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Everyone Wants To Buy It… And No One Wants To Sell
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Nearing $4,000 per ounce… Central banks are hoarding it… Silver comes close to rivaling gold… Gold is the new global safe haven asset… Crypto inflows hitting record highs… Shipping index continues to plummet… |
Table of Contents
Gold is approaching $4,000 per ounce and has rallied more than 50% year to date.
As we have reported regularly in the Daily Journal, for the first time in nearly 30 years, foreign central banks hold more gold than U.S. Treasury debt as a percentage of reserves. As the chart below highlights, this shift from Treasuries to gold began roughly 10 years ago, and accelerated after the U.S. seized Russia’s reserves following the start of the war with Ukraine. If gold is resuming its role as the world’s preferred reserve asset, history suggests it has much further to run.
We have written about the true value of gold – and why gold continues to win – in past Big Secret On Wall Street issues.
Historically, most monetary goods – including gold – were relatively difficult or energy-intensive to obtain at the time of their adoption.
However, gold’s physical durability is unique. The metal is so chemically stable that it is virtually impossible to destroy. And unlike many other commodities, only a relatively small proportion (about 3%) of gold production is consumed in industrial uses.