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A picture is worth a trillion words

derrybderryb Posts: 36,795 ✭✭✭✭✭
in Precious Metals
A most interesting chart from Gary Dorsch. Note that not only does gold closely track Treasury debt, but when it outpaces government debt (as it did in 2008) it corrects itself (2009) to get back on track with government debt. Could this finally be the ultimate forecaster for the price of gold? Note to self: If so, buy more.

image

"Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

Comments

  • fastrudyfastrudy Posts: 2,096 ✭
    Wow! That is an interesting graph.
    Successful transactions with: DCarr, Meltdown, Notwilight, Loki, MMR, Musky1011, cohodk, claychaser, cheezhed, guitarwes, Hayden, USMoneyLover

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  • 57loaded57loaded Posts: 4,967 ✭✭✭
    i kinda liked that kitco page hit graph, myself

  • derrybderryb Posts: 36,795 ✭✭✭✭✭
    shot of the present is a dime a dozen, shot of the future is one in a trillion. image

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • renman95renman95 Posts: 7,037 ✭✭✭✭✭
    I'm scared.....
  • CaptHenwayCaptHenway Posts: 32,123 ✭✭✭✭✭
    Is the U.S. government in debt?
    Surely they are taking steps to get out of debt, aren't they?
    TD
    Numismatist. 50 year member ANA. Winner of four ANA Heath Literary Awards; three Wayte and Olga Raymond Literary Awards; Numismatist of the Year Award 2009, and Lifetime Achievement Award 2020. Winner numerous NLG Literary Awards.
  • SmittysSmittys Posts: 9,876 ✭✭✭✭✭
    100 to 1 reverse split and dang it's 134.5 billion
    We have enough gold in Knox to pay that !
    https://www.ebay.com/str/christyscoins
  • mhammermanmhammerman Posts: 3,769 ✭✭✭
    "100 to 1 reverse split ..."

    But, but...bread would be $200 buks a loaf but if gold was 120 K/oz and those shiney ASE's were 2K a copy, I guess it would all work out OK.
  • derrybderryb Posts: 36,795 ✭✭✭✭✭


    << <i>"100 to 1 reverse split ..."

    But, but...bread would be $200 buks a loaf but if gold was 120 K/oz and those shiney ASE's were 2K a copy, I guess it would all work out OK. >>


    But only for those that have those shiney ASE's.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • BaleyBaley Posts: 22,660 ✭✭✭✭✭
    I'd be more confident in the relationship the graph represents, if it went back farther than 2005.

    I can think of a lot of unrelated things that look like they're correlated when conveniently graphed using certain timeframes and y-axis values.

    not discounting the concept entirely, just looking for some more corroboration before thinking, "holy cow, look at the cause and effect here!"

    Liberty: Parent of Science & Industry

  • derrybderryb Posts: 36,795 ✭✭✭✭✭


    << <i>I'd be more confident in the relationship the graph represents, if it went back farther than 2005.

    I can think of a lot of unrelated things that look like they're correlated when conveniently graphed using certain timeframes and y-axis values.

    not discounting the concept entirely, just looking for some more corroboration before thinking, "holy cow, look at the cause and effect here!" >>



    For the years 1985-2005:
    Gold traded between 250 and 500
    Treasury debt went from 2 Trillion to 5 trillion

    Appears to be a similar correlation.

    Holy cow!

    So far, appears that gold price increases an average of $150 for every new trillion in gov. debt.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • DrBusterDrBuster Posts: 5,378 ✭✭✭✭✭
    So we're going to see $1500/oz sometime early next year by this?
  • derrybderryb Posts: 36,795 ✭✭✭✭✭
    As the US's perceived ability to pay the debt decreases, the actual debt will increase at a higher rate because it will have to make bigger promises (interest payments) to sell the bonds. Charted trend will eventually become invalid as "faith" in ability to pay debt causes gold price to accelerate faster than the debt.

    "Interest rates, the price of money, are the most important market. And, perversely, they’re the market that’s most manipulated by the Fed." - Doug Casey

  • OverdateOverdate Posts: 7,007 ✭✭✭✭✭
    So if government debt ever goes down to zero (by default or otherwise), gold will be worth zero?

    My Adolph A. Weinman signature :)

  • 57loaded57loaded Posts: 4,967 ✭✭✭


    << <i>"100 to 1 reverse split ..."

    But, but...bread would be $200 buks a loaf but if gold was 120 K/oz and those shiney ASE's were 2K a copy, I guess it would all work out OK. >>



    and one would see new $1000, $5,000 and $10,000 bills, but the gold and silver equivalent would be nice, though
  • johnny9434johnny9434 Posts: 28,312 ✭✭✭✭✭


    << <i>I'm scared..... >>



    as we all should be image
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