The Econtrarian

Much is being made of late of the out-performance of gold mining stocks vs. stocks in general in the early 1930s. Charts 1 and 2 show the behavior of the Dow-Jones Industrials stock average and the price of Homestake Mining Company from 1924 through 1935. Gold: Early 1930s vs. Early 2010s

Much is being made of late of the out-performance of gold mining stocks vs. stocks in general in the early 1930s. Charts 1 and 2 show the behavior of the Dow-Jones Industrials stock average and the price of Homestake Mining Company from 1924 through 1935. From its peak in October 1929 through December 1935, the Dow-Jones stock average was down 64%. During the same interval, a share of Homestake Mining Company, a gold mining stock, was
up a whopping 519%. Some commentators are arguing that the investment performance of gold mining stocks vs. general stock during the early 1930s will repeat in the early 2010s – i.e., gold will outperform stocks in general.

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