FoxTrot,

2,200 dollar gold would have to be the price in todays dollars that gold would have to reach in order for it to reach its 1980 peak using the government supplied inflation stats.

Unfortunately the government has changed the way they calculate inflation 3 times since then. The numbers are now so massaged and hedonistically lowered that they understate the real inflation rate by a multiple of 2 - 3 times.

If you calculate the inflation rate since 1980 using the formula that they did back then ( a close aproximation ) then according to shadow statistics the value of gold would actually have to come up to aprox $6200. Yes that is correct, $6200.

Of course that is if all things were equal today to what they were back then. Unfortunately the economic situation today in the States is much worse then it was back then. Back then the States was still the largest creditor nation in the world, they manufactured many of the worlds products, the US citizen had the largest savings in the world.

Today they are the largest debtor nation in the world, their manufactor sector is being quickly dismanteled and they produce few of the products the world needs, the US citizen has had a average negative savings rate for a number of years now and are tapped out of discretionary spending money.

Back in 1980 only 5% of the population actively invested in the markets, today it is 50%. Back then the central banks had considerably more gold to manipulate the market with, gold they no longer have. When the london gold pool cartel finally capitulated in the late 60's in one day alone around 450 tons of gold was sold into the spot market.

With these added factors in favour of gold who knows where it could go by the eventual end of this bull run which has many years left to play out.

F.F.

You add all these factors together and