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Politics : Welcome to Slider's Dugout

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To: SliderOnTheBlack who wrote (2948)10/25/2006 12:53:59 PM
From: RonMerks  Read Replies (1) of 50135
 
Golds negative corelation to Stocks?

This is a great chart from Steve Saville.



A large part of the pension fund, insurance company and institutional investing in commodities is because of their need to be negatively corelated to stocks. That chart from Saville shows that strong historic negative corelation. If the stock market continues to rally, gold should collapse for history to hold.

Comments anyone?

This last paragraph is interesting.

*"After the public becomes totally convinced that the future trend is going to be in one direction and bets accordingly the weight of its betting changes the odds to the point where the probability of these bets paying-off becomes exceedingly low. The public's enthusiasm for a particular type of investment or investing strategy therefore paves the way for the cycle to change and for a very different investment type or investing strategy to come to the fore."

Heres the link to the full article.

321gold.com
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