The Battle Between Illusion and Reality: Nominal vs Real Gains

Explosive rally since 2009

S&P 500 ETF (SPY):


Turns anemic when adjusted for fiat devaluation

S&P 500 to Gold Ratio (SPYGLDR):


Expect the 1990 resistance to hold - about 1.125. This implies that further rise in stocks at this level will be exceeded by gains in gold. This is a concept is almost always missed or omitted by the media. This is illusion of devaluation - not talking about the devaluation in terms of the U.S. dollar index as quoted by the media as dollar strength or weakness but rather gold. Fiat versus hard money without liability.

The battle of perception requires a rising stock market. A rising stock market implies an improving economic environment. Be cautious of this argument, as it will be presented often by the media. Rising stock prices can be a direct result of devaluation of fiat money against gold. This comes straight from the central planners "how to manage a depression" playbook.