| This under reported "war" will change everything about the way you invest: starting with gold.
Dear Fellow Investor,
This past July, China fired its opening salvo against the U.S. and British gold exchanges.
This fall China will unleash an even bigger explosion, essentially declaring war on COMEX (the leading U.S. exchange for metals futures and options trading) and the London Bullion Market Exchange, as well as other smaller gold exchanges.
The result will send shockwaves throughout the global gold market and present profit opportunities to investors who act quickly.
Gold prices will rise to even higher than we've seen recently and those who take the right steps now (I'll tell you more about that) will enjoy a big payday.
 If you're thinking you haven't seen any big price jumps in gold recently and that current prices are here to stay you need to just look at the last five years.
You'll see that every time gold makes a leg up investors take profits that push down prices and then the run-up begins again and takes gold to the next level. . . essentially, the next shockwaves is about to begin.
The impact will take effect during the rest of this year and into next year. Recent pullbacks in gold prices have created prime opportunities for the steps I suggest.
In a moment I'll tell you what those steps are . . .
 And no, it's not about buying China stocks (too many shenanigans going on there for my taste).
And it's not about buying physical gold from China (same reason as above)
And it's not about buying physical gold from anyone else. (I like to keep things simple.)
It is about buying any one or all of 5 very particular mining stocks: all solid, North American mining companies that have some special things going for them: beyond what gold miners already have.
Before I tell you the event--the move that will essentially be a shot across the bow of the U.S. and British gold exchanges--let me give you some important background.
This past July, China launched the Pan Asian Gold Exchange.
This new exchange will act like a giant global sponge soaking up massive amounts of gold, and in the process driving up gold prices. Stock prices of well-positioned mining companies that can meet this demand will see their share prices run and enrich investors along the way.
The exchange is owned by the Chinese government and is being actively promoted as an easy way for ordinary citizens to buy gold.
China's affinity for gold is not new. The average Chinese citizen has been buying physical gold for a long time, and right now they are hungry for more. But it's been a cumbersome process for them.
Through the new exchange, the Chinese will be able to easily buy 10-oz mini-contracts for physical gold directly through their computer and link it to their bank accounts.
That's how easy the AG Bank of China (the provider in these sales) is making gold buying for its customers....
All 320,000,000 of them!
(Think of it - this one bank alone has as many potential gold customers as the entire U.S. population)
The effect this will have on the demand for gold will be staggering. Consider this:
If just 1% of their customers bought a single 10-oz contract, that would require a new physical demand of 1,000 tons of gold. (And at current gold prices that equals over $60 billion.)
So just from its Chinese customers alone, the Pan Asian Gold Exchange will send the demand soaring. And an even bigger catalyst is coming . . .
The Fall Explosion
 Later this fall, the exchange will permit international investors to buy 90 day rolling spot contracts. (Major European and North American brokerages will enable investors worldwide to invest in the Pan Asian Gold Exchange.)
And here's the kicker...the exchange will allocate a bar of gold to every bar of gold sold in their market.
Seems like a pretty innocent statement, doesn't it?
Many investors are surprised to find out that in the major gold exchanges most of the gold you buy is backed only by paper gold.
With paper gold, you don't actually own the gold; you own a promise to receive physical gold. Not exactly the real thing! And not exactly the security that investors are demand these days.
With the Pan Asian exchange investors will be able to buy the real thing.
The opportunity to buy and own real gold comes at a time when world events are creating an almost perfect storm for investing in gold:
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The Greek debt crisis has become contagious and is spreading throughout Europe... Italy was downgraded... pressure is on France... there's serious talk of the Euro collapsing altogether with more bad news coming daily
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U.S. credit downgraded for the first time ever
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Growing U.S. debt crisis with the so-called "super committee" already deadlocked
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Fears of a worldwide recession (and possibly worse) with top economists now projecting the odds of the U.S. entering another recession at 50/50
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Slowing growth in emerging markets that had been the saving grace for investors
I could go on but, you know what's happening - it's in the news every day.
But here's the good news for you.
Just about everyone is aware of the global economic crisis... and even the new Pan Asian Gold Exchange is somewhat known (at least to gold bugs). But the implications of the Fall explosion are not understood by most investors (except for those reading this timely letter for the first time).
That's why the immense impact on gold demand has not yet been factored into gold prices. So get set for big run-up.
...But it's not just gold.
Why the new Pan Asian Gold Exchange may be the best thing to ever happen to Silver, too.
The Pan Asian Gold Exchange is a metals market - and will also be offering silver contracts. Silver is up nearly 10 fold in the past decade (even more than gold), and the impact the exchange will have on silver is even bigger.
Silver is a much smaller market than gold and already in tight supply. Consider this:
If just 1% of the Agricultural Bank of China (the main bank making offers through the Pan Asian Gold Exchange) customers each bought just 500 ounces of silver, the Exchange would need to come up with 1.6 billion ounces of silver in a hurry!
For perspective, the most recent number on TOTAL worldwide mining production of silver is only 735 million ounces: meaning they'd have to scramble to fine nearly 900 million more ounces to deliver and would drive up silver prices along the way.
