Agora Financial’s Rude Awakening

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Vancouver, Canada

• Dow plunges 283 points on the back of more of the same,
• Unemployment claims up, housing down, financials still in the doldrums,
• Key highlights from this year’s Investment Symposium and plenty more…    

Joel Bowman, reporting from Vancouver, Canada…

The mob was in. The smart money was long gone. What else could Mr. Market do but hand out a beating? And that it did. The Dow plummeted 283 points in yesterday’s trading. The S&P finished down around 30 points. The NASDAQ slipped 45.

Now wait a minute here. Hadn’t we just “found a bottom?” Weren’t we on the road to recovery? What changed?

In a word: nothing…and therein lays the problem. 

Many will pin the blame on the appalling jobs report released yesterday. Data from the U.S. Labor Department revealed 34,000 more American’s filed for unemployment benefits. But employment has been bleeding jobs for some time now. Seasonally adjusted, the claims for Worker’s Compensation insurance is up over 400,000.

Yep…Still losing jobs. Nothing’s changed there.

Others will point the finger at the financials. As a group, financial stocks in the S&P 500 slipped 6.7 percent, their worst performance in 8 years and the third time they’ve slumped more than 5 percent in the last three weeks. But so what? The banks have been up to their neck in it since long before the words “collateralized debt obligation” appeared on the evening news.

So, financials continue counting losses. Business as usual there.

Maybe it was the housing data, others will attest. Sales of previously owned U.S. homes fell in June to the lowest level in a decade. Resales dropped 2.6 percent. The median home price is down another 6.1 percent from last year. Still, the word “subprime” is so passé for the average citizen that it is barely enough to sell a paper these days. (Thank God for the election, the front-page editors must be groveling.)

Right, so housing’s still in the dumps, eh? Nothing to see here folks!

Could it be the shrinking manufacturing base, others will inquire? Ford Motor Company, the world’s third-largest automaker and issuer of a shrinking number of U.S. paychecks, posted a record quarterly loss of $8.7 billion. Then again, who can remember the last time they bought a consumer product that didn’t brandish a “made elsewhere” label? 

Ah yes. We’re still sending plant jobs overseas. Same story there.

Perhaps the stars truly did align to thwart the jubilation of the mob…or perhaps falling home values, escalating job losses, an eroding manufacturing base, a sabotaged currency, mounting national debt and banks brimming with toxic waste really do matter.

The presenters here at the 2008 Agora Financial Investment Symposium have offered many of their own thoughts on ways you can avoid the pitfalls of irrational investing…and even profit in the face of the a barrage of ongoing crises. Our vigilant “roving reporter,” Jim Amrhein, has had his ear to the ground all week. We’ve pulled together a few of the highlights so far from Jim’s man-on-the-scene reporting in the column below. Enjoy…

— Bulletin Board Elite – Final 661 Spots —

JUMPER No. 1, Jan. 18, 2007: Defense stock soars 2,341% in 12 months — then another 47% after joining the NASDAQ Capital Market

Those who’d bought just $1,000 worth of this little-known defense stock only a year earlier could have been sitting on $24,410. And after its first four months on the NASDAQ — when this “jumper” zoomed up another 47% in value by May 22 — they’d have been able to cash in for more than $33,148.93!

But that’s nothing compared to what one microcap expert has lined up.

In fact, he’s sitting on 18 companies that have just as much potential if not more… If you are one of the first 661 to sign up, you will receive the names and analysis for all 18, plus any other ones he comes out with in the coming year.

