Gold’s $4,000 Rally Echoes the Nixon Era — and Bitcoin Is the Modern Winner

Core Insights - Gold futures have surged past $4,000 per ounce, marking the fastest rise since the Nixon Shock, driven by persistent inflation, rising unemployment, and a weakening dollar [1][4] - The Nixon Shock in 1971 ended the dollar's convertibility into gold, leading to rampant inflation and a loss of trust in the dollar, which parallels the current economic conditions [2][3] Market Dynamics - Since February 2024, gold prices have doubled, with the last similar increase occurring in the 1970s post-Nixon Shock [4] - The US M2 money supply has increased significantly alongside gold prices, influenced by trillion-dollar deficits and low interest rates [5] - The US Dollar Index has dropped 10% year-to-date, marking its steepest decline in four decades [5] Economic Indicators - Unemployment exceeds job openings by 157,000, the widest gap since March 2021, indicating a troubling labor market [5] - Inflation remains high, with 60% of Consumer Price Index items rising by at least 3%, while the Federal Reserve is cutting rates, risking stagflation [6] Institutional Investment Trends - Institutional investors are increasingly moving into gold, with Goldman Sachs raising its 2026 gold price target to $4,900 per ounce, indicating durable demand from ETFs and Central Banks [7]