Archived IMT (2009.07.20)

S&P500 / GOLD Parity. Metals and equities rise in tandem, with both S&P500 and gold nearly identical at around 946 producing a strengthening S&P/Gold ratio of nearly 1.0. While the ratio nears its best levels since May, the 1.0 territory has proven to be a solid resistance since January, thereby reflecting the ongoing stabilization superiority of metals vs equity indices in the medium to long term. http://twitpic.com/b0nl9 The chart suggests further downside is yet to come, with the rational that any deepening retreat in equities may refuel the move from finance to metals as was the case in Feb-March. Owners of my Forex & Intermarket Dynamics Workbook recall the Equity/Gold ratio has bottomed at around 40 year intervals.