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Detroit Files For Bankruptcy While S&P Hits New High

ByRyan Jordan
Published 07/19/2013, 02:03 AM
Updated 07/09/2023, 06:31 AM

The above tells you all you need to know about this “recovery.” And, for that matter, its all you need to know regarding the long term trend of the US economy since roughly 1971. A trend toward greater income inequality coupled with stagnant middle class wages. In this way, “the collapse” so many of us supposed doom and gloomers have talked about for years was always here, we just didn’t realize it was happening in slow motion. Something changed roughly 40 years ago, and while I won’t be so simplistic as to blame it all on Nixon closing the gold window, that moment likely marked the beginning of the end of unrivaled dollar supremacy.

While looking back to 1971, let me make another quick point — especially as many of the paper bugs continue to dance on gold’s grave. Remember where the gold price was in 1971: 35 dollars an ounce. Today, gold is still near 1300, after having been as high as 1900 dollars. For those keeping score, the 37 fold increase in the price of gold since 1971 far eclipses increases for both the S&P 500 and DOW Jones for the same period, which moved up 17 and 15 times, respectively.

I guess someone has been hedging their bets that debts, deficits, and cheap currency don’t matter.

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