Monday, November 25, 2013

Be Thankful for Vladimir Putin

Why Is Putin So Mad?Why Is Putin So Mad?

Because President Obama Just Sucker-Punched Him Where It Hurts the Most!

If you believe the global media, "The Putinator" should be a happy despot. Everything seems to be going his way.

Putin cleverly rescued his pal, Bashar al-Assad the Syrian butcher… outfoxed the U.S. in the Edward Snowden/NSA leak scandal… and is thwarting Obama's goal of reining in Iran's nuclear program.

All of which begs the question…

Why Is Putin Spitting Mad?

Because Obama just blindsided the Russian leader… and dealt a severe, embarrassing blow to Putin's most cherished dream.

Even more amazing, Putin's humiliation points you to what may be the single most satisfying windfall-profit bonanza of the decade.

I'm Phil Ash, the publisher of Investing Daily. And I can't wait to tell you how an unexpected stratagem by President Obama will not only help improve the American economy and deliver a well-deserved blow to a nasty, global bully, but can also give your portfolio a huge boost.

In fact, I'm happy to report there are TWO companies that almost have to profit thanks to President Obama's surprise "checkmate" of Vladimir Putin's ambitious master plan.

Until recently, the macho, chest-baring Putin was on a roll.

His strategy to restore Soviet-era dominance by holding Europe hostage to Russian oil and gas—first outlined in his 1997 doctoral thesis, Mineral Natural Resources in the Development Strategy for the Russian Economy—was working like a Swiss watch.

(Yes, Vladimir Putin, the thuggish former KGB officer whose specialty was snooping on university students, holds a Ph.D. from Leningrad State University.)

Under Putin's shrewd leadership and emphasis on energy development, Russia had not only surpassed Saudi Arabia as the world's Number One oil producer, but had also developed the largest natural gas reserves on the planet.

It was Putin's—perhaps I should say Dr. Putin's—stated intention to use Russia's newfound energy riches as a powerful geopolitical weapon to restore the mighty empire lost when the Soviet Union collapsed under its own weight in 1991.

Return of the Angry Russian Bear

After the Soviet collapse, Putin worked his way up the Russian bureaucracy and succeeded Boris Yeltsin as president in 2000. It wasn't long before most of energy-poor Europe felt itself once again in the crushing embrace of the Russian bear. Energy-wise, it was back to the heyday of Soviet bullies like Stalin, Khrushchev and Brezhnev.

Flush with natural gas, Gazprom, Putin's state-owned puppet gas monopoly, tightened its grip on European throats. A partial list reveals the dangerous dependence on Russian gas imports: Germany, 37%; Greece, 90%; Czech Republic, 75%; Poland, 40%; Serbia, 85%; Italy, 25%; Hungary, 65%; Austria, 51%; Turkey, 60%. (Source:

Some European countries—Bulgaria, Bosnia and Herzegovina, Slovakia and all three Baltic states, Estonia, Latvia and Lithuania—found themselves totally dependent on Russian gas. (Source:

Unfortunately for Gazprom's customers, the huge gas producer resembles the KGB more than a legitimate company. (Some claim Gazprom operates like a crime syndicate. Others say the Gestapo. Still others state flatly that Gazprom is Russia's main instrument of foreign policy. Period.)

Life in the Ice-Cold Grip of the Bear

Relying on Russian gas is risky business—especially when it's cold outside. Their business plan is simple: Pay the price we demand—or freeze.

In 2009, amid a pricing squabble, Gazprom abruptly cut off gas supplies to Ukraine during the depth of winter. The cut-off left Ukraine and over a dozen other European countries freezing in the bitter cold. (Source: New York Times, "Russia Cuts Off Gas Deliveries to Ukraine," January 1, 2009.)

The next winter, the company did it again. Gazprom sharply cut gas supplies to nine European nations—in the most brutal winter in decades. A devastating cold front killed over 300 across Eastern Europe, and some of that blood is on Gazprom's hands.

Strong-arm tactics come naturally to Gazprom's top managers, many of whom were Putin's cronies in the KGB. Although an international corporation, Gazprom's largest shareholder is the Russian state. And one politician in particular is believed to have stashed millions—if not billions—from Gazprom profits in overseas accounts.

That would be, you guessed it, Vladimir Putin, Ph.D.

Back to the Future for Europe?

So certain was Putin of his iron grip on Europe through energy blackmail that he boldly announced plans to form a brand-new economic union aimed at reunifying the scattered pieces of the old Soviet empire. (Source:, "Why is Vladimir Putin Acting So Crazy?")

