RF's Financial News

RF's Financial News

Sunday, December 8, 2013

This Week in Barrons - 12-8-2013

-->
This Week in Barrons – 12-8-2013

Is Bitcoin the next World Reserve Currency?

The average US citizen has been allowed to live well beyond their means, because the US dollar is the World’s Reserve currency.  The US dollar’s reserve currency status has been the reason the United States could ‘borrow and spend’ (like a drunken sailor) for the last 40 years.  Therefore, expect our politicians to fight tooth and nail before losing that status.  Losing that status is inevitable, but politicians will want the inevitable to be delayed for as long as possible.  One of our concessions for this delay has been to allow China to purchase tons of gold at discounted prices.  When the global currency reset comes, all currencies will be revalued based on the true assets of the holding country.  That is why Central banks all around the globe have been buying gold since the attacks on gold began a few years ago.  Every country is trying to build up their balance sheet in preparation for the new reserve currency.  After all, every nation knows that ‘printing money out of thin air’ can’t go on forever – something’s going to have to change.

Taking a step back: the US will lose its Global Reserve currency status because it has ruined (debased) the value of its currency.  All of the countries that do business with US are tired of holding US dollars, and seeing them worth less and less each year.  Therefore, job #1 for the US will be for us to try and pay down some of our debts, and actually show a ‘strengthening’ dollar.  The only problem with that is that we (as a nation) are broke – we have no money.

4 years ago I remarked that Uncle Sam is looking at the tremendous accumulation of wealth inside our 401K's, Pension Plans, etc.   This money is often just sitting idle.   Uncle Sam would like that money, and has hired firms to study how they can make it mandatory that you take a percentage of that money and purchase Government bonds.  Therefore, I think that the first step in the Global Reserve end game will be an announcement by our administration that the World Bank & IMF have instructed all nations to co-operate in a global currency revaluation, in order to bring all currencies into a new valuation range.  This will result in the US no longer being the sole holder of the Global Reserve currency title.  That title will go (instead) to a basket of currencies, backed by the assets of the underlying countries.

Because the reset will be costly (and we're mired in too much debt to bring our currency valuation in line with other countries), our administration will announce that they are going to force everyone to buy Government securities.  Remember, it worked for health insurance.  Our government will mandate that some percentage of our wages and savings will have to go towards buying Government issued bonds.  I realize that (on the surface) this sounds totally insane – conspiracy nut stuff.  But remember Cyprus?  Remember how the Cyprus government absconded with up to 50% of the population’s savings?  That was a trial balloon that worked.  Instead of armed citizens revolting in the streets, they remained amazingly calm as: (a) they were denied access to their money for days, and (b) finally granted access to only limited amounts of their individual assets.  No rioting.  No shooting.  The scam went off without a hitch.

So job #1 will be for our nation to try and ‘reinforce’ our currency by amassing all the ‘real-money’ it can scrape together.  That way (when being measured for the ‘reset’) we hold the highest rankings.  I also think (when the global reset button is pushed) – countries are going to try and work all the industrialized nations into a situation where there's not too much variance between the strongest and the weakest.  The US will want its position to be at the strongest level.  The US will want the US dollar to be ‘a significant part of’ the new Global Reserve currency basket, and supporting our dollars with the savings of 300 million people will help that effort tremendously.

From there, I think things start to unravel quickly.  The US (for a long time) has not had to produce and export goods to enjoy a good standard of living.  Currently – we simply print more money.  We are (as a nation) allowed to borrow – with no real expectation of paying it back.  Believe me, as soon as the ability to ‘print all the money we want’ is gone, it will be a very short period of time before it becomes abundantly clear that the US can not ‘produce and earn’ in the capacity necessary to keep us strong.

At that point our economy will begin to stall, and any recession will deepen.  Now, the irony of it all is that most of the world has benefited greatly by the US spending more than it earns.  Japan sells us cars and electronics by the boatload.  China sends us all manner of gadgets.  Every major economic power from Europe, to Asia, to South America to Canada has taken in fortunes on the heels of the American consumer spending money they don't have.  That will stop.

