This is historic: The dollar will soon be worth more than the euro

There’s a currency war going on, and the United States is losing. As of Wednesday, the euro had fallen to a 12-year low of $1.05, down from as much as $1.39 just last year. That’s a 24 percent drop in 11 months, to be exact, and there’s no reason to expect it to stop anytime soon.

Now a strong dollar is good for anyone who’s planning a trip overseas, but it’s bad news for anyone who’s planning on selling stuff there. That’s why stocks fell, with markets sliding into negative territory for the year this week, as multinationals that depend on foreign sales took another hit. After all, it’s not just the euro that’s falling against the dollar, but almost every other currency in the world, too — with Turkey and South Africa’s falling more than most on Tuesday.

You could see the dramatic decline in the Euro in this chart:

Sanctions against Russia and Ukraine from 31 July 2014

This guide outlines the sanctions imposed by the European Union from 31 July 2014 and the corresponding US sanctions. The sanctions are designed to discourage Russia from, in the words of the EU Regulation, “destabilising the situation in Ukraine”.

This guide was last updated in August 2014

Sector sanctions

Russia

Sector wide sanctions imposed by Council Regulation 833/2014 came into force on 31 July 2014. The sanctions will, in the main, apply to new contracts. The provision of financing, products and related services required under pre-existing contractual obligations will be allowed, at least for a limited period and subject to authorisations from particular government agencies in the EU.

Financial instruments and services

EU nationals and companies are prohibited from buying or selling bonds, equity or other money-market instruments with a maturity exceeding 90 days and which are issued after 1 August 2014 by Sberbank, VTB Bank, Gazprombank, Vnesheconombank, Rosselkhozbank, or by another institution or body outside of the EU in which one of those banks is a majority shareholder or via another person or entity which is acting at the direction of one of these five banks.

Services related to the issuing of such financial instruments, such as brokering, are also prohibited.

Energy related equipment and technology

Exports of certain energy-related equipment and technology to Russia require prior authorisation by a competent authority of the relevant EU country. The restricted items include line pipe, drill pipe, casing and tubing used in oil or gas drilling, rock-drilling or earth-boring tools, certain types of pumps, liquid elevators, mobile drilling derricks, floating or submersible drilling or production platforms, and other oil and gas drilling related equipment. A list of CN codes has been published to help exporters identify restricted items.

Export licenses will be denied if the equipment is provided under a contractual obligation which was entered into on or after 1 August 2014 and there are reasonable grounds to consider that the products are destined for projects pertaining to deep water oil exploration and production, Arctic oil exploration or production, or shale oil projects in Russia.

In the UK authorisation is by way of a Standard Individual Export Licence issued by the Export Control Organisation. It can take up to 20 working days for a licence to be issued.

Dual use goods and technology

Exports of dual use goods and technology for military use in Russia or to Russian military end-users are also prohibited. All items in the EU list of dual use goods (269-page / 432MB PDF, see annex for list) are included. As with energy-related equipment the supply of dual use used goods for military use or for a military end-user may be authorised by an EU export control authority if the supply obligations arose from a contract concluded before 1 August 2014.

Crimea and Sevastopol

There is a complete ban on new investment in the following sectors in Crimea and Sevastopol: infrastructure projects in the transport, telecommunications and energy sectors and in relation to the exploitation of oil, gas and minerals. Key equipment for the same six sectors may not be exported to or for use in Crimea and Sevastopol; and finance and insurance services related to such transactions must not be provided.

The prohibitions in respect of the provision of equipment do not apply, until 28 October 2014, to the execution of transactions required by a contract which was concluded before 30 July 2014 so long as 10 working days advance notice is given to a competent authority in the EU.

Asset Freezes and Financial Sanctions

The EU has prohibited any EU company or person, and any overseas company or person while in the EU, from making any funds, or economic resources from which funds could be generated, such as hardware and technology for example, available to or for the benefit of certain designated persons (now 117 individuals and 23 companies). The assets of these designated persons are also to be frozen.

The requirement to freeze or not to make available funds and economic resources is triggered where there is reasonable cause to suspect that the funds or resources are owned or controlled by a designated person or that the designated person will benefit from the provision of the funds or resources, even if the funds and resources are to be provided to a third party. As such, the provision of products to a company that a designated person only has a minority share in could be caught by the sanctions if the designated person will still derive a significant financial benefit from the supply of that product to the company.

The EU restrictions allow for funds and assets to be made available to or for the benefit of a designated person or for funds to be released from frozen accounts if authorised by HM Treasury or another competent authority in the EU. The ability to authorise a release of funds or assets only applies in limited circumstances. The main exception relevant to businesses is that payments due from a designated person under a contract which was agreed before the person was added to the list of designated persons may be authorised by HM Treasury or another competent authority in the EU. In addition, banks and other companies may be authorised to release funds needed for a designated person’s basic family needs or to pay his legal fees.

However, there is no pre-existing contractual exemption that allows designated persons to be provided with or benefit from the provision of economic resources to a third party company.

EU import restrictions

The EU has prohibited the import of goods originating in Crimea or Sevastopol. There is also a restriction on EU companies providing finance, financial assistance, insurance or re-insurance relating to the import of goods originating in Crimea or Sevastopol.

The import bans do not apply to imports arising out of contracts concluded before 25 June 2014 provided that the goods are imported before 26 September 2014 and a relevant EU authority has been notified at least 10 working days in advance of the import date. Advanced notifications also need to be given in relation to the finance, financial assistance, insurance and reinsurance of such contracts.

Application

The sanctions apply to all EU companies and persons operating anywhere in the world and to any overseas company and person when doing business within the EU.

Supplies of products into Russia via non-EU subsidiaries may be caught if title to the products is in the hands of the EU parent company (this is often required for financing reasons) or an EU company or EU based directors need to approve the contract or supply in accordance with the company’s pre-existing governance arrangements.

Circumvention provisions

UK laws to implement the EU Regulations make it an offence to deliberately do anything which has the object or effect of circumventing the prohibitions.

Contractual enforcement

No claim by any Russian person or entity in connection with any contract or transaction the performance of which has been affected, directly or indirectly, in whole or in part, by the EU sanctions can be enforced in the EU. Often companies doing business in Russia will have contracts that are subject to a Russian law and jurisdiction clause. Subject to force majeure considerations, such a contract may be enforced within Russia but courts within the EU will not enforce any judgment if the transaction was prevented from proceeding because of the EU sanctions.

US Sanctions

Sector Sanctions

Russia

On July 16 and 29, the US Treasury imposed sectoral sanctions against Russia targeting major banks, energy companies, parts of the defence and shipping industries. These sanctions, for the most part, apply to new contracts and the provision of financing, products and related services required under pre-existing contractual obligations will be allowed, at least for a limited period.

The sanctions affecting Russia are as follows:

  • US persons and people within the US are prohibited from transacting in, providing financing for, or otherwise dealing in new debt of longer than 90 days maturity or new equity issued by major state-owned Russian banks, including Bank of Moscow, Gazprombank OAO, Vnesheconombank (VEB), Russian Agricultural Bank (Rosselkhozbank) and VTB Bank OAO.
  • US persons and people within the US are prohibited from transacting in, providing financing for, or otherwise dealing in new debt for two Russian energy firms, OAO Novatek and Rosneft.
  • Exports of certain energy-related equipment and technology to Russia will require export licenses from the applicable US government agency (US Department of Commerce Bureau of Industry and Security for dual-use items and US Department of State for defence items). Export licenses will be likely to be denied if the equipment is provided under a contract which takes effect after the sanctions effective date and if the products are destined for deep water oil exploration or production, Arctic oil exploration or production, or shale oil projects in Russia.
  • As of April 28, 2014, any license applications submitted for the export and re-export of dual-use items listed on the Commerce Control List to Russia will be denied. Pre-existing contracts are exempt.
  • Asset freezes and financial sanctions

    The US has issued a series of Ukraine-related sanctions in response to Russia’s actions in Crimea, including three executive orders and the addition of dozens of names to the Specially Designated Nationals and Blocked Persons lists maintained by the US Treasury Department’s Office of Foreign Assets Control.

    These new sanctions, issued primarily under the authority of the International Emergency Economic Powers Act, prohibit any US person, entity or individual and any overseas company or person while in the US from making any funds, or economic resources from which funds could be generated available to or for the benefit of certain designated persons. US persons are prohibited from dealing with SDNs wherever they are located and all SDN assets are frozen. Furthermore, entities owned or controlled 50% or more by entities on the SDN or Blocked Persons lists are also subject to sanctions, even if these entities do not appear on the lists.

    Most recently, the US has designated eight Russian arms firms responsible for small arms, mortar shells and tank production, as well as a shipping facility in the Crimean peninsula and Russia’s largest shipbuilding company (United Shipbuilding Corporation). Any assets of these designated entities that are within US jurisdiction have been frozen. In addition, US persons or people within the US are prohibited from transacting business with these designated entities.

