The most outrageous thing about Lady Gaga s meat dress was it s cost. Although the $100 worth of low-end steaks wasn t as pricy as Emma Stone s chic Emilio Pucci outfit, Gaga s meat ensemble was likely the only piece of fashion worn that night that could have risen 20% in value over the past nine months. Can Ashley Green s Giambattista Valli frock make the same claim?

Livestock prices, last covered in this space in August, continue to climb. Cattle futures are now at near-two year highs and less than 5% from all-time-highs. Hog futures are up nearly 17% this year, trading near the ceiling of their long-term range. Pork bellies have more than doubled over the past year, leading bacon prices, bringing bacon to an all-time-high, just like gold.

Squeal with Delight

CME Live Cattle and Lean Hog futures 5 years
Source: Finviz.com

What livestock doesn t have, however, is nearly the speculative demand or interest of gold, which saw investment demand rise 118% during the second quarter, according to the World Gold Council. SPDR Gold Shares added nearly $900 million of new dollars in August. At $53 billion, it s now the world s second largest exchange-traded fund.

iPath Livestock, the exchange-traded security that tracks an index of cattle (63%) and hogs (37%) we wrote about in January, has barely $70 million in assets and trades a mere 12,000 shares a day.

Livestock isn t pitched throughout commercial breaks on cable TV, nor has it yet attracted showboating congressmen holding public eviscerations of gold dealers to protect the public good.

But livestock does have an utterly ravenous nation of fans. When oil prices soared to a record $145 in July 2008, consumers cut their consumption. Energy companies were demonized as greedy, nefarious thieves, and alternatives as disparate as biofuels and bicycles were explored.

Yet there s scant evidence Americans are passing over the animal protein because of higher costs. Beef consumption has trended lower since the 1970s, but it hasn t experienced a precipitous decline as a result of the higher prices or economic downturn. Americans still eat roughly 65 pounds of beef a year and intake is growing rapidly in emerging economies like China.

Bacon has experienced an historic surge in popularity, dubbed Bacon Mania," as restaurants have more prominently featured the ingredient. McDonald's recently introduced a beef and bacon wrap, while Wendy s has featured the ingredient on its premium Bacon Deluxe and Bacon & Blue burgers. In April, Subway launched a bacon and egg breakfast sandwich.

A recent segment on ABC s Nightline noted that over half of U.S. households always have bacon on hand and restaurants sales of items containing bacon have risen by 25% in just the past 5 years. Blogs like The Daily Bacon and Bacon Unwrapped suggest the food has developed kitsch appeal. Personalities like Food Network s Paula Deen, who promotes Smithfield Food sHams, have fanned interest to a nearly religious fervor.

Yet despite its popularity and high prices, livestock remains well within the reach of nearly every American. According to a 2009 study from UBS, the average Chicagoan need only work for a measly 12 minutes to earn enough money to purchase a Big Mac, which covers more than 25% of the average adult's daily caloric needs.

So livestock is culturally popular and technically strong. But even at record prices, is it also cheap as well? I ll have the surprising data later on this week.

At the time of writing, Hoenig s fund held positions in many of the securities mentioned.