What Crisis Is The Gold/Oil Ratio Predicting This Time?
The number of barrels of oil that a single ounce of gold can buy has never, ever been higher.
For the last 30 years, when the ratio of gold-to-oil spikes, something systemically serious occurs globally (as opposed to the usual bullshit "this is transitory" statements).
So what happens next?
(39 votes)
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US will declare bankrupt and start over again.
What does one have to do the other, you might as well track gold versus soybeans.
A lot.
Firstly, a lot of diesel is used mining gold. So oil is an input of gold production.
Secondly, gold / oil ratio is historically ranging normally 10-20, and tends to be correlated.
If below 10, buy gold and sell oil.
If above 20, buy oil and sell gold.
Following this would have made you good returns in the past.
Currently, the gold oil price ratio as a determinant is broken due to misallocation of cheap credit to the shale industry.
See belangp's YouTube channel, good video put out last week:
GOR (gold oil ratio) is broken
Since 2011, THE PRICE OF GOLD HAS BEEN BLATANTLY AND OBSCENELY SUPPRESSED BY THE FED. Reading goat entrails and calling them a "determinant" in markets where the FED has controlled and manipulated lower artificial pricing is a fools errand.
Charts like the one above are totally meaningless in the absence of a free market. You may as well start charting your wife's daily lipstick colour choice trying to predict movements in the S&P. Meaningless.
+1090 my friend, you are precisely right.
Up is down and down is now up. But nature hates a vacuum and gravity always eventually prevails. In the interim, however, gold is going to get monkey hammered severely because TPTB need to squeeze everyone betting against them and their fiat. It honestly would not surprise me to see it under $500 before the spring gives way ...
So then, that being the case, before the natural order of things reasserts itself, everyone who hasn't either stacked yet or enough had better back up the fucking truck. I know I will be.
I will also be busy putting the finishing touches on our other stores of value (guns, ammo, food stuffs, water (lots), medicine, and all the basics for an extended and very difficult time.)
I wish I could see a different path. I don't sleep much anymore.
i find gold under $900 unlikely. not that it can't happen, but that it's not in the interest of those that control the gold price.
my working hypothesis is that it is china that wants the gold price suppressed, so that they can maximize the gold they can vacuum up from the western financial system, in exchange for their us treasuries.
however, they don't want the price to go too low, if it were the gold demand from others would be extraordinary and the comex price setting mechanism through paper contracts would break, ending their game.
good on you for your preps; if anything they should help you sleep at night.
If you realized that physical gold will transition in value to +$55K / oz.....and you had more physical gold in your posession, you'd sleep better.
The price of paper gold may go to $500....but you won't be able to source any physical at that price!
I left the Casino 5 years ago and won't be back until this shit show is over.
Another 5 year to wait I think.
Max
Yeah I was half out the door about 2011/12...when paper gold killed me. Spent the next year's stacking pms gold, silver, lead and brass.
Bring on the next biggest one ever fucktards.
To get mine it won't be with slick computer games...you'll have to kick down my door and face the business end of an AR!
Same here. Not sure if it was exactly 5 years but close enough.
I feel much better about it too.
I just don't give a shot what the market does.
But gold hasn't even started its next rise yet.
We all fall down and GO BOOM!
.....yeah, and the dollar buys more of both..unfortunately. In simple terms, they're winning..
Next chart please
Each man and his dog will buy and hold whatever they think best for protecting his and his children's well being and future.
Let's not quibble over the percentages that should go to gold, silver, guns, ammo, food, cash etc.
Each person's circumstances will dictate the percentages.
In a market that is marked by geopolitical manouverings and central bank manipulation, the ratio of gold to oil is meaningless to a large extent.
There are some substitutes for oil. (although probably not as efficient)
There is no substitiute for PM's.
Herd everyone into the dollar. Then open the trap door.
No matter what is done to gold (silver) it is still the worlds only money, and will never go to zero, you cannot say that about any fiat.
cheap oil is good for developing economies
such as China
and when oil is available in
yuan etc. local currenies ..... ;-)
the petrodollar will be gone
and with it , gone will be the
dollar dominance
-------------------------------
I urge all all countries to offer 5-10$ more
to OPEC if oil is purchased in local currencies
-------------------------------
Remember, if you want to see america diminish
buy oil & gas in local currency
even if you have to pay a little high price
------------------
I urge Russia to take lead ,
Russia should declare that its oil & gas
will be available in select local currencies
Such as Yuan, Rouble, Rupee , Real & Rand
------------------
C'mon Russia, Putin , you know that...
America & EU want to break Russia again (like USSR)
its the right time to sell oil & gas in local currencies
do it , being 2nd largest oil & gas supplier
this will beat dollar to dust
Not second..First.
That goes for all spending in all countries, quit using the US$ quit propping it up.
The market will fall hard this week guys. Sub 14k on the DOW.
Protect yourself.
Trump 2016!!!
All Trump supporters visit: www.ptdradio.com
www.powerthroughdiscipline.com
that is so scary
By the pricking of my thumbs, something wicked this way comes…
"So what happens next?"
Let me guess: Something systemically serious occurs globally?
You ALL missed it. What does it mean... ITS THE END OF THE PETRODOLLAR.
Derivatives unwind partially responsible for pressure on oil.
My chart $GOLD:$WTIC is up with full afterburners.
Q: What does it mean... ITS THE END OF THE PETRODOLLAR.
A: It means oil is so cheap saudies can no longer buy US bonds
????=Yellen moment
$10, told you so.
http://www.newsmax.com/Finance/Markets/oil-crude-price-ten-dollars/2016/...
I suggest reading this article from 1999.
http://www.gold-eagle.com/article/dowgold-ratio-1-3000-dont-laugh
Finaly the bound between gold/oil/dollar is breaking.
