Is This The Biggest Crisis In History?

Tyler Durden's picture

Talking of Oil and Gold, last week Deutsche Bank showed a long-term graph of Oil in real adjusted terms, showing that the average real price since 1861 was $47.

Following on from that, Deutsche notes one ratio they occasionally look at is the ratio of various assets to the price of Gold...

Today we update the Oil/Gold ratio back to 1865 and find that the Gold price has just hit an all time high at around 44 times the price of Oil.



The previous high of 41 in 1892 has just been exceeded.


For perspective, the ratio was at 6.6 in June 2008 and only 12 in May 2014. The long-term average is 15.5. While this says nothing about where the ratio is going in the short-term surely this looks a good trade to exploit over the longer-term for those who care about such things.  

However, as we noted recently, it merely predicts a crisis and according to the chart above it is the biggest crisis in history...


The previous "biggest crisis in history" was in 1893 when a serious economic depresion hit America. We just topped that in terms of the gold/oil "crisis" ratio, making us wonder: what crisis is just around the corner, and just how big will it be?

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Mark Mywords's picture

Crisis? What crisis? NASDAQ is green now.

I called it last night, but thought we'd be green by open. Instead, it's green by close.

They can do this for a long, LONG time, you know?

hedgeless_horseman's picture



biggest crisis in history

Unlike 1861, you can now go to your safe space and play Angry Birds or watch youporn while you wait for government assistance. 

Mark Mywords's picture

You can also go crying to Uncle Sam if you are a big corporation or financial institution and receive all the billions and billions of taxpayer dollars you need because of your reckless and illegal behaviour.

surf0766's picture

Shut up your marxist asshole

Mark Mywords's picture

Classy. And so adult, too!

Twee Surgeon's picture

This should be called the Bankers song, you can hear the helicopters in the distance....


personal109's picture

Apocolypse Now or Helicopter money?

JRobby's picture


The chaos is just beginning

Too late for the helicopter. Although they are likely to try it. Soon?

NoPension's picture

IMHO, Bernie Madoff was technically more solvent, including right up to the end, than any bank on the planet.
What bank could survive even 10% of the deposits being withdrawn?

This is not to defend Madoff. But seems his crime was moving in on the banks' and .govs' turf.
As I see it, he did NOTHING every big bank does. Take your " money", make an entry into an account, use YOUR money to make more money for or pay themselves, and pray you don't cash out.

eforce's picture

In order for Agenda 21/2030 to get implemented it's going to have to be pretty bad.

Bokkenrijder's picture

So with oil (correctly?) priced for a global depression, is gold perhaps overpriced?

buttmint's picture

Bokken...+1,000 for your post.

My hunch could be waaay wrong, but what if current gold rise is a big set up by the Squid to fleece cash waiting in the wings?

So many stunts by the seeia et al that one questions all. What markets? Who is suddenly "allowing" gld to appreciate anyway?

SuperRay's picture

To answer the Tylers' question


Seer's picture

I'd been thinking that there would have to be a last-gasp effort at trying to settle a lot of trades in USD and that that would push down PM prices (folks having to liquidate to cover: it's happening in the case of sovereigns [see recent article on Canada's gold holdings]).  Of course, this would only be a temporary/fleeting, short-lived event, in which timing is going to be very tricky.  So, I am looking for one last big SELL on PMs.

RaceToTheBottom's picture

I agree.  I think that is why we have not seen any strong intervention against the price of gold from the central banks.

I believe there will be one more, and it will be multi dimentional:

Printing money

shorting gold

Outlawing cash 

removing ability to take money out of banks

even more


The central banks are in a war with Gold.  The member banks are prostitutes and they will try and make profits coming and going and they have the insider info from central banks.

That insider info might explain why member banks have not really been against gold too much.


I am less certain about 800$  and am wondering whether they will get it below 1000$ but they will try.  They have no choice.

omniversling's picture

When the USSA goes tits up, the only way to 'restore confidence' in the 'global economy' will be to have an even bigger, more heavyweight cabal reign-handler. Think BIS/IMF/BRICS/ESF hybrid mutant...giddyfkkknup!


Madoff conducted no trades, but assured clients he was trading, and had the best track record for trades on Wall Street. Only Markopolous realized he was full of shit throughout Madoff's entire Ponzi career. Traders on Wall Street knew that Madoff was not trading, and so did Goldman Sachs et al. I believe even Goldman Sachs lost money on Madoff's Ponzi.

Don't glorify Ponzi investment schemes.

BeanusCountus's picture

Can't really tell anything about who was "technically more solvent" of the two without a legit mark to market by the banks. To your point though, I don't think we have that from the banks to this day. However, Bernie was REALLY insolvent compared to his "floor 17" statements he was mailing everyone. Not sure yet about what my bank is mailing to me these days. Which is why I keep my balance there very small. I would suggest everyone else do the same.

acetinker's picture

There's a reason Al Capone was called public enemy number one.  He was simply doing what his government did, every day.

