the banking and corporate syndicates.

And these entities make billions with the puppets they're paying to push the paper in Washington.

America is owned by the banks. But that boat isn't going to float for long...

This Ain't Your Father's America

It's no longer about doing the right thing anymore. It hasn’t been for quite some time.

For the politicians, it's all about acquiring and controlling money and power. For the American citizens...

Well, I'm not even sure if they know what they want for themselves nowadays.

It's possible a large portion of the country simply doesn’t care anymore as long as they get their handouts.

Either way, we are all going to pay a terrible price for our fence-sitting.

Over the past few decades we've allowed Washington to run the country into the ground by running up the national debt.

And now it's gotten so out of control the government can't hide America's true debt problem.

Just yesterday, Standard & Poor’s downgraded its outlook on the U.S. credit rating to "negative", raising the likelihood the U.S. will lose its coveted AAA rating.

Large financial houses know the problem, too...

Bill Gross, founder of Pimco, the $1.2 trillion investment management firm that used to buy bonds, has stated very publicly that he considers U.S. Treasury securities to be high risk, low reward investments. Gross recently remarked:

If I were sitting before Congress, and giving testimony on our current debt crisis, I would pithily say something like this: "I sit before you as a representative of a $1.2 trillion money manager, historically bond oriented, that has been selling Treasuries because they have little value within the context of a $75 trillion total debt burden. Unless entitlements are substantially reformed, I am confident that this country will default on its debt; not in conventional ways, but by picking the pocket of savers via a combination of less observable, yet historically verifiable policies - inflation, currency devaluation and low to negative real interest rates."

Gross is not merely selling Treasuries, he is selling them short!

His flagship, $235 billion Pimco Total Return Fund (PTTAX), now holds a net short position in government-related debt securities, while also sitting atop an enormous $73 billion pile of cash.

This is coming from one of the most respected players in the financial world.

So far this year, the U.S. Treasury has raised $293 billion in net cash by selling Treasury securities. And so far this year, the Federal Reserve has purchased a net $330 billion of Treasury notes and bonds.

This translates to the Fed providing 100% of the net new cash the Treasury has raised this year, along with another $37 billion needed to mop up even more mess.

But who will buy Treasuries when the Fed doesn't?

No one. That's who.

And consider this, which most have not even contemplated yet...

With all that is happening in Japan right now, it won't be much longer before the Japanese government will have to start selling their main asset: US Treasuries.

We are getting very close and even accelerating toward the end game for the U.S. Dollar and the U.S. empire.

All I can say is, “Have your life boats ready!”

You can rest assured the politicos in Washington do:

For now, they'll continue to act in the way all politicians do when they are trapped in such a manner; They'll lie, cheat, steal, spin the facts, cover their asses at all costs, abuse their power, and misinform on a massive scale.

But even with the help of the government controlled media, the time of consequences can no longer be held at bay.

Free market forces will win, governments and their political power structures are going to come tumbling down, just as we have been seeing elsewhere around the world these past six months.

The spoils will go to those who were prepared and understood the debacle years before it hit.

~~SIGNUP_WD~~

For the past several years, we at Wealth Daily have been educating and preparing investors for this exact scenario. We have consistently helped our members protect and increase their wealth by recommending the best ways to own precious metals, energy, real estate, and other real, hard assets.

Now, many of the investment analysts here are taking those profits and placing them in much higher-yielding assets -- like precious metals exploration, new energy deals, emerging markets... even nuclear power right now.

In fact, analyst Luke Burgess believes, as I do, that uranium has been way oversold in the market.

You see, uranium became a publicly traded commodity only about a year ago. That brought in a much higher level of speculation into the market as even retail customers could invest in the uranium futures market through ETFs.

These new speculators, in large part, drained the value of the nuclear fuel following the Fukushima disaster as overly nervous investors sold their uranium assets off.

But as Luke said last week, “The Fukushima disaster does not fundamentally alter the global demand for uranium oxide.”

And the bottom line is, he's right.

The sell-off in uranium was an emotional market reaction to a terrible disaster.

The market will recover. And that really does make right now a great time to buy uranium stocks.

