Claude:
<A spike in the $200-$400 oil in the next commodity boom will not surprise me at all.>
*Now* you're talking mon ami! I see the oil spike coinciding with a corresponding spike in the Gold/Crude ratio of at least 30. i.e. At the peak, one ounce of gold will buy 30 barrels of oil, as it did in 1973, 1986 and 1988 -- implying that, based on your oil estimates above, the POG will be somewhere between $6,000 and $12,000 an ounce. :^)
In fact I like the $6,000 per ounce figure, because that would coincide with a 1:1 POG/DJIA ratio, with the DOW at 6,000. This has happened before and IMO will happen again. I don't think the DOW is going down to $1,000, but I do think the ratio is going to par. So that would mean a massive rise in the POG.
Nice to dream, but history tells us that something like this is probably going to happen.
Best regards,
Howy |
