Basic Tips on choosing Best Forex Broker

There are some basic notices that you should consider when you want choosing online forex broker.

#1- Spread Amount

The spread, which is calculated in pips, is the difference between how much you can buy or sell a currency at a specific point in time.

Forex currencies are not traded through a central exchange market, so the spread can be different depending on the forex broker you use. Some online forex brokers have variable spread; some of them have two spread amounts that depend to day and night.

Some of them their spread depends to the position of market. When market is quiet the spread is small and when market is busy the spread is high. I prefer forex brokers that have fixed spread, because over the long term fixed can be safer.

#2- Execution

— How fast is the broker's order execution?

— Do they offer automatic execution?

— How much can you trade before having to request a quote?

— Do they trade against their clients?

The best way to find out is to open a demo account and give them a test drive.

#3- Leverage Options

Leverage is expressed as a ratio between the total capital that is available to be traded and your actual capital. For example, when you have a ratio of 100:1, your forex broker will lend you $100 for every $1 of actual capital you have. Leverage is a necessity in forex trading because the price deviations in the currencies are set at fractions of a cent.

Before choosing an online forex broker notice that what is their leverage. Many brokerages offer a flexible margin that allows you to choose the leverage that's right for you.

#4- Account Types

Notice the forex broker you choose has mini account or not. Mini account is designed for those new to online currency trading and those with limited investment capital. There is a smaller deposit required to start trade of just $300 or less.

#5- Trading Platform

Good trading software will show live prices that you can actually trade at, not just indicative quotes. It will offer Limit and Stop orders, and ideally will let you attach these to your entry order. One-Cancels-Other orders are another useful feature — they mean you can set up your trade and then leave the software to get on with it.

#6- Dealing tools and value-added services

Find out online forex broker that offers the best resources and information to help you make the smartest trading decisions. A good company should offer real-time charts, technical analysis tools, real-time news and data, and software or website support. Be weary of any company that refuses to share information or trial versions before opening up an account. You will want to try out their system before you choose to invest money in it.

#7- Support

Forex is a 24 hour market, so your online forex broker should offer 24 hour support. You should also check if you can close positions over the phone — essential in case your PC or internet connection crash at a critical moment. You could contact to their Internet help desks to see how quickly they respond to enquiries.

#8- Get Referrals

Ask around and read forex forums to find out which forex brokers other people use and why they selected a specific broker.

Accepting Losses With Grace

The lack of a proper trading plan which includes precise rules for entering and exiting a trade will most certainly guarantee failure over the long term. Beginners usually suffer from the same common ailments. They abandon trading plans purely on impulse because things are not going exactly as how they had envisioned. Repeatedly they use unreliable methods that fail to produce a profit. Many traders hold on to losing positions telling themselves "it is going to turn" when every indicator says otherwise because they cannot bear the thought of a loss.

Why do they torture themselves? Why don't they just identify what's going wrong and make a change? For some people recognizing that a trade or even a trading method is not working and making a change is easy, but for others it's very difficult. They have to look at their limitations admit that they have made a mistake and that's hard because it hurts our ego. Psychologically it's risky, it's often easier to fool ourselves. Just keep going, living in a state of denial until your account is depleted. If you recognize any of these traits in yourself you must stop trading immediately.

Take a good look at what has been happening, try and identify the problem. If you look close enough you may see a pattern. This is why it is vital to record every trade and as much information about it as possible. You have to break out of old patterns and see things in a new light.

You will never be a successful trader if you continue to live in a state of denial. What can be done to return to reality? There is a lot you can do. First of all make sure you are not trading under stress. When stressed out you can't see clearly, you become rigid and unable to see alternative views. One of the easiest solutions is to trade smaller. The smaller the trade the less the stress, especially for the beginner. If you are experienced and in a loosing streak reduce your contracts until you get your confidence returns. Some people need to take a break altogether. Get away from it all. Take your mind off the trading.

The second thing you can do is to make sure you have a life. Trading can be addictive especially when you are winning. Do not put all your emotional eggs in the trading basket. You need to have other roles that give your life meaning and purpose. By defining your identity in a variety of ways, you will not place un-natural importance on trading events. Therefore, you will be able to take losses in stride and look at your trading more objectively.

Finally, radical acceptance is a key mental strategy for coping with market uncertainty. Many traders make the mistake of thinking they can control the markets. Nobody can control the markets. We must learn to accept anything that comes our way and to trade accordingly. Adopt the attitude that trading is a journey and that all we can do is go where the markets take us.

To succeed on this journey you cannot afford to lose too much. Manage risk and just accept what you get and enjoy the ride. This way you will trade more freely and creatively. Don't live your life in denial. Accept your limitations, work around them, and become a winning trader. Write out your trading plan with precise entry and exit points. Most important set your stops and mentally decide you will not break them. Test your system on paper and when confident test in real time with the minimum contract size. You will have losing trades, accept them with grace and go on to the next trade.

How To Get Started In FOREX Trading

The foreign exchange market (Forex) offers many advantages to investors. But you need to know where to begin.

This short guide will give you the Forex basics, so you can quickly start participating in this fast growing market.

In the past, foreign exchange trading was limited to large players such as national banks and multi-national corporations. In the 1980's the rules were changed to allow smaller investors to participate using margin accounts. Margin accounts are the reason why Forex trading has become so popular. With a 100:1 margin account, you can control $100,000 with a $1,000 investment.

A Learning Curve

Forex is not simple, though, so you'll need some knowledge to make wise investment decisions. Although it is relatively easy to start trading on the Forex, there are risks involved.

Your first move as a beginner should be to find out as much as possible about the market before risking a dime.

Find A Broker

Forex traders usually require a broker to handle transactions. Most brokers are reputable and are associated with large financial institutions such as banks. A reputable broker will be registered as a Futures Commission Merchant (FCM) with the Commodity Futures Trading Commission (CFTC) as protection against fraud and abusive trade practices.

Open an Account

Opening a Forex account is as simple as filling out a form and providing the necessary identification. The form includes a margin agreement which states that the broker may interfere with any trade deemed to be too risky. This is to protect the interests of the broker, since most trades are done using the broker's money.

Once your account has been established, you can fund it and begin trading.

Many brokers offer a variety of accounts to suit the needs of individual investors. Mini accounts allow you to get involved in Forex trading for as little as $250. Standard accounts may have a minimum deposit of $1000 to $2500, depending on the broker. The amount of leverage (how much borrowed money you can use) varies with account type. High leverage accounts give you more money to trade for a given investment.

Trades are commission-free, meaning that you can make many trades in one day without worrying about incurring high brokerage fees. Brokers make their money on the 'spread': the difference between bid and ask prices.

Paper Trading

Beginning traders are strongly advised get accustomed to Forex by doing "paper trades" for a period of time. Paper trades are practice transactions that don't involve real capital. They allow you to see how the system works while learning how to use the various software tools provided by most Forex brokers.

Most online brokers have demo accounts that allow you to make free paper trades for up to 30 days. Every new Forex investor should use these demo accounts at least until they are consistently showing profits.

Forex Software

Each broker has its own set of software tools for making transactions, but there are a few tools that are common to all Forex brokers. Real-time quotes, news feeds, technical analyses and charts, and profit-and-loss analyses are some of the features you can expect to see on most online brokers' web sites.

