“What’s the best way to buy silver?”

At lunch on Saturday, I asked the guy who would know… my longtime friend Michael Checkan of Asset Strategies International.

I’ve personally relied on Michael for his straight-up opinions since we first met in the 1990s. He’s been a dealer of precious metals and foreign currencies for the last 44 years.

So who would know the best way to buy silver better than Michael?

One of Michael’s favorite ideas today is “junk silver.”

You buy junk silver for the low price and the convenience.

Junk silver isn’t junk, really… It’s simply U.S. silver coins minted before 1965 that have no collector’s value today. They’re just valued for their metal content.

It doesn’t matter if it’s dimes, nickels, or quarters in a bag of junk silver coins… All these coins minted before 1965 contain 90% silver by weight.

Right now, junk silver trades at a much lower premium over melt value than silver coins minted yesterday at the U.S. Mint.

….read more HERE

http://www.moneynews.com/StreetTalk/JimRogersIWouldRatherOwnSilverThanGold/2011/01/04/id/381807

After 45 years, Harry Schultz has just published the last issue of his International Harry Schultz Letter. He’s superbearish but opportunistic.

Schultz, now 87, is one of the legendary characters of the investment letter industry: a hard-driving promoter who specialized in bold, radical high-concept stands. ( See Sept. 16, 2010 column.) I named him Letter of the Year in 2008, because he indisputably predicted the Crash (a “financial tsunami”) although paradoxically failed to benefit very much. ( See Dec. 28, 2008 column.)

But Schultz is also a trader, with a great respect for short-term trends. In this respect, if no other, he’s like the Aden sisters, to whose Aden Forecast he will be contributing occasional columns. ( See Dec. 30, 2010 column.)

The International Harry Schultz Letter has been something of a tsunami itself, with dozens of recommendations and opinions on an amazing range of subjects. Its relationship with the Hulbert Financial Digest’s monitoring system has been complex and sometimes strained.

But one thing is clear: In recent years, HSL has done brilliantly. It’s the third-best performer over the last past 12 months, up 39.65% by Hulbert Financial Digest count, versus 17.16% for the dividend-reinvested Wilshire 5000 Total Stock Market Index. Over the past ten years, the letter was up an annualized 8.94%, versus 2.5% annualized for the total return Wilshire 5000.

In his last issue, Schultz does not attempt a grand summing-up. But he does observe this:

“Roughly speaking, the mess we are in is the worst since 17th century financial collapse. Comparisons with the 1930’s are ludicrous. We’ve gone far beyond that. And, alas, the courage & political will to recognize the mess & act wisely to reverse gears, is absent in U.S. leadership, where the problems were hatched & where the rot is by far the deepest.”

He writes favorably of investment advice given in a recent interview by former Reagan Office of Management and Budget Director David Stockman:

“Stockman replied (to my huge surprise, coming from a former top government official) ‘Get some gold, beans, water, anything that Bernanke can’t destroy. Ron Paul is right. We’re entering a global monetary conflagration. If a sell-off of U.S. bonds starts, it will be an Armageddon.’”

About gold, Schultz retains his long-term bullishness. He quotes the respected Seeking Alpha service:

“For gold to match the growth in US M1, M2, public debt & budget deficit, gold will have to reach $1,800, $2,400, $7,800 & $13,200, respectively. While I can’t imagine gold going to $13k, these numbers tell me that calling gold a bubble is a bit premature. In my view, money supply, public debt & the budget deficit are in a bubble, not gold, not yet.”

Schultz’s comment: “Wake me up at $2,400 gold.”

….read more recommendations HERE

Just a couple of months ago, the richest men in America, Microsoft founder Bill Gates and famous investor Warren Buffett, met in a tiny Wyoming town that few people have ever heard of. What were they doing there? Possibly looking in on their next big investment.

On an unseasonably warm day this past November, two men you might have heard of — Bill Gates and Warren Buffett — visited the town of Gillette.

This tiny city in northeastern Wyoming is home to less than 30,000 people. Yet, it was important enough to host the two richest men in America for a day.

The short trip has received little coverage in the months since, but it has been leaked what Gates and Buffett were doing in the area. These two men, worth a combined $100 billion, flew all the way to this tiny town in Wyoming to tour a local coal mine.

Surprised?

The trip to Arch Coal’s (NYSE: ACI) Black Thunder Mine could mean an investment in coal is in the future for Gates and Buffett, but there’s no guarantee. The exciting part is that looking deeper into the investment potential of coal, the story is unrivaled — whether America’s richest men invest or not.

Over the past ten years, coal consumption has grown more quickly than any other energy source. According to Greg Boyce, Chairman and CEO of Peabody Coal (NYSE: BTU), coal use grew twice as quickly as hydroelectric and natural gas and at four times the rate of oil use during the past decade.

Most Americans are surprised to discover that coal already produces nearly half of America’s electricity — a whopping 45.3%, according to the latest U.S. government statistics. The main growth driver for coal demand, however, lies outside the United States.

Nearly 80% of China’s electricity is powered by coal, helping make it the world’s largest consumer. The country uses more coal than the U.S., Europe and Japan combined. And in India, where 53% of electricity is coal-generated, more imports are needed as demand for electricity spreads. India imported 73 million tons of coal last year, which was 22% higher than in 2009.

The good news for stateside investors is that the United States is known as the Saudi Arabia of coal. The country has by far the world’s largest reserves. An estimated 238 billion tons of coal reserves represent around 29% of known reserves, far outstripping Russia’s 19%.

But why should we care about the growth in coal demand? After all, we’re income investors.

Coal has a compelling growth story, but most major U.S. coal mining companies are not high-yield plays. The big four coal miners — Peabody (NYSE: BTU), Massey (NYSE: MEE), CONSOL (NYSE: CNX) and Arch Coal (NYSE: ACI) each yield around 1%.

However, there is a way income investors can take advantage of this hot sector. The solution is a little-known energy play — coal master limited partnerships (MLPs). These investments typically throw off 6-7% a year in quarterly cash payments.

Coal MLPs trade on the major U.S. exchanges just like common stocks. Yields are high because, under the partnership agreements that set them up, coal MLPs are required to pay out most of their cash flow to investors.

But these partnerships don’t mine an ounce of coal. Instead, their main activity is collecting royalties from their shares of coal-producing properties. The benefit of this arrangement is that the coal MLP doesn’t incur mining costs or related risks. Their operating costs consist mainly of administrative and corporate expenses. The rest is passed on to investors — as prescribed by law.

The investment universe of coal MLPs is tiny — only seven partnerships operate in this space. However, four of these coal MLPs offer yields of 6% or better (Penn Virginia Resource Partners (NYSE: PVR) yields the highest at the moment, with a 6.7% yield). Virtually all of the coal MLPs delivered gains at least twice the S&P 500 last year.

I say that’s a pretty good showing, even without a dime from Gates or Buffett.

[Note: I’m a big fan of these coal MLPs. In fact, I just added one to my High-Yield Investing portfolios — a 6.3% yielder that’s grown payments more than 60% since 2005. This sort of find is a perfect example of my strategy of going off the beaten path to find dependable income. To learn more about my techniques, read this memo.]

Good Investing!

Carla Pasternak’s Dividend Opportunities

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Gold futures wavered between gains and losses Monday, struggling to break their four day losing streak.   Gold for February delivery lost 70 cents to $1,368.40 an ounce on the Comex division of the New York Mercantile Exchange. It had earlier traded as high as $1,376.40 an ounce, and as low as the $1,365.40 level.