Top Takes From RealMoney

• China: Shanda Interactive(SNDA Quote) and AsiaInfo(ASIA Quote).
• Springtime stocks: Scott's Miracle-Gro(SMG Quote) and Central Garden(CENT Quote) (CENT).
• Auto parts retailers/repairs: AutoZone(AZO Quote) (before pulling back), Monro Muffler(MNRO Quote) and O'Reilly Auto(ORLY Quote).

That last group is thought to be vulnerable in a cash-for-clunkers program, but there will still be plenty of aging cars on the road.

3. My Two Cents on Gold

Tom Au
4/2/2009 9:51 AM EDT

The reason that gold has value is that it is an inflation fighter. So, too, are blue-chip stocks on the Dow, on which Bill Gross (of Pimco) calculated the 20th century investment return as inflation, plus dividends, plus 0.6% a year real. Ignoring the fractional real term, the prices of the Dow and gold should therefore track closely over a period of say, a century.

They don't necessarily track over "shorter" time periods (decades) because of extreme price movements. For instance, the ratio of the Dow to the per-ounce price of gold was about 1 to 1 (800-something to 800-something) in 1980, during the Iranian hostage crisis, meaning gold was too expensive and stocks too cheap. In 2000, the ratio was 40 to 1 (almost 12,000 to almost 300), which is why I sold "regular" stocks and bought gold stocks then, a move that helped me make money in all of the three down years, 2000, 2001 and 2002.

Regression-type arguments suggest that a reasonable ratio of the Dow to gold is about 5 to 1. Based on a hypothetical "new normal" of 7500 for the Dow, dividing by 5 gives $1,500 an ounce as a plausible price for gold. At a 3300 Dow, gold would go down to $660. If we returned to 14,000 on the Dow, gold should be $2,8000. One forecaster sees gold at $200 an ounce; that would put the Dow at "Jim Cramer's" 1000.