Gold in the House

Through the last decade or two of gyrating stock markets and financial crisis two investments have been heralded as booms, busts and the only place to safely stash your assets: gold and your house.  With gold prices appearing to take a hint from the past behavior of home prices, it might be interesting to compare one to the other.  The chart shows the monthly average price of gold and the S&P/Case-Shiller 10 City Home Price Index.  The index is rescaled so that it was equal to the gold price in January 1987, making it easy to compare the ups and downs of both series.  The gold price is the London afternoon gold fixing in U.S. dollars.  The data on the chart are from January, 1987 when the home price series begins to February 2013, the latest home price data point.  This excludes some of the recent weakness in gold prices. (Click on graph for a larger image.)

Source: S&P/Case-Shiller Home Price Indices; St. Louis Federal Reserve Bank

Source: S&P/Case-Shiller Home Price Indices; St. Louis Federal Reserve Bank

The posts on this blog are opinions, not advice.
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