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The Dow:Gold Ratio, which measures trend changes in the price of gold versus a basket of stocks as represented by the Dow, supports the idea that investors today should have an allocation to precious metals. Essentially, the Dow:Gold Ratio divides the Dow by the US-dollar gold price. Figure 3 shows that when the ratio is rising, as it did in the 1920s, 1960s and 1990s, portfolios should be overweight equities. When the Ratio is falling, as it did in the 1970s and is doing today, portfolios should be overweight precious metals. Currently the Ratio is 8.18:1 and, equally important, it is falling, meaning there is still plenty of time for investors to rebalance into gold and precious metals.
(Figures mentioned are as of 31st May 2011: its a lot different if you take today's numbers, where the Dow has fallen another 2000 points & Gold has risen about $350, making it approximately near 7:1 ratio).
We believe that Dow:Gold ratio will reach close to 1:1 as it has happened in the past century (1 ounce of Gold will equal the Dow Jones Index); & then financial assets will become an attractive investments.. Till than prudent investors need to protect their portfolio by holding Gold..
http://www.marketoracle.co.uk/images...location_3.png
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The Great Credit Contraction (just to get an idea of the World Financial System & How a negligible loss in the derivatives can create substantial damage)...
http://www.jsmineset.com/wp-content/..._image0022.jpg
One can only prepare accordingly.. & hope for the best (although hope is not a good strategy)
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http://www.salidacapital.com/admin/m...un_16_2010.pdf
Read this article and get important information on economy all over world.
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The US long bond index “TLT” as a ratio over the Canadian dollar Index “FXC”. When the TLT moves up more than the FXC we see the deflation fear trade has the upper hand over growth or inflation prospects.
http://jugglingdynamite.com/wp-conte...fear-trade.bmp
The next phase of money printing (as its already started in some countries, Swiss Franc was the latest example on monday, & Job stimulus in US, etc.etc. ), will ignite the inflation rally..
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September 11 – Ten Years Later (Selected Statistics)
https://lh5.googleusercontent.com/-2...-ten-years.png
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Wow, the numbers are staggering! Great info! I need to catch up on a few pages! :)
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Nick of BMG: Gold is far far away from being in a bubble.. (an 24 min mp3 audio, a must listen) http://blog.bmgbullion.com/audio/9.1...tinABubble.mp3
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Bond Investors be extremely careful specially in the long term. (the tide is gradually turning against the Bond market).... Bond are debt's of the issuer, & the quality of debt is based on the financial health of the issuer. Example: Like Greek bonds are just plain garbage right now, nobody wants them, so any investor holding Greek bonds has already lost substantially.
Quote "There is $10 trillion waiting to be invested in the US, if America will open its doors. It is bad for bonds – or will be. The money will go into strategic land purchases all over the world, until the backlash erupts in earnest. It will go into equities, until Capitol Hill has a heart attack. It will go anywhere but debt.
Yet another reason to be careful of US 10-year Treasuries and German Bunds below 2pc yields. There is a big seller out there, just itching to let go."
Please read the full details from China's Central Bank http://blogs.telegraph.co.uk/finance...s-not-dollars/
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Most commonly used staple food in developing countries "Rice: the most common food" is already showing signs of massive inflation... http://finviz.com/fut_image.ashx?rel...22064276562500
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What a bloodbath in the markets over the past day or so...not looking forward to opening up quarterly financial statements next month.
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China's economy may enter a hard-landing - "causing softness in commodities" which will affect Canadian economy..
http://www.telegraph.co.uk/finance/c...d-landing.html
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