There are many reasons why you should invest in gold now. Some reasons are more convincing than others. A good indicator I have seen recently is the Dow Jones vs Gold Price ratio.
The Dow Jones vs Gold Price ratio looks, how many ounces of gold it takes to buy the Dow, assuming that each point in the Dow index corresponds to one U.S. dollars.
Throughout history there have been some points in time, where the ratio was close to a 1:1 or 2:1, which meansIt would take one or two ounces of gold to buy the Dow.
In 1896 the ratio was 1.28:1, in 1932 it was 2.07:1 and the last time the Dow vs. Gold ratio was approached in 1980, when it 1.33:1. Analysts are predicting we are nearing that time again.
As of this writing the Dow was over 12,000 and the gold spot price was $ 903, what about the ratio 13:1. This is well below the all-time high ratio of 41:1 in 1999, but still far from a 1:1 or 2:1 Relationship.
You can easily find that for the gap that was the stock market will take a huge drop, the price of gold has increased dramatically, or both.
With all the uncertainties in the U.S., as the shrinking dollar, the economy, a housing crisis and the growing national debt, by those gold is really a portfolio of cake.
Plus, with all the turmoil in the rest of the world, gold is becoming a safe haven> Investment than ever before in history.
But of all the reasons why you should invest in gold, take a close look at the Dow Jones vs Gold Price ratio. This could be the biggest sign of all!
Jeff sneering, author of the Gold Investment System, is an expert on how to buy gold cheaply. For over 20 years, he has to buy gold below 50% of the spot price, and he can teach you how to do the same.
No comments:
Post a Comment