• They had free candy and goodies (but you had to sign up to get them)
• They were in front of the table, catching people as they walked by
• They used a generic pitch to get people’s attention, “Are you tired of the political circus?” which went with their custom brochures
• They didn’t argue, debate, or keep pushing after the sell had been made

Recently, we’ve blogged about YAL chapters in Ohio helping out with The Ohio Project, which is a grassroots ballot initiative to nullify the federal healthcare mandate in Ohio. 385,000 signatures had to be gathered for the initiative to appear on the ballot this fall. On Thursday, about 550,000 signatures were turned in to the secretary of state (440,000 by the Ohio Project, and another 110,000 by a paid effort, Ohioans for Healthcare Freedom). 

Now, this might seem like the end of the story. However, following this event, the Ohio Democrat Party sent out a press release addressing the initiative. Usually, I ignore messages sent out by the two parties, but this one was so hideous that I felt it had to be addressed. 

The message from Seth Bringman, the ODP’s communication director, is below.

After over a year of paying petition circulators and collecting a modest amount of signatures, the Tea Party is patting itself on the back today. What the Tea Party won't tell you is that they are fighting against something that was a Republican invention championed by that Party's presidential frontrunner Mitt Romney. Their initiative is a waste of time and taxpayer money, and it doesn't come close to passing constitutional muster.

As I'm sure many of you are aware, gas prices have been skyrocketing lately. The common reason given by the media for this rise is the unrest in the Middle East. Obviously, there is some truth to this, but this trend started long before the recent revolutions.

A couple weeks ago, I made a post about how the current stock recovery is not based on fundamentals, but on inflationary pressures. I believe the same mechanisms are at work in the fuel markets. 

A few simple charts will demonstrate my point. Below is a chart of gasoline contracts since mid 2008. As you can see, there was a drastic fall during the 2008 crash, an initial recovery, then a prolonged run-up.  As you can see, this latest increase began in November 2010 (which coincidentally is the month Quantitative Easing 2.0 was announced). 

Now look at that same chart divided by the price of gold (once again, the magnitude is not what is important, but the percent change).  Even with the recent increase due to the Middle East, gas prices, in terms of gold, are still below their mid 2009 levels. 

Economists often discuss the health of the economy in terms of how many ounces of gold the Dow or S&P 500 is worth . What does that mean exactly and why is it important? 

Below is a series of charts that I hope will help explain the situation. 

The first thing to remember is that stocks are valued in DOLLARS, and just like any other good valued in dollars, this means that distorting the dollar will also lead to distortions in stock prices.  

You may have heard recently about the great run up in stocks since the 2008 crash and how this is a sign of a general recovery. Below is a chart of the S&P 500 Index (which I believe is a better indicator than the Dow Jones) since 2008. As you can see, there has indeed been an over 100% rise in prices since the low of the crash in March 2009.  (You can right-click and open the charts in a new window for a better look.)

Now, if this recovery is due to the increase in the worth of the companies and a general recovery, as many economists/traders say, you would expect to see the price of stocks to also increase in terms of other valuations. 

Below is a chart of the S&P 500 divided by the price of gold. This is the chart that people refer to when they talk about the value of the S&P 500 in ounces of gold. It is important to remember, when looking at this chart, that the exact price is not what’s important, since it’s just a ratio, but the percent change over time.  As you can see, in terms of gold, the S&P 500 has actually been down since September 2009.

If you look at the S&P 500 in terms of silver, the picture is even worse.