His idea was to halt the spread of the European Union (EU) eastward and reconstruct the zone of Russian dominance stretching from the steppes of Central Asia to the banks of the Danube in Central Europe.

We all know and remember why the people and governments of newly democratic countries in Eastern Europe have no desire to resume existence as vassal states of Russia—or why western European nations (who remember well the Iron Curtain and the Cold War) feel apprehensive about the reappearance of Soviet-style "satellite states" on their doorstep.

With oil and gas revenues rolling in and "General Winter" on his side, it appeared Putin's strategy to regain dominance over Europe through its dependence on Russian energy was unstoppable.

And Then…

Across the Atlantic, two historic developments tossed a monkey wrench into Putin's dream of maintaining Russia's grip on European energy needs forever:

  1. Horizontal drilling
  2. Hydraulic fracturing (fracking)

Advances in horizontal drilling and fracking unlocked the massive natural gas potential of shale and other unconventional energy plays in North America.

Believe me, if Putin could issue a global ban to halt fracking, he would! In fact, Putin's been traveling the globe bad-mouthing fracking and speaking on behalf of… wait for it… green energy!

The absurd ploy is not working. This year, Putin's nightmare came to life: The U.S. overtook Russia to become the largest producer of oil and natural gas in the world, according to the Energy Information Administration.

That's When Obama Blindsided Putin

Shocking both the Russian bully and U.S. environmentalists, Obama, through his Department of Energy (DOE), began rapidly issuing APPROVALS of liquid natural gas (LNG) export terminals.

A little background:

LNG is what you get when natural gas is chilled to -260°F. At this temperature, the gas shrinks into a clear liquid, taking up just 1/600th of the space it formerly occupied.

In other words, you can transport 600x as much gas in the same pipeline or ship. Sounds tailor-made for exporting, doesn't it? Especially since the good old USA is positively swimming in natural gas right now.

According to the American Petroleum Institute's 2012 "State of American Energy" report, LNG exports could generate nearly 500,000 new jobs in the U.S. and grow our economy by nearly $74 billion annually to 2035.

But it's long been assumed that the "greenish" Obama administration would be dead set against exporting U.S. natural gas—a fossil fuel.

Lo and behold, the U.S. president has recently approved FOUR export licenses for LNG export terminals.

Even more surprising, top DOE officials hinted that more LNG export permit approvals could roll out as quickly as one every two months.

As I write, 15 more terminals await the DOE green light. Odds are most will get it.

In other words, the U.S. is soon to become a worldwide natural gas exporter. LNG exports are set to skyrocket. And the global ramifications are nothing short of enormous.

This is very good news for our country… and the Free World.

And, as a bonus, it's thumb in the eye for Vladimir Putin.

Goodbye, Putin—Hello, Profits

Not only is this historic development a boon to oil and gas companies… it's also a gift to investors who know which stocks will take off along with LNG exports.

We've found TWO companies that almost have to profit as more LNG export approvals roll in.

I'll say it again—it would be hard for these companies NOT to profit hugely.

The rest of the world is screaming for more natural gas—and they're willing to pay a premium price for it. Look at these numbers:

Natural Gas

In Europe, natural gas is selling for about $12 per thousand cubic feet (Mcf), and as high as $17 in Japan. And still these countries can't buy enough to fill demand.

Consider: Natural gas in the U.S. costs less than $4 per Mcf. That's dirt cheap by historical standards.

Around the rest of the world, it's a different story, to say the least.

I've told you about European nations yearning to free themselves from Putin and Gazprom gas.

They're not alone.

Asia Desperately Needs American LNG

Asia is buying LNG at almost four times the price of U.S. natural gas. Japanese utilities are consuming more natural gas than ever to replace idled nuclear facilities, and China is desperately seeking cleaner fuels.

This is a gas shipper's (and investor's) dream. What could be better for business (and the U.S. economy) than buying American natural gas at $4 or less and reselling it in Japan for $16?

Even factoring in the costs of liquefying, transporting and re-gasifying in Japan, there's a solid profit of over $6 per Mcf to be made.

What we're looking at is a historic supply-and-demand reality:

The U.S. has plenty of natural gas to satisfy the world's needs—but only if we're allowed to export it. Global demand for natural gas is growing faster than for any other fossil fuel.

Electricity Generation by Fuel

Shipping LNG in tankers is the most efficient way to bring the world the natural gas it craves.

And now it appears—with the Obama administration's policy switch and faster approvals for the 15 other export applications pending—the U.S. will be stepping up natural gas exports.

