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The Silver Bull

by Luis de Sousa Tue Jan 18th, 2011 at 09:41:43 AM EST

Taking the bull in the face is risky business. But as with many other displays of Man's pretense power over Nature, pikemen use their larger brains to overcome heavier muscle, once the beast's vision is folded by the blanket of men it simply comes to an halt and no one gets hurt. That's the theory and what takes place in most occasions, but once in while a bull comes out into the arena that no one will take. Speed, obstination, a different way of setting the face, pikemen fly and the bull goes through.

The silver market today is living a bull that looks alot like one of those that no one can take.

The emergence of paper-currencies provided state institutions with a crucial controlling mechanism over investor expectations, thus avoiding liquidity runs as the one that preceded the great depression. As a purely abstract concept, without any physical links that may restrain its supply, paper-currencies can be managed in such a way that they never become better investments themselves than real (and less liquid) assets. Basically they are improper to stuff the mattress, these currencies are perceived as a wealth storage vehicle only when properly invested (e.g. deposited at a bank, fund, etc). Without this mechanism the levels of economic growth in the XX century wouldn't have been possible. But for this monetary system to work, Central Banks have to play the capital role of managing precious metals prices. The objective is to avoid the latter to become desirable enough for investors to prefer them to the paper-currencies. Especially regarding gold, a metal whose supply grows scantly from year to year, central banks have to be particularly vigilant, promoting a slow and orderly appreciation. To this end central banks use the strategic gold reserves they possess, intervening in the wholesale market and stabilizing prices when necessary. On the other hand, by briefly allowing a faster appreciation, they activate recycling processes, by which jewellery without extraordinary value is converted into bullion, this way guaranteeing a flux of metal to the market. But when it comes to the second most liquid metal-currency, silver, none of these mechanisms is possible today; moreover, silver prices hit historically low values in late 2008 from a which a fast recovery is, and should continue to be, inevitable.

Throughout History, up to the XIX century, the relative values of silver and gold maintained a stable relationship around 15 to 1 (1 gram of gold was worth the same as 15 grams of silver). This relationship largely reflects the relative abundance of these two metals in the earth's crust, for every gram of gold in the crust there are about 18 of silver. With the development of the last stages of the industrial revolution this relationship started changing with the progressive devaluation of silver against gold; passing through wide variations, an historical low of 100 to 1 was set in 1990. This devaluation of silver against gold is possibly associated with the fact that its mining has become a process of secondary recovery in mines dedicated to other metals like copper or nickel. The exclusive mining of silver represents today but a small fraction of total world extraction.

The silver to gold ratio during the last 200 years. Click for source.

Silver become a cheap metal with industrial application and for that it stopped being eligible for recycling. The silver extracted from the earth's crust in the last 100 years has been lost in its great part, dispersed in cheap jewellery, outdated coins, photographic film, incorporated in obsolete electronic devices; plenty of it ended up in dumps and some might have even migrated to the sea, from where it'll never be recovered. The result of this dispersion of silver is an industrial stock extremely low, equivalent to one year of extraction, circa 25 thousand tones. This figure is less than one sixth of the world's gold reserves (that between jewellery and bullion is over 150 thousand tones) and translates into less than 4 grams per inhabitant of the planet.

The international economic juncture is promoting liquidity once again in the western economies, the access constraints to commodities, especially energy, the over indebtedness of states and citizens, all paint a dire scenario with negative expectations to investors. The flush witnessed today to metal-currencies, if it continues, shall push the price of silver to were it's dedicated mining is justified, and above all, were recycling becomes viable again. What value can produce such changes is largely an unknown, but the 15 to 1 relationship with gold is a target that by its history remains a reference. Such recovery, if happening today, would result in a rise to 75 euros per ounce (the traditional weight unit used in the wholesale markets and retail bullion).

