If you wanted to make money safely, you’d own profit making companies. Buy them when they were cheap and sell them when they were dear. But how would you know when they were cheap? Check gold.
Thanks Bill, articles like these are why I signed on to this newsletter in the first place! If I want to read political bashing on either side there are thousands of sites that will give me their opinion for free. This is what you do best, please continue. Regards, Lynn
The main thing that is missing in this analysis is "what does the debasement and eventual demise of the USD do to the DOW stocks"? And how does that affect the decision process?
I see gold and silver as the ultimate insurance policy. Something that can be used as an emergency currency when things go terribly wrong. When gold/silver go up in value and becomes a good investment, that is a bonus feature but also a bright red warning sign not to consider selling due to rough waters ahead.
So hypothetically, as gold gets higher and higher priced (purchasing power), and the economy starts to fail due to debt and inflation, the DOW stocks will drop in value against gold. This could create the worst possible scenario to sell your gold since that is when you need it the most. So, the "5 number" needs an asterisk that references a sanity check. And as we all know, "5" is just a number.
That is why We have something seperating our 2 ears, stuck in the middle called a brain . It is not there to take up space. We leave emotion out of the many factors of life and use this "brain " to come to conclusions. Good or bad , I can not tell!
Thank you. Your brain comment fits right in with my sanity check argument. It is impossible to create a number to fit all scenarios but at least the number scale gives you a frame of reference as to where the market is.
Yep, life is a series of choices......then moving on. And, we humans are a reflection of our environment including all the propaganda including school throws at ya. Today, it seems skimming the financial rags in the good ol' USofA, everyone things the US$ and America's hegemony are going to go on and on and on. Really? Is the US$ that important to the rest of the World they just keeping buying and buying Treasuries? What I fail to hear (and I am clueless) what happens as the Golden Yuan becomes a "reserve currency"? Does that effect the US$ at all? And, how much gold does the U.S. have? None of us peons have a clue..........just seems to this ol' man in today's changin' world, gold is essential for countries to survive.
Pegged? Or settled in gold? The Golden Yuan is settled in gold. Huge risk difference and when it comes to financial assets these days RISK is a major element in what and where "money" resides and in what form. Fiat is losing the battle..
Ol’man-I don’t think that this scenario that a new currency from any country will be used (i.e. Yuan). I truly believe it will be a currency ‘created’ by the IMF with several countries involved. AP
Ol’man-NO. That is not what I said. The IMF WILL CREATE a new currency. Possibly a currency which uses a combination of several currencies. The dollar has been on the way of oblivion since the printing presses have been going 24/7 since 1971.
Ok - so you think the IMF is still relevant? And, China, Russia, Iran, India are going to pay attention to the IMF when they know it is run by the U.S.? Wow! Talk about seeing different worlds...........going to be interesting to watch as this all unfolds..........good luck, Abe!
I believe that crypto will definitely be a major part of any new financial system. The banks and crypto companies are at a standstill. The crypto companies want to give interest on the money held, the banks don’t want that. They want to solely give interest on the funds. Hopefully, this will be resolved. Google Ripple Company and XRP. It is very enlightening to read about them. AP
5 is a reasonable ratio between gold and the Dow 30. It’s as good as 6 or 7. Remember never put all your eggs in one basket. So if it reaches a ratio of 5 maybe sell 50% of the gold for stocks.
Your logic is spot on for me. Plus is always scares me when my pea brain starts to consider selling Au or Ag. Even more so today at this later stage in life and seeing that JP Morgan and Golden Sachs proposes gold to hit $8000 - $8500 in a year. We all know the major bankers can see down the road better than us "non Elite" folks.
I'll wait and see when the bottom falls out then wait a few more months to make sure it's safe to make a move. And that day is a BIG TBD!
As do most newsletters, you ignore the grab from the taxmen. I understand that there are various schemes, but capital gains taxes will change this analysis quite markedly.
Yes. And you hardly ever see THAT fact in anyone’s comparisons. The only way for a US citizen to avoid capital gains at the collectable rate upon sale is to hold the assets in a Roth; up to 28% is a BIG bite for most of us (you can pay less if done right, but not by much if your holdings are significant).
