The South China Sea is up for grabs -- the world will soon see if any nation is ready to play for keeps. Don't look now, but the geopolitical structure of Asia is about to get very interesting.   As is often the case, it all comes down to crude oil. The South China Sea appears to have a decent amount of it -- probably no game-changers, but more than enough to add to the wealth of companies and nations. And, perhaps, enough to be strategically important.   At least, it appears China thinks so. China has unilaterally declared all of the South China Sea its property, and has sold lots for development that are up to three times as far from the Chinese coast as, say, Vietnam's. 

Talison: the Brines Come Home

Salar de la Isla - up to 1,080 mg/l Lithium and up to 9,830 mg/l Potassium

One of the more interesting discovery companies that we follow (and own) is Talison Lithium. This Australian lithium producer is the largest and highest grade producer of lithium in the world. Chris Berry recently visited the Company’s facilities near Perth Australia. Chris toured the Greenbushes facility and the labs where they were working on the exploration results from the recently acquired Salares brine deposits in Chile.

Written by Michael A. Berry, Ph.D. - [ Discovery Investing Web Site ]

I came across another anti-gold column this week. The author doesn't spring to mind, but the gist was easy to recall.   It was the tired old argument that "gold is not an investment" because you can't value it like a traditional investment. Because gold does not have cash flow, or offer some form of intrinsic asset comparison, it has to be a "speculation." (With speculation implied as a dirty word.)   This line of thinking seems silly to me. Who is to determine what counts as a speculation and what doesn't? Buying a growth stock at 50 times earnings sure smells like a speculation, even if there are tangible cash flows and assets to measure. One could say the same for the entire S&P 500 at certain valuations, which means even plain-vanilla index funds have "speculative" qualities at times.

The Great Entitlement Abyss and the Debt Ceiling

Last week our government borrowed $52 billion perhaps for the last time at the Treasury trough. We cannot borrow anymore legally, unless the debt ceiling is raised. The debt ceiling is an amount set by Congress to limit the indebtedness (aka reckless political spending) of our country which includes taxpayers like you and me. It is true, as Dr. Bernanke suggested, that the “government has a printing press” that serves to feed debt toward the debt ceiling. We all remember Dr. B and his now infamous speech in 2002 that reassured us all that deflation could always be easily dispatched through the government’s printing press.

Written by Michael A. Berry, Ph.D. - [ Discovery Investing Web Site ]