The result will be a windfall for certain types of companies known as master limited partnerships (MLPs) that are involved in everything from producing natural gas to processing it into LNG and shipping it around the world.

What Are MLPs?

If you are not yet familiar with master limited partnerships, then you're missing out on something special. But that's what our exclusive newsletter, MLP Profits, is here for. Our analysts can tell you what MLPs are, how they work and, more importantly, how to profit from them.

MLPs are unique investments that combine the tax benefits of a limited partnership with the liquidity of common stock.

The modern structure of MLPs—and which companies are eligible—was defined by the Tax Reform Act of 1986. This law was designed to boost the U.S. domestic energy industry, and created a special tax classification known as a master limited partnership. It allows "little guys" to invest directly in oil and gas drillers, pipelines, shippers and other energy-related businesses, and share in the profits—without paying for all the overhead and expenses of a regular corporation.

Taxes? What Taxes?

There are plenty of reasons to like LNG MLPs, but the top one has to be the fact that they pay zero taxes.

That's right, MLPs pay no corporate taxes—in the U.S., the country with the highest corporate tax rate in the world.

Hard to believe, but true. And that's not the only break you get with MLPs…

For example, you don't buy stock in an MLP—you become a partner. But you're a partner who doesn't have to go to the office, attend meetings or deal with any of the hassles of a conventional partner.

But you DO get paid—and very well at that.

For the millions of retirees who once lived off income investments and now find it impossible, these partnerships have come to the rescue. You can pocket an easy $10,000 a year for every $100K you put into these cash cows.

As an added bonus, your personal taxes are so low that you'll think the IRS has gone soft in the head. Thanks to depreciation, 80% to 90% of the distribution you get from a typical partnership is tax-free until you sell.

In fact, some partnerships let you pocket high yields for 10 years or more before you pay a single penny of tax.

That's what makes the investment I'm talking about now so special: Taxes don't matter because you can keep everything you make.

Keep reading, because I want to introduce you to the next big MLP that will make you money.

The P Stands for Proof and Profits

If you've never heard of MLPs, it's time to sit up and take notice… because not only are they throwing off huge yields, but these yields are growing rapidly.

When you buy an MLP with a double-digit yield, that's just the start of the fun. Plenty of MLPs have also grown their businesses impressively, creating huge capital gains.

MLPs have crushed stocks over just about any period you look at. Over the past three years, they're ahead of the S&P 500 81% to 49%. Over the past five years, MLPs are up 105% to 22%. When you go back 10 years, the margin becomes huge: 396% for MLPs versus 114% for the S&P 500.

The lesson is clear: Buy into these money makers, hold on for the long term and you make fortune.

Let's say you put $25,000 in Enterprise Products Partners at the start of 2000. By now, you'd be sitting on $346,541… and collecting $16,928 in annual distributions—a 68% yield on your initial investment.

Enterprise is by no means an isolated example. A well-run partnership can rival the growth of a high-flying tech stock.

Take Kinder Morgan Energy Partners. It was worth barely $130 million at its birth. Today it has a market cap of $32 billion. Think about what this means… Kinder Morgan has returned 90% of its earnings to shareholders over the years, and it has still managed to grow 246 times bigger.

This is the kind of growth that investment legends are made of. Since its inception, Kinder Morgan has increased its quarterly cash distribution 45 times in a row—from $0.08 a unit to $1.26 now. And its unit price has risen from $5.75 to $88.13, for a 1,433% capital gain on top of its regular distributions.

Enterprise and Kinder Morgan are both great companies. I own them both, in fact. But they are now so big that their fastest growth is behind them.

But don't worry; there are more LNG and natural gas MLPs with huge growth ahead of them.

Our investing advisory newsletter, MLP Profits, will show you how to take advantage of these types of partnerships. There are dozens of them out there just waiting to pay you a hefty distribution check.

That's why MLP Profits subscribers are…

Tanking Up on Profits

MLP Profits chief analysts Robert Rapier and Igor Greenwald bring years of valuable experience and education to this publication.

Robert Rapier is the Chief Energy Strategist for MLP Profits. He has made a small fortune investing in energy stocks over the years, and has helped many MLP Profits readers do the exact same thing.

He has worked in the energy field for over 20 years and has traveled to the farthest reaches of the planet researching developments in energy production and consumption.

In Billings, Montana, he figured out a way to blend gasoline that saved a company $9 million a year. For a couple of years he led a butanol-production team in Germany.

Along the way, Rapier picked up five patents, one for a new way to convert ethane into ethylene, cutting production costs by $5 million per year (U.S. Patent 7,074,977).