In 1971, the Ford cost this, and the house cost that, and the USD was pegged to gold.
In 2026, the USD is endlessly printed to buy real products from other countries, and POTUS plays to the electorate by blaming every other country for 'ripping' off the USA, in trading real, produced assets for fiat paper. So, maybe they'll stop that ripoff sometime soon.
I looked into that in June 2025. What I found was that between 1975 and 1995 nominal median wage and nominal gold price in dollars both went went up while median nominal wages divided by nominal gold price stayed in a range between 74 oz - 91 oz earned per year.
In 2000 the median income was $42k and an ounce of gold was $279 so income was 150 oz. gold. That was the all time high in the years I looked at.
From there, a years wages in 2005 earned you 103 oz, in 2010- 40 oz, 2015- 48 oz, 2020- 38 oz.
In June 2025 with a median wage of $80k and a gold price of $3350 = 23 oz.
Today assuming the same $80k wage and gold at ~$5k = a median wage earner only earns 16 oz of gold per year.
Is it any wonder no one can afford a house any more using dollars? In gold however, houses are cheaper than ever.
Holy shit-a complete report with no mention of Trump. Very good article. There must be a reason, my guess is that he didn’t have too much Malbec last night.
I bought an 2016 F150 lariat near the end of 2015, cost 45K, or at the time 43 Oz of gold, ~$1050/ozFast forward to 2025, i traded the 2016 for 30K, yep, 30K, bought a new F150 lariat for 65K, or 19 ounces of gold. ~$3400/oz
Bill you got it right in '71 when I was still stationed in Wiesbaden .. you got it right in '88 when we already found our bolt hole .. you got it right in 2000 with the Dot.com collapse and now all these years later you're doubting your own logic .. Why? the Only thing that's changed in all those years ..? is humans! we had less than 4 billion and now have over 10 billion if the idiots counting and their masters would ever considering telling us (humans) the TRUTH .. ah ha .. now we have the difference the old F100 or the house or the land or the Gold all came about through human effort (usually honest effort) .. no one was waiting for the 'markets' or some other scheme to make a living for them .. we just went out and got a job and worked hard to pay the bills and put a little aside for rainy days or retirement, although we could hardly imagine that time would ever come. So now its here, and by slowly steadily saving where ever it seemed frugal we did, and then bought some shiny stuff just for the hell of it as it was better than what banks gave/charged you. Well those small 1 gram coins are now fetching $450+ and are legal tender to boot ! So where is our loss or gain ? over the years we paid between $36 > $100 per once for them .. ok we got no dividends but patience pays off for those who live long enough!
just like surviving the current political conundrum .. patience is the only way to survive, so just enjoy your travels while we still can with a body that still works (sort of) and smell the flowers!
Bill, I like it when you compare real life major items like a house or vehicle in gold terms from the "old days" and today. Most of us spend a lot of our life paying for houses and cars / trucks and they represent a giant "sucking sound" in on going maintenance, taxes, and insurance. When we view these items over the years it can be depressing.
Those old yellow and silver antiques just sit there and demand no maintenance but allow us to sleep well at night.
The only thing we should be aware is, that this "5" can also be reached when both are crashing - Dow just faster. I have no idea how to predict such an event, but as long as central banks (mostly China, Russia, India and UAE) are gold buyers, we should be hodlers at least.
Great article Bill, I appreciate you reminding us of that strategy. It's easy to forget that in today's world. This is why I stay, I know you will have to flash your brilliance! It's in your DNA!
Thanks Bill, articles like these are why I signed on to this newsletter in the first place! If I want to read political bashing on either side there are thousands of sites that will give me their opinion for free. This is what you do best, please continue. Regards, Lynn
The main thing that is missing in this analysis is "what does the debasement and eventual demise of the USD do to the DOW stocks"? And how does that affect the decision process?
I see gold and silver as the ultimate insurance policy. Something that can be used as an emergency currency when things go terribly wrong. When gold/silver go up in value and becomes a good investment, that is a bonus feature but also a bright red warning sign not to consider selling due to rough waters ahead.
