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To: BenLurkin
If you enlarge the graph you can see the DJI/Gold ratio measures the health of the market vis a vis the health of the currency. Gold, while fluctuating, has been a store of value since civilization began.
17 posted on 08/03/2008 6:36:57 PM PDT by shrinkermd
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To: shrinkermd
The DOW is measured in dollars.

Gold, also measured in dollars (at least for those of us here in the USA) is merely an investment vehicle that competes with stocks for investment dollars.

Comparing the DOW to the value of gold at any given time simply compares the relative attractiveness of the two investment vehicles — and in a rather inexact way considering the probable mismatch of investment horizons (that is to say, people buying gold on any given date are probably not thinking of holding it the same length of time as those who are buying stocks on that same day.)

What's more, it isn't really possible to make sense of the two investment vehicles by comparing this particular window of time. You'd have to go a lot further back to get an accurate picture.

Just my opinion of course — I'm certainly no expert.

19 posted on 08/03/2008 6:47:18 PM PDT by BenLurkin
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