you're gonna get 17 times more shares of stock buying uh gold today and waiting for this to happen again and it's probably going to be much larger this time because of this massive amount of stored energy [Music] hi this is Mike Maloney and I've got a chart here from Tavi Costa of crestcat capital and actually the chart though is from incrementum so that would be Ronnie stoffler my friend from incrementum AG now and they produce the Intrust intra We Trust in gold in gold sorry the in Gold We Trust report uh and


this is the stock market using the S P 500 as a proxy uh gold divided by the s p 500. uh now I've been showing this chart or charts very similar to it uh the Dow and the gold if you look at Chapter 3 of The Great gold and silver Rush of the 21st century which is available for free and it's an easy fun chapter and anybody that looks at a chart should read that chapter it will benefit you for the rest of your life so go to ggsr21.com and read that it's a short chapter it's fun it's entertaining you


you will enjoy it it's not going to be chapter four is the most difficult chapter in the book that's also free online and that one is going to be modified that's the reason it's online is because I knew it was probably going to change rapidly anyway uh so back to this chart of uh gold versus the stock market so this is gold divided by the S P 500 and what it shows you uh when it's below the line the well when it's when it's toward the bottom stock market is overvalued gold


is undervalued when it's toward the top gold is overvalued and the stock market is undervalued now I just want to point out that I've been measuring things like this for a long time in my first book which was written from 2005 through 2007. I basically showed everything that you're seeing here and this part of the book was written in 2006 I've got the Dow measured in dollars and then I've got the price of gold measured in dollars then I have the Dow now the s p and the Dow are almost identical when you


measure them over a hundred years the correlation is very very high they're almost exist so either one can be used as a proxy for the stock market so here's the Dow measured in dollars back when the book was released and then the Dow measured in gold and the Dow measured in Commodities and the Dow measured in agricultural products and the Dow measured in crude oil the Dow measured in Industrial Metals and then the performance of the Dow measured as a percentage of gains or losses and the and gold measured in a


percentage of gains and losses measured in dollars now and silver measured in a percentage of gains or losses over that period of time so uh this is something that I've been doing for quite a while and this is an updated look at it with this chart from incrementum and and I really do appreciate it but I you know I realize these new things like all the stored up energy from going from a fixed more free market monetary system to a centrally planned and controlled fiat currency system that causes these


gigantic Bubbles and the disequilibria everything going out of balance and then once every several decades it tries to snap back and tries to go into balance and it overshoots and you end up with these enormous gains so if you take a look at this it looks like there's a Natural Balance in equilibrium where an ounce of gold would buy you about two and a half shares so two and a half times whatever the points are on the S P 500 I like to use the Dow gold ratio because this oftentimes gives you


partial numbers like I believe it's at zero point four nine or four eight right now where the Dow gold ratio always gives you whole numbers and people understand whole numbers better than they do fractions like that but so this was a Natural Balance under a much more fixed monetary system under gold there was there was this balance between the stock market and uh the value the value of the stock market and the value of gold and so what you see here the creation of the Federal Reserve happened


back in here and we did a bunch of uh deficit spending and expanded the currency supply for World War One and uh then when the war ended there was a big deflation called the depression of 1921 that's this but then you had these very expansionary policies in things called like bankers acceptances and uh other things there was stuff the Federal Reserve governed and the Federal Reserve was too loose with their monetary policy and there was also stuff that was uh uh more done just by the banking sector but


there was a big expansion in the currency Supply when you include it you've got to watch my video on the uh crash of 29 and the Great Depression uh to uh there's a bunch of quotes there from Murray rothbard Ben Bernanke and Milton Friedman that back up any of these claims but uh what you saw was this expansion that did not cause retail inflation it caused asset inflation well what has happened for most of this Century in the United in States we've had these big this big inflation in the


stock market and in real estate prices and some other assets but we haven't seen a lot of retail inflation until the government started sending checks directly to the U.S population and so it wasn't until after covid that we finally saw the retail inflation of that the expansion of the currency Supply always causes inflation somewhere it can inflate savings it can inflate the stock markets it can inflate real estate or it can inflate Commodities and retail prices and we are going to be seeing that shift