After I read last week's Wealth Daily, I called Luke to ask about the stock. He told me the whole story and who was behind the company, and I became really interested.

Using historic information they've acquired from national archives, the company is looking to discover one of the world's largest kind of uranium deposits in Argentina.

Without many people knowing, this small $0.25 company quietly got their hands on over 1.2 million acres of grassroots uranium exploration property.

Like all other uranium companies, its shares took a hit to the chin after the Fukushima disaster. Before the disaster, shares were above $1.00. And Luke thinks that, once the Fukushima story blows over and the uranium market recovers, this tiny $0.25 stock will be headed back towards $1.00.

He recently put together a short video report that details the company and its truly incredible story. You can check that video out by clicking here.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Get Back at The Feds

It amazes me that people still walk up to me and ask why I'm such a big "fan" of gold and other hard assets.

I try to explain to them that it's not about being a fan. After all, gold can't do very much as far as possessions go...

You can't live in it. You can't drive it. You can't cruise around the world in it.

But it does do one thing which just about nothing else can: It can protect you in times when your government can't.

Of course, when I start talking like this, the same people who wonder why I'm such a "fan" of gold start rolling their eyes.

Or at least they did — right up until the last year or so, when confidence in our federal government began falling to levels approaching those during the American Civil War.

You see, folks, every dollar you own today is nothing but a promise from the United States government to pay back the value printed on that note.

Unfortunately, people the world over are starting to understand the worth of this promise.

With a national debt approaching $15 trillion and inflation rising, even those least experienced in finance are starting to ask the question Where's all this money coming from?

Just think about it...

When our national debt hits $15 trillion — which it surely will before the next presidential election — it will represent a personal liability of almost $49,000 for every man, woman, and child in this country.

Do you have $50k to give to the government — on top of what you already give them — for every member of your family?

And if you think that sounds disturbing, consider this: It's the people and organization that created this planet-sized problem who are on the hook for fulfilling the promise of every dollar, every cent you spend.

The Federal Reserve prints the money and the Secret Service protects it. It's not so much the symbol of the United States, but the symbol of the United States Federal Government.

How's your confidence now?

This is the same government which, in the next few days, will almost definitely be forced to close down because they can't keep their own operating budget straight...

The same government which, in the last eight years, has spent more than a quarter of our annual GDP fighting two wars (wars that most citizens couldn't explain if their lives depended on it).

When was the last time you heard about the our ground forces actively looking for Bin Laden?

Moreover, this is the same government which, despite a growing consternation among its citizens, continues to take steps to limit their freedoms.

Two days ago, I read about a New York Federal judge who "sentenced" a juror to "indefinite jury duty" because he was personally offended by the way she filled out her application.

Ladies and gentlemen, that's free speech being quietly stripped away from us, little by little.

There was a time when living in America meant being free to say whatever you wanted, no matter how displeasing it may be to the person standing next to you. It was set up by our forefathers as a challenge to us; to live with both the fruits and responsibilities of being the masters of our own voice and of our own actions.

But now, evidently, the federal government — which might not even be operating a few days from now, which has diluted the value and stability of the dollar to the point where it will likely lose its status as the world reserve currency to the Chinese yuan in the next three years — is telling us what we can and cannot think.

This, dear reader, is why I'm such a fan of gold.

Gold has no national or political backing. Any stamp carried by any bar or coin vanishes the moment it's melted, and the value remains unchanged. It has been prized the world over since the time of ancient Egypt for its rarity, its color, and its unique ability to resist tarnish.

In short, it's permanent. No matter what shape it takes, its value will not depreciate... ever.

And at over $1440 an ounce, it's also been on a steady rise for the last 11 months — something you cannot say about the U.S. government or their rapidly deteriorating paper-ambassador to the world, the greenback.

To those who like numbers backing the big talk, I usually bring up the following little example...

In 1930, gold was trading at around $20 per ounce. Back then, that $20 could buy you a nice three-piece suit, a tie, shoes, and socks — essentially everything a proper gentleman needed to go to the office looking his best (or, if you're talking about 1930, to dress for a day at the office).

