UGF from Frida

Fri, 2010/02/26 - 1:12pm | Your editor

Vivian is running this late dispatch from Frida Ghitis today first of all because it was my fault she missed our deadline by sitting in on the conference call with the stock she wrote about. I assumed it was being held Brazilian time. Then our new Google software did not offer the accents we are accustomed to use with Portuguese. That is hardly Frida's fault either.

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Forecasting Gold Prices

Fri, 2010/02/26 - 11:42am | Your editor

"The idea that you can actually predict what is going to happen contradicts my way of looking at the world," said George Soros. This presumably explains why he told the Davos World Economic Forum that gold was a bubble at the same time as he was investing in the yellow stuff for his own account.

On Dec. 1, 2008, the National Bank of Canada's Tanya Jakusonek surveyed gold analysts to get their prediction for the price of the barbarous relic over the following four years. The estimates for this year ranged from $1013 per oz (Credit Suisse) or $1000 (CIBC, Citigroup, Dundee, Raymond James, Scotia Capital, and Salman, all liking round numbers) right down to $591 for Versant Partners, $700 for Soleil-Bradford, $720 for UBS, and $725 for Deutsche Bank. The consensus average for 2010 was $866. So whatever made Mr. Soros change his mind, he is right about prediction.

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Thursday Trades

Thu, 2010/02/25 - 1:21pm | Your editor

Today I sold Ormat at $31.07/sh, and NICE Systems at $30.41. I bought Mellanox, MLNX, at $18.51. There will be more Israeli trading tomorrow in a different sector.

Wrong Israeli Conference

Thu, 2010/02/25 - 1:01pm | Your editor

 

The market for ipo's from China is reportedly drying up, not just because people are worried about tightening credit conditions, but because of who is coming. The latest filings are for Redgate Media Group, a Beijing ad agency, and China Intelligent Lighting, of Huizhou.

It turns out that I went to the wrong Israeli stock session earlier this week. The real meeting to have attended (although the press was not invited) was the dinner session at the home of Israel Corporation head Idan Ofer. It was attended by the chiefs of Bank Hapoalim of Israel, and Goldman Sachs (Lloyd Blankfein) plus the Premier of the Palestine Authority, Salam Fayyad, along with a bunch of Israeli and Palestinian company heads and entrepreneurs. They were trying to work out how to do more business together despite politics.

But I did get a few stock ideas at the meeting with Nasdaq-listed Israeli companies at Oppenheimer & Co.

To make room for the newbies, we sell two of our current Israeli positions because I do not want to overload our exposure to Israel. More for paid subscribers follows. It is long because it covers two days of news.

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Linguistics, Prayer, Ethics, and Geology

Tue, 2010/02/23 - 7:39pm | Your editor

New York reader FBN, an Irish national, wrote to complain about my article about simulateneous translation, in which I called the Irish language "erse". He says: Read more »

Ethical drugs

Tue, 2010/02/23 - 11:42am | Your editor

Thanks to Jeffery, Dick, William, Jay, Moises, and Phil for their responses to our search for a paid video star. You will be contacted by the marketing team. Be sure to prepare your brokerage accounts to prove that you have made 50-plus percentage gains with your Global Investing stocks. I have too, but I am not considered to be a neutral observer for some reason.

 

There will be no newsletter tomorrow because I am attending an Oppenheimer conference on Israeli stocks at the same time as the water is being turned off both in my home and my office (which are in the same building.)

 

Our newsletter recommends GlaxoSmithKline, a UK drugmaker which has been in the new of late. GSK was formed by merger with SmithKline (of New Jersey) and many of the events described occurred in the USA.

 

According to today’s New York Times (Science Times), the dispute between Dr. Steven Nissen, the Cleveland Clinic cardiologist, and the British drugmaker Glaxo over the type 2 diabetes drug Avandia included not just competing press releases and medical journal articles casting doubt on each others’ research, but also a key May 10, 2007 meeting between executives of the drug co. and the cardiologist before his article came out.

 

The meeting was recorded (as is legal in Ohio) by Dr. Nissen, but he did not tell the Glaxo team.

 

Both sides knew more than they let on. The drug firm execs knew that their study, supposedly double-blind, would undermine Dr. Nissen’s contention in an as-yet-unpublished article in the New England Journal of Medicine that Avandia raised heart attack risks in diabetes patients. Dr. Nissen did not reveal the details of his study but the drug execs appear to have received an advance copy from the Journal, supposedly a no-no. They said they had contradictory data which they were not supposed to have because the large randomized RECORD trial was billed as being double-blind, and had not yet been handed to GSK.

