Sovereign Investor » Sean Hyman

What’s happening in Greece could happen in America if we’re not careful!

Sean Hyman — Wed, 15 Feb 2012 18:04:22 +0000

Setting the Record Straight on the Iraqi Dinar

Recently, the New York Times did a story on Greece. They reported that 1/4 of all Greek companies have gone out of business since 2009.

1/2 of all businesses in the country say they are unable to meet payroll. The suicide rate has increased by 40% in the first 1/2 of 2011. A barter economy has sprung up as people try to work around their broken financial system. Nearly 1/2 of the population under age 25 is unemployed.

They also reported that last September, a government-sponsored seminar on emigrating to Australia that normally draws an average of 42 people a year ended up drawing 12,000 people!

They also reported that Greek bankers are saying that people have pulled out about 1/3 of their money outside of their accounts and they are instead keeping it under their beds or buried in their backyards. So there’s little trust for Greek banks right now.

What happened? Government mismanagement of funds and a comfort with debt! Citizens were do different. They mismanaged their money and got comfortable with debt and had very little saved up.

We’re seeing these things happen more and more here in America. We need a “change” that people can believe in, which is getting Obama out of office.

We also need both republicans and democrats to become fiscally responsible. The same goes for individual families within America.

If we stay on the track that we’re presently on…a “Greek-like situation” could happen here as well.

Make sure you’re saving money…paying down debts and invest wisely. Make sure you’re fighting off the downward trajectory of the dollar which would erode your purchasing power. You see, it’s not only how many dollars you have…but also how far do those dollars go in purchasing things. Remember, people from Zimbabwe owned bills worth “trillions” and yet was worth almost nothing in its purchasing power.

Don’t depend upon the government to “get it right”. Yes, they need to…but you can’t control that part 100%. What you can control is your saving…your investing…your reduction of your debts. Make this a regular habit today that you carry on from here on out. You’ll never regret it. I haven’t ever regretted it.

Invest in strong currencies that retain their purchasing power and fend off inflation better than the dollar.

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

P.S. – If you’d like to find out more about the NY Times story, you can view it here.

Oil Heads Higher as Super Tankers Stop Shipping Iranian Oil!

Sean Hyman — Tue, 14 Feb 2012 16:49:59 +0000

How You Could Make 150% Gains as Silver Soars to $75

As sanctions become tighter, Overseas Shipholding Group and Frontline Ltd. said they would stop shipping Iranian oil. These two companies alone control over 100 super tankers (VLCCs).

So now, not only is Iran going to have a hard time figuring out how to get payment for their oil…but now they’re going to have a hard time figuring out how to ship it…or ship enough of it.

As the U.S. and Europe are clamping down more and more on Iran, it’s beginning to affect the price of oil, both in Brent Crude and WTI Crude. Let’s take a look at the daily chart of Brent Crude below. Click on the charts to enlarge them.

As you can see from the chart above, Brent Crude broke out about a week ago and is heading for new, recent highs now.

On the other hand, in looking to the WTI Crude daily chart below…it looks like it may have just broken out of a recent 3-month consolidation today and will likely begin to head much higher again too. Check it out below.

In fact, I think with this long, multi-month consolidation that’s gone on that the breakout could be very directional and head much higher over the course of the upcoming months. How high? There’s a good chance it will reach the old 52-week highs around $115 a barrel.

All of this is about to get ugly as more pressure is applied to Iran.

If oil prices continue to soar, watch the Canadian dollar. It may very well provide a shelter from this potential “oil war”.

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

Revisiting the Iraqi Dinar Issue Again…

Sean Hyman — Mon, 13 Feb 2012 14:16:52 +0000

How To Escape From America, and Where to Go

Last night I was working at our church, helping them get ready for this weekend’s opening of our new 3.000-seat cathedral. A lady came up to me and told me that there are people buying up the dinar in their group like crazy. She knew I worked in the currency market and so she wanted my opinion before jumping in and doing the same as they did.

I told her that it’s amazing how people that have never even bought a euro or yen before suddenly buy up something they know nothing about nor have any experience in.

I told her that it’s amazing how many people buy up this currency on the “pipe dream” that it’s going to revalue and make them all millionaires.

I told her, there are people making money in the dinar though…it’s the one that sells it to you. They get a guaranteed mark-up which is the price they’ve chosen to sell it to you at.

Now if the dinar were going to make this huge run higher…why are they selling people something that would make them that much more rich if they’d simply hold onto it themselves? Instead, they don’t believe the dream they are selling you. That’s why they are taking their money now.

