Saturday, October 4, 2008

The Dow-Gold 1-to-1 ratio is a given during this cycle

As most acknowledge, we are entering a period not unlike the recession of the late 70's and potentially more severe. Going back 40 years further, you had the great depression and then a similar recession occurred in the late 1890's. Notice how these unsettling periods occur every 40 years (1890's, 1930's, 1970's, 2010) During these periods, the Dow-Gold ratio made it's way to 1-to-1 before the Dow recovered. It doesn't take a rocket scientist to see that gold needs to move up dramatically in the not too distant future. If the Dow drops 50% from here to 5,000, gold will move up over 500%. If the Dow maintains its present level, gold will move up over 1,000%. Hard to believe? If the past is any indication of the future, it's time to prepare.

Must listen/reads from the past week...................

As the paper money world begins to crumble before our eyes, there is mounting evidence that physical gold and silver are becoming almost impossible to find for the retail investor. The divergence between the strong physical demand of gold and silver and the drop in the price of these metals is unprecedented. Strong demand and falling supplies for a product while at the same time the price drops precipitously can only last temporarily. Whether one believes in government intervention in the precious metals market can be debated endlessly. One thing is certain however, gold and silver prices and the related stocks cannot remain this low for much longer.

Listen to the last 2 weeks of Jim Puplava's show (6 hours). He has been predicting this financial calamity. Listen here.

silver summit news - price manipulation

Royal Canadian Mint under strain to meet demand for gold

Gold Chart - with comments

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