Monday, December 8, 2014


This "Cloud" Is Different

Media pundits have been talking about cloud computing non-stop for five years now. They've told us all about Microsoft's enterprise-based cloud, Amazon's extensive cloud services, and Google's ambitious cloud plans.

But they've completely missed cloud computing's biggest story…

That's because it's taking place in Australia, where an innovative communications company is using a $1 billion advantage to do something that's impossible here in the U.S.

This advantage can – and will – change the world.

Find out what others are missing.

The One Cloud Computing Stock to Buy Now

It's no secret that cloud computing's time has come.

Every world-class company is embracing it:

  • Microsoft continues to add features to its Office 365 cloud service and even has a new ad campaign to let the world know what this technology can do.

  • Google has been working on cloud concepts for years.

  • Amazon offers major cloud services and continues to be a leader in the U.S.

And that's just the beginning. Many other major companies---Apple and Yahoo among them---also offer cloud services.

But here's what we've discovered: not one of them can compete with a cloud stock we're recommending right now, because it has a special advantage no competitor can match.

Not Microsoft, not Google, not Amazon---not even Apple. (It's impossible for U.S. companies to even be in the running, as we'll explain in a bit.)

So why haven't you heard about it?

Because it's based in a country most investors pay little attention to: Australia.

That's their loss, because Australia is one of the world's best places to invest. Its economy is exploding with growth from exports to Asia, and it's incredibly safe: the only major nation that dodged a recession in 2008/09.

David Dittman, chief strategist of our Australian Edge service, has been guiding a small group of Americans to big, low-risk profits in the Land Down Under for years. The current average return in his Conservative Portfolio is 54%.

And that's before taking this latest opportunity into account...

Let's Start at the End

Our Australian Edge subscribers love large gains, but they also love safety. That's why we're going to start this story at the end.

This Australian communications stock pays 5.3% every year.And it's maintained at least this rate for roughly a decade (it has even boosted dividend payments up to 9% in recent years).

So through the best times and the worst, you can count on your payment. This stock is as predictable as a Disney movie. And now that you've heard the "happily ever after," let's get to the news that's happening right now.

Australian technology experts are waiting with rapt excitement. Market analysts are equally enthralled.

So why all the anticipation?

That will become clear in just a minute. First, we want to bring you up to speed on the state of cloud computing.

An Overnight Boost to the Bottom Line

There's good reason for the cloud's stunning growth: it saves businesses money---big money.

The cloud is basically a giant warehouse full of servers. Most people are familiar with servers used for storing data and relaying Internet requests, but cloud computing goes several steps beyond, where all processing and computing occurs on powerful processing servers.

Back in their offices, employees use stripped-down computers that only rarely need to be upgraded.

That means no more costly IT departments. No more instantly obsolete machines. No more endless software glitches.

We ran the numbers, and they don't lie:

An insurance company paying $335,000 a year for its network (including IT salaries), can buy a similar cloud service for $82,000. That's an overnight boost of $253,000 ... straight to the bottom line.

What's more, companies that go this route are locked in, because switching to a competitor is a huge and costly hassle. So they can be counted on to pay their subscriptions year after year after year.

That's why you need a safe, consistent technology pick like our "Australian cloud."

But here's the really juicy part...

The Sky Really Is the Limit on Your Profits

Our Australian cloud will be the world's first major company to put its cloud services where they belong: in the air.

You see, they're also a major mobile phone provider, so they own cell towers across Australia---and they're going to use them to offer high-speed cloud computing.

That means no wires through your walls, no boxes on the side of your house and no clunky adapters. For Australians, computers will use cell towers exactly the same way cellphones do.

Now we know what you're thinking: this already exists in the U.S., where customers use an "air card" or their smartphone to share their mobile connection with a computer.

But that's only a primitive version of what we're talking about. The Australian cloud won't be anything like that. It's a quantum leap forward.

So how can they do all this?

For starters, Australian television companies don't own all of the air bandwidth like they do here in the U.S. So our pick was able to buy the entire 700MHz spectrum and use it for mobile communications instead.

Here in the U.S., we can't even dream of such a thing.

It would cost trillions to roll out something similar for Americans---first to buy all the necessary television bandwidth (even the NFL owns bandwidth rights!), then build or improve all of our cell towers.

Sure, we'll probably get there someday, but it's going to be a while.

In the meantime, when it comes to cloud computing, Australia is the clear choice.

And it's happening right now. Thousands of customers are using the incredible air-powered Australian cloud as you read this.

In a few short weeks, that number will be tens of thousands.

And two years from now? Hundreds of thousands.

Lock in Your Cloud Gains Now

There's no doubt that our pick is one of the world's most impressive buys. But if you want to make the biggest gains, you must act now.