If I owned any asset that I felt could couple or more in the next 12-18 months…I’m not selling it to anyone.

Also, think about it…there’s no major market made for this currency anywhere. So there are no big institutions buying it up that could afford to buy up billions of dollars in dinar and become trillionaires if this crazy dream were true. But of course the “smart money” knows better. It’s all of the moms and pops of the world that are gullible enough to buy it…not large institutions. They won’t hold it or make a market in it.

But don’t just take my word for it. Check out what Forbes had to say about the dinar in January. You can find the article here.

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

Defend Yourself from the Failing US Dollar with Forex Trading

Sean Hyman — Fri, 10 Feb 2012 21:35:49 +0000

How You Could Make 150% Gains as Silver Soars to $75

The Federal Reserve’s Foreign Exchange Committee just released a report that shows Forex trading in North America rose to a record $977 billion per day in October.

Worldwide, the Forex market trades about $4 trillion a day – and North America now accounts for almost a quarter of that.

After the committee got through surveying all 25 financial institutions active in the North American foreign exchange market, they found that about 37% of the volume was euro vs. the U.S. dollar, and about 10% was dollar vs. the Japanese yen.

Thant means Americans are still largely caught up in two currency pairs, because those two currency pairs alone are accounting for almost half of the volume.

Personally, I spend most of my time focusing on Forex’s Forgotten 15% – primarily because that’s where the profits are.

But why are more Americans – most of whom are in the U.S. – turning to the Forex market?

Well, for one thing, the U.S. dollar keeps eroding in value. In fact, after a small recovery, the greenback is once again heading south.

That means the purchasing power of those Americans who do not take decisive action will continue to decline.

However, those Americans that short the dollar and buy other foreign currencies against it need not see the dollars in their Forex accounts dwindle. In fact, they can even profit from the Fed’s dollar-diluting schemes.

Let’s take a look at the chart below to see just how much purchasing power is being lost in the U.S. CRB Commodity Index…

Please click here to view larger image

The Most Important Index in the World for “Main Street”.

This index is vitally important to Main Street America. In fact, I consider it to be even more important than the Dow Jones Industrial Average or the S&P 500. Here’s why …

You don’t have to buy stocks – even though many of you own them through 401ks and IRAs, etc – but you do have to eat and buy goods for your everyday needs.

The CRB Commodity Index includes things like butter, cocoa, copper, corn, cotton, hogs, rubber, steel, steers, sugar, tin and wheat. Think you don’t use these things? You’re darn right you do.

So whereas you may or may not buy a stock…you’re going to eat. And you’re going to drive a car and live in a house that makes use of these and other commodities.

So I pay attention when CRB Commodity Index starts rising. It shows me that, unless I counteract it through the forex market, my costs will rise as my dollar’s purchasing power falls.

When you hear people say they don’t care if the dollar goes down and that it only affects them if they travel outside of the country, you can tell them I said that’s nonsense .

Here’s why…

Most commodities are denominated in dollars. So, if the dollar heads down in value, by default these commodities rise in value.

As your dollar falls…the price of your butter, corn, pork, clothing, beef, wheat or whatever becomes more expensive. And that’s exactly what is going to happen very soon.

Very soon, you’ll find that you need more money simply to feed and clothe yourself and your family.

The only way to make the dollar work for you is in the Forex market. That way, you can link the dollars in your account to appreciating foreign currencies, which over time will put more dollars in your account.

Your account balance will increase as if you literally owned a foreign currency and not the ailing buck.

Forex is the Best Tool to Defend Your Wealth

The thing I love about the Forex market is that it’s the best tool, in my opinion, to combat both the fall of the dollar and the rise of inflation.

Simply by owning foreign currencies – particularly the “commodity currencies” that rise right along with inflation like the Australian dollar, New Zealand dollar and Canadian dollar – you’re arming yourself against the ravages of the declining greenback.

This is what my Currency Cross Trader subscribers are doing. All of the trades we’ve made so far in 2012 have been plays on the falling dollar and on the rise of inflation.

We’ve profited from 100% of these trades so far simply by following this “dollar down/inflation up” theme that began again in January.

So it’s no wonder the volume of Forex trading is growing in North America.

If you’re not already doing so, it’s time join the Forex party.

Have a nice day!

