Golden Food for Thought

 Is Gold Still The Answer For Investors?

The above graph has two points to be considered:

1. There was a healthy correlation between the value of the US dollar and gold while the dollar was backed by gold prior to 1973.

2. The Y axis of the graph is logarithmic: each incremental change represents a tenfold increase in value: $10, $100, $1000 and then $10,000.

According to this graph, the real price of gold valued in US dollars should currently be $10,000 per ounce. Is gold undervalued or is the dollar overvalued? The obvious answers are yes and yes. The result of this policy will be hyperinflation courtesy of the Federal Reserve.

David DeGerolamo

      
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1 Response to Golden Food for Thought

  1. LT says:

    Ah, yes. But you “wealthy people” can’t eat gold. The OWS folks, on the other hand, have clearly declared that they are willing to “eat the rich”. At a 99:1 ratio, “the rich” are barely one meal for the 99. After that, they’ll all have to eat each other.
    Caught wearing the badge of STUPID again… useful idiots never learn.

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