It's properly known as extortion- and only government is allowed to practice it.


eatthebanksters's picture

I guess they can't call it 'Black Gold' anymore...

jeff montanye's picture

nobody loves you when you're down and out.

however on an historical point, the first peak in the gold/oil ratio is labelled opec oil crisis.  to my recollection those were in 1973 and 1979 with the yom kippur war and the iranian hostage crisis/overthrow of the shah (imposed on iran in a cia coup in 1954).  

what was happening in 1986 was a little more like right now, an attempt by the u.s. to squeeze russia by employing the saudis' excess capacity:

Seer's picture

Yeah, but.... there's still the reality of demand being down.  You'd think that with prices this low that demand/use would be up.  While there may in fact be a political play going on as you say, it still doesn't, IMO, alter the fact that oil is still reflecting the reality of a global slowdown (I'd more appropriately say that we're in contraction).

RaceToTheBottom's picture

Global contraction= Free money having no effect= pushing a string

SWRichmond's picture

Too late for the helicopter. Although they are likely to try it. Soon?

Do Something!

Antifaschistische's picture

Question:  Is This the Biggest Crisis in History?"

Answer:  Absolutely not.  

When we have the biggest crisis in won't be asking the question, and everyone will know.  

I look around me at church on Sunday mornings and I just see a bunch of nice but completely clueless people wondering if they should trade in their 4 year old car for a new one....and I'm not the one to inform them of pending storms....the stampede mentality of "we always punch through little rough spots" has too much momentum.

...and in spite of all the China bashing we read, Chinese people know how to live tough lives.  They will survive.  Our under 60 population in the US is completely incapable of roughing it.

jeff montanye's picture

i'm over sixty (67) and i'd like to point out i was raised in florida without air conditioning but that's as far as i'd like to rough it.  ok joy baths in the ocean but only from may to early november.

not living on hunting and fishing and gardening.

and i'll cry without netlix and the internet.

omniversling's picture

Apparently there's an App for i-roughing it..

Arnold's picture

The Emperors and modern day Mao kept a constant thinning of the herd going, though.

Mostly non compliant intellectuals.

Today, that is a cultural  fail in modern Chinese leadership.

AvoidingTaxation's picture

Jesus, As I Swiss Ill vote for basic income I think in june. So insane. Will never pas in CH. Althougt its a nice idea, and we discuss it. 

Elicoper money. Negative interest rates coupled with basic income by the way and all in a cash free society right??. WTF.

Our central bank went in full rampage. 

I mean 500 billions of scit, with apple stocks, all "AAA" Euro Countries, NESTE ROCHE NOVARTIS etc. 

We're somehow in the game with western banksters. Let's see what our "elite" is cooking. Eventualy we vote or SIG550 + Forcs. Thei know that. In my village there are 2x3x times more guns per people. All registered all easy going all there. Let's see.

Zerohedge is also here. SO fuck whoever attacks like DNS or scit. NSA FUCK YOU. 

Last free countries in the world in my opinion:










North Korea

Some of these will survive because somehow disconnetted but with sufficient grit and size tz matter and survive. IMHO ;)

Time to clamp down my friends. Like I don't want to be a silverbug. But Silver at 16USD an ounce looks like a bargain. I mean it's fucking Silver for the gods sake. Not plastic or scit from China?!

So strategy number one is to reaccelerate the rush to precious metals. Gold in Ingots and Silerware to get the maximum differentiation.

Cheers. Stay Thirsty my friends. 


The Grim Teacher's picture


I would remove Iceland from that list. Try finding an ATM in Reykjavik, or any other town in Iceland, they are as rare as rocking horse shite. There are a couple in the international airport and one in Reykjavik that I could find. Last time I was there, people were talking about how the National ID card and bank cards were going to be merged into a single card. Seems to me they are pushing hard for a cashless society and are almost there. Cash is so rarely used in everyday transactions there.

I wouldn't be able to comment on the others that you've listed, but I would tentatively add South Africa, for the sole reason that Kruger Rands are still legal tender in that country. Any nation that still accepts gold bullion coins as legal tender in conjunction with its rat shit fiat currency; there is a glimmer of hope.

Twee Surgeon's picture

Both, but not in that order.

mtndds's picture

But the dude in the White House said everything was great!!  In fact he is in Cali getting money and heading to Palm Springs to do some golfing!!

SWRichmond's picture
Is This The Biggest Crisis In History?

God, I fucking hope so.

ayyy lmao's picture

by "dude" you mean michelle, right?

acetinker's picture

No.  We don't recognize that nomenclature. 'Round these parts, that particular biped is (rightly) called 'The Wookie'.  What?  Did you think Chewbacca was the singular example? ;)

novanglus's picture

How about...

Theme from MASH, titled Suicide is Painless (with lyrics but no helicopters)

Gracy101's picture

Hang on! This is the Bankers Song  your link don't work in UK.


Mark My Words.

How about you go sit on a pile of that nice worthless gooberment paper, and light a match to it.

We will call that - a value added fire.

Only value fiat, treasuries, stawks, etfuckingcetera will have in the very near future, is as btu's or toilet paper.

How's that for adult ?

Classy ? I think so.

I personally don't like the idea of bucking a five thousand year old metals store of value backstop to the death of every currency ever created.