    Money-Laundering Concerns

    The US Department of Treasury’s Financial Crimes Enforcement Network has issued two advisories warning financial institutions of heightened money-laundering risks relating to the crisis in Ukraine. These advisories remind US financial institutions that they are required to “apply enhanced scrutiny to private banking accounts held by or on behalf of senior foreign political figures” and to monitor transactions that could potentially represent misappropriated or diverted state assets, other illegal payments or public corruption proceeds.

Application

These sanctions apply to all US companies and persons operating anywhere in the world and to any overseas company and person when conducting business in the US.

Compliance Steps

Given that it is a criminal offence to breach the sanctions, if a company has any doubt over whether or not a transaction is caught by any relevant financial or trade sanctions, legal advice should be taken.

As an immediate step, companies should check the scope of their pre-existing contracts with Russian businesses or which relate to the provision of financing and relevant products and services. If there is a pre-existing contractual obligation under which the supply is required to proceed, it may be exempt from the scope of the relevant sanctions (subject to any prior notification provisions) or allowed to proceed if authorised or licensed. However, care is needed as the exemptions may not cover supplies under framework agreements where there is no obligation to supply, or to orders under contracts which were extended after the sanctions came into force.

Financing agreements should also be checked as they may contain extensive prohibitions on proceeding with any contracts relating to Russian business now that sector and country wide restrictions are in place.

More generally, companies that conduct business overseas or with foreign businesses should have in place a compliance programme based around a robust policy on sanctions and comprehensive systems to implement the policy effectively. Further, companies should be aware of potential anti-money laundering risks associated with these regions in light of the ongoing crisis in Ukraine.

Such a programme should include:

  • customer and transaction due diligence and screening against applicable financial sanctions target lists, including EU, US and UK sanctions lists;
  • assessing if equipment and products are on export control lists and ensuring that all necessary licenses to export are obtained;
  • checking if imported goods are in any way restricted;
  • contractual controls, including sanctions exclusions and warranties;
  • training in policies and procedures; and
  • regular monitoring of transactions and periodic audits of sanctions compliance.

The information on the EU in this guide was prepared by Pinsent Masons, the law firm behind Out-Law.com, and the information on the US was prepared by US law firm Husch Blackwell.

source of this article

Bitcoin Must Create A Community-Backed FDIC

Three months into the year and Bitcoin exchanges are having a rough start this year – considering Mt. Gox and Flexcoin’s failures. It’s important to understand that an exchange failing is not the same as a failure in Bitcoin.  This is best understood by comparing a bank collapsing being separate from the US dollar’s value. It’s a problem with the bank or exchange.  But, these failures obviously have a serious impact on the value of Bitcoin. People are worried about the security of their Bitcoins.

The simplest answer is to keep your Bitcoins in your own wallet. There’s no risk of default, when you’re the one holding the Bitcoin (except, if you lose it in a dumpster). But, Bitcoin exchanges are necessary for the community to grow and operate effectively.

FDIC placard from when the deposit insurance l...

FDIC placard from when the deposit insurance limit was $2,500. (Photo credit: Wikipedia)

The answer to exchanges failing is a Community-Backed or Community-Lead FDIC organization. This is not be confused with insurance. The FDIC’s most important role in the banking system is often the standards it creates. Insurance is a strong component that would likely help the Bitcoin community as well, but it is not a necessary component to be included immediately.

The Issues

Centralization

Bitcoin was created so that a decentralized peer to peer currency could manifest. Wouldn’t an organization or agency similar to the FDIC “centralize” Bitcoin and go against its principles? The FDIC’s purpose in the United States’ banking system is an insurance agency that creates standards that all banks must follow by law. (Credit Unions have the National Credit Union Administration.)

Creating a Bitcoin FDIC (“BitFDIC”) would frustrate Bitcoin’s values, if it was implemented exactly the same way. But, a Community-Backed or Community-Lead BitFDIC is allowed to create its own rules.

BitFDIC should be an organization that the community controls instead of any government. BitFDIC’s primary purpose is to provide standards in accounting and security for Bitcoin exchanges. An important difference is that BitFDIC establishes standards, but not every exchange is required to abide by them. FDIC standards are legally required to be met by all banks, thus it centralizes banks. But, BitFDIC is a set of community standards that “should” be met. If an exchange doesn’t agree with the standard, they’re free to continue to operate on their own guidelines. Thus, the Bitcoin community remains decentralized.

BitFDIC’s standards should focus on the accounting and security protocols because these are facets that can be confirmed without human interaction or trust. Numbers should always tie and security protocols should conform to established conventions.

Anonymity

BitFDIC should not expose or affect the anonymity of any Bitcoin owner. These “audits” or “checks” can be done without asking for anyone’s personal identity because the accounts are inherently tracked by unique identifiers. We only need to know that the Bitcoin is there, who owns the Bitcoin is not our concern or goal. Thus, everyone’s identity should remain undisclosed and protected.

Cost

A problem that everyone can foresee is that increased standards usually lead to increased costs or strain on transactions. The benefit to Bitcoin is that technology allows for the “traditional” inefficiencies to become automated or irrelevant. Thus, the cost will always be there, but it’s either very low or only initially relevant. The best way to think about this is through credit card companies. Credit card companies make insane profits by taxing people that want to make fast transactions. The general public has no other option besides credit cards to conduct day-to-day business on any scale. Thus, they allow people to make fast transactions by creating a “secure” system, but it increases the cost to the system to generate their profits.

Bitcoin already allows everyone to freely make transactions digitally without burdening the system with additional transaction fees. But, Bitcoin needs to increase security so that the system is reliable enough to avoid situations like Mt. Gox and Flexcoin. We can accomplish this by using technology to conduct audits or checks on the company consistently to avoid fraud (think of this as a computerized CPA).  Security can be increased by setting standards and applying new technology. One solution is computerized escrow accounts that An Ark describes. Obviously, there is no single answer to solve all the problems. But, that is exactly why a Community-Created BitFDIC is necessary to create standards that can create a solution.

The Pros

Standardization is not the same as centralization. You

  1. can stabilize the Bitcoin exchanges without jeopardizing its principles. Standards are best practices are NOT required. Everyone is always free to do what they want, but setting a floor for what is acceptable makes gives everyone confidence and northstar to how things should be.
  2. Stabilized Bitcoin exchanges will inherently help Bitcoin increase in value. The media is constantly barraging Bitcoin on whether it’s secure. Stabilizing exchanges is the same as stabilizing banks (minus the bailouts). You can have a vibrant “currency,” if people think its fools gold. The Brazilian Real is the best example of this idea. The Brazilian “cruzeiro real” and its predecessor currencies faced massive destabilization. The reason why it stabilized is because people believed the currency was “really” stable. The circumstances may be very different, but the human element of trust and fear of risk is just as relevant.
  3. Running a BitFDIC doesn’t need to be a giant agency or bureaucracy. Professional associations like the Bar Association, the AICPA for accountants and Medical Boards operate as self-governing bodies. The associations can’t control everyone in the system, but it can create standards without being a governmental body.

The Cons

  1. Muddying the waters. There’s no question that by adding the human element into the equation through the BitFDIC, we’re going to make Bitcoin less efficient is some way. This is inherently the problem whenever we add people to the mix. But, Bitcoin is a tool that was created to help people in their interactions. It’s unrealistic to assume that Bitcoin will be able to entirely take out the human element. The only reason we’re having this discussion about stabilizing Bitcoin is because of our human fear of risk.
  2. It’s going to take people to come together to discuss and deal with the problem. Getting people to agree and talk about anything is nearly impossible. (Just look at American politics and I rest my case. Not that anyone else is better either!) So, I understand this is a HUGE ask.

Conclusion:

Clearly, this idea may not be the silver bullet. But, obviously something is necessary for Bitcoin to grow in the way that everyone wants it too. Some of these ideas will be included in the answer we come up with, but I have no idea what they will be.

Bitcoin companies have already begun to use insurance as a way to lower risk. Xapo has gotten a lot of attention recently because they took aninsurance policy with Meridian Insurance Company to cover “hacking, bankruptcy, employee fraud and natural disasters.” I’ve discussed insurance before as a possible answer, but I sincerely hope that there is a better option because insurance is expensive!

Disclosure:

I do not own any Bitcoins or any positions on Bitcoin.  I have purposely avoided purchasing Bitcoins in order to prevent biased opinions for my personal profit.

Forbes-Entrepreneurs

Forex Scalping Your Way to Huge Profits

Forex Scalping – Day Trading Your Way to Huge Profits

Forex scalping is one of the most popular methods of making money on the net and involves day trading and taking small regular profits that will eventually lead to huge gains over time. Let’s look at forex scalping in more detail.

There is a huge industry in forex scalping systems and vendors promote them heavily on the net with track records that are quite simply mind boggling. The problem however is – they don’t work and you will lose.

