Monday, July 23, 2012

Does gold set the price for oil?

The article "Does gold set the price for oil?" by Michael Jaeger in the Washington Times has compared the oil price and the gold price for the last 26 years, from January 2, 1986 to March 3, 2012 (6,457 matching intervals). Using basic statistics, a 2-sample t test was performed and the results are eye-opening. The comparison showed that .0602 ounces of gold times the price of gold produces the price of a barrel of oil, with an standard error of just .421%, between the calculated price and the actual price since 1986. For the last 26 years, the price of gold dictated the price of oil with 99.579 percent accuracy. That seems to be quite convincing. Read the full article for all the details. This TV news broadcast "Fiat Dollar Is The Real Reason For High Gas Prices" also talks about the same article by Michael Jaeger.

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