Long Term View of S&P / TSX Gold Stock Index

Taking a long-term view of various asset-class levels from 1928-2011 one can see that the S&P / TSX Gold Index has yet to revert to the S&P 500 / 10yr T-Bond Total Return trend line.  As for gold, it is just now arriving at the trend line meaning that it is far from a "bubble-state".

A comparison chart of gold price and the US money supply metric, Money-Zero-Maturity (MZM).  Again the gold price is far from being in a "bubble-state".   If the gold price were to reach the same heights as in Jan-1980 relative to MZM, in today's dollars gold would need to be $8,500/oz.  This number should be considered a point-of-reference rather than a prediction for future prices.

There is a good paper by then Deputy Governor, Bank of England, Mervyn King, on the relationship between money supply and inflation called: "No money, no inflation—the role of money in the economy"