- Brad Setser: This really doesn’t look good
. . . either gold has to come down, or gold stocks need to come up. . .a lot. Here is a recent article on the newsletters being bullish on bullion. Hussman uses the gold/XAU ratio which currently is above 7. (Hussman talks about a similar method here and here.)
The ratio is around .86 - near the lowest reading ever. Absolute returns for this decile have been strongly positive at 14%, 20%, and 43% for the following 3,6,12 months, and up 90% of the time a year later.
- Bloomberg: Satyam to Restate Earnings, May Be Broken Up
Satyam Computer Services Ltd. will have to restate earnings and may be broken up after the company’s founder was arrested in India’s biggest corporate fraud investigation, executives said.
Satyam shareholder Lazard Asset Management LLC said it asked for information from the government about developments in the investigation. Lazard Asset increased its stake in Satyam on Jan. 7 to 5.3 percent from 4.79 percen.
The company is now worth $332 million after the Bombay Stock Exchange removed Satyam from its Sensitive Index and the National Stock Exchange dropped the stock from the Nifty.