Making Sense of the Gold Price using Euler

Gold 1970 to 2016  Y = Ln ( Price ^2)

The following chart shows the formula : Y =  Ln ( Price^2) Note the fact that all the major changes in trend have occurred on an integer value.

View the Chart st the St Louis Fed

What is important here is that all you have to do to get a better understanding of the gold price is change the Y axis from base ten to an exponential scale.

As far as the future goes it you think we are going to get out of this global debt debacle with out a massive run up in gold at some stage then guess again.  It is self evident that the stock markets best days are behind it for now, and we are getting on for ten years into this move and I have never one last eleven. So we can just expect a replay of the GFC and for that matter the sell off after the internet bubble follow by another up leg in Gold.

Except this time it is going to be a Sovereign Debt Crisis as the final panic sets in a chain of events that was set in motion when Nixon “Temporarily” suspended Gold convertibility in 1971 and ended the Breton Woods Agreement. Keep in mind that gold often sells off during a stock market panic so there is not rush, its what it does when the dust settles in the year after the panic that matters.