If we can't print more money, we can't spend it.  And when the US stops spending, the rest of the world will soon find that their individual countries do not have the internal consumption to support their economies.  For example: Japan exported 1.5 million cars to the US in 2011.  Germany's BMW and Mercedes export billions worth of cars and machinery to the US.  If the US can't afford to buy those cars, goods, and services – will other country’s individual citizens be able to support that supply?  Of course not.  So the world will see a synchronized decline, and that is the real end game.  I think it is at that point where we see the whole world push for a single currency, run by a central planning agency out of Europe.  And that is why I find the rise of Bitcoin fascinating.  Bitcoin may or may not be that single currency – but certainly something very much like it will be.

The real question is: When does this begin?  The wheels are in motion right now, but I don't think we will see the first real actions being taken until late 2014 or early 2015.  Nobody wants to make it a part of the mid-term election process, and we have at least a year before things get desperate enough to start these dominos falling.  After all, the Fed has been pushing $85 Billion a month into our monetary system in order to keep the ‘crash’ away.  But it is that very injection of currency that has all of our trading partner nations dumping dollars.  Therefore, the Fed will have to end its currency injection (QE policy) at the very same time we approach this monetary reset.  So as you can see, there's no shortage of excitement going forward.

Honestly, I hope I'm desperately wrong.  I hope that ‘cheap natural gas / energy’ or some other magic dust hits our country, and we figure out how to solve all our economic problems.  Unfortunately, math doesn't lie, and the math says we cannot fix this mess.  This week the idea surfaced of the US minting a ‘Trillion Dollar Coin’ and having us borrow against it.  But let's face it, it would still be a man-made fake, and it would eventually fail.  The world is getting tired of the US fakes.


The Market:

Last Sunday I suggested that the market technicals were telling me that it was setting up for a pullback.  And then I also mentioned, that this year (alone) the market set up over 25 times for a similar pullback that never happened.  We would then just pause; run in place a few days, and ‘boom’ up we would go.

We did basically the same thing this time.  From Monday through Thursday we did a bit of selling, the averages faded off – but not by a lot.  Monday we opened at 16,087 and Thursday we hit a low of 15,809 – off a total of about 280 points – 1.3%.  Big deal.

Friday we received a ‘better than expected’ jobs report.  No one (except the talking heads on CNBC) seemed to know where all this new found strength came from, but let it suffice it to say that ‘someone’ wanted to make the jobs report look good and they did.   In years past, a strong jobs report would have had them selling stocks like mad (because it may signal the end of QE), but not this time.  This time everyone adored the number, and on Friday we gained 200 points – basically gaining back virtually every point of the pullback.

What’s changed?  Why was a good Jobs Report toxic for 3 years, and now it's rewarded?  Have we finally decided that our country is strong enough to not worry about a Fed taper?  Did we decide that the number was indeed ‘pretty good’, but not good enough to initiate tapering in December?

I tend to think that the last option makes the most sense.  I believe that they came to the conclusion that the number was ‘pretty good’, but it might have some ‘noise’ in it from the Government shutdown.  After all, the ending of the government shutdown did bring people back to work.  And is the Fed really going to remove the punchbowl right before Christmas?  Will the Fed really cut QE in a year when retailers are telling us that the consumer is about tapped out?

I believe that the Fed will keep some form of stimulus in place until all of the global leaders put their currency reset plans in place.  But QE (in the fashion it is administered right now) is not the only way the Fed has of keeping interest rates low.  The Fed could taper the current QE program and continue to keep rates low by using reverse repossessions.  Therefore, my feeling remains the same – I don’t think that the Fed will do any tapering on Dec. 18th.  But ‘just to save face’ (and after warning about it for so many months), I won't be surprised if the Fed (on December 18th) does toss out a ‘tiny’ $5 or $10 Billion QE reduction.

The Fed knows that they can pull $5 or $10 Billion out of the system without causing any structural damage.  The market could look at it as the start of a larger cut back and go into spasms of selling, but then Ms. Janet Yellen could easily step in (in January) and push it right back.  That's a lot of jostling around and upsetting of markets before springtime; therefore, I think they will leave things alone.

All that said, was Friday the start of the year-end push for glory?  I don’t think so.  I think we have some more chopping and slopping to do before they give us the all clear for a final year-end push.  Despite everyone’s bravado on Friday, the market is still quite worried about the Fed pulling the punch bowl away, and everyone knows that our economic numbers are as fake as an honest politician.  So unless market psychology has changed in the past day, the markets may be a bit timid about pushing us into the final year-end charge right now.  But when Dec 18 comes without a taper, we should see a freight train run into the New Year.


Tips:

We were stopped out of TSO this week for a hefty $7/share profit.  We were also stopped out of OC and AXP flat.  