So hypothetically, as gold gets higher and higher priced (purchasing power), and the economy starts to fail due to debt and inflation, the DOW stocks will drop in value against gold. This could create the worst possible scenario to sell your gold since that is when you need it the most. So, the "5 number" needs an asterisk that references a sanity check. And as we all know, "5" is just a number.
That is why We have something seperating our 2 ears, stuck in the middle called a brain . It is not there to take up space. We leave emotion out of the many factors of life and use this "brain " to come to conclusions. Good or bad , I can not tell!
Thank you. Your brain comment fits right in with my sanity check argument. It is impossible to create a number to fit all scenarios but at least the number scale gives you a frame of reference as to where the market is.
Correct in My view. Thanks for a more enligthened response.
Yep, life is a series of choices......then moving on. And, we humans are a reflection of our environment including all the propaganda including school throws at ya. Today, it seems skimming the financial rags in the good ol' USofA, everyone things the US$ and America's hegemony are going to go on and on and on. Really? Is the US$ that important to the rest of the World they just keeping buying and buying Treasuries? What I fail to hear (and I am clueless) what happens as the Golden Yuan becomes a "reserve currency"? Does that effect the US$ at all? And, how much gold does the U.S. have? None of us peons have a clue..........just seems to this ol' man in today's changin' world, gold is essential for countries to survive.
Yes using what is between Your ears is what needs to be worked harder and harder. No simple amswers in todays game of life and finances.
BTW, the new currency by the IMF should be pegged to gold.
Pegged? Or settled in gold? The Golden Yuan is settled in gold. Huge risk difference and when it comes to financial assets these days RISK is a major element in what and where "money" resides and in what form. Fiat is losing the battle..
Ol’man-I don’t think that this scenario that a new currency from any country will be used (i.e. Yuan). I truly believe it will be a currency ‘created’ by the IMF with several countries involved. AP
So your view is the US$ remains the only reserve currency other than gold?
Ol’man-NO. That is not what I said. The IMF WILL CREATE a new currency. Possibly a currency which uses a combination of several currencies. The dollar has been on the way of oblivion since the printing presses have been going 24/7 since 1971.
Ok - so you think the IMF is still relevant? And, China, Russia, Iran, India are going to pay attention to the IMF when they know it is run by the U.S.? Wow! Talk about seeing different worlds...........going to be interesting to watch as this all unfolds..........good luck, Abe!
Or it will be digital- just My view.
Agree, Don, for the West maybe. For BRICS and others - only when they have to and it is becoming less and less as time goes by.
Yep!
Don
I believe that crypto will definitely be a major part of any new financial system. The banks and crypto companies are at a standstill. The crypto companies want to give interest on the money held, the banks don’t want that. They want to solely give interest on the funds. Hopefully, this will be resolved. Google Ripple Company and XRP. It is very enlightening to read about them. AP
Yep, a very interesting situation.
5 is a reasonable ratio between gold and the Dow 30. It’s as good as 6 or 7. Remember never put all your eggs in one basket. So if it reaches a ratio of 5 maybe sell 50% of the gold for stocks.
Your logic is spot on for me. Plus is always scares me when my pea brain starts to consider selling Au or Ag. Even more so today at this later stage in life and seeing that JP Morgan and Golden Sachs proposes gold to hit $8000 - $8500 in a year. We all know the major bankers can see down the road better than us "non Elite" folks.
I'll wait and see when the bottom falls out then wait a few more months to make sure it's safe to make a move. And that day is a BIG TBD!
Jim Marshall
As do most newsletters, you ignore the grab from the taxmen. I understand that there are various schemes, but capital gains taxes will change this analysis quite markedly.
Yes. And you hardly ever see THAT fact in anyone’s comparisons. The only way for a US citizen to avoid capital gains at the collectable rate upon sale is to hold the assets in a Roth; up to 28% is a BIG bite for most of us (you can pay less if done right, but not by much if your holdings are significant).
And don't forget the middleman broker and his commssions/fees...both buying and sellling. More 'friction' in the system.
In 1971, the Ford cost this, and the house cost that, and the USD was pegged to gold.