Almost every broker operates on the Internet. To access a broker's online services you'll need a reasonably modern computer, a fast Internet connection, and an up-to-date operating system. Once your account is set up, you can access it from any computer just by entering your account name and password. If for some reason you are unable get to a computer, most brokers will allow you to make trades over the phone.

There are lots of ways to make money. Forex trading is just one more potential stream of income -- if you are prepared to learn and practice.

The Advantages and Disadvantages of Forex Automated Trading Software

Nowadays people are getting into Forex. When they do, then they would like a system that can help them make life easier. You have probably joined Forex to earn fast money. But how would you like if there is an automated system for Forex that doesn't just earn you huge profits, but it also help you save time and make your life easier by doing Forex trading automatically without needing your all-time supervision? It's double the benefit! In addition to that, a Forex automated trading software comes in a very easy way to understand and steps to follow; even a beginner in Forex can now make trading and earn fast income. Now that makes it triple the benefit! With the assistance of the Forex Automated Trading Software, you can choose a currency, its selling price prior to any buying. You will also need seed money and your trading orders will be executed.

The best thing about the system is that it earns money for you without requiring you to watch over them as they run. As the name implies, an Automated Trading Software of Forex simply means a software system that does foreign currency trading automatically without having the trader to supervise his trading all the time. The software is already programmed in a format of automated trading bots. Everything that is required by a trader is just an internet connection and a computer to get the system run! And an account to start trading of course.

The Forex Automatic Trading Software allows the traders to setup the strategy of their trading systems and the software will automatically generate trades according to the setup. The Forex trading system is able to run on a number of factors at once such as the multiple technical indicators and the market conditions. You can generate signals according to the custom trading systems that you set up. You can also set the system to create orders automatically and later perform trades when a signal of buy or sell is generated. The automated Forex trading software is also programmed to allow you to visually back test your trading systems. You can see them on a historical chart data where you can verify if your trading strategies are running effectively.

Although you may use the automated Forex trading software, there are no guaranteed successes by just depending on the software itself to make you earn high profits of money. Since the trading market depends and directed by some factors such as the economy, the political state of a country or the future strategies of big companies, a trader is still required to have some knowledge and an amount of study before setting up their trading commands. As stated earlier, the system can be programmed by you to follow your individual needs. It means that the automated Forex trading system is not exactly mechanical that you don't need to know anything at all.

When you have already programmed your settings prior to trading, you need to be confident with them. Altering the settings that you made usually can cause disaster. Thus although the Forex automated trading software does every trading for you, a trader usually gets stuck with their pre-programmed pairs they want to trade on. Alterations on settings are not recommended.

If you like the use of an automated trading software system, the thing is you will miss all the knowledge other non-automated traders know when they don't use an automated system in Forex trading. The automated Forex trading system also does not tell you how it is running. But you can still understand it if you go look up the results.

Forex makes people more clever!

Today there are a lot of people searching for alternative earnings. And many of them want to try Forex market for that purpose. At the same time they are trying to answer the question: "What is Forex: work or game?!"

Every day a lot of people come to Forex market with a stong desire to receive fast and easy profit. But, after getting acquainted with the way of erning money on th market, they understand, that it is impossible to get easy money there - you need to work hard constantly. And only at the expense of diligent and efficient work you can begin to earn money.

When a person begins to understand that fact, he has 2 variants of further action: either to start getting acquainted with Forex in detail or leave it at once and forever. Forex market is not a place for cheapskates, only intellectual and hard-working people can be a success there.

At the same time it's considered, that Forex it not only a way of earning money, but also a possibility to raise your intellectual level. Just look: every trader must be constantly informed about quotes, rates, etc. Quite a big amount of specialized literature is required too - traders read hundreds specialized books throughout their performance on the market. So, the traders is doing constant self-study.

It is also important to analyze past events on the market. The trader can learn to carry out the analysis of his past wins and losses. And constant working with elements of technical and fundamental analysis widens trader's outlook and stimulate his interest in different spheres of science and technical. That helps him to build private strategy for successful trading. Without constant studying and improving your trading skills there won't be any profits. Forex helps you to structure the thoughts. That means that you will learn how to combine and divide information and use for your purposes.

Another important fact is that Forex develops trader's psychology. Remember, that you must always keep to a condition and not lose your temper in order not to lose your deposit. Every Forex trader must understand, that he can lose his capital if he doesn't take into consideration some little details, that even seem to be not important. And making a decision about opening a position depends on trader's abilities: he must be able to risk but at the same time keep the situation under the control. Therefore psychology of the trader is one of the basic aspects of success on Forex market.

As you see, all mentioned factors show, that Forex helps trader to raise his general intellectual level. Ability to analyze the situation, structure the data, work out and use your own strategy - all that can be helpful not only in the market, but also in usual everyday routine.

Forex Trading — Opportunities for Individuals

Forex Trading-How Can Individual Investors Benefit?

Indeed large multinational and individual banks and other major financial institutions have dominated FX trading (also known as Forex trading), but there is a paradigm change in the nature and type of investing. According to one estimate, in the new millennium, there are over 6 million online investment accounts, up from 1.5 million in 1997. As a result, start-up firms now compete directly with financial institutions to serve investors in the new technologically driven economy, and the clear winner is the customer. The competition between the brick and mortar institutions and the Internet-based companies has dramatically lowered the costs of investing, and empowered the individual investor to take control of their own investment strategy in Forex trading.

We know Forex trading is direct access trading of currencies. In the past, foreign exchange trading was limited to large banks and institutional traders but recent advancements in technology have allowed small traders to take advantage of the many benefits of Forex trading using online trading platforms to trade. Virtually Forex trading is done 24 hours day and almost 5 ? days of a week. In the recent times, online trading has revolutionized the currency markets by making it accessible to the small and medium sized investor.

The Forex trading is perhaps the largest financial market in the world, with a daily average turnover of approximately $1.5 trillion. Foreign Exchange is the simultaneous buying of one currency and selling of another. The world's currencies are on a floating exchange rate and are always traded in pairs, for example EUR/USD or USD/JPY or USD/INR etc.

In the new millennium, the Forex trading has become accessible for an individual investor or small group of investors. In the current scenario, investors reap many benefits from Forex trading than stock market, e-mini futures and such other trading. Today mostly traders are choosing Forex trading than stock trading because there are approximately 4,500 stocks listed on the New York Stock exchange. Another 3,500 are listed on the NASDAQ. In spot Forex trading, you have 4 major markets, 24 hours a day 5.5 days a week. If you are so inclined, you have approximately 34 second-tier currencies to look at in your spare time. You can concentrate on the major forex and can find your trade. When you are investing in forex you can spend your afternoon on the golf course or with your spouse watching movie or celebrating holidays-in short it is easy and hassle free than stock/future market.

Not only is it an accessible, easy and less capital-intensive business opportunity, but it is much more cost efficient too to invest in the Forex market, in terms of both commissions and transaction fees. Generally, commissions for stock trades range from a low of $7.95-$29.95 per trade with on-line brokers to over $100 per trade with traditional brokers. Opposite to that, typically stock commissions are directly related to the level of service offered by the broker. At the high end, traditional brokers offer full access to research, analyst stock recommendations, etc. In contrast, on-line Forex brokers charge significantly lower commission and transaction fees.

