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Wednesday, October 6, 2010

Gold Bubble?

A lot of State comedians are saying "There's a bubble developing in gold." They can't acknowledge inflation, so instead they call it a bubble.

Compare gold hype to stock market hype:


The price of gold just went up a lot. It's too late to buy! There's a bubble!
The price of gold just went down. That proves that gold investors are idiots.
The stock market is rising! Buy before you miss the opportunity!
Stocks are cheap now! It's a good time to buy!
State comedians denigrate gold investors at every opportunity.

If you consider the FRN-denominated price of gold (gold/$), it's risen rapidly. If you look at gold/silver, gold/copper, gold/oil, gold/corn, or gold/wheat, then there's much more price stability.

In fact, corn and wheat have risen substantially faster than gold so far this year!

It's much more accurate to say "The value of the dollar is crashing!" than "There's a gold bubble!" State comedians can't acknowledge dollar hyperinflation, so they make up excuses.


fritz said...

FSK..will you please calculate substance for substance price calculations to demonstrate hyper inflation...example

in 1942 a silver quarter purchased 1 gallon of gas which today 1 silver quarter is worth about $5 fed notes.

A house in 1964 sold for $10,000 silver based money,,the house sold in 2010 for $200,000. but the value in silver is exactly the same.

or how many eggs would it take to buy a car in 1950 and would the same amount of eggs buy a car right now.

Or other creative analogies would be interesting because I think you have a mind for math,



Anonymous said...

Charts should have a "quick invert" button for a different perspective.

FRNs on sale now for only .0007413oz

CarDogg said...

When they print the dollar like it's toilet paper - you can be sure gold and silver are goin' up!

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