He headed up a team of engineers in Scotland developing oil and gas projects in the North Sea.

Later, he was an engineering director for a Dutch environmental-technology company and provided engineering support for a facility they were building in China.

Based in Hawaii, Rapier continues to travel around the world to evaluate startup energy companies for wealthy private investors and hedge funds, and makes go/no-go investment decisions that can mean millions of dollars to both the startup and the investors.

Igor Greenwald is Chief Investment Strategist of MLP Profits and managing editor of The Energy Strategist. He also serves as an investment analyst at Personal Finance. Previously he was an editor and columnist for SmartMoney and the Money Show.

Greenwald served as a financial columnist and has also worked as a newspaper editor, foreign correspondent and online producer. He was born in Ukraine, educated at Georgetown University and lives in Massachusetts.

Together, Rapier and Greenwald have identified several master limited partnerships in position to profit from this stunning shift in U.S. LNG exports and the burgeoning global demand for natural gas. It's the perfect setup for extreme profits.

And today I want to share two of the MLPs that will benefit first.

LNG tankers are the ideal way to get natural gas to customers across the oceans. But these vessels are very complex and high-tech, not to mention costly.

And scarce. There are only 374 LNG tankers in the world, with about 70 more on order. Little wonder these behemoths command rates north of $150,000 per day. (Source:

Bottom line: These specialized tanker vessels are in short supply just as LNG exports appear ready to boom. Unlike oil tankers and container ships, which can sit idle for months at a time, every existing LNG tanker is booked solid for years in advance.

Our #1 Recommendation…

… is positioned perfectly for the day when America becomes a full-fledged LNG-exporting nation.

And that day will come sooner than most expect.

This master limited partnership owns a fleet of 32 LNG tankers. All its ships are contracted under long-term charters at fixed day rates. We're talking about 10- to 15-year leases at $140,000–$150,000 per day. This business model is ideal for a partnership focused on increasing its cash distributions.

To top it off, it's acquired six additional LNG tankers from Japan. These new vessels should generate about $40 million in cash to be paid out to shareholders this year. My investors are already up 218% with this MLP—and the yield is a sturdy 6.5%. The best is yet to come.

The partnership will have all the business it can handle for years to come—not counting the added trade when North American shale riches go on the global market once more export facilities are completed.

Our #2 Recommendation…

… pursues a similar strategy to my #1 pick above, booking its vessels under long-term contracts that pump out reliable cash flow.

This MLP's general partner has 13 new tankers on order, making it the fastest-growing company in the industry. The new vessels will more than double its fleet to 22 LNG carriers, plus five floating storage and regasification units.

Drop-down transactions play a big role in this investment. If you're not familiar with drop-downs, here's a basic primer:

The best general partnerships, after acquiring new companies or facilities, will often pass along—or "drop down"—at a very reasonable price some of their prime assets to their MLPs. They do this to grow the MLPs' distributable cash flow, which makes it even more rewarding to investors.

Our #2 pick has already executed several drop-downs and has increased distribution by 11.7%.

More advantageous drop-downs are expected in the years to come, with the MLP likely raising its quarterly payout again and again. Currently, the MLP yields a solid 6.7%.

As the publisher of MLP Profits and Investing Daily, I'd like to extend a special offer to you—an opportunity to get in on these energy superstars and check out a bounty of other high-yielding and tax-advantaged MLPs—simply by giving MLP Profits a try. Be my guest and put it to your own personal test; the tougher, the better.

Build a Millionaire Portfolio with MLP Profits

MLP Profits is the only financial advisory 100% focused on helping investors safely build income and wealth from these overlooked securities.

Look through the MLP Profits portfolio and you'll see pipeline operators, storage managers, import/export terminals, distributors, processors, transporters and shippers who handle and move the product once it's out of the ground.

These outfits are the most reliable cash generators in the energy field. Even in the 2008 crash, most energy-related MLPs maintained their distributions, overcoming frozen capital markets and plummeting oil and gas prices.

Oil and gas prices will rise and fall (as they always do), but these service businesses continue doing their jobs and collecting their fees like clockwork. Best of all, many of them have long-term contracts guaranteeing their fees under all price circumstances—like the two tanker MLPs you'll find in the free special report I'll send you for giving MLP Profits a try.

No wonder the MLP Profits portfolio blows away just about every other investment you can name.

Subscribe today to join us in growing a portfolio that pays you back…


Right this minute, the average total return of the MLPs in our three portfolios is 91.8%, and their average yield stands at 7%.