Automated Forex Trading Vs Discretionary Forex Trading

There is a debate whether forex trader should use automated forex systems or have discretion in their trading. Purely automated forex trading involves the use of back testing and rules to generate every trade they make. Discretionary forex traders on the other hand use signals as an alert and then make a decision on whether to trade or not.

Automated forex trading involves having your computer make clear cut forex trading signals and the trader will not second guess the system. They will ignore all emotions and thoughts about the market and are disciplined enough to make the trades when the system alerts them to do so. Obviously not everyone is that disciplined and as such automated forex system software has been developed to completely remove the trader. These are also known as forex trading robots.

The major problem in automated forex systems is that it is impossible to program proven forex methodologies into an automated forex trading system. A good forex trader can see patterns in the market that a forex robot can not see. For example, I have yet to see a forex robot that can identify a hunch. Believe it or not but there are times when I can get a hunch that the market is not doing the right thing and I am correct. An automated forex system will never be able to do this. At least, not yet.

Another weakness of automated forex robots vs. discretionary systems comes in situations in the market that are fundamental in nature. I have yet to see an automated forex system that can identify how I should trade if there is an earthquake in Saudi Arabia that increases the price of oil. Many forex trading situations are created by fundamental reasons and the forex robot will probably not be able to identify these situations.

Automated forex trading is especially useful for the forex trader who has problems in executing forex trades. Many a forex trader never follows their own forex systems and end up getting paralysis when they are supposed to trade. The forex robot will aid such a trader in such a scenario by placing the trade as long as the trading signal has been generated.

If you have a problem finding time to trade your forex system, an automated forex system will ensure that you never miss any signal generated by your trading methodology. The forex market is a 24 hours market making it impossible for a forex trader to follow all the trades that his system is producing. Having a forex trading robot should take care of that.

Overall, it is hard to say what approach works. Forex traders make money both ways. I make an effort to have both a forex robot to trade for me, especially if I know I will not be following the forex market for long and discretion when I have time to follow the currency market. If you have a forex trading methodology that works, then stick to it.

Day Trading Tips To Give You An Edge

Day trading can be a thrilling way to make money. But it's more challening than most beginners think. Here are some day trading tips that can help the new trader as well as the more advanced trader to achieve your goals faster.

Tip #1: Do not over trade. The market is a random walk most of the time, meaning that it's moving around without a pattern that can forecasted. Retail traders taking small positions in the market cause this meaningless movement.

These amateurs do not affect the long-term movement of the market. The professionals, with their large volume and their willingness to hold positions longer, are the ones who create sustainable moves in the market that can provide meaningful profits.

Many traders are lured to day trading because of the energy of the business and the potential for big profits. This mindset is not helpful. The pros keep their powder dry for long periods of time waiting for a high-probability situation to happen. They are much less active than beginners think.

Second: The trend is not always your friend. Perhaps the most common axiom in trading is "The trend is your friend." That is a half-truth.

The trend is a fair weather friend!

It's true that the trend is your friend early on. But trends get exhausted and end. It's more accurate to say: "The trend is your friend, until the end."

There are 2 times to trade when you can put stats on your side:

When a new trend is just starting.

When a trend has run its course.

FOREX Trading Strategies

The world of trading and investment can be as frustrating as it can be rewarding! And Forex (Foreign Exchange) is no exception - often described as risky, profitable and complicated.

Forex is the largest trading market in the world.

Forex is the worldwide market for buying and selling currencies. These markets were developed to cater for the supply and demand of different currencies by governments, companies and individuals - for international trade and assisting importers and exporters.

Therefore those who trade in this market include consumers, businesses, investors, speculators and the banking industry.

Different countries use different currencies - which vary in their values against each other. Forex trading involves the buying and selling of two currencies - trading pairs - you are selling one and buying another eg you may use the US dollar to purchase British pounds - if the supply of the pound lessens - it will cost more dollars to buy pounds - the Forex trader hopes to sell their pounds at a higher price than the purchase price.

A speculator in Forex is someone who accepts the possibility of adverse exchange-rate movements in the hope of making a profit from favourable movements in currency.

As a speculator you should always start trading with a small amount and have a trading system - which tells you when to get in and out of the market. It is a favourite option for currency traders as you can trade the Forex market 24 hours per day and the transaction costs are minimal.

This market - because of its sheer size - is hard to be manipulated - which stocks can be - it is more likely to be influenced by global news or events. Hence, the opportunity for 'insider trading' is eliminated.

However - beware -Forex brokers estimate that 90% of traders lose their money; 5% break even and only 5% achieve profitable results!

How to Become a Good Forex Trader

Setting a Forex trading business should come with a wise and strategic planning. It is important that you know what kind of business you are going into. Studying the business thoroughly is a very important strategy in order to gain success in his field. It needs good management because there are risks involved in this type of business.


Keeping your mind engaged in Forex trading means acquiring money in a progressive and truthful way. In such that you will be able to have the goal you are targeting.

To attain a successful forex trading business, you must choose your currency pairs. You should also decide how much risk you are willing to take and how much you want to gain. Path the time and date when you placed the trade and keep notes describing your strategy. Familiarity also plays an important role in this kind of trading.

Here is another thing to consider before you decide to engage in this kind of trading – remember that it is very important that you have the skill and knowledge on how to run the business. Your ability together with your courage to run the business will lead you to a successful trading in the end.

Dedicated Servers for Ecommerce

If you are currently engaged in any facet of ecommerce, even service sectors, a website makes up a great deal of your business. Therefore, it is a safe assumption that you pay for hosting your website in some fashion. If you do not already have a dedicated server, perhaps you should revisit the decision for the best hosting options for your business.

What is a Dedicated Server?

Most web hosting companies set up accounts or on a shared server. You essentially share the total hard drive and bandwidth allowance with many others. This may not be the best hosting option and can present many problems such as security and traffic bottlenecks. On a dedicated server, the server is completely yours, and there are not other websites utilizing the same machine. The server is dedicated completely to you and your business.

Advantages of a Dedicated Server

Several advantages can make a dedicated server the best hosting choice for you. These include:

Server Security –Dedicated servers increase the security of your website tremendously. There are no other webmasters using the same workspace, and simple mistakes or user error that might occur due to shared machines simply no longer existent.

Storage Space – As the entire server is dedicated to a single customer, there is tremendously more storage space available for website pages, images, and features.

Data Transfer – As with storage space, there is a great deal more bandwidth available for data transfer. Traffic to your site no longer competes with traffic for other websites reducing bottlenecks and slow server response time.

Control Panel – Having your own server offers additional opportunities for control. Sharing a server indicates that you have only limited control of server features and functions, but with a dedicated server, webmasters have greater control and access to the day-to-day functions of the host.

Software Options – Dedicated servers also allow more software and script options. The server has greater storage capacity for this information, and there is no need to align coding or features with other users of the same machine.

