“Zen International” sources say that the firm’s analysts believe that it is far too early for their quantitative easing programs to be withdrawn. On the contrary, they believe that the dearth of lending by the nations’ banks and the indebtedness of their consumers will require the extension of stimulus programs to help keep credit flowing through their respective economies.
One of the “Zen International” sources said that it was no coincidence that the US and the UK’s economies were proving more resilient to stimulus than other developed counterparts citing the fact that high debt levels had left consumers in these countries largely unable or unwilling to take on more credit and, in fact, had established a new trend for paying down debt rather than adding to it.
This, in and of itself, was ample reason to suspect that it would be a long time before the consumer would represent a strong showing in economic activity.
“Zen International” believes that central banks in both the US and the UK are raising the issue of exit strategies to reassure investors whose concerns over the excessive debt issuance by both nations may see their appetite for government bonds wane in the months ahead.
This would represent some serious problem for the finances of both nations as they need to raise money for the funding of their out-of-control public spending programs.
“Zen International” say miners still represent excellent opportunities for profits.
“Zen International” the Asian-based investment broker said that its subscription clients are celebrating a profit of 23% after following a trade recommendation for Peter Hambro Mining plc (POG:LSE).
The miner is a gold and iron ore mining and exploration company in Russia and its shares are present on the “Zen International” conviction buy list.
The firm issued a trade recommendation on the 30th July to buy the stock at 610p. The recommendation apparently suggested that the firm expected to book a modest 15% within the following 3 weeks.
“Zen International” believed that the stock was ideally placed to act as a leveraged play on the short-term bullish technical outlook for the price of gold and, after 3 weeks of relatively uneventful price action, the stock broke out sharply to the upside.
As the price of gold rallied strongly last week, POG followed suit prompting “Zen International” to advise subscription clients to take profits at or around the 820p level.
The firm remains confident of the bull market in gold especially in light of the growing lack of confidence in paper currencies and the activities of central banks in China, India and Russia, all of which are buying gold as means to diversify their foreign currency reserves. “Zen International” suggests that the acquisition of shares in selected mining firms represents a potentially lucrative leveraged play on continued bullishness in precious metals.
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