Because all of this is so new (and because most investors don't understand the world-changing shift that's happening), this company's value has not yet been reflected in its share price.

You'll always have the 5.3% dividend, which makes this company a good buy for years to come, but the chance for big gains is right now.

That's why we've put all of our resources in motion...

We held a meeting with our staff last week, telling them to drop their other projects and help us compile all of the data on this opportunity.We just finished late on Friday.

And today we're pleased to announce our new special report: "Australia's Golden Cloud."

The details in this report are the perfect vehicle for massive growth---and we're ready to rush it to you immediately. It's yours FREE just for sampling Australian Edge with no risk and no obligation whatsoever.

Now your special report is ready for you, and we can't wait for you to check it out.

Don't wait another moment.

Click here to get it now.

Editor's note: Here's what else you should know: our Australian cloud isn't limited to the Land Down Under: it's taking its strategy on the road. You'll already find it in the U.K. and New Zealand---and it's got India and Hong Kong in its sights. Its smart international expansion will fuel its profits for years to come.

The bottom line is this: it's time to put your money somewhere it can provide income and grow. That's precisely what this rock-solid pick offers.

I urge you to take a look at this brand new report today---before other investors catch on. Your risk in doing so is exactly zero.


Australia Reinvents Cloud Computing

An Australian telecommunications company has developed a unique advantage in the multi-billion-dollar "cloud" market – and it's unlike anything the world has seen before. This company is rolling out this unexpected new technology in Australia first, but is already eyeing India, China, and Europe.

There's also a 5.3% dividend…

Read the urgent details here.

Traders Are Betting on Another Rate Cut from Australia's Central Bank

Ari Charney

What a difference a week makes: Australia's economic growth for the third quarter fell well short of expectations, and now a majority of traders expect the country's central bank to lower rates as early as March.

According to the Australian Bureau of Statistics, third-quarter gross domestic product (GDP) grew by just 0.3% quarter of quarter, a significant four-tenths of a percentage point below the consensus forecast.

On a year-over-year basis, the country's economy grew by 2.7%, a marked deceleration from the prior quarter's growth of 3.1%.

The main culprits, according to economists with Westpac, were a sharper-than-expected contraction in public investment (down two-tenths of a percentage point) and a larger-than-expected contraction in mining investment (also down two-tenths of a percentage point).

The decline in resource sector investment has accelerated amid falling commodity prices. And that's exacerbated the deterioration in Australia's terms of trade, which decreased by 3.5% during the quarter.

After posting a USD1.3 billion trade surplus in February as a result of record iron ore exports to China, the Middle Kingdom's demand for the base metal subsequently waned and prices have fallen precipitously.

Since the country's trade balance fell back into deficit in April, it's averaged a deficit of USD1.4 billion per month over the seven-month period that ended in October.

However, Australia tends to post persistent trade deficits over the long term. For instance, over the trailing 10-year period, the trade deficit has averaged USD846 million per month.

Also of note, gross fixed capital formation debited seven-tenths of a point from third-quarter growth, though Westpac did see one bright sign amid the weakness: Investment in machinery and equipment jumped by 7% during the quarter, which the economists see as "an encouraging sign that the economy is gradually rebalancing away from investment in mining projects to more general activity across the services sector."

Despite the near-term uncertainty, economists expect global economic growth will gather momentum next year.

Still, it will take time for that growth to flow through to Australia's economy. While economists expect GDP to grow by 3.1% for full-year 2014, growth is forecast to slacken next year, to 2.8%, before rebounding the following year, to 3.2%.

In the meantime, the Reserve Bank of Australia (RBA) is now expected use its monetary largesse to help further stabilize the country's economy.

The central bank has been in a difficult spot as far as its monetary policy goes. Its rate-cutting cycle has taken the benchmark short-term cash rate to an all-time low of 2.5%. That's helped boost rate-sensitive sectors such as housing, but has yet to meaningfully boost growth in other sectors of the economy.

Complicating the picture is the fact that Australia's housing market underwent a relatively shallow correction compared to its developed-world peers, and because prices have risen from a much higher base, they already appear to be in bubble mode.

If the RBA raises rates to deflate the housing bubble, it risks choking off nascent growth in other areas of the economy. But if it cuts rates again, it risks further stoking a bubble that's already had many observers concerned for well over a year.

But now it appears that one bank official's recent remarks about having the scope for further rate cuts, if necessary, wasn't just jawboning.

Westpac says that falling inflation, contracting national incomes, declining commodity prices, and continued weakness in consumer sentiment are now enough to prompt the RBA to lower rates even further.

Last week, futures data aggregated by Bloomberg suggested the next rate cut might not come until the middle of next year, if at all.

