Gold Chart

The Gold-Dollar Correlation: A Mess Since 2009

500 us dollar bill The Gold Dollar Correlation: A Mess Since 2009

Searching for a correlation between gold and the US dollar seems to be awkward at first, as gold is traded in this currency. Would it not be impossible to determine a relationship?

Continue reading “The Gold-Dollar Correlation: A Mess Since 2009” »

The Unstable Gold-Stock Relationship

share certificate The Unstable Gold Stock Relationship

Is there a relationship between gold and the stock price? One might expect an inverse correlation: When stock goes up, investors make more money at the stock market and thus sell their gold. This drives then the gold price down. However, data tell us otherwise.

Now let’s look at three graphs. All three show the Gold Price (London Gold Fixing PM) and the Standard and Poor’s 500 Index.

Continue reading “The Unstable Gold-Stock Relationship” »

The Gold-Inflation Relationship: None

gold inflation relationship 2008 2001 percentages The Gold Inflation Relationship: None

Conventional wisdom suggests that there is a strong correlation between gold and inflation. When inflation goes up, gold follows suit. Likewise, a drop in inflation would lead to a fall in the gold price. This is because in times of high inflation, gold becomes a better option for investors. But this reasoning is wrong.

Continue reading “The Gold-Inflation Relationship: None” »

The Gold-Oil Relationship: 3 Theories

gold and oil relationship The Gold Oil Relationship: 3 Theories

Is there a correlation between oil and gold? The first idea suggests a direct causal gold oil relationship, the second argument proposes an impact of oil on shares of gold companies, and lastly a theory argues that the gold and oil prices are driven by a common factor.

Continue reading “The Gold-Oil Relationship: 3 Theories” »

Gold Rate: Explaining the Current Bull Market (2001 – )

gold chart 2001 2011 Gold Rate: Explaining the Current Bull Market (2001   )

What explains the current Bear Market for gold?

The beginning of the 21th century is witness of a long and mostly continuous rise in the gold rate from US$ 265 per ounce at the beginning of 2001 until more than US$ 1400 ten years later. This translates into a gain of 528%, which is a stark contrast to the previous 20-year long bear market.

Continue reading “Gold Rate: Explaining the Current Bull Market (2001 – )” »

Gold Rate: Explaining the 1980 – 2001 Bear Market

gold chart 1980 2001 Gold Rate: Explaining the 1980 – 2001 Bear Market

What were the reasons for the mediocre development of the gold price from 1980 until the new millennium?

The bull market for gold in the 1970s can be explained by the end of the gold standard, the begin of gold trade, economic stagnation in the West, the oil embargo and several wars and revolutions.

Continue reading “Gold Rate: Explaining the 1980 – 2001 Bear Market” »

Gold Rate: Explaining the 1970s Bull Market

gold chart 70 81 Gold Rate: Explaining the 1970s Bull Market

This article explains the reasons for the jumps of the gold rate during the 1970s.

At the beginning of the 1970s, the gold rate was at US$ 35. Ten years later the price stood at US$ 870 per ounce. This is a percentage gain of 2,485%. In contrast, during the same time the Dow Jones Industrial Average increased only from 809 to 839 points. This represents a total gain of 3.7%; not per year, but for the whole decade.

Continue reading “Gold Rate: Explaining the 1970s Bull Market” »