Shadow Stats: Gold Near Inflation-Adjusted Low

Peter Schiff has argued for years that government inflation data in the United States is bogus. The Federal Reserve and financial media focus on a broader measurement of inflation that overlooks the significant increases in the cost of living for most Americans. What’s more, the way this inflation is measured has changed dramatically over the years, further divorcing it from reality.

John Williams’ Shadow Stats is one of the best places to find a more realistic picture of US inflation. He uses a more accurate method from 1980 of calculating inflation in the Consumer Price Index.

Casey Research worked with Shadow Stats to chart the price of gold in inflation-adjusted dollars based upon 1980 calculations. The results are striking:

Adjusted for the 1980 inflation measure, the gold price is approaching its bear market low of 2001. In fact, gold is now below the 1975 price when it became legal to own it again!

“These data clearly show that when measured against a more realistic view of inflation, gold is dramatically undervalued.

“And with total worldwide debt levels up by a whopping $57 trillion since the end of 2007, the need to own it is as important as ever.

“Don’t worry about the current rangebound price. Buying now represents tremendous value and tremendous protection against the next economic crisis.”

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