**ABOVE-THE-GROUND GOLD VALUE TO TOTAL U.S. MARKET CAP RATIO**

The second Chart (CDF) tells us that the median value of the *Above-the-Ground Gold Value* *to* *Total U.S. Market Capitalization rati*o is 35.50%.

The current value of 36.36% signals us that the ratio is in line with historical observations. The Median value is likely to be upwards-biased (due to the two gold bubbles experienced since 1970). During normal Market Circumstances the average Value has been 20%.

**The following Table summarizes the Gold Fair Prices If such scenarios were to materialize overnight:**

**If the scenarios were to materialize in 5 years' time, the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*Total U.S. Market Cap Annual Increase = 6 % p.a.*

**If the scenarios were to materialize in 15 years' time (plausible length of a Gold Bear Market), the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*Total U.S. Market Cap Annual Increase = 5 % p.a.*

**ABOVE-THE-GROUND GOLD VALUE TO TOTAL U.S. GDP RATIO**

Given its lower Volatility (as opposed to the U.S. total Market Cap TS), GDP might be considered a superior variable to evaluate Gold's Fair Prices.

The second Chart (CDF) tells us that the median value of the *Above-the-Ground Gold Value* *to* *Total U.S. GDP rati*o is 20.50%.

The current value of 39.08% signals us that the ratio in the overvalued-territory when compared to historical observations. During normal Market Circumstances the average Value has been 18.00%.

**The following Table summarizes the Gold Fair Prices If such scenarios were to materialize overnight:**

**If the scenarios were to materialize in 5 years' time, the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*U.S. GDP Annual Growth = 3.30 % p.a.*

**If the scenarios were to materialize in 15 years' time (plausible length of a Gold Bear Market), the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*U.S. GDP Annual Growth = 3.30 % p.a.*

**ABOVE-THE-GROUND GOLD VALUE TO TOTAL U.S PERSONAL CONSUMPTION EXPNDITURES**

Given its lower Volatility (as opposed to the U.S. total Market Cap TS), GDP might be considered a superior variable to evaluate Gold's Fair Prices.

The second Chart (CDF) tells us that the median value of the *Above-the-Ground Gold Value* *to* *Total Personal Expenditures Consumption rati*o is 31.01%.

The current value of 54.47% signals us that the ratio in the overvalued-territory when compared to historical observations. During normal Market Circumstances the average Value has been 24.60%.

**The following Table summarizes the Gold Fair Prices If such scenarios were to materialize overnight:**

**If the scenarios were to materialize in 5 years' time, the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*U.S. PCE Annual Growth = 3.30 % p.a.*

**If the scenarios were to materialize in 15 years' time (plausible length of a Gold Bear Market), the Fair Gold Prices would be:**

*Assumptions:*

*Above-the-Ground gold Stock Annual Increase = 1.50 % p.a.*

*U.S. PCE Annual Growth = 3.30 % p.a.*

**AVERAGE FAIR GOLD PRICES OF THE MODELS**

*Overnight*

*5 Years TF*

*15 Years TF*

**Expecting gold to trade in the sub $1,000 range.** $700 being a reasonable target. In case of a new Gold Bear Market it should find its bottom in the $450-$500 area.