The demand for physical silver is set to explode. The springboard silver has needed to realize its price potential is here.
5 stocks set to spike because of the new exchange
We've looked at a number of key criteria to determine which stocks will help you ride the China Gold Shockwave. One key criteria is undervalued mining companies that are on schedule to ramp up production.
This is critical since miners who can quickly ramp up production are the ones that can capture the biggest profits from a metal's price gains.
Even if these miners just maintain costs while increasing production the profits flow to their bottom line and lead to higher stock prices.
We've found 5 currently undervalued mining stocks that meet all the criteria and are poised to ride the effect of the increased demand for physical gold.
| | A word of caution: The smart money will load up on these as soon as they get a whiff of the new dynamic in the metals market. This won't be under the radar for very long. As the effect of international investment on the exchange takes hold, prices of these stocks will catapult. Get in too late and you'll miss the early run-up. |
You can get the inside scoop on the new Pan Asian Gold Exchange in my special research report: The Secret Gold Exchange with 5 hot stock recommendations you should jump on today.
Let me just tell you a bit about some of the stocks in the report . . .
Gold or Silver?
Gold has had the biggest run-up... while silver has the biggest upside potential. So which to invest in?
 How about both - with one stock.
You get 2 for one action with this mining company which has 60% of its production in gold and 40% in silver. And there are more reasons why I am so high on this stock.
When the company released its financial report this summer covering the second quarter, the results were nothing less than spectacular. -
Revenues rocketed a record 98% over the second quarter the previous year. -
Operating cash flow jumped 251%. -
Net free cash flow rose 263% over the previous year. -
Profit margins leap-frogged 75% over the previous year.
On the heels of such stellar results, production is expected to rise 36% this year ... yet production costs will be lower. You read that correctly: production will rise while costs will decrease. That's a winning recipe for any company and particularly for a miner. So it's not surprising that analysts say earnings per share will shoot up nearly 200% in 2011...
And there is a new catalyst for further stock growth:
The company recently acquired another miner. Analysts call it a steal, saying that with this acquisition the company is poised to deliver huge cash flows as early as next year. Right now comparing it to miners with a similar cost structure this company is very inexpensive and a great buying opportunity.
The best news for shareholders is that the company's recent performance has not yet been priced into the stock. Why? Because retail investors flee at the slightest blip in gold prices. But seasoned gold investors know that the steady upward march of gold prices means higher gold miner stock prices, plain and simple. So the sooner you get into this gold and silver miner, the more profits you can expect to pocket.
I'll share with you how to get started in a minute, but you really need to know about the other gold stocks that my research produced.
How a 1,000% increase in EPS can be money flowing to your bank account
The next miner I recommend in the report also gives you exposure to increases in both gold and silver prices. In fact, this company is expected to increase production of its silver from its mine in Mexico by 175-192%.
Not that its gold production is a slacker. Its gold production is expected to increase 80-90% over the next few years.
Perhaps the biggest reason for you to latch on to this stock is the eye-popping earnings forecast for the company. Most of its reserves come from a highly productive cash cow mine. Analysts are so high on this mine and its affect on the company that they anticipate a 1,000% increase in earnings per share by the end of 2011 over the previous year!
Earnings like that are like rocket fuel for a stock price. Load up on this one and hang on till it reaches my target price and pocket your winnings.
There are 3 other winners in my report. All mining companies that adhere to the formula of increasing production while reducing costs.
The third company saw net earnings from continuing operations during the second quarter of this year jump 253% over the previous year. With its anticipated reduction of production costs this stock could soon double . . .
The fourth miner increased gold production by 50% in the second quarter of 2011 compared to the same period last year. Not surprisingly its quarterly revenue rose 134% in the same period. Look for its stock price to catch up to its torrid performance . . .
The fifth company on the list is also on a tear. Revenues nearly doubled in the most recent reporting quarter of 2011 (the company has an unusual fiscal year that ends in April) over the same period in 2010.
By decreasing costs and ramping up production, these companies fatten their bottom line. As their profits grow, their share price follows. It's pretty simple.
If you want profit from the impact of the new Pan Asia Gold Exchange, you should get the inside scoop on these stocks before word gets out.
You can find out all about the new exchange and the 5 stocks set to soar in my new report, The Secret Gold Exchange.
 I'm Ian Wyatt, Chief Investment Strategist of Wyatt Investment Research. You may know of me and Wyatt Investment Research from some of our other investment advisory services and the research we regularly provide to nearly half a million investors.
While a number of our investment advisory services are focused on small cap stocks, dividend stocks, trading, options, etc. we believe that in this economy it's critically important to diversify and to have some of your assets in stable mid and large cap stocks that can offer you superior growth and fast returns at a reasonable price.
That's exactly what you'll find in The Secret Gold Exchange special report. And right now I am making this extremely timely report available to you at a shockingly next to nothing. Normally this report is only available to our paid up subscribers.
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P.S. As I mentioned, the impact of opening the Pan Asian Gold Exchange to international investors is not understood by most investors. So right now you have a big advantage over other investors.
Get my special report, The Secret Gold Exchange, (along with the free 3-month subscription to Top Stock Insights) and make the most of it.
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