So, check this out right here before it’s too late…

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Smarter Than Average Bears
Jim Amrhein
Roving Reporter — live from the 2008 Agora Financial Investment Symposium

Like most of you reading this, I’m not a world-renowned financial guru or even a world-class investor — I’m just a slightly-smarter-than-your-average-bear fellow with a few bucks to invest, some concrete financial goals, and an open mind. And this is the lens through which you’ll see my coverage of this event…

The End of Denial — and the Beginning of a Global Profit Outlook

As always, “Chief” Addison Wiggin started things off. Ironically, one of his first points was similar to one I made yesterday: That the ideas and themes in the annual Symposium — and in other Agora outlets — seem regularly to border on prophecy…

His speech reminded us that the Agora Editors who’ve been marquis speakers from past Vancouver events have consistently predicted major American economic trends — even as the mainstream scoffed at them. He remembers several years ago, when the editor of Strategic Investment dared to predict a $50 barrel price for oil. Since oil was around $30 a barrel at the time, he was lambasted for being “unpatriotic.”

But who wouldn’t kill for $50 oil right now?

Wiggin went on to further define the theme of this year’s conference: A View from the Peak — Seeking profits in a Time of Risk and Scarcity. Of course, the most obvious “peak” facing us all is oil.

But “Chief” Wiggin echoed his whole stable of editors to point out current or recent peaks in many less obvious — but no less potentially profitable — economic realms. In his presentation, Addison pinpointed peaks in broader universes like commodities and resources, plus more specific segments like infrastructure and water.

But that wasn’t all. He also focused on some disturbing “peaks” to an America-centric quasi-redneck like myself: Peak dollars, peak credit, and the scariest of all, peak Western influence…

Addison argued, quite rightly, that the end of the era of America’s dominance in shaping world markets with its demand is upon us — or already past.

The Coming Amerika?

Next up was the inimitable Bill Bonner.

The opening half of his remarks (the second half comes today) at this year’s Symposium were true to form. He led off saying to the crowd:

“Finally, I get a chance to say ‘I told you so!’”

He opened his speech this year with ambitious hurling of the boomerang: He informed us of beleaguered Zimbabwe’s issuance of a $100 billion currency note — that’s only worth about 80¢ U.S.

How is this relevant to American money and investing? Bear with…

As it turns out, the root of Zimbabwe’s rapid circling of the fiscal drain is actually nationalization. Increasingly over the last decade or so, Zimbabwean President Robert Mugabe’s administration has been seizing control of private industry (especially land-holding enterprises like agriculture and safari excursions). Consequently, these sectors have become far less effective and free-market competitive.

The result: Rampant inflation, increasing bureaucratic regulation, and ensuing economic paralysis.

Again, what’s this have to do with you and me and our money? Here comes that boomerang…

Citing examples from as far back as the FDR administration (and many since), Bonner paints a disturbing — check that: outraging — picture of the rapid modern trend toward nationalization in America: From government-entangled mortgage companies like Fannie Mae and Freddie Mac and health care entities like Medicare and Medicaid to what may soon include government-run banks, airlines, auto-makers, and more…

There’s so much ground to cover here that I could never do it justice with the 2000 words or so they give me to write these dispatches in. Already, I’m shortchanging brilliant day-one speakers (and perennial Symposium favorites):

Chris Mayer (Capital & Crisis, Mayer’s Special Situations ), whose elaborate PowerPoint presentation titled A Golden Age of Opportunity cautioned us Americans against crying in our beers because we’re no longer the “top dogs” — and spurred us into considering the incredibly lucrative world of infrastructure and global investment. His presentation also featured four of his best investment recommendations to help you prosper from crisis…
 
Dan Denning (Port Philip Publishing, former Editor of Strategic Investment), whose belly-laugh inducing entrance (it involved a pink brassiere — that’s all I’m going to say) gave way to a deep and serious exploration of the relationship between growing world population and not only commodities investment, but natural resource exploration, extraction, and investment. Called Investing in a Post-American World, Dan’s remarks pointed to distinctly non-American opportunities in metals, energy, and foodstuffs…
 
Rick Rule (Founder, Global Resource Investment, Ltd.) Following his perennial and always-priceless admonition that he doesn’t make specific recommendations when public speaking — but merely only “discloses conflicts of interest” regarding stocks he owns (wink, wink), the dynamic and charismatic Rule outline in his presentation, A Speculator’s Guide to Natural Resources Markets, the four reasons why he’s certain the resources bull market is intact and has real legs, despite some recent contractions.