Today, that same ounce is worth close to $1500. Again, enough to buy yourself a three-piece suit, a tie, shoes, and socks — everything you need to look your best.

But what does $20 in cash buy you? A car wash? A cab ride? Enough vodka to drink your troubles away?

This might seem overly simplified, but the fact is, it's not at all...

Our current economic problem is exactly that simple to understand — and exactly that frightening.

As the value of your cash moves toward 0, gold isn't just maintaining its value; it's actually growing.

It's that powerful.

Maybe it's not surprising that 40 years ago, the federal government took us off the gold standard. Giving the citizens such direct access to the power of gold was just too risky for them.

Maybe that's why back in 1933 — when the nation was reeling from a crisis much like the one we're still wading through right now — the government made private ownership of gold beyond $100 illegal altogether.

They knew its power and wanted to hoard it for themselves. And they continue to do the same today.

This is the biggest reason I'm a "fan" of gold.

Gold isn't just money...

It's power, it's wealth, and it's freedom — true freedom — from the laws, regulations, and limitations of an increasingly paranoid, inefficient, and bankrupt organization.

Of course, most people don't get this whole spiel when they casually approach me with a cocktail and a minute or two to kill. Consider yourself lucky.

Buy gold today.

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Libya, Oil and Gold

The latest scam being perpetrated on citizens of the world by the United States government and the mainstream media is the situation in Libya.

The pile of lies we are told regarding this unfolding drama by the media is absolutely amazing — and it's all designed to keep you from understanding what’s at the heart of the matter: power and oil money.

This is all part of an unsustainable world political situation that's rapidly unraveling.

Look at what happening around the world right now...

People are beginning to rebel against the status quo power block in Washington.

There's chaos in the Middle East and elsewhere, collapse and rioting in Euroland, and wars and rumors of wars as the power junkies jockey for position in almost every corner of the world.

Enemies or friends?

The European Union — once advertised as the ultimate “Garden of Eden” utopian model for the world to follow — is in shambles as one country after another line up for a bailout from Germany, the only country within the EU that has any money...

The rest are bankrupt and don’t like the terms the Germans are offering.

Economic reality has hit. Major changes are in store.

In the Middle East, the chaos threatens the economic lifeblood of the global economy: oil.

Any disruptions to the flow of oil would be catastrophic to the economies of the world.

Higher oil prices are already sending shock waves throughout the system; even higher prices are likely, given all that is happening.

Intelligent people are sensing and understand that something is going to give, and it looks as if the first thing to take the plunge is the U.S. dollar.

This brings the wisdom of the ages to the forefront for those who know history...

Richard Russell said it best when he recently pointed out: “There is only one certainty regarding paper money — the longer you hold it, the less it will buy in terms of real goods or real money — gold.”

Since the Federal Reserve was created in 1913, the true purchasing power of a dollar has been reduced to less than $0.05 cents. In the years from 1971 (when the dollar became a fiat currency) to 2011, the real purchasing power of a dollar has plummeted, affecting millions of people.

Now these people are beginning to rise up and blame their economic problems on Washington and the Federal Reserve — and rightfully so!

These jackals of economic insanity are the root cause of the ruthless manipulation that has been going on for decades.

As history clearly shows without exception, however, the consequences always come to governments and countries that try create something out of nothing...

The Keynesian Economic Experiment Failed

The economic consequence phase is definitely underway, and gold and silver prices will absolutely head to much higher ground as more and more evidence and chaos show up in the headlines.

As investors, the choice is clear: You must do something to protect yourself against the coming destruction and collapse of the U.S. dollar.

Stay in dollars and lose, or move to a better store of value like gold and or silver and protect your life’s work and savings.

My mantra for over ten years has been to own physical precious metals and the quality precious metals mining stocks. They have performed extremely well over the course of that 10-year period — better than any other asset class!

They will continue to perform well and, at some point, will go parabolic... but the market will not be without volatility.

When the downside volatility comes, this is your buying opportunity. Take advantage of it.

In some cases, the downside volatility may only last a few days.

As meltdown number two comes, make sure you have cash on hand to invest in what will probably be the last great opportunity to buy on the cheap.

