Dow Jones Industrials
US Stocks reached their peak in 1999, and have clearly been in a bear market since 2001. From a high of 1400, they have fallen to the 250-260 level, a drop of 81%.
From 2003 through 2007, stocks appeared to perform well when priced in dollars, roughly doubling in value. Because virtually all of this gain was due to depreciation of the dollar, however, the gold price of the stocks actually declined slightly over the same period. During 2008 and early 2009, stocks gave up all of their gains since 2003 when measured in dollars. Priced in gold, they declined from about 800 grams to 220 grams, a 70% loss from 2003 levels.
Since the bottom in March of 2009, prices have risen strongly when measured in dollars, seen by many as proof that the recession is over and recovery has begun to take hold. Yet when priced in gold, we see that all of the "robust recovery" was the result of more dollar debasement, as trillions of dollars created by the Fed's "quantitative easing" and bailout programs flood into the market. In reality (aka priced in gold), stock prices have remained fairly flat from 2009 until July of 2011, when they began falling to levels well below their 2009 lows.
DOW's 14 Year Performance:
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DOW's Performance Since 1985
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DOW's Performance Since 1900
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DOW's Recent Performance:
DOW ETF since 2002, showing performance in USD and gold, adjusted for dividends paid:
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I would love to see the TORONTO STOCK EXCHANGE priced in gold
@Andrew: Thanks for asking! That's a great idea. I've created a chart of the TSX with a comparison to the SPY, and I will update it going forward.
Hi, great site. Your charts are very interesting and helpful to get a better look at the big picture. One thought or question though… Is there a possibility, tool, service or something to apply some technical analysis indicators on your charts? I don't think they are available on yahoo, google, stockcharts or something like that. Any thoughts?
Thanx. Happy new year!
Hi Andrew! I wish I had better charting tools, too. I often download the PDF version, then print it out and mark it up with a pencil and straight edge. Old school, but it works! I'm looking into higher tech options… Stay tuned!
Great work with you gold valuation there. You present a completely different picture to the investor or anyone else interesting by the markets. Could please compare some of world's leading markets in gold please?
Hello,
What's your take on the first 2 charts in this article?
Is it possible that the gold run might be coming to an end …. and the DOW starting a new bull market?
http://www.wellenreiter-invest.de/WellenreiterWoche/Wellenreiter100522.htm
Certainly a different perspective. I was thinking about luxury items – it'd be interesting to see if they actually increase in value.
How about something like a 1921 Dom Perignon in gold?
I would love to see UK data priced in Gold, like housing, FTSE100 etc
@Sid:
Or maybe some Louis XIII?
Please show a chart comparing the price in gold to the price in dollars.
Hi Dave, thanks for the suggestion. I've been tracking the DIA index fund in USD and gold for some time, and I've added it to the page. Cheers, Sir Charles
@editor:– Please explain "scaled".– I would expect a second y-axis for the USD line.- Did you intentionally leave off the "gold grams" from the primary y-axis?What is SMA?
Hi Dave, by "scaled" I mean that the two graphs start at the same y-value, to show relative over and under performance. There is no separate labelled scale for USD. Perhaps it would be clearer if I showed the scale as % change, instead. SMA means "Simple Moving Average", in this case, a 200 day moving average. Hope this helps! Best, Sir Charles
Over the last few months, the chart since 1900 has become one of my favorites. I review it often. Would it be possible to publish a single median price for the entire time span? multpl.com shows a similar number for P/E ratios for the same date range. Thanks.
Thanks for the pointer, Michael! I've added an S&P 500 page to the site, and included some numbers for the PE10 or CAPE, calculated using gold as the deflator rather than the CPI. These suggest to me that we are starting to get into "cheap" territory, but are not out of the woods yet, by any means. Take a look, and let me know what you think.
Hello,
Could you show the NASDAQ and the RUSSELL 2000 priced in gold?
Hi Andrew! I do track the QQQ for my own use, though it isn't on the site. An easy way to generate a chart for the NASDAQ or the RUSSELL is to use StockCharts.com, and give the symbol $INDX:$GOLD (for the NASDAQ 100) $COMPQ:$GOLD (for the NASDAQ Composite) or $RUT:$GOLD (for the Russell 2000 Small Cap Index). Adding ":$GOLD" works for pretty much any symbol, and can create almost any type of chart you could want. With a subscription, you can even annotate charts with channels, resistance and support lines, Fibonacci retracement lines, and more. The only drawback (especially with low priced stocks, not so much with indices) is that this charts the price in ounces, rather than grams or milligrams, so while the shape of the chart is the same, the Y-axis numbers can get pretty tiny (i.e., 0.0030 ounces instead of 93.3 mg) . Let me know if this works for you.
Excellent analysis of the S&P 500. I tried to comment on that article directly, but it looks like comments are disabled. Anyway, thank you for the average, median and PE10 calculations. They are all very informative.
Please price Gold in Wheat and Corn and Rice. At then end of the day we have to eat, and it will show what real value is.
If Gold is a store of value, then food is the ultimate store of value. Gold stores a lot of valu in a little weight, but it is manipulated by key p;ayers and hype. Grains are pretty stable and reflect normal demand. Apart from the agricultural revolution (increased supply- new food varieties like corn/maize and rice) fertiliser (incresed supply , population growth (Demand), we should see a stable price.