These guys are NOT traders in most instances, their simply marketing organizations.

As a trader for 25 years I simply laugh when I see headlines such as “make 700 pips a week” etc but many naive and greedy traders get taken in by forex scalping marketing copy and its no laughing matter when they lose their money!

So why doesn’t forex scalping or day trading work?

Well if you think about it it’s obvious:

You have millions of traders, trading trillions of dollars and to say that you can predict what this huge mass of people will do in just a few hours – is quite frankly ridiculous.

Volatility can and does take prices anywhere in a day and support and resistance levels are meaningless – so you cant get the odds on your side and you cant win.

Anyone who thinks they can win has not tried forex scalping!

So you can’t win longer term?

No you can’t –

Many vendors claim that you can predict with scientific accuracy what will happen in forex -Really?

If they could, they wouldn’t be selling forex scalping systems – they would be to busy making money.

Another point of course is if you could predict what markets do in advance then there would be no market as we would all know the answer in advance, markets move on uncertainty and opinions and thats an investment fact.

The vendors however do produce track records but their meaningless and not worth the paper their written on.

Why?

Check the disclaimer and you will see the words “simulated” and in “hindsight” – so there done KNOWING the closing prices – how hard is that?

You, me or anyone else could do that. There is a problem though!

In the real world, you have to trade without knowing the closing prices and that makes things a little bit harder.

The rewards of forex trading are huge and its not easy to make money – but if you try a methodology based upon forex scalping, you are simply going to get a lesson in how hard it is.

THE GOOD NEWS!

Of course, with the rewards on offer you wouldn’t expect it to be easy either and that really is good news.

Leave the forex scalping systems to the dreamers and lazy traders and do your homework and get the right forex education and that means trading longer term and getting the odds on your side.

You can trend follow longer term or do short term swing trading and both can make you money you just need to get a simple system to trade the odds and in these time frames you can get the odds on your side.

Forex trading can give you gains that can be life changing and everything about forex trading can be learned by anyone, with the desire to succeed and the right education.

So if you want to win at forex trading, forget forex scalping and trade longer term, get the odds on your side and you could soon enjoy currency trading success.

By: Monica Hendrix for Streetdirectory.com

Three Bioscience Breakthroughs

Three Bioscience Breakthroughs You Can’t Afford to Miss!

You can make huge gains investing in a breakthrough drug, but you can do even better putting your money into a new, cutting-edge technology platform that can fuel a company’s entire pipeline.

One biotech I recommended to my BioScience Millionaire subscribers last July, Sangamo Biosciences Inc. (Nasdaq: SGMO), has developed a technology from naturally occurring molecules, called zinc finger proteins (ZFPs), that scientists can engineer to edit specific genes in the human genome. It can cut them out, replace them, or add new ones – in other words, it plays with the basic building blocks of life as if they were Lego pieces!

Sangamo is currently using ZFP technology to find cures for some of the most intractable – and often un-druggable – diseases we know of, including HIV, Alzheimer’s, Huntington’s, and Down’s syndrome to name a few.

And Sangamo isn’t the only company using ZFPs for research. In fact, it licenses out the technology to scientific institutions and companies all over the world – providing it with a great revenue stream.

As a result, SGMO shares have gone up more than 150% since last summer. Actually, if you’d had the foresight to buy the stock at the beginning of 2012, you’d now be realizing profits of 577% on your money.

The magic word in that sentence is “foresight.” The trick is to spot these technologies early in their development, either before they’ve had IPOs or soon after.

With that in mind, here are a few exciting new technologies to keep an eye on…

Breakthrough No. 1

Amazing Work with Genes

Last year I had the privilege of being the only bioscience writer to attend a privately held international conference in New York City on inflammatory bowel disease. One hundred of the top researchers in the world were there, and one of them, a scientist from Harvard, specifically mentioned ZFPs (see above) as central to his work. He also mentioned a similar gene editing tool called TALENS. But the really exciting one, which he spoke about in passing, is called CRISPR.

CRISPR stands for Clustered Regularly Interspaced Short Palindromic Repeats. I know. Don’t ask. The explanation is as long, complex, and sleep-inducing as you might suspect.

But the short version is this: ZFP and TALENS use proteins to do their gene editing, and proteins are – in the sub-microscopic world – big and unwieldy. It’s very hard to manipulate them to produce the mass quantities of re-sculpted genes you would need to treat some diseases.

CRISPR, on the other hand, uses very small bits of RNA (ribonucleic acid, a chemical present in all living cells) to achieve the same ends, and comparing it to ZFP and TALENS is like comparing a scalpel to a hatchet. It is fast, precise, and can produce edited genes en mass.

Over the past year, CRISPR has been showing up in labs all over the world and has turned into a tech platform for several new biotechs. Sangamo need not worry – ZFPs and TALENS will always have a secure place in research, because CRISPR does have some limitations, but it’s likely to dwarf their success.
Keep your eye on Editas Medicine, founded in 2013 by five world-renowned experts in CRISPR technology. Right now it’s financed with Series A investments, but when the IPO finally happens, get in early.
Breakthrough No. 2

It’s Not Your Garden Variety Printing Technology

Suppose you could create a human ear – or any other organ – on demand with a piece of electronic gadgetry. Sound like science fiction? It’s already been done.

Last year at Cornell University, researchers used a 3-D printer to reproduce human ears made of living tissue combined with polymer, and they come ready to implant!

This is great news for people who lose an ear through traumatic amputation (think Van Gogh), of course, but more importantly, it may be a life changer for babies born with a birth defect called microtia – lack of external ears.

But even more promising, one company has used 3-D printers to produce living, functional liver tissue! Imagine the possibilities for hepatitis, cirrhosis, and liver cancer.

The printing process starts with a computer scan of a sample object, which is then reproduced in whatever medium is called for. The size of the printer is about the same as the one sitting under your desk at home.

This is about as exciting as it gets in medicine, and it represents huge potential for investors.

And guess what? The biotech that’s printing out livers is a publicly traded company.

Take a look at Organovo Holdings (Nasdaq: ONVO), which has already gone up 142% in the last year alone.

Breakthrough No. 3

A Step Toward Curing Cancer

Cancer is an amazingly challenging disease. It can grow and spread throughout the body before giving itself away with a single symptom. Because it’s made from subtly mutated normal human tissue, it can evade the immune system undetected, like a wolf in sheep’s clothing. And it can proliferate so prodigiously and in so many places at once that trying to kill all the malignant cells in a cancer patient is like trying to stop a swarm of bees with a baseball bat.

Now, it’s true that through early detection and prevention, we’ve cut the incidence of some tumors significantly. The PAP smear and HPV vaccine, for example, have made a huge impact on reducing cervical cancer deaths. And we’ve achieved some success in curing pediatric malignancies. Children with the most common type of blood cancer, acute lymphoblastic leukemia (ALL), once a death sentence, now enjoy a 90% survival rate.

But for the most intractable adult cancers – lung, pancreatic, liver, bowel, kidney, and brain, as well as melanoma, myeloma, lymphoma, and the various adult leukemias – progress has been slow, frustrating, and frankly, a little depressing.

We need a new approach, something outside the box, a real breakthrough. And in fact, it looks like we have one. It’s called CAR-T (chimeric antigen receptor-T cell) immunotherapy.

In this approach, T-type immune cells are taken from the patient’s blood, genetically modified, and then re-infused into the patient – but now with the power to recognize, target, attach to, and kill malignant cells.

In a recent study of patients with advanced adult B-cell lymphoblastic leukemia – a highly lethal disease – at Memorial Sloan Cancer Center in New York, CAR-T therapy produced complete remission in 9 out of 10 patients.

That’s an incredible result. And of course, there are plans to study the same approach with other types of cancer, both solid and liquid.

When I see companies in the early stage of cancer drug development, I usually run in the other direction, as I’ve explained before. But the evidence for CAR-T efficacy is so strong that, in this case, I would make an exception.

One caveat: Big pharma Novartis AG (NYSE: NVS) and a start-up biotech called Juno Therapeutics (at present privately held) are currently wrangling for the intellectual rights to this technology. When the dust settles, put your money on the winner.

Novartis, of course, is a publicly traded company. Juno is operating on Series A financing, but research into these technologies isn’t cheap, and sooner or later the private pockets will go dry, forcing an IPO.

I’ll continue to keep an eye out for these promising medical breakthroughs, and report back to you on them as I find them…

By ErnieTremblay, Money Morning

Bypass These Pitfalls to (Major) Profits in Bioscience

Anyone who’s very familiar with the bioscience/pharmaceutical sector will tell you investing in experimental drugs can be an object lesson in volatility.

As the drugs progress toward FDA approval or denial, the stock prices of the companies backing them can be in for the same volatile ride.

A stock’s surge or decline is often premised on general assumptions about the likelihood of FDA approval.

But within specific bioscience sectors, that likelihood varies… widely.