Disadvantages of a Dedicated Server

The sole disadvantage of a dedicated server is the cost. It is only logical that obtaining an entire server versus a piece of a shared server would be more expensive, but the rate often makes webmasters baulk. It is important to consider the fee as related to the total cost of shared server space when determining if a dedicated server is the best hosting option for you business, despite cost. A single credit card safety incident or an exorbitant bill for bandwidth overage should level the playing field almost immediately.

Am I ready for a Dedicated Server?

Websites grow at different rates, but as the success of a business grows, so does the need for additional hosting capacity. If you are approaching the limits of your current hosting company or have concerns about safety, such as storing credit card information on the same server as others or simply if your current company is the best hosting company for your needs, it is definitely time for a dedicated server.

Hosting UK – Is It Worth It?

No matter where you are located, businesses seem to clamor to host your website. The top hosting positions among these companies are not only hard to award, but hard to define as well. There are simply too many needs to be met for too many different websites to conclusively have ideal criteria for a hosting website. All top hosting contenders do meet standard requirements for standard hosting services, and overseas companies often will meet these needs for a lower price than US or Europe based competitors, but should hosting be outsourced overseas?

Why the Difference in Price

Foreign web hosting offers the same packages as top hosting companies for considerably less cost in most cases. While some overseas companies may simply be offering low rates as a sales ploy, other offer rates that adequately reflect the cost of living in that country. Overhead costs can be tremendously lower in countries such as India or Pakistan , which means the web hosting services can be offered for less.

This makes it difficult to determine the best route for selecting top hosting companies based solely on price. Low prices can be tempting, but there is always the question of quality. Do the budget services offer the same level of service? Like all things, that answer simply depends on the company. Overall, webmasters should not write off or immediately sign up for foreign hosting companies simply based on rates. There are many other determining factors to consider.

Location, Location, Location

Much like real estate, location matters. The closer your server is to your clients, the faster those clients will be able to access your website. Even in a virtual existence, the physical distance between servers and end users can make a difference. Most internet marketers target United States and European citizens, so by hosting halfway around the globe, website response time for target demographics may be adversely affected.

Customer Service

Many foreign companies are highly trained in customer service and are highly respectful of customers and other individuals. Customer, in this case meaning webmasters, care is a top priority for most of these companies as they realize they must work a bit harder than top hosting companies in the United States to garner the same level of respect and reputation.

Having stated that, hosting in countries with different customs as well as time zones can also be frustrating for webmasters. The same problems that complicate any sort of outsourcing affect web hosting as well. Communication gaps, misunderstandings, and difficulty finding a common time to work together, despite the claims of 24/7 service, can all plague individuals outsourcing hosting. These problems, of course, are not a guaranteed byproduct of overseas hosting, but rather should be determined on an individual basis.

How to Choose the Best Web Hosting Service

One of the most crucial decisions that most online businesses have to make is choosing the best web hosting service. With a popular or well known and reliable Internet Service Provider (ISP) you won't face many problems, however with a poor web hosting service provider it can be a nightmare.

Choosing the right kind of web hosting service can be a very daunting task at times as there are some very important features that you need to make sure of. Here you can find below what exactly to look for when choosing the best web hosting service.

Amount of web space: A web hosting service provider would usually assign you a certain amount of space on their server. You need to ensure that does it have the right amount of space for your website and your business requirements. You might want to expand your online business tomorrow and would require much more space. So it's imperative for you that the web hosting company should be able to provide you with ample of space especially if your website is rich in graphics or has video clips.

FTP access: FTP access is very crucial since it provides the ability to upload new pages. Some web hosting service providers allow you to just design your web pages with their own personal web builder. This may be useful for beginners however you need to ensure if they provide you the facility to expand later when you enhance your online business capabilities.

Degree of reliability, security and speed of access: Speed, security and reliability are extremely important for the success of any online business. While choosing a reliable web hosting service you need to ensure that this is taken care of. A site that is not available, not updated on time or is down, will lose many online visitors. If an online visitor finds your site listed on a search engine, and he tries to access it but finds it down, he is sure to move on to the next link and you lose an important customer or visitor. Even slow working websites are very frustrating. So how do you know if a hosting company is reliable or not? By word of mouth or feedback from others! If that's not possible then you can yourself try accessing your site during peak hours and non-peak hours too. Your site has to be secure of intruders at the same time, especially if it's an ecommerce website.

Dependence and support: Does the web hosting service provide 24x7 supports? Do they respond rapidly to your issue? Can you depend on them? If you need 24-hour technical support that larger companies need then expect to pay substantially more. In fact, people are much more expensive than machines.

Pricing plans : Price is also one factor that you should look out for when choosing the best web hosting service. It's not necessarily true that the most expensive hosts are the best. Simply compare prices and services before you finalize one.

Data transfer (Bandwidth): You also need to see if the hosting company provides you with sufficient bandwidth for efficient data transfer. After all it's your website and you need to ensure that you are getting the best services for the money you invest.

A Sundry of Options for UK Web Hosting

Since the birth of the internet, millions upon millions of websites have been created. They may contain different information and designs, but they all have one thing in common. Web hosting, one of the most important functions in the website process, allows website owners to put up their creative masterpieces. Regardless of what they do decide to display, this type of program gives them the independence to say whatever they'd like.

One of the biggest misconceptions of web hosting is that every package is the same. We all assume that one size fits all, and that there are no in betweens. Surprisingly, this is just the opposite. Depending upon the type of website you are making, and its popularity, you may need something much more professional and expensive. Nonetheless, there are affordable packages, no matter how tiny or large your budget is.

If you are just starting out and want no string attached, there are plenty of alternatives. Free hosting allows you to not only create a website, but it helps beginners, no matter how much experience they have. Although there are popup downsides and other annoyances, free web hosting will give you everything that you need. If you are not sure if you even want to extensively design one, Geocities or AngelFire is great to experiment with.

Are you looking for something a bit more customized? For many webmasters, shared hosting is a favorite. This means that an abundance of websites are actually on one server. While this only costs a few dollars a month, there are still issues that come along with it. For instance, if a fellow webmaster were to have done something illegal, chances are your website would be shut down as well. This is because you share an IP, which of course can be quite dangerous. For this reason, you must be careful when choosing people to share a host with.

While these are great alternatives, many professional companies enjoy dedicated hosting . Fortunately, the website is the only one on the server, which results in a lot less complications. With freedom comes a plethora of features, which include extra bandwidth, visitor trackers, and your own I.P. As a result, you do not have to worry about illegal situations occurring within your server. Everything is based around your needs.

Reseller hosting is another admired amenity. If you are a webmaster and are looking to make some extra cash, this is a great opportunity. In simple terms, you purchase a web hosting package from a company and divide the space into several sections. These sections can easily be purchased by fellow webmasters, who are in need of space. With this business in place, you will effortless make a few dollars.

Regardless of what you are looking to make, web hosting is necessary. From free companies to dedicated servers with only one website, there are endless opportunities. Although people assume that there is only one type of package, this article clearly shows how wrong the myth can be. The only requirement is that you are ready to work hard, be innovative, and stand out among the crowd. With these factors in mind, you could be to the top in no time.

