The Absolute Best Buying Opportunity I've Seen This Year

[MrRich]

When I went to Brazil in late 2009 I subscribed to a newsletter from a group called International Living. They give you all kinds of tips on great places to visit or live around the world. This was in the email I got from them today from their sister publication International Living Investor. Remind me again how much natural gas Iraq has?

Dear International Living Investor Reader,

In an icy wasteland near the ghost town of Pirpyat near the Ukranian border with Belarus a concrete sarcophagus trussed up by scaffolding is all that remains of Chernobyl’s reactor No. 4.

Fukushima Daiichi in northern Japan is now certain to become the worst nuclear disaster since Chernobyl’s reactor No. 4 exploded nearly 25 years ago.

The threat of radiation in northern Japan has sparked new fears over the dangers that nuclear power poses to human health and to the environment.

In Germany, where I spend part of the year, there have been massive anti-nuclear protests. And this week Chancellor Angela Merkel ordered the temporary shutdown of 17 of the country’s reactors.

In China, too, nuclear fears are rising. China is the world’s leader in the construction of new nuclear power plants. It has 13 nuclear reactors and plans to build 25 more.

But China has announced it is suspending the construction of new nuclear power plants until it can strengthen safety standards.

It’s no wonder that uranium-linked stocks have plunged following last week’s earthquake. Cameco Corporation (NYSE:CCJ), the big blue-chip uranium producer, for instance, is down 32% from its recent high. And many junior uranium miners are down by closer to 50%.

Nuclear power produces about 16% of the world’s electricity. That’s not easy to replace. And the fresh concerns over nuclear power’s safety comes at a time when Libya’s civil war has cut the global supply of crude oil, which produces another 6% of the world’s electricity.

Right now, all eyes are fixed on events in northern Japan. But this isn’t the only world-moving event taking place.

As the brave workers at Fukushima Daiichi to try to avert an even bigger release of radiation, Colonel Gaddafi’s forces are closing in on Libyan rebels and Sunni security forces have viciously cracked down on Shia protesters in Bahrain’s capital, Manama.

Given that there are significant Shia minorities in Saudi Arabia’s Eastern Province, where the giant 5 million-barrels-per-day Ghawar oilfield lies, such brutal crackdown (it left four dead) could be a total game changer if Shia anger and civil strife spreads.

This is an obvious problem.

The shutdown of 11 nuclear reactors in Japan has cut 10 gigawatts of power. This has forced Japan to import more fuel oil and light crude oil to make up for the outage – just has oil prices are rising on tensions in the Libya and the Gulf of Arabia.

Which brings me to that buying opportunity…

The real winner in all of this will be natural gas. Natural gas already produces 22% of the world’s electricity needs. And it has three things going for it that make it an obvious “buy.”

1) It’s a clean (low-carbon) source of power

2) It is abundant

3) It is cheap

And one more thing… It doesn’t scare people the way nuclear power does.

As you can see from the chart below of the big natural gas ETF, the United States Natural Gas Fund LP (NYSE:UNG), the “spot price” for natural gas traded on the New York Mercantile Exchange have been in a long, slow decline.

That trend is about to reverse, as the world’s nuclear power producing capabilities come under increased political pressure.

I don’t recommend you buy UNG. Because it mimics the spot price of natural gas by buying futures contracts, UNG has proved to be an unreliable tracker of gas prices.

Instead, consider adding some exposure to the First Trust ISE Revere Natural Gas ETF (NYSE:FCG). This is a low-cost way of tracking natural gas explorers and producers.

Top names here include Chesapeake Energy Corp (NYSE:CHK), Devon Energy Corporation (NYSE:DVN) and Suncor Energy Inc. (NYSE:SU).

FCG is up 4.5% for the week. I believe there are much bigger gains to come.

Good luck and good investing.

Chris

Chris Hunter

Editor, International Living Investor

I'm not endorsing his stock picks. I'm just showing you the reason behind them. Natural gas, which is abundant in Iraq.

