In the last 115 years there have been three secular bull markets in gold versus the Dow. The current secular bull market in gold is the third. In each of the last two gold bull markets, the ratio of financial assets to gold fell to a ratio of less than three. The current ratio of the DJIA to gold is 8.3. Based on historical precedent the secular bull market in gold still has a ways to go. At the extremes, before this bull market is finished, gold could rise to over $5,000 per ounce or the Dow could fall to less than 2,500.
Jeremy Jones, CFA
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