The price of gold, on a quarterly basis, is 86% correlated – yes, 86%! – to total government debt going back to 1975… and a shocking 98% over the past 15 years – as can be clearly seen in the chart below. Despite the current rumblings, everyone is aware that the debt ceiling will be raised and will likely surpass $20 trillion by the end of President Obama’s term. That would put the price of gold at about $2,000 per ounce.
This post was featured on bmgbullion.com under the title Chart of the Week: Correlation Between Price of Gold and US Public Debt.
[The post is presented by Lorimer Wilson, editor of www.FinancialArticleSummariesToday.com and www.munKNEE.com and the FREE Market Intelligence Report newsletter (sample here – register here) and may have been edited ([ ]), abridged (…) and/or reformatted (some sub-titles and bold/italics emphases) for the sake of clarity and brevity to ensure a fast and easy read. This paragraph must be included in any article re-posting to avoid copyright infringement.]
[Editor’s Note: The author’s views and conclusions in the above article are unaltered and no personal comments have been included to maintain the integrity of the original post. Furthermore, the views, conclusions and any recommendations offered in this article are not to be construed as an endorsement of such by the editor.]
*http://www.bmgbullion.com/document/buzz/2013-10-02 (© Copyright 2003-2012 Bullion Management Group Inc. All rights reserved. Buy BMG Gold, Silver and Platinum >> To Learn More About BMG Bullion Products)
Q: Don’t laugh at me, but what is a deficit? A: It’s actually not a dumb question. Here’s why. Read More »
A vicious upward debt spiral is gaining momentum. The budgets of most advanced economies, excluding interest payments, need 20 consecutive years of surpluses exceeding 2% of gross domestic product – starting now – just to bring the debt-to-GDP ratio back to its pre-crisis level. Read More »
The Ponzi bubble is bigger than most can imagine. Western central planners… [continue to try to] suppress gold and silver in order to keep their sorry lives alive. In the process, the destruction of people’s financial well- being is unabated… Read More »
The price of gold, on a quarterly basis, is 86% correlated – yes, 86%! – to total government debt going back to 1975… and a shocking 98% over the past 15 years! [As such,] it would seem like a no-brainer investment thesis to buy gold… as a proxy for the not-otherwise-investable thesis that US total government debt will increase in the future. [But there is more - and it is disappointment for gold bugs - read on!] Read More »