But now, futures data suggest a 57% probability of at least a quarter-point cut by March and a 68.2% probability of a cut by April.

Notwithstanding our concerns about the country's housing market, further monetary easing should help the country find new growth from its non-mining sectors.

This article originally appeared in the Down Under Digest column. Never miss an issue. Sign up to receive Down Under Digest by email.


Verizon Is Jealous

Verizon has spent $23 billion installing their FiOS fiber-optic network into 183 cities and towns across America. It boasts Internet speeds that are faster than any competitor…

But there's a problem. Millions of under-30 consumers, a group referred to as "never cords" by a Verizon executive, have no interest in hooking up a physical connection to their home or apartment. They refuse to be chained down.

So Verizon has delayed further FiOS expansion.

Frustrated Verizon management is green with jealousy over a new technology that was just unveiled in a far-away corner of the world – it offers a solution to their billion-dollar problem.

But unfortunately, this new technology simply isn't possible here in the U.S.…

While Verizon is sad, we're still happy, because we're investing in the company driving this unique innovation. They plan to use their unstoppable advantage in several key overseas markets. Want in?

Find out more here.

Consider Some Singapore for Your Portfolio

Few global safe havens exist these days. The U.S. market is reaching nose-bleed valuations, Europe has sclerotic growth and several of its countries are economic basket cases. The BRICs are corrupt and truly terribly governed. And Japan is running a risky, steroid-driven version of U.S. monetary policy.

And then there's Singapore. Ranked yet again by the Economist Intelligence Unit as the world's #1 place to do business, it's now one of the world's richest countries, among its least corrupt, growing rapidly and with budget and inflation measures that are well under control. Given the state of the world today, prudent investors, especially income-oriented ones, should own some Singapore stocks. These investments are not in our Global Income Edge portfolios, but we think they are worthy of consideration.

I have a soft spot for Singapore, having lived there for three years as a child. Even back then, you could feel its entrepreneurialism; it was full of small, remarkably modern businesses being run from traditional straw "atap" huts in the villages or "kampongs." The population is a vibrant mix of Chinese-origin, Malays and south Indians.

The old British colonial types were clearly worried by Singapore independence (it was the capital of the British Straits Settlements, a Crown Colony, at the time), and by the tendencies of its new prime minister, Lee Kuan Yew. However my late father, got that question exactly right, saying he had every confidence in any country Lee was running, because he would combine private-sector orientation with a highly efficient and honest public sector.

Lee finally retired as "Minister Mentor" in 2011, but his son Lee Hsien Loong has run the place since 2004, getting reelected every five years (the next election must be held by 2016). Singapore, which has a population of 5.5 million, now has a GDP per capita of $62,800, nearly 20% higher than the United States. What's more, according to the Economist's team of forecasters, its GDP is expected to rise by 3.4% in 2014, with a slight acceleration to 3.7% in 2015.

By the standards of China, that may not sound like much, but you to have to compare it with the U.S. Europe and Japan, since Singapore is richer than all three of them. It also expects to run a budget surplus in 2014, has very little debt, and its inflation is running at just over 1%.

Singapore makes its money primarily as one of the world's largest trading and financial entrepts (a trading post where merchandise can be imported and exported with paying duties), but also has a substantial manufacturing sector with a specialization in electronics. It is rapidly becoming a world leader in private banking, as Switzerland is harassed by the European Union and Hong Kong falls more heavily under the direct rule of Beijing.

The Singapore market is below its 2007 level, and its P/E ratio is only around 14, which is well below the U.S. market. With the economy growing more rapidly than the U.S. and the stock market some 30% less highly valued, that makes Singapore a bargain -- it also doesn't hurt that the ETF, iShares MSCI Singapore Fund (NYSE: EWS) yields a satisfactory 3.4%. It's volatile (up 25% in 2010 and down 19% in 2011), but its 10-year average annualized return is 10.3.

Many Singapore companies pay only small dividends. For example, the three large banks yield barely 3%. However, apart from EWS, there are a number of Singapore companies with attractive dividend yields that an international income investor should consider.

In our paid issue of Income Without Borders we discuss two Singapore stocks with high dividends.

This article originally appeared in the Income without Borders column. Never miss an issue. Sign up to receive Income without Borders by email.


Income or Growth?

Yes.

We've found a company with a rock-solid 5.3% dividend. They've been paying incredible dividends for years.

But they also have a triple-digit upside. We've already banked 70% gains since 2012… and that was before they unveiled their recent surprise technological advantage (Microsoft and Google can't even compete).

Don't choose when you don't have to… We've been saying "BUY" for three years now, and we're not going to stop – it's truly the most lucrative income AND growth opportunity in the world. Now is the last chance to get in before this phenomenal stock takes to the clouds.

The full story is right here.

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