What an Inflation-Adjusted All Time High in Gold Would Look Like

Gold has been in a bear market for some two years now. As a result of this, many investors believe that the precious metal is no longer a viable investment.

 

No investment ever goes straight up or straight down. During the last bull market in gold, the precious metal rose 2,329% from a low of $35 in 1970 to a high of $850 in 1980. However, during that time, there was a period of 18 months in which gold fell nearly 50% (see the chart below)

 

 

As you can see, from mid-1971 to December 1974, gold rose 471%. It then fell 50%, from December ’74 to August ’76. After that, it began its next leg up, exploding 750% higher from August ’76 to January 1980.

 

With that in mind, I believe the next leg up in Gold could very well be the BIG one. Indeed, based on the US Federal Reserve’s money printing alone Gold should be at $1800 per ounce today.

 

Moreover, at $1,800, Gold is Still Nowhere Near Its All-Time High

 

Now, a lot of commentators have noted that gold is already trading above its 1980 high ($850 an ounce). What they fail to note is that thanks to inflation, $1 in the ‘70s is worth a LOT MORE than a $1 today.

 

 

$1 in…

Is Worth Today

1970

$5.49

1980

$2.58

 

For gold to hit a new all time high adjusted for inflation, it would have to clear at least $2,193 per ounce. If you go by 1970 dollars (when gold started its last bull market) it’d have to hit $4,666 per ounce.

 

Bottomline: gold is nowhere near a peak adjusted for inflation. And when the next leg up begins, we could see a tremendous move.

 

For a FREE report outlining how to buy Gold at $273, swing by:

http://phoenixcapitalmarketing.com/goldmountain.html

 

Best Regards


Graham Summers

 

 

Comments

No comments yet! Be the first to add yours.