Tuesday, November 9, 2010

Gold at $7,800/oz, Or S&P 500 at 220? Take Your Pick


[Most Recent Quotes from www.kitco.com]

The chart below shows yet another way to look at the value of the stock market and gold in relation to each other.
The S&P 500 to gold ratio essentially prices the stock market in terms of gold. (Normally, it is priced in terms of dollars. Alternative reference points could include barrels of oil, acres of land or any other thing of value.) This helps provide a way to evaluate the market adjusting for a loss in purchasing power.
A few observations:
  1. The ratio of S&P 500 to gold reached a bottom in 1981 - i.e. gold valuations reached a peak.
  2. Between 1981 and 2000 the stock market rose in real terms.
  3. Between 2000 and present the stock market lost value in real terms.
  4. The S&P 500 to gold ratio has not yet fallen to historical lows. To reach historical lows set in 1981 the S&P 500 would either need to fall to 220, gold would need to rise to $7800/oz or some combination of the two.
click to enlarge

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4 comments:

  1. Gold at $7,800/oz, Or S&P 500 at 220? Take Your Pick

    Neither. I'll take FreeGold at $55,000/oz with minimal impact to prices. Revaluation cometh.

    ReplyDelete
  2. Do not worry about Container bombs the most powerful bombs are suitcase bombs .

    Weapons of mass destruction including suitcase bombs already exist and are working to subvert and destroy America with economic warfare from the inside out.

    Said WMD device, is called a Central bankers printing press and is operated for Usury at the Fed HQ in partnership with subversive agents from the Squid bankster collective in control at the US Treasury together with bribed apologists and cheer squad in Congress.

    The paper money whose printed value is created out of fresh air as debts has a similar destructive effect on an economy as the fuel bombs of the military .A WMD .
    Containers and Ben branded heliicopters are being used to freely distribute shit loads of this printed or even digital created facsimiles WMD to the Wall St squid .

    Delusionary banksters are currently trumpeting their favorite song at an end of year punchbowl bonus parties.

    ‘We’re in the money we’re in the money, a bonus for you and for me!

    Happy that an American sucker is born every minute.

    On bad days the papers are only distributed in small breifcases or as 'suitcase" bombs filled with this money and carried around the criminals squids offices on wall st ,just in case the odd politicians drops in carrying a plain brown paper bag as takeaway lunch bag .

    A noisy appearance of a strong dollar is being used as the ammunition for the squid collective to fight currency wars against the rest of the people of the world as well as Americans.

    But, the more they print and fire the ammo the weaker the ammo and America gets .
    With the well know inflationary effect and in the end the ammo used in currency wars will become worthless and only blow up in the squids own face.

    ReplyDelete
  3. It would be best for America to be trimmed of its population. None of this is a bad thing. If half of the country were to be exterminated, we might be able to prosper again.

    All the junkies, criminals, and sluts will be erased. We could get rid of many obese and unlearned people, ages 35 to 60. Perhaps 50% of Generation Y should just be shot in the head so their impulsive, mindless existence could end and spare the world the energy. And finally we'd need to throw away about 80% of the bastard babies those sick dogs brought into the world.

    Only then can we talk about a possible recovery. Why you all hate the elites so much is lack of clarity. In life it was the barbarians making up the masses who caused whatever pain you carry around. I know the elites long ago devised the methods to mould people into their desired image (fat, lazy, stupid, and vampiric)... but this means these are the soldiers of the elites. It's like devils making imps out of clay. Any intelligent being who still has life in him will see it everyday how these mentally ill people with child like brains run across streets without looking just so they can try to beat everyone else running in that direction.

    Sometimes animals that can no longer help themselves need to be put out of their misery.

    ReplyDelete
  4. Remember, the last one to die, please turn of the lights....and don't forget to kiss your ass goodbye before they drop the bomb and make us go frizzle-fry!

    ReplyDelete

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