Your opinion and mileage may vary.

To which, I say " Too fucking bad for you, sheeple boy. "

1033eruth's picture

Then WHY are you still using "worthless gooberment paper" SHEEPLE boy.  

I'm always disgusted by the "holier than though" gold freaks that are so proud of their horde.  

Here's news for you SHEEPLE. the currency hasn't collapsed yet to the point that Uncle Fraud no longer considers it LEGAL TENDER.  Do you know what LEGAL TENDER means?  Apparently not.  

I am just as adverse to the corruption of our currency as YOU are.  However, what I don't do, is crow about it like a fucking rooster, every morning for life.  It is a PART of our life, whether you like it or not.  If you don't think so, pay your fucking credit card bill with some gold and see at this point, you have earned the title of MORON.  Get off your high horse prick, things are NOT going to change except for the worse.

All Risk No Reward's picture

The currency will continue to strengthen as the masses are forced to acknowledge that they don't have enough to pay their debts. People with mortgages will DESPERATELY want dollars. The Debt-Money Monopolists won't $0 out dollars or Euros until after they've unloaded their trillions in debt-money proceeds and debt-money paper. After they own the physical world for pennies on the dollar then they may destroy the dollar.

The Mises crowd has a critical poison pill blind spot which enabled them to get Rockefeller Debt-Money Monopolist funding.

TheFutureReset's picture

Back to reality.... The dollar is sliding so you are wrong right off the bat. The Fed has to print. Everything will go down in value, only some things will go down less quickly at times than others. Against gold. I rest my case. 

acetinker's picture

You can't place an intelligent bet unless you've seen the cards dealt.

So.  You are left with assumptions, to wit-

1) The oligarchs want to perpetuate the current system by any means possible.  If this is so, expect helicopter money to the proles so that existing debt seems payable, or-

2) The oligarchs want to make off with their winnings whilst leaving the proles no means to extinguish their debts, thereby creating a neo-fuedal, worldwide plantation.

Look around, and tell me which way you think we're headed.

Seer's picture

"The dollar is sliding"

Relative to what?  To PMs.  (not to other currencies,, and not to oil)  And this is only a very recent activity.  Not saying that in the long-term it won't hold, but when everyone is running around screaming "buy gold" then, to paraphrase Mark Twain, perhaps it's time to reconsider.  Again, I'm speaking short-term here.

I've been really good at hitting the spots.  Hope that my record holds up such that there comes along a true "back up the truck" event.  Only those how just jumped on the bus (and are looking to flip) are likely to be bothered by my comments  here: if you've been in it for the long-haul then you'll understand.


I believe in sharing my life experiences with people to their benefit. You don't like my opinion or knowledge ? Tough shit.

It's a free country, with freedom of speech, and freedom of choice. You invest in your unicorn based fiat toilet paper economy, and I will invest in gold, silver, copper, brass, and lead.

I will always be able to convert the sweat of my brow into what I believe in, and always be able to cash in to exchange for the fiat flavor of the day to deal with the fake monetary system economy flavor of the day.

As for legal tender, fucking hilarious. Our currency used to state " Pay to the bearer on demand ", which meant, banks had to hand you real money - gold and silver when you asked for it. The currency was just a marker, a representation of THE REAL MONEY IT REPRESENTED, dumbass.

Now, fiat currency states that it is " legal tender for all DEBTS public and private "

So, what the fuck does that mean ? It means you are shit out of luck the day of the reset, the ban on cash in favor of electronic currency, the re-valuing of currency, a bank holiday, FED collapse, or any other event that means your crusty twenties won't even buy a pinch of coon shit in the new world order of currency valuation or currency legal standing.

And, with an intermediate step to convert gold back into fakey doo fiat bux, I would have no fucking problem paying on a credit card - but I don't have one, and don't want any of them. Cash is king in my world - until it isn't.

Suck on that, Mister High And Mighty 1033eruth.

Good fucking luck with your reality.

1033eruth's picture

FUCK YOU!  Pay your goddamn bill in GOLD right now, right FUCKING NOW JACKASS.  It doesn't have to be a credit card bill simpleton.  Unless you're going to tell me you don't have bills?  You stupid shithole, you're demanding that anything BUT fiat be banned.  So follow you're demand to its proper conclusion and simply pay in gold because nothing is more realistic and urgent than eliminating fiat.  

You entire thesis is that EVERYBODY and EVERYTHING has to conduct business in GOLD or its little brother silver.  RIGHT NOW.  NOW!!!!!!  Not later, NOW.  

FUCK YOU, IT AIN'T GOING TO HAPPEN.  YOu and the other dumb 12 fuckers that down voted.  ITS NOT GOING TO HAPPEN.  DO YOU UNDERSTAND?  

That's my whole point, you're a deluded INSANE son of a bitch that does not understand REALITY.  Because you live in the land of goldilocks.  YOU'RE FUCKING STUPID and so are the other idiot goldbugs that think its the panacea for everything that's wrong.  And just in case you're misunderstanding my point - FUCK YOU IDIOT.  I've got a better grasp on reality than you ever will, deluded piece of shit.