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  • The majority is never right. Never, I tell you! That’s one of these lies in society that no free and intelligent man can ever help rebelling against. Who are the people that make up the biggest proportion of the population — the intelligent ones or the fools? I think we can agree it’s the fools, no matter where you go in this world, it’s the fools that form the overwhelming majority - Henrik Ibsen.

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Index In Real Money/Gold

Updated February 5, 2020 - Bearish Flag for the Dow expressed in Gold - A crash and a solid down trend we have: resuming bear trend now!

 

THE MOST IMPORTANT SECTION OF THE SITE!

  • This is what really counts...and this is also underestimated and not understood by the bulk of the investors.
  • We could publish a chart of any investment vehicle expressed in Real Money or Gold. As they all look alike (except for those on the Investment roster), we limit ourselves to the charts of the major stock market indexes.
  • Very few are aware that GOLD has outperformed stock markets since the beginning of this century. As the charts below shows, global equities have lost 70% vs gold since 2000 and are likely to lose another 95% in the next 3-6 years.

 The charts below speak and tell us that the Gold & Silver sector will perform BETTER than the traditional Stock markets will!

indugold pf1 INDUGOLD candle2

Dow in Gold lost 40% in 2009 and 80% since 2001!
 The SP500 in Gold lost +87,26% since 2000!

"What sense does it make to accumulate Fiat Money (Treasuries & bank deposits) which are slowly but surely becoming worthless..."

  • We advise staying away from any stock market as long as it sits in a BEAR market trend expressed in Gold or Real Money. Stocks, however, will perform better than BONDS, MONEY MARKET FUNDS and SAVING ACCOUNTS/BANK DEPOSITS.
  • The chart to the left of the Dow (click to enlarge) is a better example of the general trend. The performance of many Stock Market Indexes is even worse...
  • For the Secular Down trend to remain in force GOLD must rise more than the Stock markets or the Stock markets must fall if Gold moves sideward.
  • It is not because a stock is quoted in Dollars or British pounds that is, in fact, a Dollar or Pound investment instrument. Shares can be quoted on stock markets of different countries and the share price will reflect the currency of origin.
  • Under the actual conditions, Equities are a BETTER investment than any available BOND.
  • The Dow/Gold ratio peaked in 1999 and is now in a downtrend. Once the current correction is finished the ratio will continue down towards the 1:1 level like in 1980 when the Dow was 850 and Gold was $850. The only question is at what level the Dow and gold will be when they reach the 1:1 ratio. Will it be Dow Index 10,000 and Gold $10,000? Or will we see hyperinflationary levels of 100,000 Dow and $100,000 gold? The absolute level is really irrelevant. Because at whatever level they meet will involve a catastrophic loss of real capital for a stock market investor.

Charts (except China and Japan showing a fresh break down) all look similar and are extremely Bearish.

The best way to measure the Dow in real terms is against gold. Gold is the only money which has survived in the last 5,000 years – furthermore, GOLD represents stable purchasing power. Over time gold doesn’t go up. Instead, it is paper or fiat money that goes down until it reaches zero.

These PF-charts are the answer to an important question and show what the REALITY looks like!

ONLY  countries with CAPITAL CONTROLS HAD a Stock Market outperforming Gold!   In India and South-Africa, however things have changed during 2019 as these PF-charts have also show a STOP LOSS and now show a BEAR TREND.


DAXGoldClick on the charts to enlarge...

German DAX Gold - lost 80% Spanish Ibex Gold lost 80% French CAC Gold  lost 80% Footsie Gold lost  83% Japan Nikkei Gold lost 88%
daxgold pf1 ibexgold pf1 cacgold pf1 ftsegold pf1 nikkgoldpf1
 Downtrend
  Downtrend  Downtrend  Downtrend  Downtrend
         
Greek drama Swiss index Gold lost 85% Belgium Dow lost 65%
Dutch AEX Gold lost 85% South Africa
atggold pf1 smigold pf1 BEDOWGold pf1 ZADOWGold pf1
Dramatic....came down by a factor 50  Downtrend  Downtrend  Downtrend Stop loss & Bearish!
India Sensex China -80% USA- Dow Jones    
bsegold pf1 ssecgold Indu-Gold   Only in countries with STRICT capital controls, Stocks are doing better than Gold...that was until Oct 2018
 Historic gold
Stop Loss & Bear Trend
Downtrend

Halfway stop of Downtrend - Extremely Overbought and pivoting DOWN

   

One of the best ways to gain some perspective on stock markets and gold is to look at the Dow Jones Industrials (DJI)/Gold ratio. The Dow/Gold ratio has a long history as the 200-year chart above attests to. The ratio has had considerable movement over the years, which is an accomplishment in itself since gold was until August 1971 fixed first roughly at $20.67 and then at $35 in April 1933 when the Roosevelt administration revalued gold up in order to devalue the US$.

The devaluation of the US$ was a part of the currency wars of the 1930s.  The Roosevelt administration also forbid the hoarding of gold, gold bullion and gold certificates and gold was purchased by the US administration at the then fixed rate of $20.67. The resulting profit was used to fund the Exchange Stabilization Fund (ESF) a fund that was established by the Gold Reserve Act of 1934. One thing that stands out with the above chart is that following the creation of the Fed in 1913 the Dow/Gold ratio has become a lot more volatile.

dow gold LT.png

When the Dow/Gold ratio reaches 1:1 this means a loss of more than 90% in real terms for stock market investors – $ 1 million in stocks would be worth less than $100,000 in today’s money. And remember that the last time a 90% fall happened in the Dow in 1929-32, it took 25 years to get back to the previous peak. 

 

A different story: Stock market expressed in real money (Gold) since 1861


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