I couple things I’m looking to get involved with this week:
-       I purchased UNG (Natural Gas ETF) – April 2014 - $22 Call Options for $0.62 – currently $0.90.
-       I purchased UNG (Natural Gas ETF) – December 21, 2013 - $18 Call Options for $1.41 – currently $2.18.
-       I purchased USO (Oil ETF) – April 2014 - $37 Call Options for $0.74 – currently $0.77
-       I purchased FXY (Japanese Currency ETF) – March 2014 - $97 Put Options for $3.76 – currently $3.50.
-       Twitter (TWRT) is a little rich at $45 – but I do like the ‘covered call’ yields.
-       I’m looking at:
o   DBA – Jan, 2014 - $25 Put options around $0.50
o   EMLC – heading lower – look at the $24 Put Options around $0.50
o   ECH, PFF, PGX – heading lower looking at Put Options
o   ITB – heading higher looking at Call Options
o   TLT – heading a lot lower – looking at Put Options
o   And GLD if it breaks thru 1218.36 – it could fall to 1147 – looking at Put Options or DUST if it breaks thru that resistance level.

My current short-term holds are:
-       CCJ – in at 20.50 (currently 20.36) – stop at 19.80,
-       UNG – April 2014 $22 Calls – in at $0.62 (currently $0.90) – more room to run
-       UNG – Dec. 21, 2013 $18 Calls – in at $1.41 (currently $2.18) – more room to run
-       USO – April 2014 $37 Calls – in at $0.74 (currently $0.77) – more room to run
-       FXY – March 2014 $97 Puts – in at $3.76 (currently $3.50) – Japanese currency is worse than US currency J
-       SIL – in at 24.51 (currently 10.82) – no stop,
-       GLD (ETF for Gold) – in at 158.28, (currently 118.57) – no stop ($1,230 per physical ounce), AND
-       SLV (ETF for Silver) – in at 28.3 (currently 18.70) – no stop ($19.50 per physical ounce).

To follow me on Twitter and get my daily thoughts and trades – my handle is: taylorpamm. 

Please be safe out there!

Disclaimer:
Expressed thoughts proffered within the BARRONS REPORT, a Private and free weekly economic newsletter, are those of noted entrepreneur, professor and author, R.F. Culbertson, contributing sources and those he interviews.  You can learn more and get your free subscription by visiting: <http://rfcfinancialnews.blogspot.com> .

Please write to Mr. Culbertson at: <rfc@culbertsons.com> to inform him of any reproductions, including when and where copy will be reproduced. You may use in complete form or, if quoting in brief, reference <rfcfinancialnews.blogspot.com>.

If you'd like to view RF's actual stock trades - and see more of his thoughts - please feel free to sign up as a Twitter follower -  "taylorpamm" is the handle.

If you'd like to see RF in action - teaching people about investing - please feel free to view the TED talk that he gave on Fearless Investing: http://www.youtube.com/watch?v=K2Z9I_6ciH0

To unsubscribe please refer to the bottom of the email.

Views expressed are provided for information purposes only and should not be construed in any way as an offer, an endorsement, or inducement to invest and is not in any way a testimony of, or associated with Mr. Culbertson's other firms or associations.  Mr. Culbertson and related parties are not registered and licensed brokers.  This message may contain information that is confidential or privileged and is intended only for the individual or entity named above and does not constitute an offer for or advice about any alternative investment product. Such advice can only be made when accompanied by a prospectus or similar offering document.  Past performance is not indicative of future performance. Please make sure to review important disclosures at the end of each article.

Note: Joining BARRONS REPORT is not an offering for any investment. It represents only the opinions of RF Culbertson and Associates.

PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING ALTERNATIVE INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE INVESTMENT MANAGER.

Alternative investment performance can be volatile. An investor could lose all or a substantial amount of his or her investment. Often, alternative investment fund and account managers have total trading authority over their funds or accounts; the use of a single advisor applying generally similar trading programs could mean lack of diversification and, consequently, higher risk. There is often no secondary market for an investor's interest in alternative investments, and none is expected to develop.

All material presented herein is believed to be reliable but we cannot attest to its accuracy. Opinions expressed in these reports may change without prior notice. Culbertson and/or the staff may or may not have investments in any funds cited above.

Remember the Blog: <http://
rfcfinancialnews.blogspot.com/> 
Until next week – be safe.

