1. Episode III
Investing in Precious
Metals of Physical Market
Friday, the 6th of February 2015
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2. Who Are We?
• Four Metals Market® is a trademark of ISC sarl, and registered with
Ministry of Economy and Trade in Lebanon.
• Four Metals Market® is the Online Store that facilitates commercial
activities over the internet between retail shops and individuals in
Lebanon.
• The Online Store is not a trading platform but a normal online
shopping cart.
• Four Metals Market® Club was formed to focus on educating club
members on the industry of precious metals.
• ISC sarl is the exclusive agent of NBH (National Bullion House) in
Dubai, UAE for Lebanon covering wholesale market and trading
activities in the physical market.
• ISC sarl acts as an Introducing Broker for NBH in Lebanon to whoever
interested in operating a Trading Account.
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3. • We believe in "value" not in
"price".
• We believe that gold and
silver maintain "value"
whereas currency raises
"price".
• We believe that gold and
silver worked without a fail for
more than 5,000 years
whereas paper money was
newly invented and failed
several times.
• We believe in the fact that
gold and silver are real money
with intrinsic value, and can
not be produced infinitely
whereas paper money is
nothing but a printed
promissory note or IOU that
can be printed unlimitedly. 3
What is New?

4. Precious Stones
Coming Soon!
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What Else?

5. 5
Are you free
economically?

6. Wealth!
What is the definition of
Wealth?
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7. Wealth?
• Definition of Wealth “A measure of the value of all of the assets of
worth owned by a person” by Investopedia.
• Wealth is your time and freedom.
• Freedom is the practice of the right to choose a particular
productive activity, and set the time to spend practicing that
chosen activity in order to generate Economic Energy,
• Such Economic Energy is stored in a container called “Money”,
• Money acts as a token to trade the stored Economic Energy for
goods and services.
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8. Facts of Wealth• The law of Conservation of Energy states that the total energy of an
isolated system cannot be changed.
• Similarly “The law of Conservation of Wealth states that the total
wealth of an isolated economic system cannot be changed” by 4MM.
• Wealth can neither be created nor destroyed, but transferred from
one state to another - crisis to opportunity - either voluntarily or
involuntarily.
• Life is not fair and even The Economic System which brings
inequality in wealth concentration.
• Wealth concentration is a process by which newly unearthed wealth,
under two factors, can become concentrated in the possession of
few individuals or entities.
• Factor I: an unequal initial distribution of wealth.
• Factor II: unequal knowledge of the mechanics of the economic
system.
• Freedom is to choose when and for what to trade your money.
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9. Money vs Currency
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Money Currency
medium of exchange
unit of account
portable
long-lasting
mutually interchangeable
stores value leaks value away
intrinsic value faith
finite infinite

10. Your Money!
• If your Money is the currency created by nations
• What is the nations’ Money?
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11. Your Playground!
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12. Nations steal
wealth from people!
• Nations reward the domestic economic energy by paper money
known as fiat currency.
• Fiat Currency is a currency declared by a government by law to
be a legal tender within its territory, and backed solely by faith.
• Fiat is the Latin word for "it shall be".
• The risk which people are running is that such fiat currency will
become one day or another worthless due to hyperinflation and loss
in faith.
• Result is that the economic energy will ultimately vanish (Wealth
Destruction).
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13. Prices
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When currency pool expands, prices sucks them to inflate.
Inflation is the
result of expansion
in currency supply.
Deflation is the
result of
contraction in
currency supply.

14. Motivations for
Investing!
What are your motivations to
invest in precious metals?
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15. Motivations for
Investing!
Motivations for investing in precious metals:
• Financial Concerns: When the financial
system becomes unstable or faith in a
currency becomes questionable.
• Inflation: When cost of living skyrockets
or purchasing power evaporates.
• Unstable Political Environment: When
the political environment becomes
unstable because of war, civil war or
breakdown of political system.
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16. Case of Switzerland
• On September 6th 2011 the SNB (Swiss National Bank) sets a floor
for EUR/CHF exchange rate at €1.20 “The SNB will enforce this
minimum rate with the utmost determination and is prepared to buy
foreign currency in unlimited quantities”.
• SNB Press Release on December 18th 2014 “The SNB reaffirms its
commitment to the minimum exchange rate of CHF 1.20 per euro, and
will continue to enforce it with the utmost determination”.
• SNB Press Release on January 15th 2015 “The Swiss National Bank
(SNB) is discontinuing the minimum exchange rate of CHF 1.20 per
euro”.
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Do Central Banks lie?