Sean Hyman

P.S. Don’t miss The Sovereign Society’s ONLY offshore event of 2012. This is your big chance to attend the 11th Annual Total Wealth Symposium and join us in beautiful Los Cabos, Mexico. To make sure you don’t miss the opportunity to attend this action-packed, wealth-boosting event, contact us immediately to make your reservation. Spots are filling up fast. For full details, click here.

One Sentence from ECB’s Draghi sent my position soaring another 70 pips!

Sean Hyman — Thu, 09 Feb 2012 20:26:58 +0000

How To Escape From America, and Where to Go

The day the markets have been waiting for…no not the ECB interest rate announcement, strangely enough. It was the announcement, which oddly enough came through ECB’s Draghi at the press conference.

He said a lot of course but it was one single sentence that sent our Currency Cross Trader position in AUD/JPY soarning another 70 pips (for a total of over 200 pips).

He simply said that there has been an agreement reached with Greece. Well, that’s all the market needed to hear. It took off!

My Aussie position jumped 30 pips immediately and has been heading higher ever since.

This is our fourth winner in a row now and all trades of 2012 have been winners so far.

We’ve still got another position out there that’s up 123 pips right now too.

We hopped on the “risk-on bandwagon” early on in 2012 as I saw the Dollar Index crack its uptrend line and head lower and as I saw Copper breakout higher. Those were all the bullish signs I needed.

Copper heads higher when there is more demand placed upon it by global growth and the dollar tends to head lower again when the worst is behind the markets.

I knew that many market participants would still be on the defensive, risk-off side of the trade so I knew there was a huge chance to profit…and a nice profit is what we got.

Sooner or later, we’re going to get a pullback in the financial markets. They’ve done nothing but go straight up since the first of the year. So don’t let the pullback scare you. It’s been long overdue. When it does come, it will allow me to position ourselves into more pairs to profit!

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

Investing in Forex’s Forgotten 15%!

Sean Hyman — Thu, 09 Feb 2012 17:00:30 +0000

My publisher is very excited about the niche market that I trade in. Most forex traders don’t spend near enough time in this very profitable niche of the forex market.

So I was asked to go into the studio recently and talk to you about this niche, Forex’s Forgotten 15%. You can check it out here.

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

The Japanese Yen will Fall in 2012, and Here’s How You Can Profit

Sean Hyman — Tue, 07 Feb 2012 21:28:07 +0000

How You Could Make 150% Gains as Silver Soars to $75

Something is about to happen to the Japanese yen.

This currency is on the move.

As far as I’m concerned, there is a very definite way to profit from this move.

But it’s truly amazing how much real-world effect a currency can have on a company’s profits and its employees.

Currency is where the rubber meets the road.

Here’s the clue to what’s happening with the yen…

Toshihiro Nagahama, chief economist at Dai-Ichi Life Insurance Research Institute, recently noted: “No Japanese manufacturing company can make a profit at the yen’s current level around 75 to the dollar.”

I agree with him. The current value of the yen is the number-one hindrance to Japanese corporate growth, and that has far-reaching implications.

Why the Yen Must Fall

If you want statistical proof, just look at how the chart below shows that when the yen goes up Japanese stocks go down.

Please click here to view larger image

At the same time, when the yen heads higher against the dollar, Japanese goods become more expensive for Americans. And these goods are also expensive for Europeans with the EUR/JPY exchange rate so low.

Americans and Europeans alike have backed off of buying Japan’s goods simply because the exchange rate has gotten way out of whack.

The buck just doesn’t go as far as it used to in buying Japanese goods and neither does the euro.

It’s taken a big toll on huge Japanese exporters, like Sony, Toshiba, Mazda and NEC.

And if you think it’s not a threat, tell that to the 10,000 NEC workers, whose jobs will be axed shortly because of the slowdown in business brought on by the strong yen.

The Japanese currency has gained around 7% against the dollar over the past 12 months, alone – although it has been chipping away at Japanese corporate profits for at least three years.

There are other consequences.

For example, Sumco, which is a supplier to Sony and Toshiba, plans to cut 1,300 jobs.

Nippon Sheet Glass, which sells glass to Mazda Motor Corp, expects to make a ¥3 billion for the year to the end of March, and it said it will cut 3,500 jobs.

At the same time, Sony and Sharp are cutting in half their TV production at their biggest factories as they reduce inventory. Sony recently more than doubled its annual loss forecast to ¥220 billion.