That’s why I wanted to navigate through some types of drugs that generate a lot of enthusiasm but often crash before delivery.

That way you can avoid some of the downside risk of this often lucrative market…

The Gauntlet That Few Make It Through

First, every new medication has to pass through a regulatory gauntlet that includes at least three phases of clinical testing for safety and effectiveness, each more exacting than the one before.

Then it goes through a final review by the FDA, which starts with the acceptance or rejection of a New Drug Application (NDA) and may include prescreening by one of 33 advisory committees, as well as a final assessment by the FDA Center for Evaluation and Research (CDER).

That final assessment includes data from both animal and human studies, information on how the drug will be manufactured and marketed, and a draft of how the drug will be labeled. From there, the FDA will issue either an approval or a complete response letter (CRL), detailing why the drug was denied approval.

The odds aren’t good. New drugs take an average of eight years to get through the clinical trial process, and only one in five survives to the finish line.

In the meantime, even the hint of good or bad medical news can send a stock soaring or crashing – and all of this plays out against a background of financial catalysts and market forces that have their own heft and sway.

As an investor, you need to have ways to mitigate your risk, and as far as I’m concerned, unless you’re a short seller, that begins by knowing where not to put your money.

These High Flyers Usually Crash

There are certain types of drugs that generate exorbitant enthusiasm as they work their way toward various regulatory milestones, driving share price into the stratosphere. Unfortunately, they often end up falling short of their medical goals, they fall by the wayside, and stock value drops like a rock.

I’m talking about drugs intended to cure nasty, complex, treatment-resistant diseases that we don’t really understand, but that frighten the hell out of us: cancer, Alzheimer’s, and inflammatory bowel disease come first to mind.

When we say cancer, we may be referring to any of more than 100 distinct diseases, most of which are still poorly understood. What they all have in common is that they can spread uncontrollably before they’re ever diagnosed, and trying to kill them at that point is like trying to wipe out every ant in a large colony with a hammer. A drug that can extend the life of cancer patients by a couple of months is considered a major success. But keep this in mind: According to the National Cancer Institute, only 1 in 20 cancer drugs that begin clinical trials ends up with final FDA approval.

We’ve poured hundreds of millions of dollars into Alzheimer’s research in the past 30 years, and we still don’t really know what causes it. Some people think it’s the result of a protein called beta amyloid building up in the brain. Others think it’s caused by inflammation or another protein called Tau. Whatever the cause, over all that time the FDA has approved exactly five drugs to treat the disease, and none of them work all the way. A medication that could simply delay onset of the disease by three years would be considered one of the great medical breakthroughs of all time, but we don’t seem to be close to goal yet.

Inflammatory bowel disease (IBD) is a catchall name for colitis and Crohn’s disease. It’s probably caused by a complex interplay of genetics, environmental variables, and bacteria that live in the gut. We have some medications that can palliate the symptoms, but ultimately, we can’t cure it, and really can’t even stop its progression.

So yes, a drug that succeeds in treating any of these illnesses would be a huge win not only for patients, but for investors as well. And when the market smells a whiff of success in the air, even during phased clinical studies, the prices often go wild.

But here’s the problem: While those studies are going on, there is no way to predict their outcome.

For more tractable illnesses, like skin infections or vascular disease, preliminary data may be fairly predictive of final phase 2 results. And in turn, those results can give you a reasonably good picture of what the phase 3 data are going to look like. (Don’t invest in phase 1 drugs. Phase 1 trials give no information about effectiveness.)

But with complex illnesses like the three mentioned above, again and again I’ve seen investors lured in to buying shares by early positive results from one study, only to go down in flames after a data release from a later one.

Why? Patients can look very good early in treatment, then suddenly devolve. Or drugs that seem to do well compared to placebo in phase 2 trials don’t do nearly as well when compared to current-standard-of-care treatments in phase 3. Or in going from smaller to larger patient populations, major side effects may start showing up. Or what looks like a positive result, such as tumor shrinkage, may turn out to be meaningless in terms of extending a patient’s life.

The Payoff

One big way to limit your risk up front in biotech investing is to avoid drugs still going through clinical studies to treat highly resistant diseases. But let me emphasize that I’m talking about a specific period in the gauntlet.

Once final data is in from phase 3 trials, the picture changes. You then have real evidence to evaluate. Despite the odds against any cancer drug making it through the gauntlet, every year some do, and they pay off big.

For example, in early 2012, Pharmayclics (Nasdaq: PCYC) was selling for about $25 per share. Now, after approval of its drug to treat a rare cancer called mantle cell lymphoma (MCL), the price is up to $137…

With over 30 years’ experience writing about the latest developments in health, medicine, and related technologies, Ernie Tremblay has gained “insider” access to the world’s top doctors, professors, and researchers. He’s worked with Nobel-caliber doctors such as Yale’s Karel Liem, Columbia’s George Gaylord Simpson, and Harvard’s William S. Beck, to name a few.

Ernie’s edited hundreds of books on science, microbiology, and groundbreaking medical therapies for top publishers like Harper Collins, Penguin Putnam, and Prentice Hall. He’s also co-authored and ghostwritten numerous books on everything from Alzheimer’s to rheumatology.

Best of all, he’s developed knowledge of the inner workings of the FDA drug approval process and knows precisely when a drug or technology is about to “pop” and its company’s stock rocket upward in price.

By ErnieTremblay, Money Morning

 

The Golden Yuan Is Coming – Here’s How to Play It

The U.S. dollar has been the world’s de facto reserve currency for almost 90 years.

But this financial dominance may be nearing its end.

In recent years, China‘s been floating the idea the yuan should take on the dollar’s role as the world’s reserve currency.

In fact, the Chinese have already negotiated numerous bilateral trade deals that completely bypass it.

And they’ve even called for efforts to “de-Americanize” the global economy.

Whatever happens, China’s economic rise foreshadows increased influence.

It’s a trend that not only has serious implications, but also great profit opportunities, if you know what to expect…

A (Very) Brief History of Reserve Currencies

Along with reserve currency status come the roles of financing international trade and acting as a store of value for governments worldwide.

When we look back over the past 500 to 600 years of reserve currencies, an interesting pattern emerges.

Currencies

 

As this chart shows, since the mid-1400s, there have been six different reserve currencies.

Tied for the shortest lifespan are Portugal and the Netherlands at 75 years, while the longest tenures are Spain and the UK, both at 110 years.

The average has been about 95 years… and the U.S. dollar has presided for the past 88 years.

As you can see, reserve currencies come and go. It’s not a question ofif, but when. And it appears the greenback’s dominance has reached its twilight.

Until 1971, when Nixon closed the “gold window,” overseas dollars were backed by gold. That meant foreign governments could redeem their American dollars for gold at $35 per ounce.

But the 1950s and 1960s saw ballooning deficits, inflation, and swelling debt from welfare and warfare as America’s share of the world economy shrank.

So Kissinger and Nixon hatched the petrodollar system, whereby the United States would provide political and security support to Saudi Arabia’s royal family. In exchange, all oil deals would have to be transacted exclusively in dollars, and the House of Saud would buy lots of Treasurys with their greenbacks.

In effect, this guaranteed a constant and elevated (though artificial) demand for U.S. dollars worldwide.

But still, using the unbacked dollar as a world reserve currency is a massive experiment in fiat money.

It’s never been tried before… and it’s unlikely to end well.

The Emerging Yuan

In the past few years China established a string of currency swaps with other nations to settle trade, bypassing the dollar completely.

The goal is to help internationalize the yuan by gradually growing its level of acceptance. It’s working.

On Dec. 4, 2013, the Wall Street Journal reported that China’s growing slice of the world’s economic pie saw the yuan overtake the euro and yen in trade finance.

According to the Journal, “That made the yuan the second-most used currency in trade finance but still well behind the U.S. dollar, which backs 81% of trade finance.” The yuan now accounts for 8.7%, but it’s gaining quickly.

In October, China announced a 350 billion yuan ($60 billion) swap for euros with the European Central Bank. That ranks second only to its previously established 360 billion yuan swap line with South Korea. There’s even a 400 billion yuan agreement in place with Hong Kong.

There are as many as 25 such swap agreements in place with various nations, estimated to be worth nearly $1 trillion. Corporate debt issued in yuan has nearly doubled in the past couple of years to around $50 billion.

So clearly, the yuan is being readied for internationalization.

China’s central bank has stated the yuan would become “basically convertible” by 2015.

But what the yuan may look like before trading freely is what’s most intriguing.

China’s Gold-Buying Binge

It’s no secret that China’s been accumulating gold – a lot of gold.

Hundreds of tons flow into China each year. Though difficult to track precisely, the country’s imports appear to be off the charts.

China is the world’s largest gold producer, and nearly all its production stays home. Thomson Reuters has indicated that most of the gold liquidated from physically backed ETFs in 2013 flowed east to China. UBS thinks China imported as much as 1,500 tonnes last year alone.  That’s nearly half of all the gold mined in 2013.