During the last months of 1979 the powerful Hunt family from Texas cornered the silver market in the USA while trying to hedge against inflation. They took possession of most of the long positions (paper contracts that provide buying rights) of this metal, along the way taking the price to a nominal record that holds to this day. Such action was deemed as purely speculative by the authorities and dealt with legally; nonetheless this event was just a warning for the panic lived in January of 1980, when a relentless run to liquidity doubled the price of gold in just a few weeks. The relationship between silver and gold returned to the historical benchmark of 15 to 1 during this brief period. The western powers had been living for almost a decade with an incipient economy, trying to adapt to a new monetary regime (in the wake of the collapse of the Bretton Woods agreement in 1971) and to energy prices without precedence. In 1979 Saddam Hussien attacked Iran producing the worst oil shock in History and fear took hold of investors. This gold panic forced a shock action by the Federeal Reserve president, then Paul Volcker. Up to March of 1980 interest rates where hiked to 20% and the western world dived into the worst economic recession since the end of the second World War.

The 1980 gold panic was a fracturing event that provoked great changes, both economical as geo-political. It put an end to the 1970s Stagflation and set in motion the policies that would lead to the emergence of a new international monetary system, in which the dollar remained as the world's reserve currency by the military guarantee of access from western economies to the energy reserves around the Persian Gulf. When this new monetary system was sealed in 1985 with the Plaza Accord, so was sealed the fate of the Warsaw Pact economic bloc and the starting of a new world order.

2011 can witness events parallel to those lived in 1979. In first place for the prevalence of a similar economic context, the access by the OECD to large energy reserves is getting harder, either by scarcity or by concurrency from other powers, which limits any sort of physical growth of the economy. And in second place for ever stronger signs of constraints in the bullion markets. In the second half of 2008 a huge silver price drop at the wholesale markets expanded the relationship with gold to over 80 to 1, setting on fire the demand for this metal-currency. In the beginning of 2009 the price difference between the wholesale and the retail market went over 50% and in spite of a correction in the wholesale market, demand never eased off, by the contrary. Investors simply reckoned that a silver relationship with gold at this levels during such economic setting could represent the opportunity of a lifetime. In 2010 silver went into backwardation in the London wholesale market (the world's largest) with front delivery contracts being more expensive than those for delivery in the following 6 months. This market structure is extremely rare and a clear sign that supply isn't answering demand. A first serious warning took place in April of 2010, in the weeks that followed the announcement of the creation of the European Financial Stability Fund, silver bullion disappeared of the shelves in central Europe; in the Benelux, in Germany and some parts of France many retail sellers closed shop, others set minimum limits to orders that put out the majority of investors.

The structure of futures contracts at the London Bullion Market Association. Click for source.

Finally in 2010 a correction of the silver price relatively to gold took place, climbing to 50 to 1 by year's end, a clear consequence of unprecedented demand. In 2010 alone the American Silver Eagle one ounce coin sold more than 30 million units (about 900 tones), other famous coins like the Viena Philarmoniker, minted in Austria and the Mapple Leaf, minted in Canada, doubled their sales throughout the year. In the wholesale markets the news are similar, at the COMEX in New York are registered and stored about 1600 tones eligible for trading, but in December alone 280 tones were sold, part of which will leave the market's warehouse for good.

Thus it seems that an event similar to that which shook the economic world in 1979 is approaching. It can take several forms, a default in the wholesale market, a prolonged scarcity in the retail market, mintage suspended by lack of raw material. The immediate result may also be similar to that of 30 years ago, the general reckoning of scarcity and panic, spreading to other metal-currencies. It is the answer from governments and central banks that might be different, sharp action protecting paper-currencies with interest rates hikes shall have very different results today, for the levels of sovereign and individual debt are much higher. Nonetheless, a situation like this, if unfolding, brings on the table options that may seem unthinkable today. Just as the events of 1979/1980 triggered a transition process to a new monetary and economic system, a liquidity run to metal-currencies today will set the end of that same system and the emergence of a new paradigm for international trade in a different geo-political setting.

In this particular juncture, silver is an investment that offers opportunities like few others. But the investor must be conscious of two things: first that investing in metal-currencies is a direct confrontation with all central banks of the planet and in second place that a generalized panic shall have deep economic and social consequences. A liquidity run can paralyse the economy in such way that not even the largest sums of metals can provide certain products and services. Investing on metal-currencies is betting on continuing physical restrictions to economic growth, thus the prudent investor will always complement metals with investments on the basic production factors of the economy, such as energy or agriculture.