Edited March 18, 2011 by MrRich

[okane]

Good post and thanks for the info.

[ThePeoplesChamp]

Good Post Mr.Rich

Thank you for that read.

[DaveH]

Great post Rich. Thanks for sharing. Iraq just became a wee bit more wealthy(in the future), and more important, IMO.

[cardinal sin]

Thx Rich.

[HYDRANT]

NATURAL GAS IS THE WAY TO GO AND ALL THREE PIONTS ARE CORRECT-AND YES IRAQ HAS ABUNDANT OF IT THATS WHY I STARTED BUYING STOCK IN IT LAST YEAR ITS GIONG TO BE STRONG AND THE STOCKS ARE GOING TO GO UP AND UP-LOOK FOR IRAQ ALSO TO COME OUT ON TOP WITH GAS CONTRACTS ITS A BIG SOLUTION TO CLEAN FUEL AND WE HAVE PLENTY OF IT----GOOD POST MR.RICH

Edited March 18, 2011 by HYDRANT

[3keepfaith]

Thanks Rich, Sounds like a good investment to consider.

[JohnnyZ]

Great find, Scooby Doo. This will definitely help me.

[SushiLovr2]

I'm not poo pooing the point.

I believe natural gas production will continue to rise.

But here in Arkansas, where natural gas production has exploded (no pun intended), we have experienced a dramatic number of earthquakes, or earthquake swarms.

While the gas companies deny that their injection wells have anything to do with the earthquakes, and scientists are on both sides of the debate about it, I can tell you this much...

Since the state ordered the two injection wells near Greenbrier to be closed, the earthquakes have pretty much stopped.

I don't know how much it would affect the industry as a whole, if they were to prove a link between the injection wells and earthquake swarms, but I will say it's something to pay attention to if you plan to invest in this sector.

Just an FYI for everyone.

[MrRich]

Thanks for the responses. I've been asked for the link to their site so here it is. Enjoy!

[rjboots1]

Thanks for the post Mr. Rich. I'm an International Living fan also, hoping for the opportunity to do something about it post-RV. As a side-note, if you pursue the nat. gas idea, I would suggest individual company stock(s) instead of the UNG. If's a little funky because it's tied to future's contracts which expire each month, so it jumps to the next one. I'm not even sure how it tracks but I do know that it does not necessarily track exactly with spot prices on nat. gas. (I learned the hard way!)

[whatsfordinar?]

....I've got gas from waiting for some good news about the Dinar.........thanks for post Richman

[Sparky69]

When I went to Brazil in late 2009 I subscribed to a newsletter from a group called International Living. They give you all kinds of tips on great places to visit or live around the world. This was in the email I got from them today from their sister publication International Living Investor. Remind me again how much natural gas Iraq has?

I'm not endorsing his stock picks. I'm just showing you the reason behind them. Natural gas, which is abundant in Iraq.

Suncor Energy is primarily heavy "dirty oil" as you americans like to call in Ft Mac,Ab although they do have assets all over the world including the states,this is their bread and butter area.(they also own Petro-Canada).Still a very good stock but a little pricey to get in on.Cequence Energy is a junior upcoming gas producer in Northern Alberta as well and they seem to have horseshoes up their a$% when it comes to drilling and hitting boomer wells.(I contract to Suncor and work about 20 miles from the last well Cequence Energy drilled).Don't have symbol for Cequence handy but it is easy to find and is at about $3.50 CAN right now up from around $1.70 about 2 months ago.

Hope this helps.Good post Mr.Rich.Gas is clean and a very viable alternative to nuclear and even oil.The US has VERY large reserves of un-tapped natural gas and oil as well!!!

Cheers,

Sparky

[jamadude99]

Thank you, Mr. Rich. We all need to get on our

congress and senate and insist that they get on

the band wagon for clean natural gas power!

jamadude99

[MrRich]

Thanks for the post Mr. Rich. I'm an International Living fan also, hoping for the opportunity to do something about it post-RV. As a side-note, if you pursue the nat. gas idea, I would suggest individual company stock(s) instead of the UNG. If's a little funky because it's tied to future's contracts which expire each month, so it jumps to the next one. I'm not even sure how it tracks but I do know that it does not necessarily track exactly with spot prices on nat. gas. (I learned the hard way!)