In investing, you either learn to be a contrarian or you become a victim...

Don’t believe the government, Federal Reserve, and Wall Street lies that are designed to bankrupt the country and steal your wealth. Their time is at hand, and a new paradigm shift is underway that will help us get back to true liberty and freedom for all.

It is not going to be easy, and there will be dark years ahead.

But for those who are prepared, there is no need to be fearful... Forewarned is forearmed if you prepare.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

~~SIGNUP_WD~~

The World Debt Bubble Just Popped

Even though gold and silver are nearing record highs, the metals are ready for a major breakout as the flight to safety is becoming necessary.

   Current Metal Prices

Gold      $1,446.10/oz
Silver    $38.07/oz

Unfortunately, many people still doubt gold — or simply don’t understand why they need to own the precious metals.

But they're going to learn the hard way... and sooner rather than later.

Over the next several months, investors will come to gold and silver after they have gone through a process of elimination, investing in other over-valued investments such as currencies, real estate, and Dow-related stocks.

Once these investments start to decline, investors will jump from one over-valued investment class to another until they finally discover the precious metals.

This transition has been slowly been taking place over the past several years.

At some point, the U.S. dollar will be in free-fall — and the stampede to gold will be in full swing.

The gargantuan financial risks that exist in our global markets are staggering. When you understand the risks to the market with naked short selling, derivatives insanity, unsustainable debt structures of governments worldwide, etc... it leaves you with a very uneasy feeling.

These risks are very real and hardly understood by the average citizen.

World Prepares for Staggering Debt Bubble

We’re in the midst of a huge bubble in the debt markets that’s probably going to get bigger before it finally deflates.

That bubble is characterized by huge bets on risk in the markets for government notes, corporate bonds, home mortgages, and the various synthetic derivatives based on those instruments.

These bets are getting larger and larger as those involved have to keep going to the next level of risk to manage their current unsustainable position.

The question is can these bubbles be deflated slowly or will they just pop. Either way, the die is cast.

The people who tout the idea that these risks to the system will just disappear with little or no consequence are living in a fairytale land.

Gold and silver will be going much higher as events worldwide continue to unfold. Beware of those who maliciously and negatively pound on gold, trying to mislead you from the very asset class that will protect you.

The mainstream media keeps referring to gold being in a bubble, suggesting the yellow metal is destined to collapse...

But whether it's FOX or CNN, conservative or liberal, the engines of mass media are fueled by the revenue from their corporate advertisers.

And these giants ultimately depend on your continued faith in the U.S. economy and dollar.

Gold is currently nearing record highs.

But I believe momentum will continue to gain as the problems with debt become more pronounced and the problems from the derivative situation again show their ugly head.

I expect gold to reach for $1,700 an ounce if things don’t fall apart and the world continues on its merry way without major problems unfolding.

Silver could be even bigger. I think we could see $50 silver as early as autumn.

~~SIGNUP_WD~~

When things come to a head, however, there is no limit I see on how high gold and silver prices can go...

It will simply be an equation of how much fiat money is chasing such a small amount of physical bullion.

How much will you have?

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator

Gold Stocks to Outperform in 2011

Gold is the most important investment to own in 2011.

There are several factors at work that will continue to push gold prices much higher over the next several weeks and months:

a continually weakening U.S. dollar
rising consumer demand, particularly in China and India
producer de-hedging
central bank buying
lower global supplies from scrap and recycling
rapidly increasing investment demand
decreasing world gold production

Most investors have already caught on to these facts and what they could mean for gold prices.

Forecasts of $2,000 an ounce... $2,500 an ounce... and now even $5,000 an ounce are commonplace among both professional and amateur investors.

And now, renewed confidence in gold has prompted many investors to start seriously buying gold stocks again.

Gold Stocks Shine in 2011

Gold stocks are once again seeing strong appreciation and starting to garter the attention of a greater number of investors.

I recently attended the Prospectors and Developers Association of Canada (PDAC) convention in Toronto. In the 10 years that I have been attending the PDAC, I have never seen such robust attendance as I witnessed this year...

The place was packed as investors, prospectors, suppliers, government reps, and mining executives from around the world convened to do business.

