A- In light of your additions to GLD, do you basically disagree w/ the points made by Katsenelson in his article at MSN today on 5 reasons to avoid the gold bug?

I do know that after gold hit $800 in 1980 on fear and inflation concerns, it was a horrible investment for the next 20 years, regardless of fear, gulf war, inflation scares, or whatever.

I'm real happy about a bunch of Eagles I bought in early '01 for under $300 each in a scrap exchange, but I sold some last year, and I wonder why gold is once again being looked at as a hedge against inflation or global turmoil, or is it? Does ease of purchase through GLD have a lot to do w/ the run-up?

A-
Okay. I admit it. My inner child was having a hard time resisting the desire to be able to look at my porfolio and see MOO COW there. Now that you sold MOO today, maybe I can start to see more clearly. Maybe.

"why and with what catalyst. (or cowalyst in this instance) "

Can I be the first to say, "HOLY COW!, Andrew has coined a new term!"

I said, "At some point don't hog and cattle numbers/supply start to be the main factor in a turn around?" I guess in the futures market, the real trick would be in predicting when the shortage begins, not recognizing it when it already starts. Although a reversal is not absolutely guaranteed, it's hard to imagine that it won't happen at some point, no?

A-
Of course, I guess the question on SAFM then centers on whether the good news has already been substantially factored in to the price of the stock, no? Up 66% since Feb. low by my calculation, and a big pop in the last week from strong earnings report. Side note- It's share price today is almost exactly it's share price one year ago.

As far as I know, you don't get swine flu from eating pork, like mad cow from eating contaminated beef. But, I understand the public panic issue is never rational. However, how much of that has already factored in to the downside for hogs? Hogs are only about 1/3 of COW, I think. At some point don't hog and cattle numbers/supply start to be the main factor in a turn around? I have no idea what that looks like at this point.

Andrew- How much do you consider downside risk vs. upside potential when choosing investments?

For exampe, I know you have been positive on commodities related to the fact that "people have to eat", and other factors. While some of the Ag related ETF's have done well this year, the livestock market has continued a downward slide, at least looking at COW, which is basically cattle and hog futures markets. In fact, it has been on a steady decline for 12 mo.

Do you try to look for investments that may be nearing the point of little downside risk, assuming you feel like you can reasonably gauge that?

Andrew-

Just find it interesting that VTI is off over 13% ytd and VWO/ emerging mkts. is only down 3.5% ytd. Is that saying anything significant about global recovery or is that a reflection of the fact that emerging markets took too big a hit last year in the meltdown?

"Put you Ask up in the air, make your trades like you don't care!"

Andrew, or anyone--

I have been watching for a comment on what happened in February when UCO fell off a cliff, and USO took a beating also, but hasn't stayed down to the extent that UCO has as oil prices recovered some.

UCO seemed in Jan to have a floor around $10, and then after falling off the cliff in Feb., it struggles to get back above $ 8 even though we have seen oil in the upper $40's some days.

Did I miss a post on this? If not, can someone explain the behavior? rk

yesterday's action sure would concur w/ the idea of staying away for now. since I already own a lot of preferreds, the choice becomes A- sell at a huge loss on the face value, or B- hang on, keep drawing the dividend, and hope the economy recovers before massive bankrupcies/defaults totally wipe me out. If that doesn't happen, it's a lot of short term pain, but turns out okay in the end.

There really hasn't been anyplace to hide lately, but in cash or FDIC insured investments, has there? Well, gold, I guess, unless you bought at $1000/oz. But, I have a hard time not remembering that for over 20 years, from 1980-early 2000's, gold was a terrible investment, but it didn't stop the gold bugs from continually touting it as a safe haven.

Sorry for another reply, but I should have mentioned that the board "can" decide to withhold a dividend on a preferred, and that is also a risk. If it's a cumulative preferred, they still owe you the money, but that does not mean that you will ever see it. Strong companies do not have a history of withholding the dividend, but before late 2008, the shares did not have a history of trading at steep discounts either. If a company withholds a preferred dividend, it's in deep yogurt! rk