R.F. Culbertson
<http://rfcfinancialnews.blogspot.com>


Sunday, December 1, 2013

This Week in Barrons - 12-1-2013


This Week in Barrons – 12-1-2013

A Nice Couple of Thanksgiving Stories:

Because Thanksgiving is my most favorite holiday, I would rather not dwell on the #WalMartFights, or any other goings on that turned caring individuals into ferocious zombies – fighting, punching, and tasering each other over junk they don’t need and often with money they don’t have.  (Yes, in one instance a fight over an electronic device caused one woman to use a Taser on another.)  I would rather talk about 2 thoughts – submitted by SF – that should leave a smile on your face. 

Many years ago, Al Capone virtually owned Chicago.  Capone wasn't famous for anything heroic, but was notorious for immersing the windy city in everything from bootlegged booze and prostitution to murder.  Capone had a lawyer nicknamed "Easy Eddie." He was Capone's lawyer for a good reason - Eddie was very good.  In fact, Eddie's skill at legal maneuvering kept Al Capone out of jail for a long time.  To show his appreciation, Capone paid him well.  Not only was the money large, but Eddie received special dividends, as well.  For instance, he and his family occupied a fenced-in mansion with live-in help.  The estate was so large that it filled an entire Chicago City block.  Eddie lived the high life of the Chicago mob, and gave little consideration to the atrocities that went on around him.  Eddie did have one soft spot, and it was for his son that he loved dearly.  Eddie saw to it that his young son had clothes, cars, and a good education.  Price was no object.  And, despite his involvement with organized crime, Eddie tried to teach him right from wrong.  Eddie wanted his son to be a better man than he was.  Yet, with all his wealth and influence, there were two things he couldn't give his son; he couldn't pass on a good name or a good example.  One day, Easy Eddie reached a difficult decision.  He wanted to rectify wrongs he had done.  He decided he would go to the authorities and tell the truth about Al "Scarface" Capone, clean up his tarnished name, and offer his son some semblance of integrity.  To do this, he would have to testify against The Mob, and he knew that the cost would be great.  But he went ahead and testified.  Within the year, Easy Eddie's life ended in a blaze of gunfire on a lonely Chicago Street.  But in his eyes, he had given his son the greatest gift he had to offer, at the greatest price he could ever pay.  Police removed from his pockets a rosary, a crucifix, a religious medallion, and a poem clipped from a magazine.  The poem read:  "The clock of life is wound but once, and no man has the power to tell just when the hands will stop, at late or early hour.  Now is the only time you own.  Live, love, toil with a will. Place no faith in time.  For the clock may soon be still."

Changing gears a little bit.  World War II produced many heroes.  One such man was Lieutenant Commander Butch O'Hare.  He was a fighter pilot assigned to the aircraft carrier Lexington in the South Pacific.  One day his entire squadron was sent on a mission.  After he was airborne, he looked at his fuel gauge and realized that someone had forgotten to top off his fuel tank.  He would not have enough fuel to complete his mission and get back to his ship.  His flight leader told him to return to the carrier.  Reluctantly, he dropped out of formation and headed back to the fleet.  As he was returning to the mother ship, he saw something that turned his blood cold; a squadron of Japanese aircraft was speeding its way toward the American fleet.  The American fighters were gone on a mission, and the fleet was all but defenseless.  He couldn't reach his squadron and bring them back in time to save the fleet.  Nor could he warn the fleet of the approaching danger.  There was only one thing to do.  He must somehow divert the Japanese aircraft from the fleet.  Laying aside all thoughts of personal safety, he dove into the formation of Japanese planes.  Wing-mounted 50 caliber guns blazed as he charged in, attacking one surprised enemy plane and then another.  Butch wove in and out of the now broken formation and fired at as many planes as possible until all his ammunition was spent.  Undaunted, he continued the assault.  He dove at the planes, trying to clip a wing or tail in hopes of damaging as many enemy planes as possible, rendering them unfit to fly.  Finally, the exasperated Japanese squadron took off in another direction.  Deeply relieved, Butch O'Hare and his tattered fighter limped back to the carrier.  Upon arrival, he reported in and related the events surrounding his return.  The film from the gun-camera mounted on his plane told the tale.  It showed the extent of Butch's daring attempt to protect his fleet.  He had, in fact, destroyed five enemy aircraft.  This took place on February 20, 1942, and for that action Butch became the Navy's first Ace of W.W.II, and the first Naval Aviator to win the Medal of Honor.  A year later Butch was killed in aerial combat at the age of 29.  His hometown would not allow the memory of this WW II hero to fade, and today, O'Hare Airport in Chicago is named in tribute to the courage of this great man.  So, the next time you find yourself at O'Hare International, give some thought to visiting Butch's memorial displaying his statue and his Medal of Honor.  It's located between Terminals 1 and 2.

