Graham Osborn Posted July 2, 2016 Share Posted July 2, 2016 I'm increasingly starting to feel that CPI is meaningless in the face of QE. The true cost of living is just not being captured. And if CPI is meaningless, money is meaningless even if there is relative meaning through exchange rates. And if money is meaningless, the indices we use for tracking the performance of financial assets are meaningless as well. I am not a gold bug and actually think gold is a bad buy right now. But gold at least has some sort of tangible reality which is lacking in the world of fiat money. For this reason, I think the S&P/ Gold index is a far more meaningful indicator than the S&P of market values. Here's the link: http://www.macrotrends.net/1437/sp500-to-gold-ratio-chart Make sure to turn off log scale for the full impact. According to this way of thinking, we are in the final stages of the greatest economic collapse since 1929 and 1974, with probably 15% to go to reach rock bottom. The market profits people have enjoyed the last 10 years have been more than offset by the vastly reduced purchasing power of the dollar. The magic of central-bank policy has been to hide rather than change the outcome. Link to comment Share on other sites More sharing options...
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