Back in 2009 China announced its official gold holdings stood at 1,653 tons, or about 33.9 million ounces. There’ve been no updates since, but some think we could get news in 2014.

I estimate China’s central bank stash now stands at 4,409 tons. It could be even bigger than that.

Why would China be so hungry for so much gold?

Though it may already seem like a distant memory, last fall the United States was in a heated debate over its debt ceiling and the risk of default by mid-October. The federal government was shut down as the world watched.

China, as the largest foreign holder of U.S. Treasurys, expressed its concerns and frustrations.
Official press agency Xinhua’s op-ed writer Liu Chang wrote that the United States’ fiscal fiascos warrant “a de-Americanized world.”

He went on to call for “effective reform,” which should include a “new international reserve currency that is to be created to replace the dominant U.S. dollar…”

No doubt, with the yuan expected to be free-floating next year, the Chinese would like their currency to take on a much more significant role.

So far their actions are pointing in that direction.

Toward a Golden Yuan

Consider China’s call for a new international reserve currency, nearly $1 trillion in trade swap deals, and their relentless gold buying.

It’s not a stretch to figure when China floats its currency, they’ll do so with a partial gold backing.

Zhang Bingnan, market analyst for China Central Television and vice president of the China Gold Association, had intriguing things to say at a financial conference last year. As a result of his studies on gold’s place in the modern economy, he concluded it has an essential role in the current monetary system.

Shortly thereafter Tan Ya Ling, president of the China Foreign Exchange Investment Research Institute, spoke at a Beijing gold conference last May. She told delegates that gold is a currency – perhaps even the next world reserve currency – and therefore China has to dominate the world gold market.

Suddenly, a gold-backed yuan would carry intrinsic value, something absent from every other currency today.

The world would quickly want the yuan, pushing up its value and rapidly spreading its ownership and acceptance.

True, a stronger yuan will make Chinese exports more expensive. But China’s migrating toward a consumption economy, and a stronger yuan buys them more of the natural resources they desperately need.

There’s a number of ways to make money on this development. One way is to exchange dollars for yuan.

But you don’t have to open a Forex account or fill out paperwork at the bank to get access to a golden yuan. There are easier ways.

I’m a big believer in the strengthening of gold, and my suggestion is to buy more of it… the bull market is far from over.

By PETER KRAUTH, Resource Specialist, Money Morning

يمكن أن يكون الألماس الذهب الجديد؟

هناك عدد صغير من خبراء الاستثمار حول العالم تتنافس وراء الكواليس لتحويل الأحجار الكريمة إلى سلعة التي ستكون متاحة للمستثمرين في الطريقة التي تم تداول أسهمها الذهب من خلال صناديق في البورصات.
التجارة في الماس محدودة في الولايات المتحدة لسوق التجزئة للخواتم الخطبة وغيرها من المجوهرات والمساومة الغرف الخلفية بين التجار في أماكن مثل حي الماس في مانهاتن في شارع 47 غرب.

لكن اللاعبين في مجال الصناعة المالية في نيويورك ولندن وسويسرا وإسرائيل يقولون إن هناك فرصة لتوفير وصول الجمهور موثوق بها للكون متزايد من المستثمرين الذين كانوا على استعداد لإغراق المال في صناديق تدعمها الأصول الغريبة مثل البلاديوم والفضة. حولت هؤلاء اللاعبين صندوق المدعومة من الذهب، وأسهم الذهب SPDR، في واحدة من أكبر الصناديق المتداولة في البورصة في العالم، مع قيمتها السوقية نحو 70 مليار دولار.

لجنة الاوراق المالية والبورصات واستعراض مقترح لإنشاء أول المدعومة من الماس صندوق النقد المتداولة، والتي ستكون متاحة لأي شخص لديه حساب التداول عبر الإنترنت. فإنه شراء الماس واحد قيراط وتخزينها في قبو في أنتويرب، بلجيكا، وتوفير القيم اليومية مع المؤشر ولكن في ذات لم يذكر اسمه. يتم دعم الصندوق من قبل شركة نيويورك، IndexIQ، التي جلبت 14 تبادل الأموال المتداولة الأخرى إلى السوق في السنوات الخمس الماضية.

وبالإضافة إلى ذلك، قال مارتن رابابورت، الذي أسس قياس شعبية من التسعير الماس، مؤخرا انه كان يستعد لاطلاق سراح “بعض” المنتجات هذا العام التي ستكون متاحة للمستثمرين من الأفراد. ورفض لوصفها.

في ولعل الخطة الأكثر تطورا، وتعمل أكبر شركة الماس للتداول العام، هاري وينستون، مع مدير الأصول السويسرية لإنشاء صندوق بقيمة 250 مليون دولار التي تم تعيينها لبدء شراء نصف قيراط على الماس ستة قيراط هذا العام مع المال من المؤسسي المستثمرين مثل صناديق التحوط والمعاشات التقاعدية. ان صندوق امتلاك الماس تباع وتشترى في هاري وينستون مخازن وبيع حصص لمستثمرين من القطاع الخاص.

“الماس هو سلعة uncommoditized الماضي، وحتى انها الرسم في العديد من المنظمات” قال Edahn الجولان، ورئيس تحرير آيدكس على الانترنت، وهي موفر لبيانات صناعة الماس. “أفترض أنه بحلول نهاية هذا العام سيكون هناك حفنة منهم المغادرة.”

ويقول خبراء الاستثمار أن المستثمرين الأفراد يجب أن نكون حذرين للغاية، نظرا لصعوبة وضع أسعار ثابتة للالماس من تخفيضات مختلفة على نطاق واسع والجودة، والسرية التقليدية لهذه الصناعة. كما تم شوهت سوق الماس عن طريق حسابات من الأحجار المستخرجة في مناطق مزقتها الحرب من أفريقيا، على الرغم من كل من صندوق IndexIQ ونستون صندوق هاري التزمت تجنب مثل ما يسمى الماس الدم.

“، سيكون هناك منحنى التعلم كبيرة بالنسبة لي أن يكون شيئا تجارة مريحة مثل هذا” وقال مات زيمان، وهو تاجر سلعة في Kingsview المالية.

صناعة الماس يمكن إلا أن حلم تكرار النجاح الذي حققته شركات الذهب. استثمارات الذهب، بدلا من المجوهرات، أصبحت المحرك الرئيسي للنمو في هذه الصناعة، وفقا لمجلس الذهب العالمي، ودفع الإنتاج السنوي إلى نحو 100 مليار دولار، ويقول محللون في سيتي جروب. وقال سيتي وبالمقارنة، فإن الإنتاج السنوي من الماس المصقول حوالي 18 مليار دولار.

جاذبية من الماس هو أنه، مثل الذهب، يتم مصادقة بسهولة أنها وطويلة الأمد. ولكن على عكس الذهب، والنفط، لم تكن لديهم الكثير من الماس تقلبات الأسعار، في جزء منه لأنها لم تطرق من قبل تدفقات كبيرة من أموال المضاربة، على الرغم من أن ذلك قد يتغير إذا كانت الجهود الجديدة النجاح.

“، فمن المنطقي أن المستثمرين لديهم مصلحة في الأموال المدعومة من الماس”، وقال جونج بارك، محلل السلع الاولية في مورنينغستار.

ليست هذه هي الذروة أول من جلب الماس إلى وول ستريت. عندما التضخم وارتفاع في أواخر 1970s، أدى البحث عن مخازن مستقرة من القيمة على عدد قليل من الشرعية، وكثير غير شرعي، العمليات التي أغرت المستثمرين الافراد في الماس. بيعت واحدة، بدأ من قبل شركة طومسون المالية ماكينون، أسهم القطاع الخاص، وكان الجرح أسفل عندما انخفضت أسعار الفائدة، مع قيمة الماس معهم.

صدت السوق الطويل العديد من خبراء الاستثمار بسبب حصتها في السوق 80 في المئة الى 90 في المئة من الإنتاج عقدت شركة دي بيرز، عملاق الألماس العالمي. التي بدأت تنحسر عندما خففت دي بيرز قبضتها على قنوات الإمداد في عام 2000، وبيعها في وقت لاحق بعض من مناجمها والمخزون، والحد من حصتها في السوق إلى 40 في المئة اليوم، وفقا لسيتي.

