maandag 24 december 2012

Correlation between Bonds and Gold

Just to be sure that I have this picture (and correlation) logged onto this blog, here is the famous Zero Hedge bonds Vs. gold chart.

Chart 1: Bonds Vs. Gold

And here is my updated version based on the charts GOLDAMGBD228NLBM and DGS10:
Chart 2: Bonds Vs. Gold

The decoupling of the two charts seriously went into overdrive from 2008 onwards. Guess what, that year marks the start of the QE programs to keep interest rates low. I wonder which one of the two charts will be the ultimate loser. (it won't be gold because marginal cost of production is $1500/ounce)

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