An Interpretation of the China Silver Short Theory and Fractional Reserve Bullion Jesse's Café Américain

This is my interpretation of the China silver short theory as expressed by others, but especially the respected analyst Harvey Organ. As you may recall, Harvey was the trader who helped to identify the notable lack of actual bullion in the vaults of Scotia Mocatta, causing a minor scandal.   There have also been other claims of a significant leverage or 'fractional reserve selling' in the physical bullion markets, with a circumstantial evidence of a potential 100 to 1 leverage involving unallocated bars and claims of cross ownership of bullion held by some of the large ETFs.

....(paragraphs of caveats)

Imagine you are China.

At some point, probably shortly after the year 2000, a large US bank comes to you via the US Treasury discreetly and asks to borrow 300 million ounces of silver. The deal is that the Treasury/Fed will provide you with US Treasury bills as collateral. The US sweetens the deal by granting the unrelated negotiating point of most favored nation trading status, and explicitly but verbally guarantees the deal with its full faith and credit. The Bank, with explicit US backing, promises to return your silver on demand after four years.

Some six years later you come back and ask the Bank for your $300 million ounces of silver. They say that the silver is gone, having been sold into the physical bullion market.

So you ask, well, what did you do with it?

And the Treasury answers, we lent it to the bullion banks and JPM, who sold it in the markets as a part of our plan to keep the prices of gold and silver from rising, in order to sound a warning about our monetization of the reserve currency using Treasuries.

So you approach the US Treasury and complain, asking them to honor the agreement. The Administration says, "we are sorry, but we no longer have the silver and we do not have any in our reserves. So you can keep our paper IOUs we offered as collateral instead."

You are very angry as you do not wish to own more paper, but instead the bullion which is a legacy asset.  You, as China, consider the situation, and start selling silver short on the Comex, using HSBC and JPM as your agents. They sell the entire 300 million ounces of silver short. On the side and through other sources, you are using other agents to buy this same silver in the form of physical bullion for your own reserves. You consider this an equitable return of your bullion at a relatively neutral price compared to that at which you lent it.

It seems that the silver was a legacy asset only because when Chang Kai Check fled China for Taiwan he was only able to take the gold with him. (The same gold that, according to other stories, had been taken to Japan by Prince Chichibu during the Japanese occupation of China?)

But what to do when people ask for the physical sliver which you have sold short?

When JPM and HSBC need the silver to cover the pledges on the short sale as more people demand delivery and existing supplies become tighter, you as China offer the pledge of the US for your 300 million ounces of silver as collateral and says "collect it from your colleagues at the US government."

Technically the short sale is 'hedged' because the US offers little counter-party risk, and it is their IOU that is the basis of the short sale. The problem is that the collateral is in dispute between two sovereign nations.

But in point of fact the US does not have and cannot obtain this quantity of silver without severely disrupting the silver market, or demanding the output of its own silver mines which is unconstitutional. They do have the power to force a 'cash settlement' for the short positions, but this would be viewed as precipitating a major default on the Comex and with the Fed's "house bank" JPM. Not exactly a trust builder in already shaky markets tainted by scandals of fraudulently valued paper.

And so the market remains at an impasse with a tremendous undeliverable short in silver with the US and JPM in a very embarrassing position of being entrapped in what China considers their own scheme by one of the few entities capable of standing up to them - their major creditor China.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Jan 18th, 2011 at 10:54:27 AM EST
Whenever I fall for one of these explanations, I go back and try to find the math behind the vague "more and more of less and less" verbal manipulations.

I found none here. Therefore, very pretty, but useless. We are the grass where elephants joust.

Align culture with our nature. Ot else!

by ormondotvos (ormond.otvosnospamgmialcon) on Wed Jan 19th, 2011 at 02:55:32 AM EST
[ Parent ]
Between coins, bars and other bullion, private investors have probably hoarded more than 300 Moz since the 2008 price dip. At an average price of 15 €/oz that's about 4.5 G€, which spent across 2.5 years isn't really that much.