Thanks for the tip. Yeah, I've got some ideas for relocation post-RV too. They say Costa Rica is beautiful. I've thought about Puerto Rico too, but the attraction to me about Brazil is the fact that it has a tropical climate with beautiful beaches (and women) but it's big enough to give you the conveniences of modern life. Check out this photo of Maceio in northeastern Brazil.

[deepseadinar]

GREAT POST AND ON THE MONEY. I HAVE SPENT MY EXTRA MONEY ON DINAR TO HEDGE MY UNEMPLOYMENTS AND 100% DISABILITY FROM THE ARMY BUT...

I AM GLAD FOR THIS POST AS I HAVE BEEN TRACKING NATURAL GAS FOR SOME TIME AND I BELIEVE THIS WILL DEFINATELY CHANGE THE LANDSCAPE IN THE WORLD. I CAN SEE SOME COUNTRIES BUILDING NEW NATURAL GAS TYPE PLANTS TO FURNISH ENERGY AND SHUTDOWN THE NUKES.

AND THE FACT IRAQ IS RICH IN THIS RESOURCE TO; THEN WE ARE REALLY ON OUR WAY AND HOPE IT IS MY LIFETIME TO ENJOY THE INVESTMENT (62).

I DO PLAN TO BUY A GOOD NATURAL GAS STOCK AND THANKS FOR THE INSIGHT ON THOSE LISTED HEREIN. NOW TO FIND THE MONEY TO GET 100 SHARES!

[jimpickles]

a great post !

[umbertino]

Thanks for the responses. I've been asked for the link to their site so here it is. Enjoy!

Mr.Rich, may I ask you where in Brazil were you located? I'm planning on passing a fairly big amount of time there each year in the next Future..... I usually go to Salvador, Bahia but have visited Rio and Sao Paulo in the past..... Thanks in advance.

Edited March 19, 2011 by umbertino

[coorslite21]

Another opportunity in Natural gas would be "Royalties".....you can learn more here......

http://www.ehow.com/how-does_4900043_how-natural-gas-royalties-work.html

You can find companies that will locate opportunities for you...there is an initial investment, and then you get a monthly check for a number of years, depending on your contract......I have simplified it.......but I assure you the concept works.....just do the homework......look to the heartlands of the US, and over the long term you can make a very nice profit.

[MrRich]

Mr.Rich, may I ask you where in Brazil were you located? I'm planning on passing a fairly big amount of time there each year in the next Future..... I usually go to Salvador, Bahia but have visited Rio and Sao Paulo in the past..... Thanks in advance.

I heard a lot about how incredible Bahia is, but I didn't go to Salvador or Rio. I was there for 81 days and I traveled a lot. I went all the way from Porto Alegre in the south where my best Brazilian friend Jeferson lived, to Fortaleza in the north. In between I visited Gramado, Florianopolis, Foz do Iguacu (highly recommended), Curitiba, Sao Paulo, Brasilia (three and a half weeks there with my friend Nelson), Recife, Campina Grande, and a town called Iguatu in the state of Ceara where I have some English speaking friends. Unfortunately I didn't know anybody in Rio de Janeiro and I didn't want to go there alone so I skipped it. I'll put it on my list for sure in 2014 when I go there for the World Cup.

I've been studying Portuguese for a couple of years and I found a website called LiveMocha where you can network with people who know the language you want to learn and want to learn your language. That's where I met all of these people. I discovered that studying English in Brazil is very popular these days. Some estimates say that half of all Brazilians between 18 and 30 have studied English beyond the introductory level. While I was in Brazil I was invited to speak at five different English schools. Most of these people had never met an American or a native English speaker. I was treated like a celebrity.

