GOLD, SILVER HIT RECORD HIGHS

Concern at events in the Middle East, fear of the consequences of the March 11 earthquake, tsunami and nuclear mishap in Japan, together with the continued slide of the US Dollar have led to gold hitting over $1,550 per troy ounce for the first time. Silver has followed the trend and has more than doubled in price in the past seven months alone. Clients holding the Aliquot Precious Metals fund will have benefitted strongly from this double gain plus the appreciation of platinum. Investors must be wondering how much further precious metals can go. Gold in fact was more expensive in inflation-adjusted terms in the early eighties but that was a short-lived boom.

The direction of the USD is probably the key to how much further precious metals in general can rise. The US Federal Reserve's current policy supports a weak dollar but at some point in time USD interest rates will rise and the USD will recover. We could then see gold sliding although supply and demand factors should prevent it from falling too far. For the moment there is probably some steam left in precious metals but if you are among the many whose holdings have more than doubled in value over the past few years you may wish to consider taking some profits.

STOCK MARKETS ALSO FLYING HIGH AGAIN – BUT CAN THIS LAST?

For those of you keeping a close eye on stock markets it won't have escaped your attention how they have buoyed in April, reaching a three year high in the case of the Dow Industrials Index. The Thai stock market is at its highest level since pre the Asian crisis in1997. Markets have been boosted by some good earnings reports but the falling dollar could also be a factor as investors move from cash into assets that have real value. But there are many reasons why markets should be falling. These include the still massive sovereign debt of the US, the near bankruptcy of certain European countries, the severe recent blow to Japan and the impact on the price of oil of the current unrest in the Middle East. Even China is feeling the pinch as truck drivers strike over the crippling cost of fuel.

If there was a stock market crash tomorrow analysts would have no shortage of explanations. But markets do not always move in a logical fashion. Cautious fund managers have often been caught out by selling prematurely only to see their clients left behind by still rising markets. Market timing is not easy; the conventional wisdom for long term investors is to remain in the markets and ride any storms as they occur.

Having said that, a wise investor who already has a fair amount invested in conventional markets should now be looking at alternative asset classes that are not correlated with the markets. We have been exploring these for ourselves and believe we have found some very good options for clients seeking to diversify.

ARGENTUM IS FOR REAL!

One alternative investment option promoted by PPI has been a range of tranche funds linked to litigation funding from a company called Argentum. For those of you who may be questioning the credibility of an investment that offers guaranteed returns of at least 14% per annum plus the possibility of additional bonuses (not unreasonably), I can report that I have now visited their London offices twice in six months. Last month I met with all of their executives and teams of lawyers whose task it is to identify and screen cases that warrant financial support. The cases have to be strong enough to obtain insurance that will cover all costs in the event a case is lost and ensure investors receive a full return of capital and interest irrespective of the outcome of the case.

The concept of litigation funding has mushroomed in the UK since the passing of the Access to Justice Law in April 2000. While providing funds for those who could not otherwise afford the cost of litigation Argentum has now expanded into some major multi-million dollar international arbitration cases. Interestingly, these are highly enforceable under international conventions.

Clients who invested in any of the earlier series in 2010 should be seeing their first win bonuses this or next quarter as some cases are approaching a favourable conclusion.

LATEST ARGENTUM ISSUE – NOW WITH A USD OPTION

Very briefly, there are two options with the latest issue, both for two year terms:

1. Stratum Series IV: USD20,000 per Note. 9% per annum, paid half-yearly, with a further 10% at the end of the term. Win bonuses 20% of amount invested in the respective cases (eg $1,000 if $5,000 allocated to a case).
2. Palladium Series II: Minimum GBP 27,000 for three Notes. Immediate uplift to GBP30,000 with 12% interest paid on this at the end of each year. Win bonuses 40% of amount invested in the respective cases. This option will invest primarily in international arbitration cases.

Both options have the same triple layers of protection. For more details please request the latest flyer and full details of the terms (small attachments).
Closing date for this issue is Friday 13th May, unless fully subscribed earlier.

FORESTRY INVESTMENTS – A 'GREEN' ALTERNATIVE

This is another opportunity to diversify into an asset class that is not correlated with the financial markets. The two principal products on offer are Argawood, an extremely valuable resin extracted from the Aquilaria tree, and bamboo, an environmentally friendly plant which can be harvested yearly from the same original clump. Argawood is basically a 7 year investment while Bamboo is a 15 year investment, which provides a rising income from the fifth year. Both products are projected to produce annual returns well into double digits. Again, descriptive pdf's with price lists are available for both.

ENJOYABLE WINE TASTING AT THE PACIFIC CLUB

PPI held its first wine tasting "Opportunities Series" event at the Pacific Club, Pacific Place 2 on April 5th. The featured presentation was unsurprisingly on "Investing In Fine Wine" from Premier Cru, with some startling returns on offer. Feedback was very positive and thanks to all of you that attended. Watch this space for future events of this nature.

THAILAND MONEY EXPO

For the first time in its history, PPI will be exhibiting a booth at Thailand's annual Money Expo event to be held at Impact Arena Muang Thong Thani May 12th – 15th 2011. Whilst there will be a focus on opportunities for local Thai investors, the same will apply for expatriates based in Thailand and we would love to see PPI clients visit the booth.

CHANGE OF OWNERSHIP FOR HARMONY FUNDS

As a result of a merger RMB Investment Services will shortly be renamed Momentum Wealth International Limited. You will therefore see a name change affecting all Harmony funds. Momentum Wealth International is not connected to the Momentum AllWeather Fund which closed following the 2008 financial meltdown. Please note the change should not have any effect on how the funds are managed. A full 49 page document (4MB) regarding the change is available on request.

DEATH OF BIN LADEN – A BOOST FOR MARKETS?

The death of Osama Bin Laden had a short-term impact on world markets after President Obama's announcement yesterday, as most bourses that were open made moderate gains during morning sessions and then returned to normal trade in the afternoon. Some analysts fear another chapter commencing in the battle between Western powers and extremists but this remains to be seen.

Eric Jordan, Bangkok, 3. May 2011
Kindly note this news update is primarily for information only for clients of the PPI. If you are not a client please seek professional advice before making any investment decisions.