When’s the last time you checked your breath to see if it was minty fresh?
The mint ratio isn’t that kind of minty. It’s the exchange rate between the two most popular metals in school...er, the world: gold and silver. The mint ratio is the price of an ounce of gold divided by the price of an ounce of silver.
Even if you’re not interested in gold or silver...or commodities at all...you might want to pay attention to the mint ratio. The mint ratio was inversely correlated with the S&P 500 for three decades...when the S&P goes down, the mint ratio goes up.
The idea is that investors buy gold in uncertain times (which increases the price of gold) while silver generally is determined by the industrial market. That means a large mint ratio signals uncertainty, and a low mint ratio signals more investor certainty. However, the S&P and the mint ratio both went up in 2013, rather than their usual inverse relationship, so...it may or may not be a solid economic confidence indicator. Back in the day when money was backed by gold and silver, the mint ratio was held at a constant, fixed by the government.