Monday, February 25, 2008

Gold Priced In Dow? Not Very Pretty!

The stock market in the U.S. lost about 1.2% in yesterday’s trading session. The Philly Fed Index seemed to be the downer of the day… losers topped winners 3-to-1 on the NYSE. In spite of all the recent volatility and occasional market upswings, the Dow is now a mere 2.5% above its January low.
And for some broader perspective, check out this graph of the Dow priced in gold:
The Dow, priced in gold, has been a totally hopeless venture since the tech boom. In 2000, you would have needed 45 ounces of gold to buy one “share” in the Dow… today those 45 ounces would fetch you three times the number of Dow stocks.

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