My perception is that since 2008 it has been the retail market setting the price, not the wholesale market.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Jan 19th, 2011 at 03:49:17 AM EST
[ Parent ]
worth of paper silver, on your recommendation.

(Don't fret, I won't burn your house down if it doesn't do well. It's only money after all.)

I already had a bit of gold. I need to hedge more, I have a portfolio composed exclusively of alt-energy stocks, and I'm barely breaking even in a bull market (thanks to the failure of Cancun, and the French sledgehammer approach to industrial policy regarding solar energy)

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Wed Jan 19th, 2011 at 07:36:39 AM EST
eurogreen, paper has no value. If you intend to invest on metals you should acquire the real stuff. One of the ways I envision has the rupture point is a default at the wholesale markets, if something like that happens, the value of futures goes to zero in the blink of an eye.

My advice is investing on paper only for the short term; mid/long term the prudent investment is physical.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Wed Jan 19th, 2011 at 10:08:53 AM EST
[ Parent ]
which is not futures as such, but purely index-based.
They have another thing, EURPOOLSILV/ETFS (PHAG Amsterdam) which is allegedly backed by numbered bars of actual silver. Whatever. Will there be any difference if there is default on deliveries? I dunno.

You're talking about taking delivery of actual metal, and I don't think I can relate to that.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Wed Jan 19th, 2011 at 01:24:26 PM EST
[ Parent ]
  1. Physical precious metal, PM, hedges against paper market failures. The main reason to be interested in silver just now is the enormous short interest relative to the total annual production. But if the market blows up, the paper will blow up. Physical will still be physical, unless authorities are delegated to search houses and safe deposit boxes.

  2. Most of the problem is due to regulatory forbearance with respect to the bullion banks. If you wish to help banks which are perpetrating the naked short and distorting the market, buying paper PM is a good way to do that. If you want to end that practice, taking physical possession is the way to go.

A safe deposit box runs ~$25/yr in Arkansas and the physical PM can be shipped back and forth insured for the full value via UPS and/or the USPS. If you buy directly from a mint you can usually count on selling directly back to them. Just now delivery times on PM orders are running 6-8 weeks.

Were I to find myself in possession of paper PM I would sell it at the first opportunity when I could do so without a loss, as I consider US$ or Euros safer than paper PM.

"It is not necessary to have hope in order to persevere."

by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jan 19th, 2011 at 07:55:38 PM EST
[ Parent ]
eurogreen, there are anecdotal evidence out there that ETF like SLV are not backed by the physical metal, they're very close to ponzi schemes. A market failure and you're toast.

If you don't feel comfortable owning physical then you can opt for adhering to a Trust, where warehouses are  regularly audited and your paper links to specific, identifiable pieces of bullion. For obvious reasons I won't suggest names here.

All the silver I own is physical, but I'm not a wealthy individual, and it comprises but a small fraction of my portfolio, hence I do not have storage issues. Btw, the largest share of my portfolio (over 50%) is energy, but once again physical stuff, not paper.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Thu Jan 20th, 2011 at 06:57:45 AM EST
[ Parent ]

Your advice has cost me 55 euros so far...

Don't worry, I don't know your address or anything.

Maybe I'll just shoot myself.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Thu Jan 20th, 2011 at 11:53:43 AM EST
[ Parent ]
.... Iain "You need to halves to get ahead" MacGilchrist on this one. What I've learned from his most excellent book 'The Master and his Emissary', is the cultural importance of the fact that we have two hemispheres in our brains. But it is nothing like the 'left-brain, right-brain' Cosmopolitan Magazine simplistic polarity. In fact McG explains so much, so well, that it feels like a big leap forward even though our understanding so far of 'how the brain becomes mind' is limited to our pondering over a black box made out of clear plastic.

I won't summarise his remarkable conclusions here, but go with the hemisphere that keeps a look out for danger, while the contralateral hemisphere focuses on the berry you are about to pick. Context and discreteness, figure/ground. But right or left? Read the book.