because even though the currency Supply is currently Contracting there has been so much created that as some of that leaks out it's going to cause Commodities so food and energy and so on to rise along with gold so this whenever this is high that's gold overvalued in stocks undervalued whenever it's low it's uh stocks overvalued and gold undervalued and once we went on to this fiat currency system you see it go out of equilibrium you've got the the Roaring 20s and asset prices soaring


and gold is fixed and then you've got the crash of 29 and the banking crisis and then gold is uh uh the dollar is devalued against gold causing this to soar and then you've got the great the deflation of the Great Depression keeping this high and then you've got the Bretton Woods system uh was uh passed here but sort of took a took effect over here and the constant creation of currency uh but gold being fixed in price it was 35 bucks an ounce and uh it stayed that price well we inflated the currency supply for uh


North for South the the Korean War for Vietnam for Johnson's Great Society and then Nixon uh takes us off of the Bretton Woods system and the world goes on the global dollar standard it wasn't just the US dollar the rest of the world was pegged to Gold through the US dollar so when we severed the peg to gold with the US dollar we severed it for the entire world and uh then you and this is the stock market going sideways the Dow hit its head on a thousand points in 66 didn't break out until 82. so some of


the stock market is basically going Sideways from here to about here this is all Gold's spectacular move making up for all of this suppression and currency creation and then you have the currency creation spilling back over into the stock market and gold hit its high now incrementum the in Gold We Trust report they always use the monthly average price for gold which means that it's probably a ratio that you can be able to hit that's it's something where you couldn't if you did invest it one of


these points you might be likely to because you've got an entire month here an entire month there an entire month there to be able to sell your position and go into stocks and realize these big gains because uh when you're in in if you're in gold from here to here you're making gains if you're in stocks you may as well flip this chart upside down because from here to here is huge gains in stocks now um this is gold going from uh here they've got it it doesn't on the monthlies it


doesn't even reach 700. it's in the high sixes uh so now I'm going to show you on stock charts it says that gold reached 873 dollars an ounce uh in January of 1980 and so instead of if we go back to this incrementum chart uh if this is at six up here and so you're a little less than six one ounce of gold would buy almost six shares of the uh S P 500 so an ounce of gold the price of an ounce of gold was six almost six times the price of the uh the points on the S P 500. well currently it's at like 0.49 or


0.48 something like that and so uh if it went back to that equilibrium that would be about 12 times gains if you are invested in gold now and it goes back up there but I think it's going higher simply because look at the amount of stored energy here where it goes out of kilter and then makes up for it then the amount of stored energy here where it goes out of kilter and then makes up for it now look at all of the years of stored energy that we've got under papering over it this is just currency


creation and this is uh we go from regular economics to Bernanke economics we go from Keynesian economics to bernankian economics Bernanke non economics and uh and massively papered over things and so the energy that is stored in this being under the two and a half so it's this you know not this line ignore that line that's the average as calculated by a spreadsheet of all this data it's not the equilibrium under a fixed monetary system versus a phony baloney fiat currency system that can


cause these massive Bubbles and disequilibria these everything being out of balance balance is up here and so when it this overshoots it's going to overshoot much higher except uh the if you want to know the maximum you know you go to this uh where gold hit 873 instead of 600 and something and you see that this was almost eight times and we're down at I'm sorry 0.46 so let's take I'm going to do a little calculation here we have almost it's we'll call it 7.75 divided by 0.46


equals seven you're gonna get 17 times more shares of stock buying uh gold today and waiting for this to happen again and it's probably going to be much larger this time because of this massive amount of stored energy so this is the reason that I buy gold and silver I want to thank you for watching if you got anything from this video please consider us as your gold dealer we'll see you next time hi I just wanted to tell you about gold Silver's 111 ounce silver giveaway where you can win win one one


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