"I want to profit from a weak dollar," says Jack Adamo. In Insider Plus newsletter, he adds, "We will do it by adding two newly-launched ETFs -- one for silver, one for gold."
"The huge creation of money in the last year must go somewhere. The Fed is creating yet another bubble to offset the deflation in demand.
"Meanwhile, the U.S. dollar has weakened in almost exact proportion to the rise in stock and commodity prices. By keeping interest rates near zero, Central Bankers force investors to participate in the asset inflation unless they're willing to accept zero return on their money.
"This game can continue until something comes along that shocks the markets into fear of losing money. A zero return is better than a negative return.
"Since this rally is liquidity driven, my guess is that traders will be looking ahead to the fact that we're going to need another stimulus package soon.
"As soon as the housing and clunkers programs wane, it should be apparent that there's no real strength behind the economy. Politicians will come to the 'rescue.' More stimulus will mean a weaker dollar and probably a continuing rally, even if we have a short-term correction.
"The ETFs we will use to profit from a weak dollar are pretty new. I prefer them to the more popular ones because their custodianship of the bullion seems more secure to me than the two biggest ETFs.
"We will consider these short-term trades. If the market does an about-face, I will probably recommend selling them. Eventually, we will have a larger long-term precious metals position, but I'm not sure that time has arrived yet.
"I want you to buy ETFS Silver Trust (NYSE: SIVR) and ETFS Physical Swiss Gold Shares (NYSE: SGOL). Despite their 4-letter symbols, both are traded on the NYSE.
"They invest in actual silver and gold bullion, not derivatives; so they track the prices of silver and gold tightly, except for their modest expense fees of 0.3% and 0.4%, respectively.
"Because their trading volume has yet to build, you should use a limit order to buy them, rather than a market order. I think this will change in a few months, as the shares become more well known."
Steven Halpern's TheStockAdvisors.com offers a free daily overview of the favorite stock picks and investment ideas from the nation's leading financial newsletter advisors.
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