“قبل أعطى دي بيرز حتى احتكارها، كان الحال الاستثمار صعب جدا”، وقال بيتر Laib، رئيس الماس الشركة السويسرية للاستشارات الأصول، التي تعمل مع هاري وينستون في صندوق الماس. “لماذا أبدأ صندوق حيث يتم التحكم في الأسعار من خلال شركة واحدة؟”

نهاية الاحتكار لا تزال تترك ولعل أكبر عائق أمام الاستثمار: عدم وجود معايير موحدة لتسعير الماس. على عكس الذهب الذي يباع للفي الأساس نفس السعر في الأسواق المالية في جميع أنحاء العالم، وقد تم بيع الماس في الغالب من خلال المناطق bazaarlike مثل منطقة مانهاتن والماس بورصة أنتويرب، التي تعلن أن “ملزم المصافحة إصلاحات السعر، والتسليم وشروط. ”

وقال “ان صناعة الماس يعاني من صورة وهو للأسف بدلا عن جدارة، والذي يختبئ وراء الدخان والمرايا”، وقال تشارلز يندهام، مؤسس ومقرها لندن من الأسعار ملمع، وهي شركة تسعير الماس.

يجادل العديد من المشاركين في السوق أن الماس ليست سلعة ولكن العناصر الفريدة التي تحتاج إلى تقييمها بشكل فردي. لكن يندهام، ورابابورت آيدكس تتنافس لإثبات أن الخطأ من خلال خلق تسعير موحدة. آيدكس يحتوي على فهرس تحديث كل ساعة من أسعار يسأل من قاعدة البيانات الخاصة به عبر الإنترنت، مرجحة مع الأصناف الأكثر شعبية 15.

مؤشر آيدكس ليست أفضل قياس، السيد يندهام يجادل، لأنه يعتمد على أسعار يسأل بدلا من أسعار المعاملات الفعلية، كما تفعل البورصات. وقد بنيت انه مؤشر الأسعار المصقول، والذي يتوفر على المحطات بلومبرغ، ويستخدم أسعار البيع وتتلقى شركة من 20 تجار الجملة. وقال انه كان يعمل مع “المؤسسة المالية الأوروبية الكبرى” التي تسعى للحصول على موافقة الجهات الرقابية في أوروبا لصندوق الماس بعد آخر يمكن أن تكون متاحة للجمهور.

استضافت الأسعار مصقول مؤتمر في عام 2007 مع عشرات من المهنيين صناعة التمويل الذين اعتبروا كيفية صنع الماس استثمارا للوائح. وقال شريك السيد يندهام، وريتشارد بلات، وقال انه يعتقد بعد ذلك أن المنتج سيكون متاحا في وقت أقرب.

“لقد كان من الصعب، ولكن نحن تماما شوطا طويلا على طريق للوصول إلى هناك”، قال السيد بلات.

السيد ويندهام السيد رابابورت ينتقدون صندوق الوحيدة التي تتوفر للمستثمرين العاديين، وصندوق الماس دائرة كابيتال، التي أدرجت في بورصة لندن في عام 2008. انها جمعت ما يقرب من 50 مليون دولار من المستثمرين واستخدامه لشراء الحجارة، وتبلغ قيمة كل منها ما لا يقل عن مليون دولار. وقال السيد ويندهام لم مديري الصناديق لا تعمل خارج نظام للتسعير وبيع حيازاتها في نهاية المطاف. وانخفضت الأسهم إلى أقل من 4.20 دولار هذا الاسبوع من حوالي 10 دولار في عام 2008.

وقال أندرو داوسون، مدير الصندوق، فإنه خضع مؤخرا لإدارة التغيير ولديها الآن استراتيجية أفضل مع المديرين الجدد. صندوق العمل مع هاري وينستون وضعت طريقة جديدة للتعامل مع مشكلة التسعير. وسيكون مدير في سويسرا تدفع ثمن المخزون في مخازن هاري وينستون. وسيتم تحديد قيمة الماس بعد زبون يشتري قطعة من المجوهرات التي تحتوي على الحجارة ويتم شراء حجر الغيار من خلال سلسلة التوريد هاري وينستون لل. فإن الرسوم للصندوق أن تكون مماثلة لتلك التي من صناديق التحوط، مع رسم إدارة 1.5 في المئة و 20 في المئة من أي زيادة في القيمة.

وقال إن الصندوق يستند إلى الولايات المتحدة من المستشارين IndexIQ لا سرد رسوم المخطط لها في التطبيق أنها قدمت إلى المجلس الأعلى للتعليم في مارس اذار. لتبادل الأموال المتداولة غيرها من الرسوم حوالي 1 في المئة سنويا والتجارة بشأن تبادل اركا نيويورك للأوراق المالية. صندوق أكبر لها مكررات استراتيجيات صناديق التحوط واجتذبت 200 مليون دولار في الأصول. وS.E.C. لا تعلق على الطلبات المعلقة.

جميع مقدمي الجديدة تجعل نفس الحجة لما يجعل الماس جذابة للمستثمرين: وبينما لا يتوقع أن يرتفع المعروض من الماس جديدة، ومن المتوقع أن يزداد باطراد الطلب من الهند والصين. وقال بريان تشن، وهو محلل التعدين في سيتي غروب، “أساسيات تبدو جيدة جدا من حيث العرض والطلب.”

انخفض مؤشر الأسعار ملمع 2.2 في المئة هذا العام، ولكن ارتفعت 5.6 في المئة خلال العام الماضي، و 56 في المئة منذ إنشائها في عام 2003.

لكن رون رولاند، وصناديق الاستثمار المشترك ومستشار صندوق النقد المتداولة، ومؤسس شركة Capital Cities إدارة الأصول، وقال انه حتى لو لم تبدأ الأموال، ينبغي على المستثمرين التجزئة الاقتراب بحذر شديد.

“، والبقاء بعيدا حتى تعرف بالضبط كيف يعمل، ويمكن أن يكون متأكدا من أنه يتصرف مثل كنت تعتقد أنه سيكون” قال. “انها سوف تكون سوقا الصعب خلق.”

Read our English post
بواسطة NATHANIEL بوبر / THE NEW YORK TIMES

 

Now is the Time to Buy the “New Gold”

On May 15, Christie’s auction house sold a huge diamond to the Harry Winston firm for $27 million, setting a new record price for a colorless diamond in the process.

And while diamonds have been a girl’s best friend long before Marilyn Monroe crooned those words, it’s always been tough for investors to get into the game. Diamonds are considered one of those esoteric fields; an area of investing too small, complex, and exclusive to bother with for most.

Let’s face it, up to now, there’s much more subjectivity in rating diamonds than gold. And that makes it more challenging for investors if they want to hold the physical asset.

But it’s worth the effort: Historically, diamonds have proven themselves to be very price stable – with a growth kicker. What’s more, technology is making standardization of gemstones easier, making valuations more transparent.

That means diamonds are becoming an increasingly popular store of value.

According to the Financial Times, between 1999 and 2011, three-carat diamonds have risen in value by 145% while five-carat diamonds have risen 171%, as measured by the Rapaport Diamond Trade Index. The thinking is the relative price stability of diamonds is due to the fact that there’s little speculative capital in this sector, estimated by some at no more than 1% of the market.

Rising Demand

Like other commodity markets these days, diamond prices are most influenced by global economic growth. Larger developing nations, especially the BRICs (Brazil, Russia, India and China) are growing their middle-class populations.

According to Kris Schellhas of the Investment Diamond Exchange in Los Angeles, China has seen diamond demand compound 32% annually since 2005. What’s more, Chinese and Indian buyers often view diamonds not only as jewelry, but also as a store of wealth.

In China, diamonds are the fastest growing discretionary purchase.

Matt Manson, President and CEO of Stornoway Diamond Corp. (TSX:SWY), a developing junior diamond miner, also sees diamonds increasingly being thought of as an investable asset. According to Manson, “The target in the future is to have 15-20% of world diamond demand be people purchasing diamonds for just this purpose, for physical diamonds as an investment vehicle.”

2 Factors That Change Diamond Investing

Beautiful as they may be, getting to the point where diamonds are a more common physical investment has proved difficult.

By comparison, gold and silver are much more straightforward. One ounce of 0.9999 physical fine gold has a worldwide market price, so anyone can easily determine its value at any point in time.

Not so with diamonds. The biggest challenge is determining value, because each diamond is unique.

But thanks to some significant developments in the diamond market, that’s been changing.

The first obstacle was achieving a free market in the diamond trade.

For the longest time, even this basic goal was impossible thanks to the “De Beers Factor”. You see, De Beers effectively ran a monopoly of the diamond market for a century.

But De Beers went private in 2001, and by 2004 its diamond stockpile had become depleted. That opened the door to a free market for diamonds, one where price discovery was made possible by allowing the forces of supply and demand to work unencumbered.

The second requirement has to do with how investment-grade diamonds are classified.

According to Schellhas, the U.S. government patented a process last year which now allows for classifying to be done in a repeatable way that is reliable, predictable, and consistent.This achievement has paved the way for making physical diamond investing a realistic objective.

Thanks to this new classification system, GemShares has registered with the SEC to eventually roll out a new ETF, this one backed by physical diamonds, planned for some time in 2014.

Details on exactly how this ETF will be structured still need to be refined. But yes, the goal is for shares to be redeemable in a basket of investment-grade diamonds.