17. Big Casualties
• Alpari UK, which was the pioneer of the Forex industry announced
insolvency.
• New Zealand based Excel Markets basically said that they will not be
returning back to business.
• Citigroup lost $150/- Million.
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18. Case of Lebanon
• Banque Du Liban is announcing a stimulus package of US Dollar 1
billion to boost local demand where housing loans will capture the
main bulk of loans in the 2015, by BusinessNews.com.lb dated 8-Dec-
2014.
• Moody's Investors Service downgraded Lebanon's government bond
ratings to B2 from B1 and maintained the negative outlook, by
BusinessWeek.com.lb dated 19-Dec-2014.
• The Ministry of Finance launched a medium term public debt
management policy from 2014 to 2016. Increase borrowing in foreign
currency until 2016
• 30% to cover the duties of the principal of debt and interest rates
in foreign currencies (refinancing).
• 70% to cover the obligations in Lebanese Lira. by
BusinessWeek.com.lb dated 8-Jan-2015.
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19. Lebanese Lira
• 1964 - Present
• the local exchange rate of the lira is partially covered by gold, and
foreign currencies that are convertible to gold,
• 30% cover of cash and deposits, and
• 50% cover of cash.
• the local exchange rate of the lira is controlled through market
intervention by Banque du Liban when needed.
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20. Art of Building Wealth
• Regular capital accumulation is the key to build wealth.
• Capital is the financial resource available to posses real assets.
• Capital is divided into:
• Constant capital: refers to value of physical assets in possession.
• Variable capital: refers to employed capital.
• Fictitious capital: refers to intangible representation of physical
assets.
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21. Ownership!
• Ownership is the right to possess assets.
• Contracts in general facilitate the transfer of assets’ ownership
between contracted parties.
• The devil CFD (Contract for Difference) was introduced by financial
engineers to confuse people and breakdown the rules.
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22. Contract for Difference
• CFD is an arrangement made in a futures contract whereby
differences in settlement are made through cash payments, rather
than the delivery of physical goods or securities, by Investopedia.
• Where losses and gains are paid in cash where CFDs provide the
benefits and risks of owning a security without actually owning it. he
financial resources available to posses the said something “assets”.
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23. Risk Profile
• Suitable Profile:
• Saver: Regularly putting aside part of income directly into
constant capital.
• Investor: Suitably employing capital in goods to produce other
goods to build up the constant capital.
• Speculator: Preferentially burning available financial resources in
fictitious capital to recover and generate other financial
resources.
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24. Options Available
What are the options available
to invest in?
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25. Options Available
• Commodity ETFs (Exchange Traded Funds): claim on the
performance of a particular fund, basically a company trading in
contracts.
• Common Stocks: direct claim on the performance of companies
dealing in precious metals.
• Futures and Options Contracts: offer the benefits of owning without
the actual ownership.
• Certificates: offer actual ownership minus the hassle of insurance,
transportation and storage.
• Bullion: offer actual ownership in addition to the hassle of insurance,
transportation and storage.
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26. Starting Your Investment
• Remember “Most unsuccessful investors are slaving the fear of
misfortune by jumping into market when its skyrocketing and getting
off when it is falling”.
• Know your goals and risk profile in order to succeed.
• Be with markets as being with friends and deal with falling market as
dealing with discounts season.
• Action Plan:
• Put an initial capital in action.
• Turn off emotions.
• Have a Action Plan with targets.
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27. Your Action Plan
• Define your profile
• Set your goal.
• Determine your target dates.
• Turn off your emotions and stick to your plan.
• Have firm belief in what you are doing and NOT in what others are
saying.
• Make friendship with market.
• Stay resourceful.
• Finally, whatever happens keep going!
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28. Facts About
Physical Market
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29. Your Strategy!
When do you buy?
How to you buy?
What do you buy?
Where do you buy?
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30. Usage of Precious Metals
• How to make payments in gold:
• gold can be put in vaults
• you transfer ownership of gold at nanogram grams and ounces
• the transfer goes from one account to another
• payment method can be by any mean like plastic card or paper
receipt.
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31. Recommendations
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32. Things to remember!
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33. US Dollar Currency
• Pre World War I: Classical Gold Standard
having 100% reserve ratio. $20 bill = $20 gold
receipt.
• 1913: Gold Exchange Standard having 40%
reserve ratio. $50 bill = $20 gold certificate.
• 1943: Bretton Woods System states that
every currency of the nations will be backed
by the US Dollar and the US Dollar will be
fixed at $35 an ounce of gold. There was no
reserve ratio established.
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34. US Dollar Currency
• The US continued printing its US Dollar at 0% reserve ratio.
• 1960: President Charles De Gaulle claimed that there was not enough
gold with the US to back its currency and asked for the gold.
• 1960-1971: Phenomenon of rush on the US gold by France and other
countries started resulting in loss of around 50% of the US gold
reserve.
• 1971: the US had 12 times of printed US Dollar to the existing
physical gold stock. The US created more receipts for gold that what
they actually had of gold.
• 15th of August 1971: Fiat currency was born to avoid default on
payments.
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35. Nixon Shock
• In 1971 the US was unable to meet its obligations to foreign creditors
under the terms of global monetary system that was negotiated by
world leaders and in place since the end of World War II.
• That system was based on the US Dollar redeemable in gold.
• President Richard Nixon unilaterally withdrew the US as a party to the
agreement citing the actions of “speculators” as the reason for default
rather than admitting the inability of the US to meet its obligations
under the agreement because Vietnam War spending was
bankrupting the country.
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36. Nixon Shock 1971
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37. De Gaulle 1965
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38. De Gaulle 1965
• The french president was opposing the US monetary
policy and having the belief that the base of the world
monetary system must be gold.
• In 1965 he warned that the International Monetary
System based on the US Dollar was a danger to the
world.
• The danger he warned about 49 years ago is now too
large to manage.
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A monetary system based on a single nation’s currency is a
danger to the world.
© Tacna | Dreamstime.com - Memorial Of General De Gaulle Photo

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