Quote:
Originally Posted by Alex Linder
I don't get what he's saying. Silver can stay where it is and gold drop until the ratio is restored.
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Possible , but very unlikely . The two metals trend together , only differing in their relative magnitude of percentage movement , historically . At low extremes , like early 1990's, the G/S ratio reached 101 to 1 . At the top of markets , like 1980 , it reached 16 to 1 ( as mentioned in the article ). Obviously, he is basing his assumption on a powerful bull market .
I'd suspect that the trend correlation of S & G is > + 0.99 , almost unity . The price correlation isn't nearly so strong, but it is still strongly positive . ( IT would be interesting to see these figures . )
Silver is an industrial metal , every cell phone has some . Silver is bio-active, gold isn't. It has very unique anti-bacterial and anti-fungal attributes .