Gold will beat U.S. stocks in turbulent market, strategists say

BNN Bloomberg/Greg Stuart Hunter

“Gold and U.S. stocks could part ways during a fresh round of market turbulence, ending a three-month period in which their returns were almost yoked. Renewed deterioration of the global economy and more lockdowns to prevent Covid-19 from spreading should hit equities but leave gold standing, according to Societe Generale.”

USAGOLD note:  A solid argument why investors who own stocks might want to unlock some of the purchasing power stored there while the ratio between stocks and gold is still working to their advantage. The number in the chart below indicates how many gold ounces it would take to buy the Dow in any given month.  At present, the ratio is 13.38 to one. Its low came at the peak gold price and the DJIA nearing its low point in 1980 – 1.3 ounces.

Dow to gold ratio
1970 to present (Log scale)

line chart showing the Dow-gold ratio 1970 to presentChart courtesy of • • • Click to enlarge

Related:  CCN/Prepare for a massive stock market meltdown and explosive gold rally/Stepahie Bedard-Chateauneuf/8-3-2020

Repost from 8-6-2020

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