Loading ...Gold to Silver ratio – Economic indicator 333 years history
Gold to silver is a reliable indicator of credit in market. Credit contract when ratio rises and expands when the ratio declines.
333 years of GSR research.
This research paper out lines why GSR has remain high since it bottom in 2011.
Many banks research departments like CITI and others watch movement of GSR.
Two current charts:
Gold to CRB indicating deflation
Gold to Silver weekly
The Gold-Silver Ratio is Indicative of Global Deflation
” For at least 150 years the ratio has served as an indicator of the global monetary condition. During periods of
inflationary monetary proliferation, the ratio falls. During eras of deflationary monetary destruction, the ratio rises. ”
“Two points summarize the overall story. Firstly, the gold-silver ratio has been an indicator of global monetary conditions for well over 150 years. It remains so to this day. Secondly, monetary conditions when viewed from the perspective of capital markets, commodities, and economic indicators are in concert that either deflation or disinflation lies ahead. ”
https://s21.q4cdn.com/266470217/files/doc_downloads/blog_post/2020-01-Jan-Macro-Metal-News.pdf
So.. while I have been saying inflation.. actually we have been deflating (since 2011)… gold bugs want inflating.. and this will be seen in gsr drop? So my question is.. what can create inflating?
FED target rate is 2% and yet it is lower. FED can not create inflation???
Reading the wheaton paper now…
The LAW of unintended consequences…
I subscribe to 3 services. 2, neither of which is free with praise, have recommended this Wheaton paper.
I fell asleep reading it. I will have to try again. I think it says that it looks as if it looks as if we’re heading for deflation (despite and perhaps even because of the central banks’ handiwork) and gold as an investment will do well.
If I can’t stay awake for my next reading — is that approximately the gist of the conclusion?
“…
Some three decades later Federal Reserve
Chairman Alan Greenspan reconfirmed the
truism while speaking at Stanford University
saying, “Nonetheless, we recognize that
inflation is fundamentally a monetary
phenomenon, and ultimately determined by
the growth of the stock of money, not by
nominal or real interest rates.”
…”
“…
At the time of this writing the ratio is at 86,
equal to the average for 2019. Baring a
“massive turn” in the inflation cycle it would
not surprise this author if the ratio remained at
these elevated levels. The monetary order, in
other words, is likely to continue
malfunctioning.
Nor would your analyst be astonished that
following such a surge in inflation the ratio
would plunge through the 2011 lows. One day,
in other words, radical central bank policies
seeking inflation will ‘work’.
…”
How could I have been soo blind! Great read! Looks like gold was right all along! We have been in very low inflation/deflation since 2011-12… and now what gold is sniffing is not deflation.. but the end of it! and possibly incredible inflation cycle (the monetary tools, easing) ! Makes soo much sense! Commodities should also sniff this soon..