There is a remarkable correlation between the prevailing level of global liquidity (defined as the sum of the U.S. monetary base and the foreign holdings of U.S. Treasuries) and the price of gold per troy ounce. The current correlation suggests a gold price of $1,780 as illustrated by the chart below.

The Dow has begun a major rally 13 times over the past 112 years which equates to an average of one rally every 8.6 years so, as it stands right now, the current Dow rally that began in March 2009 would be classified as well below average in both duration and magnitude.

Is gold undervalued or overvalued?...[Unfortunately,] there's no good way - and definitely no universally accepted way - to determine a "fair value" for gold. Unlike a stock, gold doesn't have a price-to-earnings ratio that we can easily compare to the market. [That being said, I offer in this article] a logical, real-world price target. Words: 700

From the onset of the global financial crisis, the price of gold has often been portrayed as a barometer of global economic insecurity (in principle, holding gold is a form of insurance against war, financial Armageddon, and wholesale currency debasement) so does the collapse in gold prices - from a peak of $1,900 per ounce in August 2011 to under $1,250 at the beginning of July 2013 - represent a vote of confidence in the global economy?

While the US$3000 figure is wildly above most forecasts, which are mostly flat at the current level, UBS global commodity analyst Tom Price said these flat forecasts are based less on informed analysis than on the fact that "people just don't know what's going on."

This summer we are nearing a possible inflection point in terms of Fed actions. The mere suggestion from the Fed that something is going to change is enough to supercharge markets, either up or down....Will markets go to 20,000 or to 5,000? That depends upon the Fed and how much they debauch the currency.......Stay tuned, this story has hardly begun.

The damage has already been done. Junior mining companies have already dropped 80%. Rather than wallow in the injustice of the apparent gold market manipulation, I believe it is better to apply the wisdom, "if you can't beat them, join them."

It seems that the past few years of falling interest rates have lulled a big part of the global economy into financing with variable-rate debt...[As such,] when interest rates go up (as they did last week), there’s a world-wide reset in interest costs that, best case, amounts to a tax increase on individuals and businesses and, worst-case, threatens to blow up the whole system.

Are stocks in a bubble? While leverage has returned to the stock market driving up stock prices and aggregate demand in the process, margin debt is still shy of its all-time high as a percentage of GDP, so there is certainly some headroom for further rises. A look at the following 5 charts illustrate that contention quite clearly.

Lately, the dollar has been making a comeback and, as usual, gold is tanking...[That being said,] however, the timing of the dollar’s resurgence is a bit curious. Perhaps not coincidentally, gold began tanking just as the dollar was advancing against the yen. [Why do I say "Perhaps not coincidentally"? Read on.]