Tuesday, Jul 29, 2008
More destruction coming up
Daily Paul: The Silent Crash is Starting to Make Noise
This is the Dow priced in real money - gold. It is down 73% to date from its peak. If Congress, the Fed and the Treasury had not been colluding to inflate the our currency and destroy the dollar, this is what the nominal Dow would look like, too. And according to his analysis, it soon will
Posted by sold 2 rent 1 @ 10:00 AM (1169 views) Add Comment
21 Comments
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1. sold 2 rent 1 said...
2. Ah-so said...
Priced in "real" money, property is not expensive or increased in price over the pas 5 years - it has stayed stable.
Perhaps we should let Kirstie know about this?
3. harold said...
In real money the Dow still looks overpriced. When one or two ounces of gold buys the Dow is when I'll move back from commodities to equities.
4. nooneo said...
So if gold goes down the line on the graph will go up!
All this really shows is that gold is another bubble just about ready to burst.
If you used silver this graph would be reversed. Using gold as a de facto standard for wealth (as we did in medieval times) is just not realistic and will eventually be seen as such. Why not use the price of land as a standard for wealth or anthing else for that matter?
5. harold said...
"If you used silver this graph would be reversed."
Not so. Gold and silver ususally move in tandem.
6. drewster said...
s2r1,
You might like this analysis:
Reuters: Hedge funds sell oil as ratio to gold narrows
"The tumble in the price of oil over the past few weeks may have been exacerbated by hedge funds deciding that it was just too expensive, particularly in relation to gold. Oil's sharp rise this year -- New York crude had gained as much as 53 percent to a record high above $147 a barrel earlier in July -- has not been matched by gold, which was up just 18 percent on the same period."
To return to the historic mean, they reckon that either "gold today should be at $1,230 an ounce or oil should be at $92 a barrel."
Personally I think the gold/oil ratio is distorted by peak oil, but it's certainly food for thought.
7. rickyb said...
As far as I can see from the graph on the homepage of this website, if you're serious about buying a house in a few years time, then keep your cash in a safe RPI linked account, and you'll double the amount of house you can get in a few years time. After all we all want ready cash to be able to put down a nice large deposit on a house soon don't we?
Safer than gambling on the vagaries of the gold market, and being stuck with some useless yellow metal at just the time that house prices have bottomed out.
8. Rentinginthesouth said...
A good port folio should contain a good spread of assets,gold, shares, property etc... - Gold is another bubble, agreed - but it hedges against other investments
9. techieman said...
The interesting thing about this is that Pretcher is actually bearish on gold. However hes even more bearish on the stock market! Thats not to say there wont be a pull back on the chart posted before the next leg of the bear. In terms of the stock market itself hes pretty bearish to say the least! - In any case i have watched it and its pretty good and well for $29 it must be worth a watch?!
10. guiriduro said...
It would be interesting to compare the dow or FTSE's value in terms of the square footage of property it would buy over time as well. But really, all market transactions are relative, there is no absolute measure of value, no universal benchmark which sits outside the influences of inflation, deflation, speculation, demand and supply forcings. And if there were, it wouldn't be tradeable or useful as a measure anyway. At least with Einstein's relativity, the speed of light is (assumed to be) a constant.
11. sold 2 rent 1 said...
Here's my latest thoughts on gold and Calleman's model
We know the centre points of the "nights" are peaks for gold.
6th Night in Planetary cycle 1972-1992 (gold peaks in 1980, just short of the mid point)
4th night in Galactic cycle (Nov 2005 - Nov 2006) (gold peaks at mid-point in May 2006
5th night in Galactic cycle (Nov 2007 - Nov 2008) (gold peaks just short of the mid-point in March 2008)
So the next minor peak in gold could be spring 2009 (mid point 6th day) (say $1,200)
But the next major peak in gold won't be until spring 2010 (mid point 6th night) (say $2,000)
Phase 3 of this gold run should then occur in spring/summer of 2011 when the 4th, 5th and 6th nights all occur in the space of 3-4 months
This will be the mania phase where we see the end of money.
12. sold 2 rent 1 said...
See how the big gold peaks occurred in the spring of 2006 and 2008 matching closely with the mid-points of 4th and 5th nights.
13. last_days_of_disco said...
@s2r
I thought we were all supposed to have had a change of consciousness by now and the queen was to be revealed as a shape shifting lizard.
Or are you now transitioning to a more "the end is fluid" type of message. Don't rise to it.
Nice graphs though.
14. sold 2 rent 1 said...
Gold is down to 914 and oil down to 121.
Gold should find support in August around 880-900.
This will be a buying opportunity for an upleg peaking into spring of 2009 ($1,200)
15. shipbuilder said...
I thought gold had found support at 920 and then it would 'go to the moon'? You've been predicting this massive upswing for a while now.
Should you really be offering this advice?
16. p. doff said...
15. shipbuilder said...
"I thought gold had found support at 920 and then it would 'go to the moon'? You've been predicting this massive upswing for a while now".
S2r1, our flexible friend!!!
17. jonb said...
These graphs may tell s2r1 something about planetary cycles and galactic cycles. What it tells me is that the Dow is slightly below the long term trend line (from 1980 anyway) relative to gold. By slightly below, that means within the usual fluctuations.
We had the dot.com bubble up to about early 2000, and the slump in gold prices round about the time Gordon Brown sold all our reserves. That explains the peak.
Gold, as I've said before is massively over-priced at the moment, as nobody is buying it except for speculators. Maybe the Dow is over-priced as well? But mostly, I don't believe chartism can tell you a lot about future share prices, or commodity prices. You need to look at the current value of future cash flows from the asset you are buying and see if that is less than or more than what you are being asked to pay for it.
18. sold 2 rent 1 said...
p. doff and ship,
I thought gold would go crazy in this 5th night.
It turned out to be oil that had its bubble.
Gold will have its mania phase in the Universal Underworld 5th night in the summer of 2011.
19. Nemo said...
S2R1: Can you explain Universal Underworld 5th night? I'm not familiar with it at all.
20. shipbuilder said...
I know, but you predicted the 920 support only the other week.
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