Ignore the 'Noise'


". . .this is an ideal time to load up on physical bullion and precious metals mining shares."

Only a couple of weeks ago, we were expecting a multi-week pullback, but the markets resolved their overbought conditions via a sideways consolidation instead of another correction. Accordingly, we have now parted ways with our defensive investment position and in the past week, we have reinvested our capital in our preferred markets in emerging Asia and the commodities complex. Our view remains that emerging Asia and commodities remain in a secular bull-market, which will probably end in a gigantic bubble in the future.

In the business of investing you must remember that economic news is always the most rosy at market tops and most negative at major bear-market bottoms. This is why we take our cues from the market action instead of the experts. Over the following months, many economists and experts will continue to be skeptical about this rally and this is due to the fact that they are psychologically committed to their bearish outcomes. We suggest that you ignore the 'noise' and focus your attention on the market action, which never lies.

If our view is correct, this is a fantastic time to be investing in the strongest sectors and markets of the global economy. Capital allocated now should see above-average growth over the next business cycle. As the various governments push towards alternative sources of energy and Mr. Obama introduces the 'Cap & Trade' system, the alternative/clean energy sector should be a big winner.

In the world of metals, the action is also bullish. Recently, copper has broken out to a new recovery high and this is an indication that the global economy may not be as weak as some suggest. This is a great time to invest in diversified mining companies, which are trading at super-cheap levels.

In precious metals, both gold and silver are concluding their usual, lengthy consolidations and if the bull-market is still intact, then both these metals should rocket higher over the following months. We expect gold and silver to resume the next upleg within a month or so and the rally should continue until spring next year. So, this is an ideal time to load up on physical bullion and precious metals mining shares.

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