So I can tell you firsthand the gold mining sector is rocking and rolling once again. A rising tide lifts all ships...

And it's not the just precious metal mining sector that's doing well; the base metal mining industry has also recently began receiving heavy investor attention.

But when it comes to base metals right now, buyer beware...

Time to Ring the Register on Base Metals?

Many in the industry are extremely bullish on commodities of any kind. And I understand their argument for such a case.

But I also understand that the financial problems we experienced in 2008 have not been dealt with. And the mess is only worsening by the day, week, month, and year.

This is why I remain focused on the precious metals as the best opportunity in the junior mining space, and not the base metals.

At some point, the world will have to deal with a second round of major financial problems. This could seriously hurt, even cripple, the broader economy — and ultimately hurt the base metals companies.

So I continue to be most bullish on the precious metals, and I recommend taking any major gains on base metal stocks right now.

What's Next for Gold and Silver?

Within the precious metals complex, I maintain that while gold is going up, silver is going to move up even more — and by a large margin.

At AmeriGold, we are seeing more silver being purchased than gold. This is the first time this has happened in 14 years of doing business, and is probably a good harbinger of things to come for the silver.

That is not to say that our precious metals market will not have its occasional pullback; these will happen.

But gold and silver prices will continue to push for one new high after another.

You want to train yourself to buy the dips when they happen and take some profits when they are hitting new highs.

This is your key to understanding how and when to take some money off the table.

While gold has corrected again over the past week due to yet another technical bounce in the U.S. dollar, we can expect gold to easily break $1,500 within the next several weeks.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator

The Nuclear Option

The demand for electricity will increase by 50% in just two and a half decades.

The Energy Information Administration forecasts world electricity demand to balloon from 495 quadrillion Btu (quad) to 739 quad.

Take a look:

To meet this rising demand, the global power sector will need to add nearly 5,000 gigawatts (GWe) of new electrical capacity to the global grid.

To put that into perspective, a city the size of San Francisco requires about 1 GWe of electricity to run function.

To boost the world's electrical capacity, industry analysts estimate that a whopping $10 trillion is needed to build new power generating facilities and to replace aging infrastructure.

But coming up with the money isn't the real problem...

Fossil Fuels: The sobering realities

Nearly 75% of the world's electricity is currently generated using fossil fuels — mostly coal and natural gas.

These natural resources are ultimately finite, and there's no doubt that sooner or later we'll need to switch to an alternative.

In response to this, worldwide governments and corporations have already spent hundreds of billions searching for viable alternative energy sources.

Among the alternative energy sources being researched are the so called “green” alternatives, such as solar, wind, hydroelectric, and geothermal.

The technologies behind these alternative energy generating sources have seen significant advances over the past several years. But at present, they simply cannot meet the growing global energy demand in a cost-efficient manner...

Nuclear power is, however, the one alternative available that is able to meet growing electricity demand throughout the world.

"It is not too much to expect that our children will enjoy in their homes electrical energy too cheap to meter."

– Lewis Strauss, Chairman of the U.S. Atomic Energy Commission (1953-1958)

Consider this: A single kilogram of uranium can yield approximately 20,000 times the energy as the same amount of coal can.

This makes nuclear energy remarkably more efficient than current electricity generation.

A typical 1,000 megawatt electrical coal-fired power plant has a fuel requirement of about 3,200,000 tonnes of black coal a year. A nuclear power reactor of the same capacity has an annual requirement of only 27 tonnes of fuel.

Producing this amount of uranium fuel requires the mining of between 45,000 and 70,000 tonnes depending on the grade of ore.

This yields about 200 tonnes of yellowcake (U3O8), which is sold and enriched to yield the 27 tonnes of actual fuel.

The U.S. Department of Energy reports nuclear power costs 1.72 cents per kilowatt-hour (including operations and maintenance costs).

Compare that to:

Coal at 2.37 cents per kilowatt-hour;
Natural gas at 6.75 cents per kilowatt-hour; and
Oil at 9.63 cents per kilowatt-hour

With diminishing supplies of finite fossil fuels, nuclear energy is almost guaranteed to make a comeback. And with a troublesome supply/demand imbalance, we are at the beginning stages of a massive bidding war in uranium...