If all of a sudden the world just found hundreds of tons of gold, or every one thought their gold was just a relic the price of gold would drop accordingly, but somehow I dont think that is going to happen.
Do you realize that "hundreds" of tonnes of gold is nothing? A month or two of worldwide production.
Over the next 10 years, there will be 24,000 tonnes of new gold mined, to add to the existing 150,000 tonnes of gold in existance.
In 1859, the first barrels out of Drake's well sold for about one ounce of gold. Before then, oil was much more expensive because it had to be skimmed off of surface springs.
In 1892, with Pennsylvania oil fields at their peak, the economy in a severe depression, and no automobiles yet on the road, oil bottomed out at $0.56/barrel, or 36.9 barrels per ounce of gold.
In July 1931, oil fell to $0.13 per barrel, or 159 barrels per ounce of gold. We have a way to go to break *that* record.
You got the ratio backwards. You don't quote oil in barrels/dollar, do you? Then why would you quote it in barrels/oz? When quoting the price of anything, it is customary to place the monetary unit in the numerator.
And that is, by the way, one of the reasons why you should start quoting in gms of gold rather than troy ounces. The units work out better and there is less chance for confusing the two kinds of ounces.
The correct value at the moment is 0.822 gms/bbl. Or, if you would prefer, 822 mgm/bbl
Easy does it, Sherlock. Some people like whole units instead of fractions.
Then least call it what it is. The graph is oil to gold ratio or number of oil barrels PER ounce of gold. I have no problem with this approach, just use the proper labels.
Gold was chosen for one of the graph axies because of its use as money. Acknowledge it by skipping the word 'ratio'. You don't say 'Dollar-to-oil ratio', do you?
So, as I said in my post, use milligrams. We could even use the symbol 'mgg' for Milligrams Of Gold. That's what we do with every other money now, isn't it? Centidollars, known as cents, is the solution for dollars.
There aren't many practical of money that can't be inflated by some central authority. Bitcoin, gold, and sliver stand out at the moment.
math is hard...... for liberals!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!!
LOLOLOLOLOL
It means that oil will soon be priced in gold and not in dollars since dollar pricing will soon be irrelevant.
it tells someone big is going to default unless the fed bails it out with more printed dollars
Or is this Justification for making Gold 200 Buckeroonies an Oz
If commodities are being devalued, then it makes CENTS that the Currency will be Devalued to match.
Which is great if you don't own a house, you'll be able to pick up 4 bedder for 1940's price tag, bad news if you have a mortgage though. It's not a Depression, it's just RESET world wide.
So can you guess who the Grinners are ?
John Stockman talks about a (forget what he calls it), but a breakdown (deflation) and then a boom (massive inflation). If you buy this theory, as I do....
1.) Short the market now (particularly financials) via out-of-the-money puts and keep rolling down with every +/- 10% correction. I realize the trade isn't nearly as cheap as when I was putting it on early in 2015, but still very do-able trade. Recommend XLF as underlying... the puts are still reasonable.
2.) Also, buy gold/silver now for the inflationary boom phase after. Can only dedicate assets to the pm's with a longer time horizon, because you can bet your ass TPTB will print until the machine blows AND they control the media (propaganda) and government data/statistics on inflation (lies). In real terms, we are already having our assets strip-mined right beneath our noses. It will only get worse.
*Bonus: If you buy into this theory, you should actually take equity OUT of your house to put into PM's and extend mortgage back out to longest horizon possible. Let them inflate away your debt for you in the future... which they will.
Tick tock, tick tock....
a dollar de-peg changes everything and the charts will mean nothing
What happens next is seeing the Turkish PM on Bloomberg coming out with a number of statements which seem to be a complete turn around to his past attitudes.I see him repeating a speech that he was ordered to give from European and American leaders.I think he was ordered to come on side when everything was revealed to the general public that Turkey was actually part of the CIA financed ISIS scheme in the MiddleEast.The corruption schemes there have been reported and are too widespread for NATO to ignore now that they've been seen as part of the CIA plot in supporting Wahhabi extremists funded by Saudi Arabia.Obama saw the game was up with their losing strategy.He's seen what happens when NeoCons like Victoria Nuland and John McCain do to his reputation when they fuck everything up bigtime.He seems worried about his Presidential image for history now.Maybe it'll screw up his chances of making money when he gets out.No way now under the Wolfowitz Doctrine to bomb Iran into ruins like NATO did to Libya,Iraq.Syria and Afghanistan.The crooks in the WhiteHouse got caught,the useless tool in Turkey helped blow the whistle and Putin put a stop to the nonsense.Iran's alliances with Russia and China saw the NeoCons back down as chicken shits.
Dude this is a progressive owned shit show. Obirdbrain and the neo-stalinist progressives doubled down on the progressive "useful idiot" neocon shit from the Bush regime. We are at "peak progressive" now, over a hundred years of progressive control in .gov and finance has brought the house down.
The progressive stupid, it burns.
Grimaldus
The progressive stupid...it does burn.
The majority of NATO countries are being run by "socialist-democrats", Obama, the CIA, ansar al Sharia & their merry band of Joey Jihadists along with Hillary! take out Mooomar, send weapons into Syria through Turkey, creating body lined streets, bombed out buildings and a tidal wave of humanity into the loving arms of Frau Merkel and...somehow Obama has now learned his lesson.
Well, this is wonderful nuuuz!!!
Just in time for him to leave the smoldering train wreck for someone else to clean up.
WWIII
Wow russian economy really sucks RUB has new low record. 2 years ago it was 34 RUB for 1 USD now its 79 RUB for 1 USD
Where did you learn your economics?
Russia last year sold, 30% more gas to Europe at double the price, in Rubles.