Turmoil in Venezuela Could Spell Opportunity for You

From Money and Markets 
Wed, Mar 13, 2013 at 7:33 PM
Turmoil in Venezuela Could Spell Opportunity for You

View Our Website [»] Archives [»] Find us on Facebook Follow us on Twitter Wednesday, March 13, 2013 YOUR BEST SOURCE FOR THE UNBIASED MARKET COMMENTARY YOU WON'T GET FROM WALL STREET Turmoil in Venezuela Could Spell Opportunity for You in Brazil by Tom Essaye Dear Subscriber, Venezuelan president Hugo Chavez died last week after a lengthy fight with cancer. Reactions to his passing have run from despair in the poor sections of Caracas to jubilation in the ex-pat Venezuelan communities in Miami. Regardless of your opinion of the man or his politics, as investors we always have to be mindful of political change and the potential implications on the markets and assets. Venezuela is a major player in the global energy market since it holds the world's largest proven oil reserves, even more than Saudi Arabia. According to the Energy Information Administration's most recent figures, Venezuela is the world's eighth-largest oil exporter. And it is the United States' fourth-largest supplier of imported crude oil and petroleum products, despite the often heated rhetoric aimed at Washington. Outperforming the S&P 500 by 50 to 1! One retirement expert has been giving thousands of Americans the chance to beat the broad S&P 500 index by more than 50 to 1 over the last five years. In this urgent video, he names the specific investments he's been recommending ... and also warns you about the biggest retirement threat he sees on the horizon. Click here to watch it now. Internal Sponsorship While Venezuela's vice president has already declared he is running for president in a special April 14 election, these types of regime changes can often get messy. Keep in mind that in the last election Chavez's victory was heavily contested. Yet as seen by the outpouring of support at his funeral, Chavez and his socialist policies are hugely popular in Venezuela. Therefore, I fully expect that at minimum there will be turmoil as the various political parties vie for power. In the past, that turmoil has affected most government-run industries not only in Venezuela, but other countries as well, and there is a high likelihood that the same thing will happen again. So, the question is ... Who Would Benefit from Political Turmoil in Venezuela? I say Brazil. And here's why ... Brazil's recent offshore discoveries could make it a major oil exporter. Brazil is the largest oil producer in South America, and is in the process of ramping up production and oil exports as there have been some very large discoveries there in recent years. Consequently, it is the logical alternative for oil importing countries, given Venezuela's uncertainty. In particular, Brazil will look to boost demand from China. That's because China has substantially increased its oil imports from Venezuela over the years. As of last year it was 460,000 barrels per day and was on track to import over 1 million barrels per day by 2015, according to Venezuelan oil officials. That's a big increase. And you can bet that the Brazilian energy authorities are courting the Chinese in a big way, given the potential uncertainty in their northern neighbor. Internal Sponsorship One way to play this favorable trend in Brazil is via the iShares MSCI Brazil (EWZ), a position I have in the Million-Dollar Contrarian Portfolio. This ETF holds stocks in companies — including the state controlled oil company, Petrobras — that represent Brazil's major industries. So if Brazil's oil sector benefits from political turmoil in Venezuela, EWZ should rally. Best, Tom Have comments? Tell Us! About Money and Markets For more information and archived issues, visit http://www.moneyandmarkets.com Money and Markets is a free daily investment newsletter published by Weiss Research, Inc. This publication does not provide individual, customized investment or trading advice. All information is based upon data whose accuracy is deemed reliable, but not guaranteed. Performance returns cited are derived from our best estimates, but hypothetical as we do not track actual prices of customer purchases and sales. We cannot guarantee the accuracy of third party advertisements or sponsors, and these ads do not necessarily express the viewpoints of Money and Markets or its editors. For more information, see our Terms and Conditions. View our Privacy Policy. Would you like to unsubscribe from our mailing list? To make sure you don't miss our urgent updates, just follow these simple steps to add Weiss Research to your address book. Attention editors and publishers! Money and Markets teaser content may be republished with a link to the full story on MoneyandMarkets.com. Such republication must include attribution with a link to the MoneyandMarkets home page as follows: "Source: http://www.moneyandmarkets.com" Money and Markets: A Division of Weiss Research, Inc. | 15430 Endeavour Dr. | Jupiter, FL 33478 | 1-800-291-8545