[umbertino]

I heard a lot about how incredible Bahia is, but I didn't go to Salvador or Rio. I was there for 81 days and I traveled a lot. I went all the way from Porto Alegre in the south where my best Brazilian friend Jeferson lived, to Fortaleza in the north. In between I visited Gramado, Florianopolis, Foz do Iguacu (highly recommended), Curitiba, Sao Paulo, Brasilia (three and a half weeks there with my friend Nelson), Recife, Campina Grande, and a town called Iguatu in the state of Ceara where I have some English speaking friends. Unfortunately I didn't know anybody in Rio de Janeiro and I didn't want to go there alone so I skipped it. I'll put it on my list for sure in 2014 when I go there for the World Cup.

I've been studying Portuguese for a couple of years and I found a website called LiveMocha where you can network with people who know the language you want to learn and want to learn your language. That's where I met all of these people. I discovered that studying English in Brazil is very popular these days. Some estimates say that half of all Brazilians between 18 and 30 have studied English beyond the introductory level. While I was in Brazil I was invited to speak at five different English schools. Most of these people had never met an American or a native English speaker. I was treated like a celebrity.

Very interesting.. Thanks. I do speak Portuguese fairly well. I got motivated by Heart reasons.... smile........It's a beautiful language. I agree Foz de Iguacu is fantastic... Visited there many years ago (1985).. I love Salvador but the place is getting almost as violent as Rio, unfortunately...an average of 1,800-2,000 murders a year........I'm considering checking Maceio' myself............I'd like to buy a home eventually if I 'm able to spot the "perfect" place.....I'll check that site you wrote about....Thank you.

Edited March 20, 2011 by umbertino

[summershah]

Great post Mr Rich thanks.

[butkus51]

Mr. Rich. Forget Brazil. I have relatives there, been there. If you never leave the beach, you may be okay. Once, you put your car in gear, you are in gridlock. Plus, the Brazilians hate us, except when they come to Miami and New York for shopping. And geo-politically, they sit on the sidelines during any crises-notice how they abstained about Lybya?

[MrRich]

Mr. Rich. Forget Brazil. I have relatives there, been there. If you never leave the beach, you may be okay. Once, you put your car in gear, you are in gridlock. Plus, the Brazilians hate us, except when they come to Miami and New York for shopping. And geo-politically, they sit on the sidelines during any crises-notice how they abstained about Lybya?

Well obviously your experience was quite different from mine. I never saw any gridlock in Brazil's traffic, even in Sao Paulo. I've lived in Houston and nothing in Brazil was as bad as their traffic. And in Curitiba the mass transportation system is incredible, which makes the traffic there a breeze. As far as Brazilians hating us, I never saw anything of the sort. As I stated earlier I was treated like a celebrity. Brazilians love American music, movies, TV shows ... etc. Everywhere I went I saw signs of American culture. If they hate us they sure have an odd way of showing it.

Your point about Brazilians not siding with the US on international matters is valid. But that's not a problem for me since I don't always go along with my government either. Libya is a good example. I don't really see how there was any national security threat to the US in Libya. It seems to me that it's just a humanitarian mission and I don't think that's what our military is for.

Edited March 21, 2011 by MrRich

[rjboots1]

I'm hoping that people don't abandon DV after the RV because I think there will be a lot of interesting posts about international travels, real estate, investment ideas, etc.

Scooby Doo, I've only visited Costa Rica for a day off of a cruise ship, but I've been snooping around Central America for months on the internet. I used to own a condo in Ambergris Caye off the coast of Belize. (Heavenly, but over-developed now.) Belize City and Panama City have become the western Carribean's international banking centers, and Panama is growing like crazy. I'm hoping to spend a lot of time exploring post-RV, with some guidance from the International Living group.

I'm curious about Brazil, but also want to explore inland a bit, if it's safe.

Oh, and by the way, MasterofPower, even if you are correct, noone will ever listen to you until you get a better grip on the concept of diplomacy! Might want to work on that.

Edited March 21, 2011 by rjboots1