Uranium prices have already begun to rapidly move higher. In the past few weeks, uranium increased from $40 to over $70 per pound, prompting interest in the sector from commercial and retail investors.

The overall uranium market still seems bullish with many new large buyers emerging over the past several weeks.

And all this makes for a great opportunity to invest in uranium stocks.

I have recently begun to reorganize my portfolios to leverage $100 uranium this summer. And over the next few weeks, I'll be writing to you about various uranium investment opportunities.

I've been busy making phone calls and looking into several uranium companies for Wealth Daily readers. I expect to have a new uranium investment opportunity for you soon.

Companies in the uranium sector should very well this year and deliver spectacular gains for their shareholders.

We'll be there to reap the benefits.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

China Buys 47% of the World's Gold

China is panicking.

Rampant inflation is driving Chinese consumers to buy gold on a massive scale...

In fact China is already set to buy almost half of all the gold that'll be mined this year.

You read that right: The Chinese may buy nearly 50% of total world gold production in 2011.

This incredible demand will no doubt put significant strain on global supplies.

Today I want to talk about how this soaring demand may be the catalyst that pushes gold prices over the $1,500 level in as little as a few weeks.

~~SIGNUP_WD~~

Over 1.3 billion inflation-nervous Chinese eye gold

In January 2010, China recorded an inflation rate of 1.5%. But just 12 months later, the rate of Chinese inflation has climbed to 4.9%.

Rising inflation has sent food and property prices in China skyrocketing.

The price of food in China, for instance, has increased 10.3% on an annual basis; grain saw an increase of 15.1% and fruit is up 34.8% since January of last year:

China's rising inflation stems from the $585 billion economic stimulus package its leaders pushed through in the depths of the financial crisis two years ago.

In dollar terms, China's stimulus was much smaller than the $800 billion package the U.S. created. But it was much larger as a percentage of the nation's GDP...

And now, all of that money sloshing around the Chinese economy has driven inflation rates to nearly 5%.

The Chinese government has already made some big moves to keep domestic inflation from spiraling out of control:

raising interest rates multiple times;
toughening price-fixing rules;
tightening lending requirements and raising the minimum down payment people need to buy a home.

So far, none of these measures have managed to curb inflation. Fears of uncontrollable inflation — even hyperinflation — are quickly circulating throughout the Chinese economy.

This has prompted a rapidly growing number of China’s 1.3 billion citizens to start devouring gold as wealth protection.

Panic in the East

According to the gold-specializing Swiss Bank UBS, Chinese gold demand exceeded 7.05 million ounces in the first two months of 2011 alone.

This incredible demand is equal to roughly 47% of all the gold produced during the same two months!

The Chinese are buying nearly half of all the gold that is being produced worldwide.

Extrapolated over the full year, Chinese consumers could be in line to buy over 42.3 million ounces of gold just this year.

Let me put that into perspective for you. That's more gold than is being officially stored as reserves by China's Central Bank...

The Financial Times recently quoted a senior executive at the Industrial and Commercial Bank of China ICBC, who spoke of the “voracious” appetite for gold in China...

China's largest bank by market capitalization started a physically-backed gold savings accounts in December with the World Gold Council. Account openings have already surpassed 1 million, with more than 12 tonnes of gold already stored on behalf of investors.

Zhou Ming, deputy head of ICBC's precious metals department, said the nation's largest bank sold nearly 250,000 ounces of physical gold in January — the equivalent of 50% of all the bullion ICBC sold last year.

China Produced $35 Billion in Gold in 2010

According to China's Ministry of Industry and Information Technology, gross output from domestic production increased 67% to 230 billion yuan ($35 billion) in 2010.

Of this, China's gold industry realized 5 billion yuan ($3.8 billion) in profit — 78% more than in the previous year.

China's gold mines produced 9.9 million ounces of gold in 2010 — an increase of 7% over 2009. Meanwhile, total domestic gold output grew 9% to 12.0 million ounces.