Three 24K Buys

Other than buying physical diamonds, diamond investments remain a little more indirect, for now.

And diamond-related equities are your simplest option.

This first company is the most direct and compelling play in the nascent sector.

Dominion Diamond Corp. (NYSE:DDC) was established in 1980 and is formerly known as Harry Winston Diamond Corp. This $1.2 billion market cap company mines and markets rough diamonds, and is the 4th largest diamond producer and the largest publicly listed diamond miner.

DDC owns a controlling interest in the Ekati Diamond Mine and 40% of the Diavik Diamond Mine, both located in Northern Canada. DDC has transformed itself by selling off the Harry Winston brand and retail operations to Swatch and most of its debt, and bought the Ekati mine from BHP Billition. Dominion Diamond’s current P/E is a mouthwatering 2.4, it has lots of cash, and trades about 10% below book value.

The following pair are less direct plays, which offer benefits in diversification as the sector grows more investor-friendly.

Blue Nile Inc. (Nasdaq:NILE) is the world’s largest online diamond retailer. The company was established in 1999, and also sells engagement products, as well as other fine jewelry made of gold, silver, platinum, palladium, and tungsten, plus pearls and precious gemstones.

NILE operates on thin profit margins (2.2%) in order to move its volume. The stock is rather expensive, trading at a rich P/E of 51.3, but earns a respectable return on equity of 33%. It has a market cap of $430 million, with low debt at only $670,000. This is one to watch, especially if the price comes back a bit.

Tiffany & Co. (NYSE:TIF) is a leading worldwide jewelry and luxury goods retailer. Founded in 1837, TIF now sells diamond rings and jewelry of all kinds, as well as timepieces, sterling silver goods, china, crystal, fragrances, and leather goods and accessories.

The company sells its merchandise through its retail stores, Internet sales, BtoB, and wholesale distribution. Though not cheap, its P/E is a more reasonable 22, with a current dividend yield of 1.8%, and profit margins at 10%. TIF is less of a pure play on diamonds, but certainly positioned to benefit as demand continues to grow globally.

By Peter Krauth, Resource Specialist, Money Morning. June 25, 2013

How to Beat the Market

How to Beat the Market: The New Momentum Strategy

 

The 2008 market meltdown called into question the old buy-and-hold dogma. Momentum investing, the notion that you ride rising stocks, got discredited after the dot-com blow-up. It is back – but with a difference. Matthew Tuttle, one of the smartest money managers in the advisor world, is a proponent of a new style of momentum. Tuttle, who heads Tuttle Wealth Management in Stamford, Conn., is worth listening to.

After dealing with multiple market blowups, many investors question the strategy of simply buying a stock index and hoping for the market to improve by the time they retire. I believe that more active strategy is the better way to build wealth and make sure that a down market doesn’t wreck your savings.

In numerous studies, several investing strategies – such as value, momentum and small- and low-beta stocks – have proven to outperform the market.

Value investing is a popular approach that famous investors like Warren Buffett and Bill Mhttp://fastcashforex.com/wp-admin/post-new.phpiller advocate. This involves researching companies and finding those with strong fundamentals that the market doesn’t yet appreciate. Buy them at bargain prices, and when the market comes around and gives them a higher valuation, you can sell the stocks for more.

Momentum involves finding stocks that are the strongest, and are the likeliest to trade higher. In a bear market, that means buying the ones that dropped the least. When they start to lose momentum, you get out of the position. Where value investors buy low and sell hihttp://fastcashforex.com/wp-admin/post-new.phpgh, momentum investors buy high and sell higher.

Smaller stocks can be good because big institutional investors such as mutual funds might not even be allowed to invest in them, even if they have strong fundamentals. You might find a small-cap stock with an attractive price that the bigger players aren’t able to inflate.

Low beta stocks are a less risky component of a portfolio. Beta measures a stock’s volatility relative to the market. Stocks with high beta are riskier, but potentially more rewarding. When the market goes up, low beta stocks go up by less, but when the market is down, those stocks don’t go down as much.

Momentum is one of our favorite strategies. Momentum strategies can help investors beat the market and avoid crashes, when coupled with trend-following, which focuses only on stocks that are gaining.  My firm is also very interested in value, since it is not correlated with momentum. We are constantly studying ways to apply value across asset classes and see how it can be combined with momentum strategies. Momentum is the only one of these factors that can be tweaked to avoid large losses.

Lately, we have been thinking about combining relative strength (buying the one asset out of a basket of assets that has the strongest performance over time) with value, momentum, low beta and small stocks investing. So I decided to study whether this would work. I found exchange-traded funds or mutual funds to represent each. I found the following portfolio that would have delivered a substantial average annual return:

Momentum: PowerShares DWA Technical Leaders  (PDP)
Low Beta: SEI Managed Volatility (SVOAX)

Value: iShares Large Cap Value (IVE)
Small-Cap: iShares Russell 2000 (IWM)

For diversification, I also included PIMCO All Asset (PAAIX). I also designed a simple relative strength system, which measures how different assets trade compared to one another.  The system rotates monthly among the best performing funds and goes to cash if nothing is in an uptrend. I went back to Feb. 25, 2009, when the bear market was ending. Here are the results from then until Oct. 4:

Average Annual Return: 21.11%
Lowest Point: -15.37%
Worst Month: -7.16%
Sharpe Ratio: 1.32
MAR Ratio: 1.37

The performance numbers and the MAR and Sharpe Ratios (two measures that compare risk to rewards) are very attractive. However, the drawdowns and worst month are a little high for my taste. Still, this experiment has sparked my interest and I will study these strategies further.

By: Larry Light-Forbes

تجارة العملات Currency Trading

imagesتبادل العملات, او تجارة الفوركس هي المضاربة بأسعار بالعملة الرسمية لدولة معينة بعملة دولة اخرى. المضاربة بأسعار العملات هي بالأزواج. ترتفع قيمة العملة او تنخفض بشكل مستمر مقابل العملات الاخرى وبالتالي يختار تاجر الفوركس شراء او بيع زوج العملات لجني الارباح. سوق العملات الاجنبية هو اكبر سوق اقتصادي بالعالم مع تحرك يومي يقاس بأكثر من 1.4 ترليون دولار امريكي مما يجعل هذا السوق اكثر مجالات الاستثمار تذبذبا ورواجا وقابلية للربح. يعمل السوق على مدار الساعة وعلى مدار الاسبوع , من الاحد مساءا الى الجمعة مساءا موفرا بذلك اضخم سيولة عالمية للنقود مما يجعل الاستثمار بالمجال مناسبة لكل بيئة عمل واستثمار اقتصادي

 الفوركس تعني باختصار سوق العملات الاجنبية او البورصة العالمية للنقود الاجنبية ، يتم التعامل بالعملات في سوق العملات (فوركس) على اساس ازواج من العملات . ويكون التعامل  فيه بالبيع والشراء ، على اساس شراء فرد من هذا الزوج وبيع الاخر مقابله. ويوفر اسعار فورية لازواج العملات العالمية , وكل المعلومات المساعدة للمضاربة والاستثمار على سعر البيع والشراء بين عملتين . وعلى ذلك يقوم المضاربون بشراء او بيع عملة واحدة مقابل الاخرى على امل تحقيق الربح عندما تتغير قيمة العملات كنتيجة للاحداث التي تحدث عبر الكرة الارضية. يتميز هذا السوق بوجود احجام تداول يومية كبيرة ووجود مشترون وباعة اكثر من ايّ سوق اخرى في العالم. كما انه مفتوح على مدار 24 ساعة يوميا ، خمسة ايام في الإسبوع. علاوة على ذلك، إن سوق تبادل العملات هو السوق المالي الاكبر في العالم من حيث الحجم ، حيث تصل حجم التداولات إلى 2-3 تريليون دولار ، وهذا ما يجعله واحد من اكثر الاسواق إثارة وسيولة للتجارة , وعلى الرغم من ان تجارة العملة كانت حكومية اصلا (بنوك مركزية) ومؤسسية (بنوك تجارية واستثمارية )، إلا ان التقدم التقني ، مثل الإنترنيت، جعل الامر سهلا على الافراد للإشتراك في اسواق تجارة العملة والمتاجرة به بامان ودقة .

تجارة العملات وساعات عمل البورصات

ساعات التجارة بالعملات

توفر التجارة 24 ساعه منذ يوم الاحد الساعه 5 مساءا توقيت نيويورك الشرقي EST حتى يوم الجمعه 4 مساءا توقيت نيويورك الشرقي.

لتجارةالنفط والذهب والفضه التجارة 24 ساعه منذ يوم الاحد الساعه 6 مساءا توقيت نيويورك الشرقي EST حتى يوم الجمعه 4 مساءا توقيت نيويورك الشرقي.

