Tags: sean | hyman | currencies | commodity

Fill Up on 'Commodity Currencies' Before Gasoline Soars

By    |   Tuesday, 13 April 2010 01:38 PM

As many of you may know, I live in the Dallas area.

While I’m not much of a sports fan, I did watch the implosion of the Dallas Cowboys’ old home, Texas Stadium, on Sunday. It was quite a sight to see.

However, while I was watching the implosion, I was also watching the “explosion” of a certain commodity on my charts.

In fact, this commodity has grown a whopping 280 percent since the beginning of the year.

Guess what?

You already deal in this commodity every day and so does much of the world.

You’ve paid more for it in the past six out of 12 months.

What is this commodity that acts like a global tax on the economies of the world?


Join the Robber Barons Next Door. Your Potential Reward: $137,000 (or more) Legally in Your Pocket in the Next Year Alone!

As I looked at the chart of gasoline futures from Jan. 1 until now, futures have made a staggering comeback. Worse yet, they just broke out of a seven-month sideways consolidation just a few short months back.

When this happens, it almost always means that prices will trend rather sharply higher during the upcoming months and possibly years.

The more it takes out of your pocket to go to drive, the less you have to spend on other things.

Guess what?

Corporations also have to pay this “higher tax” too in their pursuit of profits.

When that happens, their profit margins shrink and they struggle more to meet their earnings estimates. Therefore, in time, it weighs down their stock prices too.

So with almost 10 percent unemployment (and more than that if we were ever to see the “real” numbers) and this increased tax on society of higher gasoline prices, you can almost be assured that the stock market will not be “the place to be” for the next five to 10 years.

Much of any of the growth will not come from stock appreciation but rather from those companies that are able to pay a dividend.

Now, you might ask: "If this is such a big deal, then why hasn’t the media been talking about it?"

Well, it’s taken a back seat to Obamacare and the Greek debt crisis.

As a nation, we are back to $3.00 a gallon on average for gasoline. Some places are already higher than this.

The last time that gas prices hit $3.00 and then worked their way up to $4.00 and above, it almost crushed us. And we didn’t have nearly the rate of unemployment that we have today.

So from a currency investor’s perspective, what can be done in order not to get crushed by these increases that are coming?

Invest in the currencies of the commodity-exporting countries like Australia, Canada and New Zealand.

In other words, if you can’t beat’em, join’em!

Since higher prices are on their way, if you are positioning your portfolios to where your investments benefit from these increases, then you are helping your overall portfolio as you hedge against these costs.

If you are invested in things that don’t benefit from these higher prices, like the U.S. dollar and your typical stock, then your overall portfolio will likely get crushed during the next five-plus years.

I personally feel that this could last for 10-plus years very easily because before, we didn’t have 10 percent unemployment, Obamacare and the higher taxes that will be required of you to pay for Obamacare.

Therefore, it is my opinion that the next 10 years will be the best to those that are in “commodity currencies” (which are similar to owning the actual commodity except that you earn daily interest along the way).

Those that are also in commodities and the best of dividend stocks should do well also.

So make sure you get some of your money out of the U.S. dollar and into the Australian, Canadian and New Zealand dollars before these “costs of living” (like gasoline) rise even further.

Remember, you can’t help it if these costs of living do go up. However, you can help whether you fall victim to them or not.

This is what I help the Money Matrix Insider subscribers with all the time.

There, I give exact trade recommendations with entries and exits and even how much currency to buy in proportion to how much is in their trading account.

So if you aren’t comfortable doing this on your own and you find that the world of currencies is new to you, then check out my Money Matrix Insider service.

About the Author: Sean Hyman
Sean Hyman is a member of the Moneynews Financial Brain Trust. Click Here to read more of his articles. He is also the editor of Money Matrix Insider. Discover more by Clicking Here Now .

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As many of you may know, I live in the Dallas area. While I m not much of a sports fan, I did watch the implosion of the Dallas Cowboys old home, Texas Stadium, on Sunday. It was quite a sight to see. However, while I was watching the implosion, I was also watching the...
Tuesday, 13 April 2010 01:38 PM
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