 

Dr. Nissen’s conclusions were based on a statistically imprecise method called meta-analysis combining multiple trial data rather than patient level analyst. Meta-analysis without careful controls correcting for the mounting imprecision of the results, when I studied statistics in grad school, was what made you flunk the course. The margin of error goes up the more you combine different databases using different methodology. The cardiologist did not do a time-frame analysis of how long patients were on the drug before heart attacks occurred, which undermined his conclusions.

 

Yet after Dr. Nissen’s article appeared (when the NYTimes does not say), GSK’s head of research, Dr. Moncef Slaoui, in an internal emailed message, agreed with his conclusions that heart attack risks increased with Avandia. He said “the risk for ischemic events” ranges from “30 percent to 43 percent”. These are horrific numbers but the newspaper does not say when and to whom Dr. Slaoui sent this email, nor how it got a hold of it.

 

Nor does it tell us how Dr. Slaoui reached this conclusion.

 

Meanwhile, the US FDA, reacting to criticism in a new Senate report questioning the safety of Avandia, yesterday told doctors it is reviewing information on the drug but recommends that patients continue taking it.

At the same time, Rep. Rosa DeLauro (D., Conn.), chair of the House appropriations committee (controller of the FDA's budget) called for the FDA to remove Avandia from the market until its safety and effectiveness can be evaluated. She took up the cudgels against the drug because safer alternatives exist. A rival drug, Takeda Pharma's Actos, has been shown to lower glucose as well as Avandia while causing a lower risk of heart attacks.

 

A report published earlier (Sat.) in the New York Times based on work by the Senate Finance Committee accused Glaxo of knowing about the risk of heart attacks with Avandia, but says it hid this from the public and the FDA. The Senate report was critical of the FDA's support of Avandia, and included studies by FDA doctors who said in 2008 the drug poses serious heart-related dangers to patients and should be pulled from market.
On Mon., FDA drug division leader Dr. Janet Woodcock said data linking Avandia to heart problems has been “inconclusive.”

 

“We have possession of no new information that raises additional alarm about the drug,” she added. However, Woodcock said some people in the FDA believe the drug should be withdrawn.

 

In a statement, Glaxo noted that a public health posting on the FDA's Web site reading “There are no new FDA conclusions or recommendations about the use of rosiglitazone (Avandia) in the treatment of type 2 diabetes.”

 

Last June, GSK released the results of the RECORD study which, GSK said, showed that there is no serious risk of heart attack or death from Avandia. Woodcock said the agency got the results of the trial in mid-2009. She said the agency was looking at the RECORD data and would discuss it at an advisory committee meeting in July.

 

According to Dow Jones, Dr. Robert A. Vigersky, president of The Endocrine Society, questioned why the meeting wouldn't be held until July when the agency received the data last year. “Is that by virtue of the fact that you need that amount of time to get the data analyzed?” he asked. He added, “Is there any way this could be accelerated?”

 

Woodcock responded that the FDA needs time to “look very closely” at the study because its results are “at odds” with other studies associating Avandia with heart attacks. When RECORD was released, some doctors questioned whether it was statistically adequate enough to draw conclusions. The Senate report charged that Glaxo knew since at least 2004 that RECORD was statistically “underpowered.”

 

Investing conclusions follow for paid subscribers. While I studied statistics, I never studied heart surgery. One of my daughters-in-law is attached to the Cleveland Clinic, but not in cardiology.

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We're Giving Away $25,000

Mon, 2010/02/22 - 11:21am | Your editor

Hi, I’d like to write you a check for $5,000.

No, this is not a joke.

We are in the process of planning to increase the reach of our investment advisory services and as part of that we’d like to share the successes of our current subscribers.

And as a “Thank-You” for taking the trouble to do so I’ll be writing $5,000 checks to the first 5 people who respond and complete the criteria listed below.

Also, because we’re fiercely committed to “truth in advertising,” I’m asking for some form of verification of the successes mentioned on your video. I know this is a little more hassle which is one reason we’re giving away $25,000 to compensate you for your trouble.

Here are the guidelines for claiming your $5,000.

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Cassandra's Euro Forecast

Mon, 2010/02/22 - 11:18am | Your editor
From the darkest post-World War II trials, of Nazi war criminals in Nuremburg, came a key feature of modern international diplomacy, the use of simultaneous interpreters housed in little booths to translate what people speaking different languages have to say. Without this instantaneous translation, the post-War world would not have seen the United Nations, global trade negotiations, functioning bodies like the International Monetary Fund, the World Bank, the ASEAN or the OAU.
 