الساعه العالميه للتجارة بالعملات

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Forex Trading in Dubai and Switzerland

تداول العملات الأجنبية في دبي وسويسرا

By: Adma Dababneh

Dubai investors have turned to Forex following the downturn of the real estate market in Dubai and around the world. The number of Dubai forex brokers has increased as more and more investors seek profit-trading currency.

Dubai is a tax-free country; The benefits of trading forex in a tax-free country are amazing.

Many Companies in Dubai offer a trading with their partners in Switzerland or Dubai, they have a choice of either Dubai or Switzerland

The question is which Country to choose Dubai or Switzerland?

Those that prefer to use Dubai as a trading base can benefit from fixed spreads, no matter how volatile the market, as well as Dubai based banking facilities regulated by the Central bank of the UAE to conduct forex brokerage.   Since Dubai is a tax free emirate, no tax is paid if staying in Dubai or using a Dubai company

While many new traders look within Dubai for the tax benefits, the benefits they seek are available and much more established in Switzerland. Trading in Switzerland also avoids the red tape required for foreign investors who choose to trade through a Dubai company while still providing the privacy and tax-free benefits.   All Forex traders based in Dubai and in Switzerland pay no tax on the profits they make.

 

Choose between Dubai or Switzerland as your trading base

Dubai based forex services Switzerland based forex services
Tax free Tax Free
Fixed spreads regardless of market conditions Spread varies depending on conditions
Regulated by Central bank of UAE Regulated by Swiss Financial Market Supervisor Authority (FINMA)
Dubai based offices Offices in Switzerland and Dubai
Arabic speaking advisers available Arabic speaking advisers available
Trade CFDs and other commodities Swiss Banking services available
Choice of MT4 or proprietary trading platform Choice of MT4 or proprietary trading platform 

Forex Trading in Dubai-تداول العملات في دبي

Currency trading in Dubaiتداول العملات في دبي

is  a part time income for some of Dubai young residents. Many trade currency during their job. Online currency trading is becoming a part time business in Dubai for some.

Currency trading can be very risky. It is very volatile market as compare to other financial markets. The base line for Forex or currency trading is to manage your risk line, which should include your strategy and proper planning.

Some Cautions before you start Online Currency Trading in Dubai

 

New comers please educate your self and investigate Brokers before you jump with it. Here are some points to check

 

  • Regulated Forex broker
  • Low Spread
  • Regulated by DFSA (Dubai FSA License)

Please send us an email if you wish to ask about a certain Broker, we might be able to give you a list (WE ARE NOT AFFILIATED WITH ANY OF DUBAI FOREX BROKERS.)

 Before you start trading with any Forex broker in Dubai, find out if they are regulated by FSA UK and from DFSA. If you are new to online currency trading in Dubai, even they will help you to initiate your first online trade.

 

Advantages of Currency trading

 

Market Liquidity and Volatility

  • The forex market is the largest and most liquid of the financial markets.

Market Hours and Liquidity

  • Forex trading operates 24 hours a day, five days a week. The greatest liquidity

Low Cost of Forex Trading

  • The cost to trade with most forex brokers is the spread. This is the difference between the bid and the ask price.
  • Spreads in the forex market also tend to be much less (or tighter) than the spreads applied to other securities such as stocks.

Advantages of Margin-Based Trading

  • Most OTC forex brokers offer margin-based trading accounts.
  • Margin-based accounts differ from credit-based accounts in that when trading in a margin account, you must first open an account with your broker, and then fund the account by depositing money into the account.
  • Once you have funded a margin account with your broker, you can engage in any trading activity you wish so long as you have sufficient margin remaining in your account.
  • Leverage makes it possible for you to trade larger positions than would otherwise be possible based on your actual account balance.
  • The downside of course is that there is also greater potential to lose money and you can incur significant losses in your account very quickly.

Profit Regardless of Market Direction

  • A short sale – or simply a short – is the selling of a currency pair before you buy it.
  • It is very easy to enter into a short sale when trading in the forex market.
  • In order to make a profit on a short, you must buy the currency back for less than you received when you sold it. The difference represents your profit or loss.
  • The ability to engage in short selling means that it is possible for you to profit no matter which way the market is trending.
  • When rates are increasing, you can earn a profit if you buy (go long) a currency pair, and then sell it later for more than you paid.
  • When rates are falling, you can earn a profit if you sell (go short) a currency pair, and then buy it later for less than you earned when you originally shorted the currency pair.

By: Adma Dababneh

 

 

Trading forex risk disclaimer

Trading Forex (foreign exchange) on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.

US Forex Traders should look for US Brokers

Why you should open your forex account in the United States?

 

Where you deposit your money is very important. You need to know that it’s safe and that the brokers holding it are the most regulated and under the heaviest scrutiny in the forex industry. Trading is hard enough as it is; don’t expose your funds to unnecessary risk?

 

The United States is the most heavily regulated Forex industry in the world. All brokers must register with the Commodity Futures Trading Commission and are members of the National Futures Association.

US Brokers have daily, monthly, and quarterly operational reporting requirements, detailing customer funds on deposit, the number of retail and ECP forex customers that are active, whether they are US or foreign domiciled, and the percentage of non discretionary accounts that were profitable vs. non-profitable among other things. Unaudited financial statements are filed monthly and audited financial statements are filed annually. Failure to comply with these NFA requirements can result in severe disciplinary actions as well as substantial fines and penalties.

 

US Brokers abide by the CFTC FIFO rule, the counter party offsets the positions on a First In First Out basis. On the MetaTrader 4 platform you have the ability to close the positions as you see fit. For example, if you buy a contract and buy another contract at a later time and you decide to close your most recent buy position, you can simply close this position on the MT4 interface, however, the order that is sent to the counter party will be offset with the FIFO rule in place. Your net position remains the same on the MT4 and the back office.

 

 

Complete history of all NFA brokers as well as the key personnel is available online at www.nfa.futures.org/basicnet

 

Daytrading

Keys to Daytrading Success

This is not like most career fields, where an average teacher, middle manager, or sales person can sustain a living. An average performance in trading is one in which the trader does not make money at all. The Times article cites research suggesting support for the often-cited statistic that 80% of day traders lose money.

I’m in an interesting position, because–as a trading coach–I see the actual trading of actual traders, not the performance claims of wannabee gurus. I also see which traders have been able to sustain meaningful livings from their trading and which have not.

Here is a post outlining what I see among the consistently successful traders. The links at the bottom of the post will also help you focus on what helps traders sustain solid performance.

The most important contributors to trading success:

1) The development of concrete trading skills: pattern recognition, ability to execute sound trade ideas to create a positive expectancy, sound risk management;

2) The cultivation of the mental toughness, continuous learning, and discipline that enable you to adapt to new, challenging market conditions.

Sitting at a computer each day, not having a concrete strategy for the day, and relying on a vague sense of intuition to get you through is not going to cut it.

Success is something the great traders do, not just something they have. They work on building skills, they work on building themselves, and they have routines in place for accomplishing both.

 

 

 

Other Related Stories

 

Tips for online currency trading

Tips and Strategies for trading Forex

Buy when the price of a particular currency is low. When you find a shift on the higher side, sell and make a profit.

Read any training material offered by marketing services to achieve the desired success.

Forex training and appropriate education essential to achieve success.

There are plenty of resources for online Forex trading. Many guiding manuals are offered free online, information websites, technical and fundamental analysis of the market, charts and news-updates registered with the system and even hands on training online. The forex reviews and market trends based on stock research should also be made accessible.

Look for online Forex trading websites that enable you to start insider trading and learning with free Demo account and then with a minimum possible investment from your home office.

 

Forex trading strategies for beginners are a must

The goal of every strategy devised must be that of protecting investments and making profit.

Here are some of the forex trading strategies:

Hedging Strategy:

Forex is risky; you can’t predict the prices of certain currencies when they start falling. Through this strategy the investors sells when a time period expires. When the prices of the currency that you are holding on to are falling

 

Buying on margin Strategy:

If you are a valuable and trusted customer, your broker may decide to extend credit to you to make the purchases. If you are successful you can keep the profit, however, if you lose you have to return the credited amount with interest. To achieve profit use of this forex trading strategies for beginners is not recommended,

A beginner wanting to trade in currency market is up against this fact and has to overcome this hurdle. It is essential; along with using the forex trading strategies for beginners that one must use automated forex-trading software for online trading. These are a great help in analyzing what is happening in global forex trading markets, and what trends are swirling the prices of the currencies. One must, after deciding to trade in this market, to pick a broker or a firm that has holds the membership of the National Futures Association. It is important that your broker gives you access to forex trading software that allows you to conduct mock trading.

MSA Strategy (Moving the Simple Average):

The different variant of this strategy concentrates on averaging the values of the currency over a certain period of time to determine when to make the purchase of a currency. A variant of this, simple forex trading system of moving averages considers each and every value of currency in that period as important. On the other hand, recent values or the values of the currency that are registered for the middle part of the time period under study are also considered by certain strategies.

 

By Adma Dababneh