NEC forecasts its third annual loss in four years and has been forced to cut 7,000 jobs in Japan and another 3,000 abroad, roughly about 8.6% of their workforce, because the yen’s strength is killing the demand for its handsets and wireless gear.

Japanese corporations are at a tight spot right now, and their desperation – as well as the impact on bottom line and jobs is a sign that the yen has to weaken in 2012.

Simply put: Japan’s corporate landscape can’t take more years of an ultra-strong yen.

We’re literally talking about a battle for the existence for the likes of Sony, Hitachi, Mazda, NEC, Canon, etc. – all of them household names in America.

For instance, whether the world’s largest camera producer can stay in business depends on what happens with the exchange rate.

Lately, the yen has traded sideways, and is now trading around the 76 to the dollar. I believe the Japanese central bank is supporting the USD/JPY pair there after their huge intervention last March.

And that’s where the investment opportunity lays.

USD/JPY Will End 2012 Higher for the First Time in Years

The Japanese government will not allow these great corporation and world-wide names to perish because of an exchange rate issue.

If they have to get more aggressive or if they have to get the other major central banks of the world to “gang up” on the yen… they’ll do it.

Will the USD/JPY exchange rate head higher tomorrow? I don’t know.

But I do know that it’s a good bet that it will rise significantly by the end of the year.

After all, these corporations are Japan’s largest employers – so it is also a political imperative.

The pressure is on the Japanese government, particularly its central bank… they must act or the Japan’s economy will be doomed.

There is a chance that the yen could turn around on its own. The fact that stock markets around the world are beginning to rebound could help the yen, which tends to prosper when the crap is hitting the fan elsewhere.

But if it doesn’t turn around on its own, look for the central bank to get more aggressive.

Either way, the yen must fall … and when it does, USD/JPY will turn around and head higher – and, for the savvy sovereign investor, that’s an opportunity to profit.

Have a nice day!

Sean Hyman

P.S. As the leaders of France and Germany yesterday stepped up pressure on Greece to accept the terms of the new €130 billion bailout, the European crisis cast its long shadow on Wall Street and other global markets. The dollar made gains against the euro, but it’s only a temporary respite. As the fed’s attack on the greenback continues unabated, with interest rates stuck near-zero until at least well into 2014, the dollar continues its day-by-day death by a thousand cuts. However, there is a way to put those sinking dollars to work in an overlooked part of the currency market that’s persistently dishing out substantial returns. It may be a tough and unpredictable market out there, but every investor needs a trump card he can pull from his sleeve in times like these. To learn the secret of how to grab double-digit gains, click here …

Stealthy Yen Intervention…Keeping the Yen at Bay!

Sean Hyman — Tue, 07 Feb 2012 19:30:50 +0000

How To Escape From America, and Where to Go

For those of you that follow my World Currency Watch articles, you’ll remember thta I stated that the yen simply wasn’t acting right…like a freely tradable currency lately and that told me that I felt that the yen was being messed with – propping USD/JPY up above 76.00.

Well, last night I ran across an article that gave me the proof of what I saw playing out on the charts.

Here’s a little excerpt from the Bloomberg.com article:

Japan sold its currency five times in the final quarter of last year, the Ministry of Finance said on its website today, as the government moved to shield exporters’ earnings from the impact of yen gains.

The ministry’s quarterly data confirmed speculation that the nation carried out so-called stealth intervention following a record daily sale of 8.07 trillion yen ($105 billion) on Oct. 31, when the Japanese currency climbed to a post World War II high of 75.35 against the dollar. Japan sold a total of 1.02 trillion yen during the first four days of November, according to the report.

“Coming under growing criticism from overseas, Japan couldn’t openly intervene in the markets,”.

It’s stealth-like intervention because they intervened without anyone officially knowing it since they never announced it like they normally do. However, the charts told me something was up. Take a look below. Click on the chart to enlarge it.

After their “announced” intervention back in late October of last year (shown by the huge blue candle that spiked higher off of the 52-week lows)…the ultra-strong yen all of the sudden seemed to be held at bay. It was almost like you could pop a line at the 76.00 level.

Financial markets rarely hold a “clean line” like that on their own after an intervention. Therefore, I was almost 100% certain that the Bank of Japan was selling the yen and buying dollars every time USD/JPY got down to around the 76.00 level…well, as of last night we have the proof that it is EXACTLY what was happening.

The price action on the chart tells us a lot. They speak to us in a sense. We just have to pay attention to what they are trying to tell us.

It’s just like a person that can’t technically speak…it doesn’t mean they can’t communicate. It means they can’t speak out loud.

