Posted on 08/21/2009 12:19:01 PM PDT by h20skier66
Correlations come and go, but the path of Euros and gold rarely diverge vs. the Dollar...
"The DOLLAR is not a good store of value," says Nobel prize-winner Joseph Stiglitz, finally catching onto the last nine decades' 95% loss of purchasing power.
"Right now," he told an audience in Bangkok on Friday, "the Dollar is yielding almost no return and yet anybody looking at the Dollar has to say there's a high degree of risk."
Gold also yields nothing, but your risk in the metal is somewhat lower. At least it will still be a lump of rare, precious, yellow and shiny metal tomorrow.
Whereas the Dollar...or Euro?
The link has been very strong, reaching above its current level of 0.90, almost one-sixth of the time. And all told, that leaves the current state of play as:
• Crude oil correlation: 0.67 (decade average 0.21)
• S&P correlation: 0.28 (decade average 0.08)
• Euro: 0.92 (decade average 0.51)
Typically, the correlation with Euros can be expected to ease back from the current extreme, but it's unlikely to go sharply negative should the Euro now rise.
(Excerpt) Read more at commoditynewscenter.com ...
Hold firearms and canned goods at this point.
Far, far more stable than currency, precious metals, or gems at this point.
Four precious metals to hold:
Gold
Silver
jacketed lead
blued steel
Brass and lead ... not a viable currency ... ever. (But still very good to have)
Gold, silver, and commodities. If equities and treasuries crash with all the leveraging going on. These will have a MASS SELL OFF and the prices will drop as hedged and leveraged firms attempt to raise capital to meet things like margin calls. If the currency completely collapses aka Weimar, or Zimbabwe, silver gets very valuable as a working medium of exchange along with the fact that most money is electronic. Deflation will be rampant as the supply of money will be extremely small in pre-collapse comparison.
Does it build or produce something and can you physically own it? That's a good buy. Firearms + ammo are good buys. Food, almost always fungible or tradable for someone's labor. 300 bucks of food can go a LONG way as wages for labor in a post collapse economy.
Those are my thoughts anyway.
Brass and lead ... not a viable currency ... ever. (But still very good to have)
Gold, silver, and commodities. If equities and treasuries crash with all the leveraging going on. These will have a MASS SELL OFF and the prices will drop as hedged and leveraged firms attempt to raise capital to meet things like margin calls. If the currency completely collapses aka Weimar, or Zimbabwe, silver gets very valuable as a working medium of exchange along with the fact that most money is electronic. Deflation will be rampant as the supply of money will be extremely small in pre-collapse comparison.
Does it build or produce something and can you physically own it? That's a good buy. Firearms + ammo are good buys. Food, almost always fungible or tradable for someone's labor. 300 bucks of food can go a LONG way as wages for labor in a post collapse economy.
Those are my thoughts anyway.
I like sugar and molasses for barter goods. Can always turn them into booze.
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