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The Hooker-Opportunity



-- Posted Friday, 23 March 2012 | | Disqus

 “Hooker – a concealed problem, Flaw, or Drawback”

Dictionary.com

 

“I'm afraid the stage is already being set right now and it's certainly a high inflation crisis. You can see the incipient signs of rising prices in all kinds of areas.

 

“The rises in commodities prices across the board is a result of the Federal Reserve trying to monetize the deficit and give the politicians cover for their irresponsible spending by printing the money to cover it up so we don't have to go out and borrow it.

 

“We're not the only ones doing it. The Bank of England is doing it, the Bank of Japan. China is inflating, even the Swiss for crying out loud, and the European Central Bank. We have a global problem of money printing that's going to explode in our faces in the next year or so.

 

“As far as the unemployment rate, the single best thing we could ever do is we have to get government out of the picture.

 

“When World War II ended, the federal government cut spending by two thirds and this country boomed like you cannot believe. We haven't had a boom like that since. And they cut spending by two-thirds to achieve it.

 

“Normally we're running at least a $100 billion deficit a month ... Not only is the country broke, but the red party and the blue party are both into this thing up to their eyeballs.”

 

“'High Inflation Crisis' Looms for U.S.”, Charles Goyette,  3/16/2012

 

The eight largest Central Banks’ Orgy of Fiat Money Printing continues. They inflated their Balance sheets by $3 Trillion in 2011 alone. This unprecedented-in-human-history Orgy of Fiat Money Creation is creating many downstream Negative Consequences and a select few Opportunities, for those aware of the implications.

 

It is one such “Hooker Opportunity” on which we focus Today. We call it a Hooker Opportunity because it is a Profit Opportunity which also creates Negative Consequences for most other investments.

 

All but the Purblind; or those in Denial, are aware that the ongoing Massive Money Creation is already Creating Price Inflation in Food and Energy, with more to come. For details regarding the Consequences and Profit Potential from Massive Money Printing see our recent Article “Two Critical Investment Keys Going Forward” in ‘Articles by Deepcaster Cache’ at deepcaster.com and Note 2 below.

 

And Massive Ongoing Monetary Inflation implies that the Profit Potential for those Purchasing Gold and Silver now is Extraordinary. But the Hooker-Opportunity lies in the Energy Sector.

 

Though U.S. Crude Oil Demand (about one fourth of World Demand) is down over 12% from its mid-decade peak, and U.S. inventories have been uptrending since then, Crude Oil prices have been uptrending since 2008.

 

Why?

 

It is not just Mideast War Fear.

 

Consider:

-- The World consumes about 74 Million Barrels of Oil Per Day.

 

-- But production from currently producing reservoirs drops by about 7 Million Barrels Per Day Annually (i.e., year over year).

 

-- “Shale Oil” Reserves take years from Discovery to bring to Production and Production Rates are less compared to the Depleting “Elephant” Fields (e.g. Ghawar in Saudi Arabia) of days gone by.

 

-- “The Libyan War showed that Saudi Arabia does not have the 2-3 Million Barrels/Day spare capacity, contrary to what they claim.

 

-- Top Producer Russia has seen its production growth Flatten.

 

-- Non-OPEC production has Not Increased.

 

-- Thus Total World Production has remained Flat at around 74 MBD since 2005. This Reflects Geological Realities – The “Easy Oil” has been found already, and although Shale Oil and Undersea Reservoirs are coming on line, production rates from these “Hard” Oil Reservoirs are lower, and do not easily (or ultimately, at all) replace production from the depleting Easy Elephant Reservoirs.

 

-- “Peak Oil” properly defined, means Peak Production, and we are there now, as Billionaire Oilman Boone Pickens repeatedly correctly emphasizes.

 

-- In recent years, the Central Banks have poured Trillions into the International Economy, far in excess of increases in GDP.

 

-- Thus the rate of increase of price increases of Crude and other Tangible Assets has begun to accelerate. And it is these price increases which have made most of our recent ‘Profits Taken’ possible (see Note 1).

 

-- Asian consumption now accounts for nearly one-third of World Demand. For example, China’s Energy use rose at its fastest rate ever just last year.

 

In sum, World Production is Peaking/Flattening, Spare production capacity is Diminishing, Demand is still Increasing, and the Central Banks are creating ever more Dollars, Euros, etc. to “Chase” Supply.

 

Conclusion: High and Higher Crude Oil Prices will continue to be with us. That is the Profit Opportunity for those who are long Oil. Consider using the current short-term Mini-Pullback to get long.

 

But the Opportunity-Hooker is that Crude Prices at or much above current $100/bbl levels will throttle Economic Growth, impel Inflation upward, and wages and corporate earnings Downward.

 

“[The] world has not suddenly been ‘fixed’ – not by the Federal Reserve’s quantitative easing, not by the European Central Bank’s longer-term refinancing operations, and certainly not by ultra-low interest rates across the developed world.”

David Rosenberg, Financial Times, 03/20/2012

 

Respect the Power and Potential of the Opportunity-Hooker.

 

Best regards,

 

Deepcaster,

March 22, 2012

Note 1: Deepcaster addresses the questions of Profit and Protection in light of Fiat Currency Purchasing Power Destruction and provides Guidelines in his article – “Essentials for Wealth Acquisition Acceleration” found in ‘Articles by Deepcaster’ Cache.

Using such Guidelines facilitated Deepcaster’s making buy and sell recommendations resulting in remarkable profits recently if acquired and liquidated when we recommended, approximately*:

57% Profit on Agricultural Blue Chip on February 24, 2012 after just 149 days (i.e., about 140% annualized)

 

45% Profit on Platinum ETF on February 8, 2012 after just 42 days (i.e., about 390% annualized!)

 

40% Profit on March 2012 $55 GDX Calls on January 27, 2012 after just 23 days (i.e., about 635% annualized!)


34% Profit on Gold Royalty Streaming Company on December 5, 2011 after just 166 days (i.e., about 74% annualized!)

42% Profit on Volatility Index Futures ETN on October 3, 2011 after just 292 days (i.e. about 52% annualized!)

36% Profit on Double Short Euro ETF on September 7, 2011 after just 43 days (i.e. about 300% annualized!)

35% Profit on Double Long Gold ETN on August 23, 2011 after just 41 days (i.e. about 280% annualized!)

26% Profit on Double Long Gold ETN on August 17, 2011 after just 35 days (i.e. about 260% annualized!)

25% Profit on Gold Stock on August 8, 2011 after just 201 days (i.e. about 45% annualized!)

150% Profit on Gold Stock Calls on July 13, 2011 after just 56 days (i.e. about 975% annualized!)

*Past Profitable Performance is no assurance of future Profitable Performance.

 

Note 2: “This is breathlessly brilliant. U have exceeded yourself.” Uncle Harry Schultz, legendary Investor and Newsletter Writer, re. Deepcaster's Article “Two Critical Investment Keys Going Forward” 03/16/12. We appreciate Uncle Harry’s Wit and Wisdom.

 

DEEPCASTER LLC

www.deepcaster.com

DEEPCASTER FORTRESS ASSETS LETTER

DEEPCASTER HIGH POTENTIAL SPECULATOR

Wealth Preservation Wealth Enhancement


-- Posted Friday, 23 March 2012 | Digg This Article | Source: GoldSeek.com

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