So what do these two stories have to do with each other?  Butch O'Hare was "Easy Eddie's" son.  Happy Thanksgiving.


The Market:

The broken record plays on and on. Once again for what seems like the 50th time, the market is sending signals that it is exhausted and wants to take a nap.  The signals tell us that it would like to correct some of the insanity that has pushed it to daily, all -time highs.  But we've seen the market set up to correct in the past, only to be jammed higher as desperate people push freshly printed fiat money into the system, eeking out returns. Will they do that again, or are we going to see a quick drop of a few percent?  Recent history shows us that the market will ignore all the technical signs, and just shovel ‘new month’ money into the market and move it ever higher.

This week brings in the month of December, and will indeed usher in ‘new month’ money as pensions and insurance companies invest some of the monetary inflow they have received for the month.  It is likely that the inflow will keep the market (at minimum) flat and potentially up if the inflows are large.  But I am a tad concerned later in the week.  At some point, fund managers are going to want to ‘lock in’ some of their gains, and you can only do that by liquidating positions.  The second week of December is often when this happens, and then we often jump back up and the market runs to yearend.  I am looking for that to happen again this year.

However, there are quite a few things out there that could send a ripple through the global markets.
-       The Middle East is turning ugly as Saudi Arabia and Israel appear ready to make a strike on Iran's nuclear ambitions.
-       In Asia, China and Japan are rattling swords at each other, as China established "No Fly Zones" overtop their two disputed island countries.
-       And North Korea has restarted a nuclear facility.
So there's no shortage of things to be concerned about.

Thanks to DS for the following thoughts surrounding the latest Fed minutes.  The minutes show that the Fed expects inflation to be tame for years to come. That means that they are unlikely to raise rates or unwind QE anytime soon. Moreover, the Fed may actually add measures that expand QE to address falling prices and demand if there is another economic shockwave. 
The takeaway:
-       The Fed does not expect inflation to be anywhere near the 2.5% level that would trigger a rate hike through 2016, and
-       Any external shock – the meltdown of a country in Europe or terrorist attack in the developed world – would certainly draw more and varied QE with interest rates at zero. 


This gives our stock market a natural ‘upward and onward’ bias, and the bond futures a reason to continue to rally.

I have been leaning long into this yearend push, taking some profits along the way.  I think if more gains are coming, we should find them in technology, and in some retail stocks.  I'm thinking Starbucks (SBUX) may have some room to run, as do some of the technology companies behind the gadgets and games.  The key is the XLF, which is the financial Exchange Traded Fund (ETF).  The market cannot get far without the criminal bankers, so if the XLF starts to fade, a market pullback will indeed happen. 


Tips:

The market should have a natural upward bias for the week – especially with Friday’s retail sales exceeding expectations.  I couple things I’m looking to get involved with this week:
-       FXY – buying March, $97 PUTS for between $3.30 and $2.65.  The Japanese currency is being ‘destroyed’ and I’m looking for it to bottom around $88.
-       For a speculative play look at ONTY.  It got over the $2/share price last week, and could ‘technically’ run as far as $5 – but it’s not for the ‘weak of heart’.
-       Buy-the-dips on the 3D printers.  They corrected and sorted wheat from chaff with DDD and SSYS coming out on top.  My advice is buy-the-dip – especially DDD – covering it with a weekly covered call.
-       Look at RiteAid (RAD) in the healthcare space.  (FYI – I still like GILD and INCY.)  RAD broke out last week – and at $5.96 – buying shares and selling the $6 calls could net you 4% for the week.
-       ACI at $4.08 is attractive – and covering it with the $4 calls gives you over 5% for the month.
-       NPSP at $26.41 is on a tear.  Look at NPSP under $35 or buy the February calls.
-       Twitter (TWRT) at $41.57 – but ONLY for the $41 or $41.50 ‘covered calls’ – yielding 2% for the week.
-       Finally – GDXJ has ‘literally’ been left for dead.  It’s the Junior Gold Miners that has fallen 41% in 2013 – after falling 43% in 2012.  When gold wakes up (and it will) these Junior Miners will rocket higher in epic fashion.  Remember the goal here is to ‘buy low’ and ‘sell high’. 

