Core Insights - Gold has seen a significant increase of 55% this year and nearly 25% since late August, outperforming US and global stocks [1] - Despite reaching an all-time high of $4,359.40 on October 20, gold has since dropped by 4.5% within a week [2] - The article emphasizes that gold is often perceived as a safe haven during economic uncertainty, but this notion is challenged [5][6] Market Performance - Gold's recent surge is attributed to trade war concerns, inflation fears, and geopolitical instability [5][6] - Long-term performance shows that gold has annualized gains of 7.1% since 1974, which is only slightly above the 30-year US government bonds [8] - In contrast, US stocks have annualized returns of 11.5% and world stocks at 9.6% over the same period, highlighting a significant performance gap [9] Myths and Misconceptions - The article argues that gold does not serve as an effective hedge against tariffs, inflation, or market downturns, citing historical performance data [7][13] - The volatility of gold is noted, with its returns being significantly less stable compared to stocks, leading to unpredictable boom-bust cycles [15][16] - Emotional and cultural perceptions of gold as a symbol of wealth contribute to its allure, but these beliefs are described as outdated and misleading [17]
What every investor needs to know about gold's historic rally — whether it continues or not
New York Post·2025-10-27 10:00