Oh, alright then

"The Divided Brain and the Making of the Western World"

You can't be me, I'm taken

by Sven Triloqvist on Thu Jan 20th, 2011 at 12:47:47 PM EST
[ Parent ]
but I'm buggered if I know what you were replying to!

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II
by eurogreen on Thu Jan 20th, 2011 at 12:55:42 PM EST
[ Parent ]
You're buggered! What about me?

You can't be me, I'm taken
by Sven Triloqvist on Thu Jan 20th, 2011 at 12:57:42 PM EST
[ Parent ]
You said you needed more hedges and that is what I use to justify my PM purchases. I suffered through a month or so of prices below my purchase price, let alone the difference between MY purchase price and THEIR buy price before I took delivery on my first purchase. But I do not need the money any time soon and still think there is a good chance I will make even more money by waiting while knowing that the only counter-party  risk I am taking is that of not being able to access my safe deposit box. I made my initial purchases after I became concerned about the decline in purchasing power of my cash savings and that is what I am hedging.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Thu Jan 20th, 2011 at 04:57:10 PM EST
[ Parent ]
eurogreen, you probably know this, but you hardly make any money short term betting the market on fundamentals. I bought a set of Philarmonikers in December of 2008 for 12.4 € a piece. Today the same dealer is selling them for 28 €.

by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Fri Jan 21st, 2011 at 03:59:46 AM EST
[ Parent ]
just trying to hedge a bit. Silver's going down, but that's OK because my stocks are tending upwards. Sometimes it will be the opposite. Sometimes both will trend in the same direction, which is uncomfortable, but I'm hoping it won't be too often.

For the moment I won't be buying any more [insert image here of hand catching sharp falling silverware], I'll wait for it to flatten out a bit.

My father, a radiologist, started recovering silver from his film processing machines in the seventies, at a period when there was a price hike, I suppose. He hoarded it at home for a couple of years (an unpreposessing black powder) then started smelting it with a blowtorch, and making silver jewelery. Loads of fun.

If I had silver ingots, I would contrive to lose them. I'm not very good at worldly possessions.

It is rightly acknowledged that people of faith have no monopoly of virtue - Queen Elizabeth II

by eurogreen on Fri Jan 21st, 2011 at 01:27:23 PM EST
[ Parent ]
Happier now that silver is back over US$30/oz as of 2-8-'11 in the USA?

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Tue Feb 8th, 2011 at 10:20:24 PM EST
[ Parent ]
I'm barely breaking even in a bull market...

Thanks to my August, '09 PM purchases I am well in the black despite being down ~20% on an inverse S&P500 EFT. The rest is cash.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Wed Jan 19th, 2011 at 11:25:31 AM EST
[ Parent ]
James Turk to King World News

"Silver is in backwardation not just in the short-term, this time it is extending twelve months forward!

The last time this happened Eric was in January of 2009.  Over the next few weeks silver rose from about $10.50 to $14.50, a roughly a 40% move higher.  The key to understanding backwardation is that the price must rise to entice holders of physical metal to sell and accept a national currency in return.  I think we can expect a similar event to repeat over the next few weeks.  


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Sat Jan 22nd, 2011 at 01:24:06 PM EST
Parts of this article are being quoted today in the online edition of Expresso, the largest weekly newspaper in Portugal. I can't provide a thorough translation right now, with my apologies here's the Google translation:

I'd like to thank Jorge for continuing to listen my observations on commodities and currencies. He's one of those that makes the journalist profession worthy of credit.


by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Sun Jan 23rd, 2011 at 11:48:03 AM EST
Oops, something went wrong with the blockquote, here it is:

Expresso : Signs of an upcoming "shock" [to] the market for silver

It is more likely this year a market panic silver than a new oil shock. What can repeat scenes already experienced in 1979/1980. Com mudanças radicais impensáveis, diz Luís de Sousa, editor português do The Oil Drum With radical changes have been unthinkable, says Luis de Sousa, Portuguese editor of The Oil Drum