Well, while charts don’t “speak out loud”, they do communicate. We just have to learn how they speak. That’s what technical analysis does for the chartist. It’s like sign language for those that can’t speak.

Ok, so where does USD/JPY head now? Well, a new uptrend could emerge if USD/JPY can close and continue to hold above the 78.00 level. So that’s the level to watch. See how it deals with 78.00. If it can top that…then the buyers may be back in control for the first time in years.

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader

2012 Could Be America’s Next “Oil War”!

Sean Hyman — Tue, 07 Feb 2012 14:16:33 +0000

Setting the Record Straight on the Iraqi Dinar

The next Oil War could begin sometime this year.

While it’s not certain yet…it certainly is becoming a huge possibility as America and Iran keep trying to “one up” each other.

It’s like one country moving a Chess piece and the other one countering with their next move…both trying to Checkmate the other.

That’s been going on for months now. One thing is for certain…it’s going to bring a lot of volatility to the price of oil again if the next “oil war” breaks out.

Oh I know they say it’s for nuclear weapons…and it could be. However, all I know is that we tend to fight the most where there are vast resources where we can get our hands upon them. There’s unrest all over the world, but it seems we’ve been very strategic as to where we strike.

You see, you can’t get America to send their young men over to go get Iran’s oil but you can get them to send their young men over if you mention the word “nuclear”.

Don’t get me wrong, I’m not against the military. Heck, I’m encouraging one of my sons right now to consider going into the Air Force when he gets out of high school. So I’m pro-America and definitely for a strong military.

However, I’m not always for policing the world or pulling the wool over the public’s eyes either by fancy political moves.

I have no doubt that Iran would love to take over the world and the only way they can even attempt to do that is to have nuclear weaponry that can reach the U.S. It’s the only “equilizer” I know of out there.

So I figure we will ensure that Iran can’t successfully build nuclear weaponry and while we’re there…we’ll try to ensure that they 1) can’t cut the world off from oil and 2) that we’ll get our hands onto their oil to ensure we continue to have the needed supplies to continue to grow our massive economy.

The bottom line: If America or Israel strikes Iran, oil will likely spike and gas will likely go up at the pump. This will eat into your pocket book if you don’t prepare ahead of time.

I watch two currency pairs in the forex market for my Currency Cross Trader subscribers that we’ll look to if this war does breakout and we’ll not only defend our wealth but we’ll also profit from these actions since we can’t stop them anyway.

Whatever tactic the government uses to impact our wealth in the short-term or long-term, the forex market has an answer that appropriately combats their tactics.

So while I can’t control the wacky moves of the government…I do still have control…it’s through knowing how to combat those policies/moves in the markets to help to protect the wealth of my subscribers and to even grow that wealth while the wealth of most Americans wanes due to higher oil prices and higher prices of gasoline at the pump.

Unemployment & ISM Services Data Shows Things are Slowly Improving in the U.S. for Now

Sean Hyman — Fri, 03 Feb 2012 21:49:33 +0000

Amazingly, as we get closer to a presidential election, the employment data starts to improve. There were 243,000 jobs added.

The unemployment rate continues to slowly head lower, which is encouraging. It came in at 8.3% vs. 8.5% formerly. Also, the ISM Non-Manufacturing (Services) PMI came in much better than expected. Check it out below. Click on the chart to enlarge it.

The services sector of the U.S. had a huge boost, which is good because we’re such a service-oriented society anymore. Also, it’s good to see that the unemployment rate is slowing ticking lower.

These are just further confirmations right now that it’s the “right trade” to make by being on the bullish, risk-on side of things rather than on the defensive side for now.

Don’t get me wrong…there will be some huge pullbacks along the way. One likely may be coming soon since we’ve seem markets head higher quite consistently since the first of the year.

In “currency land” this means that largely, a bet against the dollar is more favorable right now…and a bet for the commodity-currencies like the Aussie dollar, New Zealand dollar and Canadian dollar are more favorable. These are all “inflation plays” and I believe we’ll see much more of it in the future months despite what the Fed says. I’d rather trust a commodity chart any day over Fed-speak.

By playing the “inflation trade” my latest trade is up about 80 pips already and this trade just got started. Inflation will not devour my Currency Cross Trader subscribers’ wealth. Instead, we’re attacking inflation head-on!

Sean Hyman
My E-Book
info@worldcurrencywatch.com
Editor, Currency Cross Trader