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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory
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To: Wyätt Gwyön who wrote (47008)12/10/2005 6:18:24 PM
From: Wyätt Gwyön  Read Replies (2) of 110194
 
When the price of housing is deflated instead by the best benchmark we know for expressing the dollar's falling value -- an index of gold, silver and platinum prices -- we find that it has actually been declining in real terms since the end of 2001.

this is a pathetic argument. it boggles the mind that these people can find a publisher. if gold were a valid deflator for housing, then housing had a great run from the 1980 gold peak until 2001 but has treaded water since. in reality, we have a housing bubble.

it's interesting how these "gold is the only real value" fanatics manage to ignore the decline in gold's value from 1980. they even say oil is overvalued based on its historical multiple to gold. sorry, but you might as well talk about the historical multiple of sugar to oil, or of the number of homeruns hit by the American League MVP to the price of gold, or the relationship between market returns and whether an AFC or NFC team wins the Superbowl, or any other meaningless correlation you care to create. the fact remains, civilization would get along fine for the next decade if nobody mined another ounce of gold (it would actually benefit as gold has zero real value and extracting it does damage to the environment and diverts capital from meaningful endeavors). but if we stopped extracting oil, billions of people would die over the next few years and we would have the end of the world as we know it. trying to derive the fair value of the most important commodity (oil) from the most useless commodities is the height of absurdity.
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