In fact, says the Portuguese expert, the industrial stock of silver is very low, equivalent to one year of mining - it is a profoundly different market of the gold market. "Contrary to what may be happening with other commodities, the increase in the price of silver has been caused solely by physical bullion market retail. This is noted in the small size of the bond market (futures) when compared with other commodities and the value of open futures in silver is less than a third of that in the gold market. But this becomes especially apparent in the huge difference between the retail and wholesale market, a gap that now stands at around 20% . During periods when the wholesale bond market corrects downwards, usually the retail price is maintained, thereby extending this margin, a clear sign of strength in demand, "says the expert.

by Luis de Sousa (luis[dot]de[dot]sousa[at]protonmail[dot]ch) on Sun Jan 23rd, 2011 at 12:00:41 PM EST
[ Parent ]
Silver Breaks Its Golden Shackles  Guest Post by Adrian Douglas in Zero Hedge

Since September 2010 silver has broken its golden shackles. The algorithmic trading that kept the price of silver subdued for seven years has been completely annihilated.

Figure 1 is a cross-plot of the price of gold against the price of silver for every trading day from June 2003 to September 2010. There are two linear relationships, one is pre-2008 (black line) and the second is post 2008 (green line). The best fit equations for the two data sets are also given on the chart.

The stunning revelation from the data analysis was that if on any day I knew what the price of gold was I would be able to calculate the silver price from the equation of the relationship! How is that possible in a free market? It simply is not possible and so the conclusion is that silver is not in a free market but is manipulated to move algorithmically with the price of gold. I have written many articles that show that gold is itself manipulated and suppressed (for example, see Gold Market is not "Fixed", it's Rigged )

On Friday silver closed in complete backwardation on the Comex. Spot silver closed at $29.075/oz while FEB 2011 closed at $29.064/oz and DEC 2015 closed at $29.026/oz. I believe this is the first time in history that this has happened. Silver traded in backwardation between the spot price and futures contract up to one year out during the blatantly manipulative precious metals bashing of January, but now the entire futures structure is in backwardation. This is a sure sign there are shortages of silver because it means that buyers will pay a premium for silver delivered sooner rather than later.

Signs of shortages have also been apparent from a shrinking silver inventory on the Comex in the face of rising prices. The registered inventory stands at a paltry 43 Mozs. In addition there is lots of anecdotal evidence that there are tight supplies everywhere. There are reports of refineries refusing to take new orders due to insufficient silver feedstock.

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Feb 7th, 2011 at 12:54:34 AM EST
[Bad Statistics™ Alert!]

Keynesianism is intellectually hard, as evidenced by the inability of many trained economists to get it - Paul Krugman
by Migeru (migeru at eurotrib dot com) on Mon Feb 7th, 2011 at 04:13:22 AM EST
[ Parent ]
... a bad presentation. There does seem to be a signal where they claim there is a signal, and they aren't really trying to quantify it in those figures.

I personally don't like plotting time series that way, but it's something economists do all the time.

- Jake

Friends come and go. Enemies accumulate.

by JakeS (JangoSierra 'at' gmail 'dot' com) on Mon Feb 7th, 2011 at 07:29:47 AM EST
[ Parent ]
From looking at the data, if you bet on the relationship you can lose your shirt...

Keynesianism is intellectually hard, as evidenced by the inability of many trained economists to get it - Paul Krugman
by Migeru (migeru at eurotrib dot com) on Mon Feb 7th, 2011 at 08:41:27 AM EST
[ Parent ]
I did find it a bit weird that he is plotting time series against each other yet neither axis includes time. But NCE has this thing about time...

"It is not necessary to have hope in order to persevere."
by ARGeezer (ARGeezer a in a circle eurotrib daught com) on Mon Feb 7th, 2011 at 11:55:04 AM EST
[ Parent ]
That is more informative than plotting both series against a single time axis.

But what you should be plotting is periodic returns against each other.

Keynesianism is intellectually hard, as evidenced by the inability of many trained economists to get it - Paul Krugman

by Migeru (migeru at eurotrib dot com) on Mon Feb 7th, 2011 at 12:06:20 PM EST
[ Parent ]

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