And of course there would be no way that the European Community could have grown from six countries speaking 3 different languages to its current membership of 27 nations speaking a dozen and a half different languages (not counting Erse since most Irish speak English.)
 
In the pre-War years, the only way diplomats could communicate and haggle and play chicken about financial aid to each other countries was by all talking French.
 
My knowledge of Estonian or Hungarian, Bulgarian or Latvian. is meager.

My Nightmare

Fri, 2010/02/19 - 12:19pm | Your editor

I had a nightmare last night. I was driving a van on a steep crooked road while talking on a cellphone with a reporter who had just landed an exclusive interview for us at the Bank of England. I was taking notes while driving and talking on the phone, and absolutely terrorized. I woke up before the crash.

Your editor lives in New York City where she rarely drives (although when babysitting with grandchildren she does sometimes have to drive a monster van. She is a law-abiding driver and would not talk on a cellphone while at the wheel. There is no way the Old Lady of Threadneedle Street would allow one of my reporters an interview. It was a nightmare.

You don’t need Dr. Freud to know this dream  tells you about my mood and concerns after a short week of using the new website under construction and working with the new webmaster, sometimes by telephone at late hours. The message for all of you, and me as well is: please be patient about problems on the site because they will be dealt with but cannot all be handled at once. Today we lost the lede paragraph indent.

And also, please forgive me for sending out the same article to subscribers three times yesterday. I am still being trained in the new system. I now understand what went wrong.

My dream also reflects my uncertainty about the impact of the American variant of the Bank of England, our Fed, raising the discount rate it charges banks. The stock and gold markets appear to dislike the measure, but the dollar is stronger, which of course hurts an international portfolio like ours.

Wall Street runs on liquidity these days, and even this tiny hint of eventual money supply tightening scares the pants off the equity market, to say nothing of the market for Treasury bonds. (Remember when interest rates rise, the price of existing bonds falls.)

But whenever there is a nightmare, you eventually wake up. The dollar’s meteoric rise may not even last long enough for my next overseas trip, to start Mar. 17 and end April 21. This should provide an escape or closure from the hassle of transitioning to a new website.

Yes, I will be filing my newsletter from England, France, and Spain where I’ll be traveling. The newsletter will come out normally except for Mar. 30 (Passover),  April 2 (Good Friday), April 4 (Eastern Monday),  when we would not create a newsletter anyway.  (We’re ecumenical.)

The huge European visit is not only for business, but also for two weddings, of my eldest nephew and his Italian bride in Kew Gardens, London; and of a close cousin’s daughter and her partner in Malaga. Both bridegrooms are bobbies, British police officers, which tells you something about my family. And why would not even think of really chatting on a cellphone while driving.

One piece of intriguing news: Invesco is creating an exchange-traded fund in its Power Shares series, to invest in closed-end funds (tracking an index they have created.) This combines two investment vehicles into the first U.S. legal fund of funds since Goldman Sachs  was barred from using this vehicle after the 1929 crash. In the 1960s many Americans in Europe, mostly in the military, were lured into another fund of funds by Bernie Cornfeld. His slogan was “Do you seriously want to be rich?” He lured in GIs who were not buying Global Investing, as the newsletter did not yet exist.

More for paid subscribers follows from Mexico, Israel, Britain, Canada, Japan, and the Dutch Antilles. Read more »

You Load 16 tons

Thu, 2010/02/18 - 12:51pm | Your editor

 

You load 191.3 tons, and what do you get? Another day older and deeper in debt.

The note I published yesterday mixed up the venerable billionaires. The one who bought gold exchange traded funds was George Soros, not Warren Buffett. Soros did this, according to papers he filed with the SEC, despite having publicly called gold a bubble early this year. Presumably he was trying to cheapen the price.

What Soros failed to do, the International Monetary Fund managed yesterday, by announcing it would sell another 191.3 (metric) tons of the yellow metal, why I was quoting the miner’s song. Presumably the money it raises will help pay for more bailouts.

That of Greece, however, will not be an IMF operation; it will have to be financed by the European Community. Right now EU leaders are all dumping on Wall Street and Goldman Sachs, which is easier for them to do politically than dumping on their own errant Eurostat watchdog, their local banks, or fellow pols. Read more »