Download now: The Downfall of Cable, and the Rise of 5G!

Silver, BAP and License Plates

Investment Ideas for a Deleveraging World

Written by Christian DeHaemer
Posted May 31, 2012

Many years ago, I remember talking to a guy from New Zealand about the then-hot market in vanity license plates.

I was astounded that people would pay $50,000 to have “DR SEXY” on the back of their vehicle.

So I shouldn't have been terribly surprised when I came across the news that “WWW1” was sold for $170k in Malaysia.

It seems the government is capitalizing on the popularity of license plates, and now they're selling a series of World Wide Web plates that start “www.”

Malaysia might be 12 years behind the times, but the government plans to make $3.6 million on the sales of plates.

If you were looking for a rebuttal to the Efficient Market Theory, this is it. (Perhaps that “AOL 1995” towel I have in the garage could catch a bid?)

But 170k doesn't even come close to the absurd prices paid for a vanity plate...

one may 31

Back in 2008, Saeed Abdul Ghafour Khouri paid $14.3 million for a license plate labeled "1" in Abu Dhabi.

The tag still holds the record as the world's most expensive sheet of aluminum.

In the United States, there is a ground-floor opportunity...

A few years ago, this “1” plate from Delaware sold for the bargain basement price of $15,000, chump change. And today you can buy “3” for a mere $17,500 — but “755” will set you back $50,000 for some inexplicable reason.

Equities

Stocks, gold, silver, and oil have been getting crushed over the past month. Crude is down more than 16%; gold is off 8%; silver is down 10%.

We are officially in correction territory.

Let's look at some bullish charts...

Silver

Silver (SLV) has dropped down to its support line of $27 and is sitting on its uptrend.

Here is the five-year chart:

slv may 31

SLV is overdue for a bounce.

It has been consolidating for the past 13 months and is down by almost 50%.

The gold-silver ratio is running into strong resistance at 59:1. This indicates that all the fast money has sold silver and investor sentiment is bearish.

The catalyst for higher silver prices is a settlement of the Euro question.

Any solution to the Greece/Euro situation will reverse the dramatic rise in the dollar over the past month. Money will flow back into bargain basement Euro stocks/bonds, and silver will jump.

Longer term, we are still in a world where every country is printing money and piling on debt...

Now is a good time to add to your positions.

Peru Banks

Here is a stock that no one knows about: Credicorp Ltd. (BAP).

bap may 31

Credicorp has a near monopoly on banking in Peru and is expanding into booming Colombia.

What you may not know is that Peru has one of the cleanest balance sheets in the world.

Peru's economy is expected to grow by 6% this year and has $50 billion in foreign currency reserves.

Interest rates are at 4.25% and the country just signed free trade deals with the European Union. Imports increased 21% in the last quarter and exports jumped 31%. The Bolsa de Lima (IGBVL) is up 7.77% for the year.

Full disclosure: Crisis and Opportunity readers have had a position in BAP since it was $90 a share.

Have a great week,

Christian DeHaemer Signature

Christian DeHaemer

follow basic@TheDailyHammer on Twitter

Since 1995, Christian DeHaemer has specialized in frontier market opportunities. He has traveled extensively and invested in places as varied as Cuba, Mongolia, and Kenya. Chris believes the best way to make money is to get there first with the most. Christian is the founder of Bull and Bust Report and an editor at Energy and Capital. For more on Christian, see his editor's page.

Buffett's Envy: 50% Annual Returns, Guaranteed