How to Make Money with Web Hosting

We all know that web hosting is the basis of all web sites. It helps us attract visitors, it displays what we are desperately trying to get across, and it allows us to survive in the cut throat internet world. While these are all important qualities that come with web hosting, there are many other opportunities. Dying to make extra cash? Surprisingly, web hosting can actually help with your bills. In a few simple steps, you will be on your way to a richer lifestyle.

Fortunately, there is a new trend in the web industry. Reseller Hosting, which consists of purchasing a web hosting package and reselling it for a larger price, has been making webmasters just a few cents richer. Although this sounds like a daunting task, it actually only requires a large amount of space. Once the webmaster acquires such a large server and bandwidth, he/she is able to divide it up among other people. As long as they are willing to pay a monthly fee, you will never get screwed over.

Regardless of how much money you want to make, purchasing this re-seller hosting does not cost much. For an average of $30/month, you can purchase enough space to make a profit. While all of these websites will be on a shared server, the majority of webmasters do not mind this downside. After all, not everyone can shell out thousands a month just to acquire their own dedicated server. Once you have found a few loyal customers who will not create any illegal material, you will be generating a profit every single month out of the year. Fortunately, until you stop your hosting, you will never be out of a job.

In order to sell this type of hosting, you absolutely need to network. Regrettably, there are many webmasters trying to follow the trend. For this reason alone, you should look in unpopulated areas. Try and find a website or forum that has not yet been tackled by other masses of website owners. For instance, find websites similar to your own. If you do not have one, look on webmaster-related forums such as Digital Point or Webmaster-Talk. These areas are populated with thousands of interested clients, who will be more than happy to jump on the bandwagon, if you do have a great deal.

Still desperately trying to find other ways to market? Many website owners advertise through blogs and buy text link ads. As a result, people will be more apt to find what you are offering. If this doesn't work, you could even start marketing in a local newspaper or a newsletter that goes out to professional companies who are always looking for alternatives. Nevertheless, there are plenty of consumers out there. You just need to be creative and put in the effort, in order to get anywhere.

For years web hosting has been flooding the market. However, it has just recently become a form of revenue for webmasters who just don't own their own web hosting company. It is a wonderful alternative to an additional part time job, especially if this is what you love to do. Networking with others, controlling a server, while working on your website certainly sounds like the perfect occupation.

Gold vs. the Dollar

The PRICE OF GOLD is now holding just below $1,000 and consolidating, writes Julian Phillips of the Gold Forecaster.

Why is it at a high point having fought to get there over the last 18 months or so? Since it first broke through the 30 year high of $850 it has held its ground. It has steadily built a base over $850 and is moving if it has not already moved to a clear Point of Resolution, where it will show itself as either having had its day or is at the beginning of a new day.

Which way will it go? As many believe that it moves the opposite way to the Dollar, it is telling us that the Dollar is also at a Point of Resolution. The atmosphere surrounding the US currency at the moment is telling us that it is about to descend possible to the lowest level ever seen against the Euro.

Objections to the US Dollar's behavior are not only coming from China but now from Europe. The US keeps saying they have a “strong Dollar policy”, but few now believe this. Overall the official consensus is that the Dollar should descend another 20% or more, but this will hurt the recovery badly. Consequently, theGold Price is waiting for action on this front. Will central banks try to ‘manage’ the Dollar exchange rate up or will they let it fall, or is that just too simple a pair of conclusions?

Gold since the dawn of man has been money, but in our lifetime (if you are younger than 40) gold has ceased to be money, but it has held an important place in the reserves of the developed nations, in particular. And now we are watching European signatories of the Central Bank Gold Agreement, which has bee on the go since the turn of the century, slowing their gold sales to barely a trickle. Why are they not selling more?

Yes, the International Monetary Fund (IMF) has now agreed it will sell 403 tonnes and opened its way to sell either in the ‘open market’, which will affect the gold market, if only to do so slowly, or to sell direct to another buying central bank in large amounts at market related prices.

If a major central bank like China or Russia buys direct, they will want the lot at a market related price, we would imagine. But don’t think for one minute that European central banks are making way for the IMF in this new Agreement. Look at the table of sales in this latest issue [for subscribers] and you will see that in essence they have completed their sales!

So we must ask ourselves, why have central banks on balance become net buyers? Again, the darkening of the monetary skies is telling us that they are regaining their respect for the shiny metal. This implies a dropping confidence in paper money.

With the “accelerated supply” of gold produced in the eighties and nineties of the last century having eaten up most of the known, large gold deposits, it is increasingly difficult to source new and viable deposits. Yes, it is different in China, where the government is favoring gold production, and gold individual gold ownership (as a hedge against uncertain paper currency values) and is now beginning to issue the Yuan internationally, to assist in holding down its exchange rate.

The only source of quick gold supply comes from a rapidly rising Gold Pricepersuading gold holders to sell their gold (because they think the price has peaked). This happened in India earlier this year where 900 tonnes of gold was sold as scrap gold. However, with India being a nation who sees gold as money and as security, they will sell because they think the Gold Price will fall only. Once it has formed a new ‘floor’, back in they go, as they have started to do now. So expect scrap sales to decline quickly around current Gold Prices. After all, to Indians, gold is the ultimate money! They will always continue to favor it over paper money, as financial security.

On the other side, and with the advent of the gold Exchange Traded Funds, institutions across the world, who had not previously been allowed to own gold (in the form of bullion and coins) were now able to directly impact the Gold Priceby buying the shares of these funds. In turn, these funds went into the gold market and bought gold itself, with this money. We believe that up to 1,500 tonnes of gold is held in these funds, so far, and the demand has hardly been tapped yet. That is only in three years, showing how much even institutions want a safe-haven against the uncertainties building up in the future. Expect this demand to continue to burgeon!

Traditional bullion demand itself is strong from China westwards to the UK and onto the US. This demand and investment demand have proved to be the most remarkable and heavy form of new and old demand over the last three years and looks set to continue to grow and perhaps substantially, from now on. It will want to see clear evidence of economic or currency breakdown, before it jumps rapidly though.

But why will demand overshadow supply? Here we are at $1,000 and demand is still strong overall. What is this telling us?

• It tells us that a glance into the future of the global economy, of global currencies has and is still making major global, institutional central banking and high wealth individuals trepidatious;
• They look at the global currency world and see it heading into uncharted waters, where the US $ may fall into the hole it dug itself into;
• They look at the recovery itself and see that little has been done to avert the causes of the ‘credit-crunch’ except to repair the damage it did;
• They see a major shift in economic power away from the States and Europe to the East. This upending of the present balance of economic power is bound to deeply disturb the financial world.

They see that a combination of all of this is a dubious place for the prudent investor! Prudence is found in a place where such risks do not rule. Alternative investments such as gold and silver have proven to be the place to be since the beginning of this century.

Gold Miners to Catch Up?

The MERCENARY GEOLOGIST, a.k.a. Michael S. "Mickey" Fulp, is a Certified Professional Geologist with a bachelor's degree in Earth Sciences from the University of Tulsa and a master's degree in Geology from the University of New Mexico.

Fulp's near-30 years' experience as an exploration geologist has come from working with junior explorers, major mining companies, private firms and investors as a consulting economic geologist, specializing in geological mapping, property evaluation and business development. He launchedMercenaryGeologist.com in late April 2008.

