"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat

Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


Wednesday, August 31, 2011

Monthly Gold Charts - August 2011

What an impressive performance by Ol' Yeller for the month of August! Note that Gold has bettered the all time high CLOSING price on an inflation adjusted basis.


  1. Hi Dan,

    Thanks for reminding us. We're all fixated on the old high...

    What measure of inflation did you use?

    Thanks again,

    Bill M

  2. Hey there Dan,

    Thanks for the update. Can you believe the BAC debacle. I am sure you are not a happy guy with that type of rediculous media hype, non free market action. Wow, what a bunch of bear tracks. Why does the regime and others continue to do whatever it can without the "truth". You are a beacon of light in the wilderness. I won last year, now, as everyone who likes miners, am about even. If the free market existed, I would be way ahead.

  3. Chart shows a parabolic bubble ready to burst. Looks even worse than Nasdaq 1999. A lot of smart money has huge shorts on this and will win big when QE3 does in fact does not happen in Sept, which has been fully priced into the gold bubble, lol!

  4. I agree. It is a bubble about to burst... and when the dollar does collapse, people from all over the globe will sell there dollars and there will be a stampede into gold.

  5. Thx Dan. Why are you using the Govt's distorted inflation rate, rather than John Williams' from Shadow Stats?

  6. For those asking me about the data I have used to create the inflation adjusted gold price chart - I have used the government's CPI numbers which I realize are basically useless as a true measurement but that is all I had when I set out to create the initial chart some time ago and to be honest, it took so much time and effort that I have no desire to create another one using John William's data, which is of course, excellent data. Still, it does give us some sort of comparison to where the metal is in relation to the previous historical peak back in 1979-1980.

    I have to laugh at the comment by one named Judy who talks about the "smart money" shorting gold. I wonder if those were the same ones who were so smart that they shorted it all the way up from $1500 and go a good education on the power of leverage to destroy one's trading account. To believe gold is in a bubble one has to believe that the fiat currencies being issued by the governments of the West are rock solid. It is also to believe that there is no inflation problem raging across China and other various parts of the far East. All markets correct in price and experience price retracements in ongoing bull markets so it is not unexpected that gold has seen a price setback from the $1900 after putting on $400 in six week's time. A time of consolidation will do it a lot of good.

  7. One thing about smart money; it's today's dumb money....

    Puting one's bias asside, keping it visually simple, we are either in a situtations similar to '74 or '79/'80. Either way, a retracement is due and a severe one at that (both in price and duration) Time will tell then if we will then have another blow-off move

  8. to compare gold to '80 and say it is a bubble is to ignore the exponential private and public credit/debt growth of the last 35 years.....unprecedented in the history of the world.

    this is just the beginning of the middle part of this unravel/reset......we still have EU collapse,china stall(or worse), IRA's forced into treasuries, possible gold confiscation,japan demographics crashing home bond sales,etc., etc. to go.

    watch sept 7-- german supreme court to rule on legality of greek bailout.

    thank you for your time and effort here,dan.....i realize its not like you are just working up to a paid subscription newsletter.

  9. Not about gold, but a comment about inflation.

    In 1964, the last year silver was in U.S. coinage, I earned $2.25/hour in my first job following four years in the military.

    My dad was buying bags of uncirculated Morgan’s and Peace dollars for $1,300 per $1,000 face bag. He was separating out the choice specimens, and selling the remainder of the bag for face value. He did that day after day. Back then silver spot was about $1.30/oz/troy.

    The DJIA was in the 850-900 range.

    Today, the DJIA at 11,500 is about 13-14 times higher than 1964.

    A $1,000 face bag of uncirculated Morgan’s have increased in value about 34 times.

    And, if my job were stil paying me in silver dollars, I would be earning about $90/hour.

    Go figure.

  10. This chart really looks like a buy for you guys?

  11. Returns Needed to Match ShadowStats Alternate CPI (CPI-S)

    Metal...Price to Match CPI-S...Percent Climb

    As of 8-31-11

  12. Want to know when we'll really be a bubble? When they stop saying it's one and actually start buying and recommending gold. When they begin running 15-minute updates on the latest gold stock. When you are sought out relentlessly by your friends and relatives because they know you know something about all this "gold and silver stuff."

    -Casey Daily Dispatch

  13. exactly zenith......when my buddy that's so proud of buying ford at 3.5 wants to know how to buy gold, i'll sell him mine.....ditto w/the plumber across the street.

    and the guy looking at the chart can't see how its a buy..........its not going to be business as usual.....you will not see usual for a decade....lot of pain for most between here and there.

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  15. If we update the chart to current prices at the time of this post, would that be a massive cup and handle formation?


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