And that's just the average. You could cherry-pick our five highest yielders and start earning 12.3% on your money right away. Imagine what steady income like that could do for your retirement plans.

Here are some of the MLPs in our portfolios right now. The gains and yields here are current, and I expect them to move even higher in the weeks and months ahead…

  • 218% in marine LNG transport—current yield: 6.5%
  • 139% in Permian Basin energy—current yield: 8.7%
  • 330% in midstream petroleum products—current yield: 3.8%
  • 317% in oil and gas midstream services—current yield: 4.1%
  • 217% in midstream energy assets—current yield: 5.8%
  • 222% in pipeline operations—current yield: 4.3%
  • 183% in midstream gas and NGLs—current yield: 7.2%
  • 124% in gas and petroleum products—current yield: 6.7%

Start a No-Risk 3-Month Trial Subscription Now

I think you'll quickly see these unique high-yield-plus-strong-capital-gains-plus-no-tax recommendations are likely to make you substantially more money in the coming years than conventional stocks.

Remember, the average total return of the MLPs in our three portfolios is 91.8%—and their average yield stands at 7%.

MLP Profits is an exclusive, subscription-only, web-based advisory service covering every single MLP trading on the major exchanges.

Subscribe and you will find…

  • Monthly Issues. Our monthly issues offer an in-depth look at the timely partnership opportunities you need to know about. It also keeps you up to speed on every market event that matters in the MLP sector.
  • Conservative MLP Spotlight. Here you'll find a full breakdown of the most reliable partnerships for long-term, worry-free wealth-building. You can buy these steady performers and forget about them for a long time.
  • Growth MLP Spotlight. Our expert analysts constantly scour the market for MLPs that deliver high yields combined with sleep-like-a-baby safety. Each month, they highlight the latest finds—gems that yield 7%, 10%, sometimes 12% or more. Buy them now and they're likely to shower you with rising income and share prices for years to come.
  • Aggressive MLP Spotlight. If you relish taking on a bit more risk, go for these newer, more speculative MLPs. They're strictly for your "play money." But many of our readers find them irresistible because of their potential to take off.
  • Three Model Portfolios. One for every risk profile, from conservative to growth to aggressive. Follow them exactly or use them to customize a portfolio with the right mix for you. Plus, our analysts carefully track their recommendations so you see exactly how they perform.
  • "How They Rate" Table. We rate every MLP on the major exchanges as a buy, sell or hold. You can assess the entire field at a glance. You'll find current price and yield, plus proprietary safety rating—which ranks the reliability of every MLP's distribution.
  • Access to the Full MLP Profits Archives. You can find every article, piece of advice and analysis we have ever published—just as if you had subscribed from our very first issue.
  • Live Reader Chat Sessions. Every other month, Robert Rapier and Igor Greenwald sit down for a few hours to answer your questions in detail. Whether it's broad energy trends or which MLPs they like best at the moment, nothing is off-limits in these interactive free-for-all sessions.
  • MLP Investment Insider E-letter. This weekly bonus report analyzes emerging developments in the MLP sector and passes on updates on portfolio holdings.

Try MLP Profits—Just to See If You Like It

With my special invitation, you can start a no-risk subscription to MLP Profits for $147 per quarter. That's less than the masthead price of $697. Or you can save even more with a full one-year subscription for $497 today.

That's thousands of dollars of investment opportunities for you for less than $600 a year!

There's no better way to check out these unique investments than this.

If it turns out MLP Profits isn't for you, simply cancel for a 100% refund.

In other words, MLP Profits is a no-risk investment!

If, over the next three months, you're not satisfied with the money you're making, I'll send you a full refund whenever you want. The special investment reports you will receive when you place your order are yours to keep, along with my thanks for giving MLP Profits a try.

Years from now, plenty of investors will scratch their heads and ask, "How did I miss this?"

You'll be sitting right there… banking your profits.

You don't want to miss out on this opportunity.

Try it now by activating your 90-day guaranteed, no-risk subscription to MLP Profits.


Phillip Ash

Phil Ash
Publisher, Investing Daily and MLP Profits

P.S. To get you off to a running start, I'll send your special report with full details on how to profit from seven of the top MLPs right now—including the two LNG tanker champs set to profit hugely. MLPs for the Growth Investor is yours free just for taking a look at MLP Profits.

And if you will subscribe for one full year at $497 today, I will throw in a second free special report, MLPs and the LNG Export Race, to help you get ahead of the coming boom in LNG exports.

Make the right decision—try MLP Profits now.

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