In 2026, the USD is endlessly printed to buy real products from other countries, and POTUS plays to the electorate by blaming every other country for 'ripping' off the USA, in trading real, produced assets for fiat paper. So, maybe they'll stop that ripoff sometime soon.
I'll keep my gold a while longer.
It would be interesting to see salaries in gold terms over those decades as well. I'm pretty sure they have gone down.
I looked into that in June 2025. What I found was that between 1975 and 1995 nominal median wage and nominal gold price in dollars both went went up while median nominal wages divided by nominal gold price stayed in a range between 74 oz - 91 oz earned per year.
In 2000 the median income was $42k and an ounce of gold was $279 so income was 150 oz. gold. That was the all time high in the years I looked at.
From there, a years wages in 2005 earned you 103 oz, in 2010- 40 oz, 2015- 48 oz, 2020- 38 oz.
In June 2025 with a median wage of $80k and a gold price of $3350 = 23 oz.
Today assuming the same $80k wage and gold at ~$5k = a median wage earner only earns 16 oz of gold per year.
Is it any wonder no one can afford a house any more using dollars? In gold however, houses are cheaper than ever.
Thank you! This is what I expected, but hadn't yet done the research to confirm.
Holy shit-a complete report with no mention of Trump. Very good article. There must be a reason, my guess is that he didn’t have too much Malbec last night.
Oh ...Abe, that's a gem.
I bought an 2016 F150 lariat near the end of 2015, cost 45K, or at the time 43 Oz of gold, ~$1050/ozFast forward to 2025, i traded the 2016 for 30K, yep, 30K, bought a new F150 lariat for 65K, or 19 ounces of gold. ~$3400/oz
Gold price is the avg. annual price
Was the new 2025 F150 cheaper? Hmmmm....... :-)
I too like five! 🫶🏼
***** 5 stars, great topic
Bill you got it right in '71 when I was still stationed in Wiesbaden .. you got it right in '88 when we already found our bolt hole .. you got it right in 2000 with the Dot.com collapse and now all these years later you're doubting your own logic .. Why? the Only thing that's changed in all those years ..? is humans! we had less than 4 billion and now have over 10 billion if the idiots counting and their masters would ever considering telling us (humans) the TRUTH .. ah ha .. now we have the difference the old F100 or the house or the land or the Gold all came about through human effort (usually honest effort) .. no one was waiting for the 'markets' or some other scheme to make a living for them .. we just went out and got a job and worked hard to pay the bills and put a little aside for rainy days or retirement, although we could hardly imagine that time would ever come. So now its here, and by slowly steadily saving where ever it seemed frugal we did, and then bought some shiny stuff just for the hell of it as it was better than what banks gave/charged you. Well those small 1 gram coins are now fetching $450+ and are legal tender to boot ! So where is our loss or gain ? over the years we paid between $36 > $100 per once for them .. ok we got no dividends but patience pays off for those who live long enough!
just like surviving the current political conundrum .. patience is the only way to survive, so just enjoy your travels while we still can with a body that still works (sort of) and smell the flowers!
Bought most of my gold in 1990. Price was around $380/oz IIRC. Still have it tucked away safe and sound.
Bill, I like it when you compare real life major items like a house or vehicle in gold terms from the "old days" and today. Most of us spend a lot of our life paying for houses and cars / trucks and they represent a giant "sucking sound" in on going maintenance, taxes, and insurance. When we view these items over the years it can be depressing.
Those old yellow and silver antiques just sit there and demand no maintenance but allow us to sleep well at night.
Jim Marshall
Finally a read that made my day better. Thanks
The only thing we should be aware is, that this "5" can also be reached when both are crashing - Dow just faster. I have no idea how to predict such an event, but as long as central banks (mostly China, Russia, India and UAE) are gold buyers, we should be hodlers at least.
A Shelby Mustang 350R was $6K in 1965.
If it didn't rust or get eaten by moths, the same car is now $500k+.
Great article Bill, I appreciate you reminding us of that strategy. It's easy to forget that in today's world. This is why I stay, I know you will have to flash your brilliance! It's in your DNA!