Dow Industrial Index Relative to Gold

Here is a chart that is sure to drive my pal Paul a bit batty: The Dow in Gold.

While these sort of bananas priced in herrings occasionally can provide some insight, just as often as not they are confirming an existing bias.

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DID THE BULL RUN END IN AUGUST?

Dow relative to Gold

Source: David Rosenberg, Gluskin Sheff

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As much as I disagree with David Rosenberg’s market posture the past 2 quarters, I am cognizant that he raises a very valid point when he notes:

“The latest Investors Intelligence poll shows the bull camp at 50% and the bear camp at 16.7%.  That bear-share is down to a six-year low.  Note the current level on the VIX index, it is at 21.12 — complacency reigns.”

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