Here Fulp speaks to The Gold Report about the outlook for Gold as well as Gold Mining stocks, plus the crucial importance of doing your own due diligence in whatever investment you make...

The Gold Report: You've been traveling quite a bit this summer...

Mickey Fulp: Yes, I focused mainly on the northern tier of North America, which is what I generally do in the summertime. I looked at some gold companies, some uranium companies and some rare earth companies; those are the sectors I'm following. I was in the Yukon, Saskatchewan, Northwest Territories, Quebec, Wyoming, Idaho, Armenia, Haiti – to name a few places. All in all, it was quite a busy summer.

TGR: You've gone to some remote places, which can be fun but also arduous traveling. From a geologist's perspective, it's apparent why you, as the Mercenary Geologist, look at your sectors from the mining angle. Each is so different in terms of what drives value, though, how do you build expertise in these three different sectors?

Mickey Fulp: All are quite different in what drive their values. I study commodities and commodity trends as part of my basic research. As you may be aware from my recent Mercenary Musing called The Trouble with Geologists, I'm an economic geologist. I meld both economics and geology disciplines. I'm always looking at sectors that appear undervalued, trying to determine whether there are upcoming catalysts that will tend to make those sectors appreciate.

TGR: What are the key elements that help you decide whether a sector is undervalued? Are you looking at company financials? At the overall sector relative to other investment opportunities?

Mickey Fulp: That's a very good question. It's basic commodities study. For instance, Gold drives the Venture and the Toronto markets in the junior resource sector. When the price of gold is robust, those companies tend to do well. We've seen that happen this year with the increase in the price of gold.

TGR: Gold, of course, is the big topic in the news, closing over $1,000 for more than seven trading days in a row before dropping a bit. What's going on in gold?

Mickey Fulp: I think it's the weak US Dollar. I am generally bullish on Gold, but I am far from being a gold bug. I'll stick with the prediction I made in January when I said gold was going to be range-bound this year between $750 and $1,050. I believe I missed that on the low side, but I think gold will finish the year in the present range, perhaps it could make $1,050, but I don't expect it to go higher than that.

TGR: What's holding it back?

Mickey Fulp: The fundamentals of the gold market are still not good. Jewelry demand at these prices has dried up in India and the Middle East, which are the biggest consumers. We're seeing that offset somewhat as Chinese people are now able to own gold and the government is encouraging its citizens to buy it. I think that gold is a bit overbought right now. I know I'm in the minority on this position, but we shall see at year end if my predictions are right.

TGR: If Gold is a little overbought – assuming you're talking about the actual commodity – what does that mean for the juniors in the sector?

Mickey Fulp: We'd seen a disconnect between the price of gold and the juniors' values last year; the juniors lagged behind. But then in the early part of this year the strongest gold juniors began doing remarkably well. Certainly that correlates with the fact that gold has been trading at $900-plus for a number of months now.

If you look at valuations from the highs of the junior market in October to November of '07, gold juniors are still trading at deep discounts. So I think there's room for up-trends in this marketplace.

TGR: If they're still trading at a discount from where they were at the highs, who's to say that the highs were the correct market caps for values of these companies?

Mickey Fulp: What is the correct market cap? The market does what the market will do. There's no predicting what these valuations are. It's driven by market psychology. In November of '07, we were using $65-$70 valuations for ounces in the ground for a junior explorer. Now, those valuations are in the $40-$45 range. What's fair market value? It's what the market says it is at any particular time. So if you use the metric we were using a couple of years ago, the gold sector is still undervalued.

TGR: But if people who say gold may go to $1,500 before the end of the year trigger a market mania, won't that continue to lift up the whole gold sector and make the discount from the highs of 2007 go away?

Mickey Fulp: Sure, if gold goes to $1,500, we'll see tremendous increases in valuations of gold companies, particularly the producers, and that will filter down to the explorers, too. But I won't buy the idea of $1,500 gold in the foreseeable future.

The gold explorers are the ones that have really done well this year. Early on in the year, I said that cash flow was king and that you wanted to go in and find small gold producers. That really hasn't played out; what's been king – and that's been driven home this summer – is the explorers. Companies that issued a release of 100 meters of over a gram per ton of gold went flying. So the emphasis and the attention have focused on the gold explorers. For some of the companies I'm involved in, that's been quite good.

TGR: When we interviewed you in June, we talked a bit about Armenia...

Mickey Fulp: Yes. Armenia is certainly an emerging market environment. Miners there are encountering very encouraging results and have been very well-received by the marketplace.

TGR: Anything else you would like to tell our readers?

Mickey Fulp: I'd say, "Do your own due diligence, dude." I borrow that alliteration from my friend Otto Rock who writes the Inca Kola News blog. The successful investors in this business are the ones who research and study companies before investing in them. You don't want to be throwing darts at the board. It's a high-risk business; it's gambling. But you can skew the odds in your favor by doing careful research.

GAAP: Crazy But True about Gold

"ALL THINGS must pass," George Harrison mournfully crooned on his 1971 album of the same name, writes Eric Fry in the Rude Awakening.

"All things must pass away...Sunrise doesn't last all morning. A cloudburst doesn't last all day..."

And neither, of course, does a superpower's global economic hegemony.

America's dominance of the global economy is falling victim to self- inflicted wounds – namely, extreme and rising indebtedness. America's recent flood of red ink would make a banana republic blush.

As a result, risk-free Treasury bond may not be as "risk free" as they used to be. A few days ago, the highly regarded hedge fund manager, Julian Robertson, revealed that he is purchasing long-term put options on long-term Treasury bonds. In other words, he thinks their long-term value is lower from here. And his reasoning is persuasive.

"If the Chinese and the Japanese stop buying our bonds," Robertson explained during a CNBC interview, "we could easily see [interest rates] of 15% to 20%...

"It's a question of who will lend us the money if they don't. Imagine us getting ourselves into a situation where we're totally dependant on those two countries. It's crazy."

Crazy, yes, but true.

The US financial markets, especially the credit markets, benefit greatly from both familiarity and reputation, more than merit; past reputation, more than future reliability. But "reputation" doesn't pay the bills.

The growth of emerging economies is "symbolic of the relative, less dominant position the United States has, not just in the economy but in leadership, intellectual and otherwise," former Federal Reserve Chairman Paul Volcker said in an interview with Charlie Rose last week.

"I don't know how we accommodate ourselves to it," Volcker continued. "You cannot be dependent upon these countries for three to four trillion Dollars of your debt and think that they're going to be passive observers of whatever you do."

The US government, like one giant General Motors, is technically insolvent. And yet, it borrows at low 'triple-A' rates of interest because of its long-term legacy of world-beating economic success. That triple-A credit rating does NOT come thanks to America's recent history of extreme indebtedness.

The fiscal condition of the United Sates has deteriorated dramatically during the last several years. On the basis of current obligations, US indebtedness totals "only" about $12 trillion. But when utilizing traditional "generally accepted accounting principles" (known as GAAP) – the kind of accounting that every public company in the United States MUST use – US indebtedness soars to $74 trillion.

This astounding sum – including things like the present value of the Social Security liability and the Medicare liability (i.e. real liabilities) – is more than six times US economic output...