Truth, Consequences — and the Opportunities That Make Them Bearable

Space doesn’t permit me to talk too much about I.O.U.S.A. — you’re reading this for investment news and views, not movie reviews. But I will say this much: If the tenor and intensity of the questions that followed the movie in a special Q & A session with Addison and former U.S. Comptroller General David Walker (who stars in the film) are any indication, this film has a tremendous impact on audiences…

I predict, based on what I gathered from talking to dozens of people after the show — and what I heard following the three sold-out showings of a previous cut of this movie at the Maryland Film Festival this spring — I.O.U.S.A. is going to make a sizeable splash on the American scene when it’s released in major metro-area markets in August. So it won’t be long before you can see it for yourself.

And you should. It’s the most eye-opening, sobering true horror movie you’ll ever see.

Why the Pundits Are Wrong — on Commodities, Speculators, Ethanol, and More

One of today’s first speakers was the velvet-voiced, camera-lovingcommodities master, Kevin Kerr — a staple of the Agora Financial stable for years. As you may well know, Kevin (aka: the Maniac Trader) has one of the most impressive commodities investing records to be found anywhere. And like Rick Rule did yesterday, Kevin tells us today exactly why the commodities boom is far from over, and what you should do to capitalize on it.

Scoffing at the mainstream’s recent suggestion of a “commodities bubble” — and roundly rebuffing the oft-repeated notion that “speculators” are driving the increase in certain commodities prices — Kevin rattles off six key reasons why commodities of all types will continue to rise, using one of his favorite types as an example: Foods.

Why does Kevin like food — er, food commodities — so much? Most people ignore them, he says. In this gem of a quote from Kerr: “As long as American Idol is on, and the ATM works, nobody really cares (about food commodities).”

To buttress his point, Kevin presents us with seven reasons why the costs of farming are on the rise — with no end in sight. And not just in America, either. Of course, this translates into higher food-related commodities prices. But according to Kerr, playing this market for mega-gains isn’t as easy as plunking down money on corn, wheat, and rice options, then buying a roomful of cash-counting machines. Making the most of the current food commodities situation can be tricky…

In fact, there’s one mainstream-darling demand source driving the increase in corn prices right now that Kevin thinks is going to go bust-o — and soon, perhaps starting by the end of this year: Ethanol.

Yep, that’s right. Kevin (and I) both think America’s corn-based “deathanol” is a long-term loser. He reveals more details on how to play the bust he predicts — plus some other actionable commodities investment recommendations — in his specialized afternoon “break out” session…

The Best and Worst Is Yet To Come

All that and we’ve still got crowd favorite Doug Casey, the inimitable James Howard Kunstler and, of course, Jim Rogers, legendary contrarian thinker and author of Investment Biker.

But now, a way you can take the entire conference home with you…

Here’s the deal: For the week of the 2008 Symposium (technically until Monday, 7/28, since these dispatches run next-day), the complete set of 2008’s Symposium recordings are available for only $99 for MP3 files — and just $149 for the CDs…

Or Both Formats in a “Dual-Media” Combo for Just $149

However you feel like listening — on the road, while doing housework, while you’re at work, and during your work — we’ve got the medium to suit you…

After the last dispatch from this year’s conference hits your inbox (next Monday), the prices on these recordings — and the Special Report that comes with them — will go up to $149 for the MP3 version only and $199 for the CDs (or the dual-media package).

So click here to order your advance copies now for an aggressive discount — as much as at 33% off!

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[Rude Endnote: If you would like to comment on anything from this week in Rude, please send your thoughts along to the address below. We’re off to the Laguna Beach Rude HQ in a couple of hours and will check in from there over the weekend.

Until then…

Cheers,

Joel Bowman
Rude Awakening

aussiejoel@the-rude-awakening.com