sitting tight, page-23

I found the quote below interesting, especially the last point re our latest peak in gold at $1900, being only 2.2 times the price of the 1980 peak. 1980 was 32 years ago!
Compare that to any other asset, houses, copper, etc. and a rise of 2.2 times in 32 years is nothing.
This is an extract from a previous post of mine (gold was $1500 at the time);

"As a comparison, median house prices in Melbourne were $44000 in 1981 and $524,000 in 2010.
That's a rise of 12 times over the same period that gold has risen by just 3.76 times" (off its $400 base in 1981 post the peak rather than its $800 peak-if I used the peak price, gold had risen by less than a factor of 2).
Realistically, gold needs to rise by a factor of more than three times from $1500 to catch up to house prices. Even if house prices are in a bubble and need to correct say 30% it still leaves very large upside to at least double to $3000 just to catch up.
Gold and therefore gold stocks remain extremely undervalued IMO.


http://kingworldnews.com/kingworldnews/KWN_DailyWeb/Entries/2012/1/9_Louise_Yamada_-_Gold_%26_Silver_Bulls_to_Continue_Stampede.html

1) David Rosenberg noted that Central Banks bought a record 148.3 tonnes of Gold in Q3 with more in 2011 than any other year since the Bretton Woods system collapsed four decades ago; 2) Paul Brodsky notes that as the Gold futures have come down, the stocks of physical Gold with dealers have depleted at a significantly faster pace; and 3) As to the concern of Gold having experienced a bubble this year, Ian McAvity lends a wonderful statistical perspective: “At $1,900 Gold recently, it was 2.2x its early 1980 peak. US GDP & US Federal Debt are about 5.5x their early 1980 levels, while the S&P 500 and Total Credit Market Debt are at 11 ½ -to-12 times their early 1980 levels. The real bubble has been the issuance of debt that is increasingly stifling any real recovery in the Main Street economy.”)