Silver Wheaton (NYSE: SLW) is one of the best ways for investors to take advantage of the bull market in silver. Many people assume it’s a mining stock, but it’s clever business model frees it from the risks of mining while giving it leverage and profitability from silver’s increasing value. It does this by buying the future production of silver mines and miners for whom silver is a byproduct. The miners get an assured price for their production that allows them to expand now, while Silver Wheaton gets their silver. This company owns no mines, but has contracts that allows it to profit from the silver of several major mines. It’s a pure silver play and a real bargain at the moment, in my opinion.

I marvel at how Americans are strangling themselves with debt. Here’s a passage from a recent note from the angriest man in economics, Richard Daughty, a.k.a. “The Mogambo Guru”:

We professional economists call this process the Slow, Horrible Spiraling Death Of An Economy By Inflation Syndrome, but more commonly by its acronym, SHSDOAEBI Syndrome. In the early stages, it can be temporarily delayed by using savings to plug the gap between stagnant income levels and rising spending levels, which resulted from prices rising so high, and so fast.

In the later stages, however, after the “Steal the kids’ piggy banks!” and “Intercept birthday cards from their grandparents!” stage, now with no savings remaining, the onset of economic death can be temporarily forestalled, one last time, with increased borrowing. This is Late Stage SHDOAEBI Syndrome.

And we are already in this advanced stage, if you listen to Martin Weiss of the Safe Money Report, who says “According to Federal Reserve data, the typical American family today has a balance of only $3,800 in cash in the bank, has no retirement account whatsoever, owes $90,000 on their mortgage, and owes $2,200 in credit card debt.”

I know what you’re thinking: How do these average Americans get by on so little credit card debt? OK – there must be a typo in that figure – it’s got to be more. But don’t miss the main point here: we’re doomed unless we get out of debt. Get out of debt now, or perish. And as part of your financial plans, you need to invest in things that maintain value when the dollar crashes. Precious metals can help.

How does one get out of debt? The first step is to begin living within your means. Prepare a budget. Stick to it. Eliminate things that aren’t needs. Be disciplined. Get rid of credit cards. Cut back. You’ve got to live your plan and move forward.

Silver was knocked down to below $11 an ounce recently, apparently dragged down by falling oil and efforts to strengthen the dollar (alleged by some to be pre-election manipulation to keep voters happy). But the fundamentals of silver point to a much higher price potential. Global silver inventories are down. Millions more ounces of silver are being consumed industrially than are being produced, and production of silver from mines is difficult to increase – partly because silver tends to be a byproduct from mining of other metals, and if their demand does not increase dramatically, there is little motivation to ramp up silver production.

A huge reason to expect silver to rocket upward in the near future is the emergence of new hedge funds devoted to silver. Barclays of England brought the SLV exchange traded fund online this year for American investors, and now more such funds are planned for Europe, Australia, and New Zealand. Investment demand for silver can be expected to escalate as it finally becomes easy to invest in, and as people recognize it as protection against inflation. But the key dynamic is that silver is rare, being used up steadily for industrial needs. In fact, it is rarer than gold in terms of available physical silver above ground. But it’s an a ridiculously low level of around 1/60th the price of gold, when historically it’s been at 1/16 or higher – a logical price given the relative amounts present in the earth’s crust.

What all this means is that today, this month, perhaps this year, you have a marvelous window of opportunity to invest in silver. Get the real physical metal, get some SLV exchange traded fund in your 401(k), and get some silver stocks such as Sliver Wheaton (SLW) or Silver Standard Resources (SSRI). If you want a speculative junior mining company (for advanced traders only), try Clifton Mining (CFTN.pk) or Sterling Minerals (srlm.ob).

Celgene, one of the best biotech/pharma companies out there, has an incredible business model, amazing drugs, and a very hot pipeline. I recommend it as a key part of your investment portfolio. One reason is that Celgene is developing a whole class of new but related drugs called IMIDS, building on the success of thalidomide and Revlimid in dealing with certain cancers and other diseases. Its price has been held back this summer and is ready to move forward at this excellent buying opportunity.

As reported by the Multiple Myeloma Research Foundation:

Like thalidomide, IMiDs are immunomodulatory agents (drugs that can modify or regulate the functioning of the immune system). IMiDs appear to have multiple actions, including both anticancer and anti-inflammatory activities.

Details on IMiDs’ Mechanism of Action

IMiDs affect the immune system in several ways. They induce immune responses, enhance activity of immune cells, and inhibit inflammation. IMiDs appear to alter the levels of various cytokines (growth factors or factors that inhibit growth) and affect cells of the immune system. Studies show that IMiDs:

• Enhance the activation of T cells
• Enhance the activity of natural killer cells, which help kill cancer cells
• Enhance production of interleukin 2 (IL-2), a growth factor for T cells
• Inhibit inflammatory cytokines including
• Tumor necrosis factor-alpha (TNF-α)
• Interleukin 1-beta (IL-1β)
• Stimulate the production of interleukin 10 (IL-10), an anti-inflammatory cytokine

In addition, the IMiDs inhibit the growth of new blood vessels (angiogenesis) through inhibition of vascular endothelial growth factor (VEGF).

Celgene has been down a little in the past few weeks, and frankly seems coiled and ready to spring. Watch for a strong move this week or early next week. By the end of the year, I would not be suprised to see it 30% higher than it is now.

Central Banks may yet make efforts to drive the price of gold down further this year to allow them to purchase more, so I suggest being ready to jump in and buy if gold dips below $580 an ounce. Might go below $550 an ounce, one gold expert told me. That’s if we’re LUCKY. There is also the potential for geopolitical tensions and the reality of rampant inflation and inadequate quantities from mines to generate a rapid and long-lasting increase to much higher levels, such as at least $800 an ounce. What to do?

Roger Wiegand offers some compelling reasons to buy gold now. I think a portion of your savings needs to be in gold and silver, the physical metal, and I would begin buying some now. I’d keep some cash on hand, maybe 30% of your PM budget, to catch a possible dip between now and late September. If it rises to $700 or so, well, you’ll be glad you had some gold, and you’ll still have cash to watch for future buying opportunities in precious metals of mining stocks, or some other investment. And if there is a correction first, buy with both fists and then HOLD. Don’t even think of selling gold below $2000 an ounce unless you have no other choice to meet your obligations. We will see such prices, perhaps within a couple years.