Perhaps this mind-blowingly large debt load would seem less mind-blowing if it were decreasing. But it is not. Instead, the current US administration is amplifying the long-standing American habit of spending money it does not have.

The chart below tracks the federal budgets for both America and Brazil as a percentage of each country's gross domestic product. Back in 1998, the US ran a budget surplus, while Brazil was running a deficit equal to 9% of GDP. But the two nations have since traded places. At last count, the US budget deficit totaled an astounding 9% of GDP, while Brazil's deficit totaled only 3.3%...

And yet, the US government pays only 3.28% in interest per annum to borrow money for 10 years. The Brazilian government must pay 5.05% to attract investors to its 10-year bonds.

Thus, the yield spread between these two borrowers is 1.77 percentage points – or 177 "basis points" – and gives the advantage to the United States, despite its massively greater debt burden.

At this point, a brief tutorial may be in order...

Like a polite dinner guest, the bond market does not express its opinions in absolute terms. Rather, it renders a relative judgment.

It prices specific bonds relative to other bonds, or specific credit instruments relative to others. This relative pricing is known as the "yield spread" – and the most common yield spread comparison is made relative to US Treasury bond yields. So for example, if a certain 10-year bond issued by a corporation or a foreign nation is yielding 6.50% at the same time that the US 10-year note is yielding 4.50%, that bond is said to be trading 200 basis points over Treasurys. In other words, it's paying 2.00% more than the US debt.

The higher the spread over Treasurys, the riskier the debt is perceived to be. Because the United States Treasury is deemed to represent the ultimate "risk free" debtor. And this is where our story takes an interesting turn...

The yields on foreign sovereign bonds (i.e. government bonds) have been falling closer to US yields for several years. This process has been unfolding gradually, and in fits and starts. But over time, the trend is clear. What's not clear is who is moving closer to whom.

Are foreign sovereign issuers becoming MORE credit-worthy or is the US government becoming LESS credit-worthy? Or is it a little bit of both?

Whatever the case, the nearby chart illustrates the result. Using a four-year rolling average of yields (to smooth out the trend), it is easy to see that Developed World interests rates are converging toward US rates. Canadian and French sovereign 10-year interest rates, for example, have been moving closer to US rates for several years. (And in fact, French rates have dipped below US rates several times during the last several years).

Endless Stimulus and $2000 Gold

SELF-AVOWED "old rock hound" Byron King earned his bachelor's degree in geology at Harvard, and then worked as a geologist in the exploration and production division of a major oil company, says The Gold Report.

After "earning his wings" in the US Navy and the US Naval Reserve, logging more than 1,000 hours of flight time in tactical jet aircraft and recording 128 aircraft carrier landings, Byron practiced law in Pittsburgh before becoming a prolific author and popular investment speaker.

Now a core contributor to Agora Financial's Daily Reckoning, Whiskey and Gunpowder and Penny Sleuth, he also edits the Energy and Scarcity Investor andOutstanding Investments newsletters.

Here he speaks to The Gold Report about the "bottomless pit" of stimulus spending and why he sees $2,000-per-ounce gold on the not-too-distant horizon...

The Gold Report: We've seen quite a rebound in the markets since we spoke in May, and governments across the world have begun releasing some positive economic news. Are we out of the recession as Bernanke has told us?

Byron King: I don't agree with that all. It's like at the funeral home where they put really good makeup on the corpse and people walk in and say, "Oh, he looks so good." Then you think to yourself, "Wait a minute. If he looks so good, why is he dead?" That's where we are now, I think, with our economy. We're still in the recession, it has been well-masked.

Let me digress and say that yes, the stock market rebounded. The "sell in May, go away" thing didn't work this year. So if you stayed in the market, you probably benefited very well from the market recovery. But it was a recovery not rooted in fundamentals. Part of it is that we've had a banking recovery, too. But that was because of massive infusions of new liquidity out of the Federal Reserve and the Treasury Department into the financial sector. That's not the prescription for long-term health.

As with someone really sick in the hospital, the problem isn't putting him on life support; the problem is getting him off the respirator. Now the question is how to stop hemorrhaging public money into the system, and in fact, begin pulling some of it back out.

TGR: Let's assume for now that the government isn't prone to taking the patient off the respirator. Do you expect diminishing returns in terms of less recovery seen for every Dollar the government puts into the system?

Byron King: That's a great point. We're there, at the point of diminishing returns in terms of what it takes to get another Dollar of real GDP. It doesn't matter how much green ink they use down at the Bureau of Engraving and Printing or how many ones and zeros they create in the Federal Reserve. At the end of the day, how much have we improved? How much have we built our economy? Look at numbers like new business formations, numbers that indicate the health of growing businesses – hiring, recalls, overtime certain types of gross output figures, job creation. You're not seeing healthy numbers for those things in the economy.

Gold Supply

IF WE'RE RIGHT ABOUT where the price of gold is headed, writes Jeff Clark, senior editor of Casey's Gold & Resource Report, the general public will someday clamor to buy all things Gold.

While Gold Mining stocks will be where the real leverage is, the rush will start with gold itself. As a gold editor, I have a very natural question: Is there enough to go around?

According to the US Census Bureau, there are 6.783 billion earthlings. Meanwhile, CPM Group, a highly respected industry organization, estimates there are 4.8 billion ounces of above-ground gold in the world. And this includes jewelry, electronics and dental gold.

So, even if everyone around the world volunteered to have their chain, cross, or tooth melted into a coin, we're already short if everyone wanted, say, to own a single ounce each. Those towards the end of the line are out of luck.

However, it's worse than that. Of all the physical Gold ever mined:

• 2.1 billion ounces, or 43%, is found in jewelry, decorative, and religious items;
• Private stock – gold already held by various private parties – accounts for 1.1 billion ounces;
• Official reserves (central banks, IMF, etc.) stand at 1 billion ounces;
• Industrial use accounts for 530 million ounces.

Very little of this is likely to come available for purchase in Gold Bar or coin form. After all, most private investors aren't selling any of their gold right now, and neither are many banks or institutions. Most everyone is buying.

So for those who don't yet have that solitary ounce (or you greedy investors who want more than one), this pretty much leaves us with mine production and scrap sources.

CPM forecasts that total new supply in 2009 will be around 122 million ounces. Only a small percentage of this is made into Gold Coins and bars, but if all of it were, it would amount to less than two one-hundredths of an ounce, or about half a gram, for every man, woman, and child on earth this year. A product of this dimension is about half the size of that small button on your shirt collar.

Since this supply is only available annually, it means 0.018% of the global population – one in every 55 people – could buy a one-ounce Gold Coin this year. Or, said differently, it would take 55 years before everybody had one, assuming the population never increased and supply never decreased. Reality is that both those factors are moving in the opposite direction, however. And it's worse than that.

Actual 2009 coin production will be around 5 million ounces (excluding medallions or "rounds"), leaving two one-hundredths of a gram of gold (or 0.3 of a grain) available this year for each of the planet's inhabitants. This is about half the size of the sesame seed that fell off your hamburger bun at dinner last night. It means that only 0.0007% of earth's citizens – or one in 1,356 – can buy a one-ounce Gold Coin this year, and it would take 1,356 years for everyone to get one.

