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« The Difference between Risk and Fear | Main | Weighing the Week Ahead: Expect Volatility, not Clarity »

August 29, 2013


J Kloss

Thanks for this analysis Jeff.

My educational and working background are in physical sciences and software. After semi-retiring, I'm now studying economics and finance diligently. Your analysis methods are rigorous which I appreciate. Unfortunately, I would not have known to compare GDP to M2 nor would I feel comfortable with my layman's interpretation of correlation vs. causation.

The good news is that a less precise method ...taking a quick look at the site referenced... would have, unscientifically, led me to ignore the writer anyway. Here are a few clues supporting my knee-jerk but appropriate reaction:

* The site's favicon is a $

* The site's text is peppered with the word "gold". While I am gold neutral, it is obvious to me the site's author is probably not.

* Prominently displayed are phrases boldly claiming "A golden opportunity" / "Profit Confidential" / "Special Report" / "Hot Off The Press" / "A Dire Warning" / "Guaranteed Oil Pension Checks" etc.

* If this site were a physical place of business, it would likely have a doorman swinging the door wide and screaming "Today only! Come take a look! We have it all! Don't let this opportunity pass you by!" as potential clients walked passed.

In my experience there are few, if any, sites having that look-n-feel which are legitimate or contain information I would trust. This is a real-world skill many of us hopefully brought to the virtual one. Sites like "A Dash of Insight", "Calculated Risk", "The Big Picture" et. al. pass the "Is this a serious site?" whiff test. "Profit Confidential" does not.

Bottom line: Looks count.

Ed Foster

This is another great post. These types of misleading charts pop up with some regularity.

I'd like to remind you of your Nov. 7, 2012, post regarding the 100% Recession Chart. This thing suddenly appeared all over the Internet. Numerous commentators used it to predict an imminent recession. Of course, they didn't check with the authors of the chart.

You did check, and debunked their arguments. On Nov. 7, the S&P 500 closed at 1394.53. As of the close on 8/30/13, the S&P 500 was up 238 points, or 17 percent. Some recession!

Your Nov. 7 post is at

I hope you will continue to write these posts. The charlatans' work, if unchallenged, can be dangerous.


Thank you! This is a great series. If people stopped to actually think about what they read we would be much better off. Critical thinking takes practice, and knowing what to look for. Unsophisticated investors can get easily snookered when they are presented with exotic charts talking about the money supply, QE, etc.


What do you think about purely technical interpretation of data without fundamentals and using sound management ?

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