Zhou also said there was heavy demand for silver, with ICBC selling about 13 tonnes of physical silver in January alone, compared with 33 tonnes in the whole of 2010.

The demand for gold in China is exploding before our eyes. It seems that demand by individuals is reaching almost frightening levels.

And none of this includes what the country's Central Bank may be squirreling away...

We know that China has been buying on gold price dips. Various officials have confirmed this in the past, although we have no idea of the volumes involved.

The People’s Bank of China is almost certainly continuing to diversify their massive $3 trillion currency reserve into gold and precious metals in order to protect themselves from their large exposure to the weakening U.S. dollar.

We also know that China has been accumulating gold surreptitiously through buying up domestic production.

This suggests that increasing gold production was part of a long-term strategic plan to become a global leader in gold investments among governments.

The World Gold Council even reported:

Some market participants believe that China may also be continuing to buy local mine production, which it has done regularly in the past. There is certainly no shortage of experts, both domestic and from overseas, advising China to do so.

The World Gold Council estimates China’s gold demand could double in 10 years as more investors embrace precious metals.

But even in the short term, the expected demand for gold in China over the coming month will be enough to put significant strain on global supplies.

I expect this heavy demand to help push precious metal prices to record highs in 2011.

Prices of $1,500 an ounce for gold and $40 an ounce for silver remain viable short-term targets.

Any price dip should be seen as a buying opportunity.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert

Silver Headed to $50 an Ounce in 2011

Gold will continue dominate the precious metal headlines in 2011. But it's silver that will ultimately be the year's top performing precious metal.

Don’t get me wrong; gold will do very well for investors this year.

But on a dollar-for-dollar basis, silver is going to blow the doors off gold’s performance in 2011.

Silver could easily eclipse the metal's 1980 nominal high of $50 an ounce this year.

And when you learn just how little silver is available on the market right now, I think you'll agree...

The ten largest precious metal traders on COMEX currently hold net short silver positions that represent more than 330 million ounces — nearly half of total global silver production.

Compare that to gold, in which the net short position in of the same ten traders represents 25 million ounces (or a mere 1%) of the 2 billion ounces of world gold inventory.

That means the net short position in silver is 27 times greater than that of gold.

This is setting up what I believe could be an explosive situation for wise investors.

Silver Prices

The world's largest holders of silver bullion account for roughly half (500 million ounces) of the available 1 billion ounces of worldwide silver.

This is spread over the seven largest investment funds, which include iShares Silver Trust (NYSE: SLV), the Central Fund of Canada (AMEX: CEF), and others.

This means only 500 million ounces remain for the rest of the world to invest in.

And remember that, at some point, 330 million ounces of this will eventually need to be purchased by the net physical short positions of the ten largest short players who will have to eventually cover.

That means there would only be 170 million ounces of silver available to investors worldwide who are suddenly buying silver in ever-increasing amounts.

And unlike gold, there is little in the way of available above ground silver inventory.

The COMEX reports roughly 120 million ounces of silver in inventory. But most of this is already accounted for by those who hold a warehouse receipt.

All this becomes a real problem when you consider that ownership of physical silver is practically becoming a religion in China.

~~SIGNUP_WD~~

In the past 16 months, China has gone from a net exporter of ~100 million ounces of silver to a net importer of ~150 million ounces of silver. This essentially means that ~250 million of silver is no longer available to the market on an annual basis.

The Chinese government is teaching their citizens the ownership of silver is an antidote to a devaluing U.S. dollar.

And they're right.

This has massive implications for the silver market when you consider the 1.3 billion people who live there are rapidly becoming more interested in buying physical bullion... and will continue to do for quite some time in increasing amounts.

The price of silver is now within striking distance of re-testing record highs as the metal continues to react to rising global demand and rapidly diminishing supplies.

As I mentioned, I expect to see the price of silver top $50 this year. In respect to this, I continue to urge speculators to buy physical silver while it's still easily available to the retail market.

Investments in physical silver — as well as quality silver stocks — will perform very well in the coming months and year.

Good Investing,

Greg McCoach
Analyst, Wealth Daily
Investment Director, Mining Speculator and Insider Alert