AGORACOM Small-cap Investor Relations Blog

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If actions speak louder than words, then the search actions of Washington are speaking several decibels above the party line “don’t worry be happy”. Specifically, using Google Trends, I compared the 2007 trends of two specific search terms (which are graphically displayed above):

• Recession (Blue Line)
• Gold Price (Orange Line)

I ran the trend for searches strictly taking place in the United States. The results clearly tell us two things:

First, fear of a recession amongst Americans is clearly rising – and rising fast. After calming down in July, “recession” has rapidly become a matter on the minds of Americans. You don’t search for recession unless you are worried about it, so clearly Americans are worried.

On that note, look at the hockey stick growth in searches for gold price. After remaining relatively flat for the entire year, it took off beginning in September. You can argue this is strictly a function of the higher price of gold but gold has made several moves in the past year without little more than a blip in increased searches. Why now?

Second, when you look at the cities most responsible for these searches, Washington ranks #1. Here is what is even more telling, when looking at these searches by region, 3 of the top 5 regions are:

1. District of Columbia (DC) #1
2. Maryland #2
3. Virginia #5

Unless these regions have become the financial powerhouses of the country, it is clear as day that the US government (politicians, aides, committees, etc.) have rapidly become interested in both a recession and the price of gold.

Conclusion – The US government is telling us not to worry, then heading back to their computers and singing searching a different tune.

Actions speak louder than words.

Regards,
George

p.s. You have to love the power of the web and it’s ability to pull powerful data that was once never thought possible. In this case, Google trends pretty much gives us the ability to sit behind the closed doors of Washington and find out what they’re actually thinking. Scary – but sweet!

It wasn’t long ago that calls for $100 oil were looked upon as simply “wild” predictions of analysts looking to garner attention. Maybe we should have paid closer attention and profited from those crazy turned reality predictions. In case you didn’t, you have a chance to redeem yourself because oil – according to Jean-Francois (AKA “JF”) Tardif – is going to $200.

Now, before you go making the same mistake all over again and call JF another analyst looking for attention, you might first want to consider the fact that Barron’s just ranked his Sprott Opportunities Fund as the #18 Hedge Fund on the planet.

In addition, he was recently awarded “Best Canada Based Manager” at the HFM US Performance Awards.

JF is a renowned and very successful Senior Fund Manager with Sprott Asset Management. He achieved his prestigious ranking and award thanks to his performance with the Sprott Opportunities Hedge Fund where he posted average annual cumulative returns of more than 33% over the past 3 years. As such, when Jean-Francois Tardif speaks, you probably want to hear what he has to say.

Fortunately, you can listen to our interview with him via our newly launched content partnership with GlobeInvestor.com – the AGORACOM Small-Cap Energy and Resources HUB. (I know, that’s a doozy unto itself but I’ll talk about that later). In the interview, he discussed the global supply squeeze taking place in both oil and gold, as well as, why he sees even more sub-prime pain for the US in 2008 (Hint: You may not want to be walking on Wall Street in May 2008).

In case you are reading this post well after November 9th, 2007, you can also find the interview archived on our industry leading Podcast site – SmallCapPodcast.com

See you at $200.

Regards,
George

Good morning to you all. First, let me apologize for the hiatus. It hasn’t been a complete hiatus because I’ve seen most of you at the two large conferences we sponsored (and I delivered speeches at) over the last couple of weeks PIPEs Conference and Toronto Resource Investment Conference.

In addition, our “Investor Controlled Discussion Forums” launch continues to shake the world of small-cap discussion forums, as we broke through 400,000 page views on Thursday – and climbing. Most of you have been in daily contact with me via e-mail and posts around the site as I chose to personally get involved in tech support for the last 10 days.

I’m back now and I’ve got a great article for you to read, especially those of you that are investing in gold as a hedge against a US economic collapse. The gist of the article may not come as a surprise to you – but the underlying support for the article is compelling.

Moreover, the source of the article is Roger Ehrenberg, an ex–Wall Streeter and author of the financial blog Information Arbitrage – a blog I read religiously. In short, this guy knows what he is talking about. He isn’t fringe, he isn’t an extremist. He knows the game and he is spotting some real cracks in the system that, according to him, will result in significant market pain.

I can try and point out the highlights but this is a story worth reading. It can best be summarized by his opening paragraph:

The Root Cause of Today’s Market Turmoil?: It’s a Matter of Trust

Trust in our government. Trust in our financial institutions. Trust in those who play the role of “trusted adviser,” regardless of whether or not they are considered fiduciaries by law. After taking a big step back and asking the question “Why are the markets trading so poorly, and why are financial institutions in particular getting crushed?” the answer boiled down to one word: trust. Or the lack thereof, as seems to be the case today.

Great Saturday afternoon reading – and even better Monday morning investing.

Regards,
George