Yet another fail – Cluster Stock chart of the day

ST. LOUIS (Alpha Found) — ClusterStock.com has a problem with the brains working up its charts of the day.

The latest oopsie is a moronic interpretation, no, commentary, on global gold demand. According to CS, “The true gold bugs of yesteryear are no longer in charge. Though they’re probably not complaining given that retail demand is making them rich. Just realize that retail demand can be a fickle friend.”

Good grief! Do you guys have any clue, whatsoever?

Firstly, the “retail demand” being referenced is very gold buggy. They’re investing in gold for gold bug reasons. They’re gold bugs, geddit?

What CS fails to appreciate is that the investment demand has swelled at exactly the right point to deal with the decline in industrial and jewellery demand because of higher prices. What is most surprising is that non-investment demand has held up as strongly as it has in the face of a huge rise in prices in a short time.

The CS ‘chartists’ do not have the faintest idea what retail demand means on this chart. In fairness, the World Gold Council could do a better job with the labeling and categorization.

© 2009, Alpha Found.

Globalization they can live with – the “Wall Street” tax

ST. LOUIS (Alpha Found) — The pitchfork waving mob has arrived at the gates of the palace only to discover the incumbent royalty would rather depart for friendlier foreign climes than than fight for hostile local ones.

Commenting on a proposed $150 billion a year tax on financial transactions, Speaker of the House, Nancy Pelosi, said, “We couldn’t do it alone, we’d have to do it as an international initiative.”

That’s globalization she and her party can suddenly live with!

Bloomberg notes that, “Seven Democratic House members

A bailout for newspapers?

We can certainly rely on the media to be more independent with government funding, no?

more about "A bailout for newspapers?", posted with vodpod

How diving real interest rates are fuelling the gold price surge

ST. LOUIS (Alpha Found) — Real interest rates in the United States are not the only factor driving gold prices, but they are clearly important as a reciprocal indicator.

However, it is surprising that gold is responding so mildly. Real interest rates declined the most month-over-month in a decade with another drop forecast for November. Yet gold is barely making headway. Stay tuned, the month isn’t over. Especially if you’re one of the believers in $3,000/oz.

© 2009, Alpha Found.

Gold ETF turns five. A mountain of fees & a warning sign?

ST. LOUIS (Alpha Found) — Hedge fund manager John Paulson is opening a new gold fund seeded with a quarter billion of his own wealth. With Paulson the largest shareholder in the SPDR Gold Shares, it’s a timely reminder that the gold ETF turned five today. Happy Birthday, GLD!

Sarbanes-Oxley cancer spreads at a cost of $80bn a year

ST. LOUIS (Alpha Found) — Dale Halling has some good ideas about how to end-run Sarbanes Oxley by innovating state specific equity markets. We doubt it could work given SEC’s jurisdiction jealousy, but it’s certainly worth considering. It also surrenders the whole point and value of Interstate Commerce.

Previously Halling deduced some

Fake profits? Go to jail. Fake statistics? Go to government

ST. LOUIS (Alpha Found) — The bureaucrat in charge of Recovery.gov, the White House effort to spin good news, has admitted that he is knowingly publishing bogus information. If a company were to report its performance in this manner, the executive team would find itself in jail thanks to Sarbanes-Oxley and similar controls.

Would it be too much to demand that

Mainstream media on the gold margins

It is interesting, in an amusing way, to watch the mainstream financial media waking up to gold.

They mostly ignored the 300% increase from $250 to $1,000, but they are now delirious about a 13% increase to $1,130.

Here’s an example from Reuters (are we unkind for noting that Reuters had to source the data from a private investor…):

Gold predicted to hit $3,000 as US economy implodes

ST. LOUIS (Alpha Found) — Author Martin Hutchinson has put his neck on the line with some bold predictions to which he assigns “near 100% probability”.

Here’s the meat of it:

• Gold to $2,000/oz within 6 months.
• $5,000/oz “possible but not certain” by the end of 2010.
• Gold at $3,000/oz and oil at $150/oz before the end of 2010.
• The gold and oil bubble will burst, probably before the end of 2010.
• Treasury bond market will collapse.
• Banking crisis will accelerate.
• Unemployment will spike toward 15%
• Euro will buy $2.
• Dollar will buy 60-65 yen.

Meanwhile, what is the Gold ETF telling us? Is it as ominous as it looks?

© 2009, Alpha Found.

South Africa & Brazil – twins for a time, now splitting up?

ST. LOUIS (Alpha Found) — Brazil has received some lavish praise in recent months. The November 12 edition of the Economist is typical of the press attention it is garnering. However, the country’s late October decision to tax foreign equity and bond inflows makes the loudest statement about the country’s potent offshore appeal.

Back in 2003 Goldman Sachs coined the BRIC acronym to