About Forex and Dollar Rate

WE HAVE BEEN waiting such a long time for clarity on how International Monetary Fund (IMF) is to conduct its gold sales of 403.63 tonnes, writes Julian Phillips of the Gold Forecaster.

The IMF Executive Board has now approved those gold sales. Now the head of the IMF, Dominique Strauss-Kahn, has said "These sales will be conducted in a responsible and transparent manner that avoids disruption of the gold market.

"Most importantly, the sales are strictly limited to 403.3 metric tonnes, which is one-eighth of the fund's total holdings, so the IMF will continue to hold a relatively large amount of its assets in Gold."

Prior to selling this gold on the open market, the IMF is prepared to sell the gold directly to central banks or other official sector holders. These sales to official sector holders will be conducted at market prices and would shift official gold holdings without changing total official gold holdings.

Any IMF Gold Sales onto the open, international market would be phased over time, it says. Regular external reporting on gold sales will also be provided to assure markets that gold sales are being conducted in a responsible manner.

Let's be clear on this: If the IMF is to offer this Gold to other central banks before offering the gold to the open market they are likely to receive bids that would certainly confirm that central banks value gold in their reserves and are prepared to buy it in even at these prices! Whether it received a few or many bids is irrelevant. If all the 403 tonnes were sold this way, then that confirmation would elevate gold as a reserve asset and a measure of value once again.

And if there is an amount left over, it will be sold in a manner that will not brutally bring the Gold Price down, since it must avoid disruption of the gold market.

Which large Dollar surplus holding nations can afford to make this investment? Far more than just China or Russia, we believe. Indeed, we expect the IMF is already receiving offers from these central banks. So will any of this gold make it to the open market? What if only 100 tonnes are left for the market? What if none is left? Sales of this gold to any central bank will be positive for the Gold Price. Sales of all of it will bring a confidence to the market that will send it to new heights.

We believe that this statement from Strauss-Kahn, in itself extremely positive for the Gold Price, will represent confirmation of gold's role in the monetary system.

Economic Dark Matter

IT SEEMS WE'RE NOT the only people trying to figure out where all the money went from this decade's debt bubble.

"Where did all the debt go?" asked Bank of England economist Spencer Dale in a speech last Thursday in Exeter. Sadly for US and British households, however, let alone savers and investors, he had fewer answers than even us here atBullionVault.

"Household debt as a proportion of income increased from 100% to 165% in the 10 years to 2007," Dale noted of the United Kingdom. "[Yet] this big run up in debt was not used to finance a surge in spending," he added, as if taking his cue from our essay of last Wednesday, Economic Dark Matter, and scribbling his speech the next morning as the train crawled through Reading.

"Where did it all go?"

Where indeed...? Because as the chart shows, the surge in Britain's household debt ratio starting 10 years ago coincided with a marked slowdown in consumer spending growth.

In the US, the same picture...with personal indebtedness ticking higher from the same point in time, too. Which hardly seems fair. Just imagine! Borrowing a record multiple of gross income – fully 120% in the US by 2007...and a whacking 170% by the start of '09 here in the UK – just to ease up on discretionary spending.

"In fact, there was no such boom," Spencer Dale went on in this week's speech, pretty much quoting yours truly. But just like his policy-making predecessor,Stephen Nickell, five years before him, he thinks the missing billions – borrowed but not spent in the shops or malls – are explained away by "developments" in the housing market...

"House prices trebled in the ten years to 2007. And mortgage debts were accumulated to pay for the housing that had become so much more expensive. The conventional wisdom that the sharp increase in household debt was associated with the house price boom of the past decade is well founded."

So far, so good. The missing digit in our grand sudoku puzzle – that economic dark matter which forced consumers deep into hock without consumption soaring – lies in house prices. Right? Not quite, says Dale.

"What is less often appreciated is that much of that rise in household debt was matched by a comparable increase in the value of financial assets held by households."

Just like Nickell in late 2004, the Old Lady's man sees a matching asset to balance the debt. Borrowing here must equal new savings there. The volumes, though swollen, still equal each other. Net-net, we all got richer by taking on debt. That's why economists call it a balance-sheet, stupid!

Story of Gold Market

The Gold Report: Malcolm and Marshall, you started the Encompass Fund in June of '06 with the intent of investing in a wide array of sectors, "to minimize or avoid sharp declines in the market," as it says on your site. However, according to your stock chart, you had a fairly dramatic decline in Q4 '08 with a pretty dramatic recovery since then. Tell us a bit about what happened there.

Malcolm Gissen: What happened was that prior to and in 2008 we emphasized resource companies in our portfolio, and we believed that these companies were performing well. We had confidence in management. In the case of the resource companies, many of them continued to expand their resources, in some cases, very substantially. So we felt we were pretty comfortable with holding these positions in our portfolio.

In the second half of 2008, a number of these companies experienced very sharp declines in their stock prices. We were alarmed, so we called the companies and asked if they knew what was going on. Their only explanation was that somebody was dumping a lot of their shares, which we, of course, could see in the market.

But it wasn't until very late in the year, when these companies spoke to and visited hedge funds, that the hedge funds would tell them that they had experienced a lot of liquidations and, as a result, were selling all of their resource company positions – and selling them as quickly as they could. In some cases, it was program trading. In other cases, they just dumped the stock. In the case of the junior mining companies, where the stock was generally thinly traded, it had a profound impact on stock prices when hundreds of thousands of shares or, in some cases, millions of shares, were unloaded in the marketplace, driving down the price of a number of these companies anywhere between 50% and 95%. When we saw that happen late in the year and realized the cause, as managers of the Encompass Fund, we decided we would buy more shares of some of the companies. We did that and that is one of the reasons the Encompass Fund has gained about 80% this year.

Marshall Berol: There were several things we did, but when we saw what was happening with the markets in the fourth quarter of 2008 and what was happening with the companies that the Fund was invested in, we went back and reviewed each of the companies for how well we thought they could survive (i.e., a good investment going forward), and sold several of the companies we felt were weaker because of finances or the projects, or the time involved in getting the projects moved along, and factors of that nature. So those companies we sold at that time, and as Malcolm said. We increased the positions in some of the companies that we did own and felt were strong companies with good management, finances and projects that we felt would be worth owning going forward. Fortunately, that has worked out this year.

Malcolm Gissen: I would say I have not been surprised at how well many of the companies in the Encompass Fund have performed this year. Marshall may not agree with this – and we don't agree on some issues – but I expected that good companies that performed well from an operations standpoint would outperform. I felt that the resources companies that were continuing to expand their resources would excel since I didn't think the prices of the resources were going to decline much. I felt there would continue to be demand for the resources and so I've not been surprised by the performance and, in fact, think that there's more to come. I don't think the story is over yet.

Marshall Berol: Yes, we're definitely of the view that the resource investment story is not over. We're still in the early innings. There are a lot of reasons we believe that the demand for resources will continue to expand. It's supply-demand in the case of gold and, to a lesser extent, silver. It's the storehouse of value. There's the inflation aspect. A lot of aspects come into the various resources – whether it's the metals or energy – that we feel has a very bright future going forward.