My current short-term holds are:
-       TSO in at 50.56 (currently 58.63) – stop at 57,
-       JNJ – in at 94.50 (currently 95.24) – SOLD @ $95 - $0.50 gain,
-       CCJ – in at 20.50 (currently 20.48) – stop at 19.80,
-       OC – in at 38.44 (currently 39.31) – stop at entry,
-       AXP – in at 84.14 (currently 86.41) – stop at entry,
-       SIL – in at 24.51 (currently 11.65) – no stop,
-       GLD (ETF for Gold) – in at 158.28, (currently 120.93) – no stop ($1,237.80 per physical ounce), AND
-       SLV (ETF for Silver) – in at 28.3 (currently 19.29) – no stop ($19.43 per physical ounce).

To follow me on Twitter and get my daily thoughts and trades – my handle is: taylorpamm. 

Please be safe out there!

Disclaimer:
Expressed thoughts proffered within the BARRONS REPORT, a Private and free weekly economic newsletter, are those of noted entrepreneur, professor and author, R.F. Culbertson, contributing sources and those he interviews.  You can learn more and get your free subscription by visiting: <http://rfcfinancialnews.blogspot.com> .

Please write to Mr. Culbertson at: <rfc@culbertsons.com> to inform him of any reproductions, including when and where copy will be reproduced. You may use in complete form or, if quoting in brief, reference <rfcfinancialnews.blogspot.com>.

If you'd like to view RF's actual stock trades - and see more of his thoughts - please feel free to sign up as a Twitter follower -  "taylorpamm" is the handle.

If you'd like to see RF in action - teaching people about investing - please feel free to view the TED talk that he gave on Fearless Investing: http://www.youtube.com/watch?v=K2Z9I_6ciH0

To unsubscribe please refer to the bottom of the email.

Views expressed are provided for information purposes only and should not be construed in any way as an offer, an endorsement, or inducement to invest and is not in any way a testimony of, or associated with Mr. Culbertson's other firms or associations.  Mr. Culbertson and related parties are not registered and licensed brokers.  This message may contain information that is confidential or privileged and is intended only for the individual or entity named above and does not constitute an offer for or advice about any alternative investment product. Such advice can only be made when accompanied by a prospectus or similar offering document.  Past performance is not indicative of future performance. Please make sure to review important disclosures at the end of each article.

Note: Joining BARRONS REPORT is not an offering for any investment. It represents only the opinions of RF Culbertson and Associates.

PAST RESULTS ARE NOT INDICATIVE OF FUTURE RESULTS. THERE IS RISK OF LOSS AS WELL AS THE OPPORTUNITY FOR GAIN WHEN INVESTING IN MANAGED FUNDS. WHEN CONSIDERING ALTERNATIVE INVESTMENTS (INCLUDING HEDGE FUNDS) AN INVESTOR SHOULD CONSIDER VARIOUS RISKS INCLUDING THE FACT THAT SOME PRODUCTS AND OTHER SPECULATIVE INVESTMENT PRACTICES MAY INCREASE RISK OF INVESTMENT LOSS; MAY NOT BE SUBJECT TO THE SAME REGULATORY REQUIREMENTS AS MUTUAL FUNDS, OFTEN CHARGE HIGH FEES, AND IN MANY CASES THE UNDERLYING INVESTMENTS ARE NOT TRANSPARENT AND ARE KNOWN ONLY TO THE INVESTMENT MANAGER.

Alternative investment performance can be volatile. An investor could lose all or a substantial amount of his or her investment. Often, alternative investment fund and account managers have total trading authority over their funds or accounts; the use of a single advisor applying generally similar trading programs could mean lack of diversification and, consequently, higher risk. There is often no secondary market for an investor's interest in alternative investments, and none is expected to develop.

All material presented herein is believed to be reliable but we cannot attest to its accuracy. Opinions expressed in these reports may change without prior notice. Culbertson and/or the staff may or may not have investments in any funds cited above.

Remember the Blog: <http://
rfcfinancialnews.blogspot.com/> 
Until next week – be safe.

R.F. Culbertson
<http://rfcfinancialnews.blogspot.com>