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<title>What are the main uses of gold</title>
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<em>What is gold most used for...</em>
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<strong>IT’S OFTEN</strong> thought that gold’s value is arbitrary, or that it’s “just” decorative.
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But there are good reasons behind the enduring use of gold in the financial system across thousands of years, and its endurance for just as long as a luxury material for jewelry.
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Now, increasingly, gold’s properties of durability, malleability and conductivity are seeing the industrial uses of gold increase as new technologies develop; from aerospace to sustainable energy to computing to healthcare. Here are some of the main uses of this surprisingly versatile metal.
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<span style="font-size:11px;">Source: BullionVault via World Gold Council, LBMA</span>
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<h2> Investment and finances</h2>
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Gold has long been considered a cornerstone – and sometimes the “standard” - in investment and finance, mainly due to its scarcity, resilience and stability. No longer used as a literal currency, gold still provides a store of value and can be used as an investment to hedge against inflation and economic downturns. Investors particularly turn to gold during periods of economic instability, as it tends to preserve value more predictably than other asset classes. When inflation erodes the purchasing power of money, gold often retains its worth.
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Central banks play a crucial role in this dynamic, maintaining substantial
<a href="https://www.bullionvault.com/gold-news/infographics/central-bank-gold-biggest-smallest-change" target="_blank">gold reserves</a>&nbsp;as part of their monetary policy. These reserves serve as a financial cushion and a source of liquidity in times of crisis. The presence of gold in the reserves can enhance trust and confidence in a country's economic stability. For an individual, the possession of vaulted bullion can provide similar confidence. Investment gold held by central banks takes the form of 400oz (12.4kg) bars with a minimum fineness of 99.5%.
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Unlike stocks, which can be highly volatile, or bonds, which are susceptible to interest rate fluctuations, gold offers a tangible asset that is not directly tied to the performance of companies or governments. While stocks and bonds can yield higher returns in a bullish market, gold has continued to be a popular option for diversification, risk management, and long-term security and has been the
<a href="https://www.bullionvault.com/gold-news/opinion-analysis/gold-invest-best-asset-century-121920241" target="_blank">best performing asset so far this century</a>.
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<span style="font-size:11px;">Source: BullionVault via World Gold Council, LBMA</span>
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<h2> Aerospace</h2>
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Gold is an increasingly valuable resource in the aerospace industry, owing to its unique properties and versatility. One of its primary applications is in the creation of reliable electrical connectors and bonding wires, where the metal’s conductivity and resistance to corrosion ensure that electrical connections remain stable and effective under the harsh conditions of space, where other metals might degrade.
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Gold is also used in coating aerospace components to enhance radiation shielding. In the vacuum of space, spacecraft are exposed to intense solar radiation, which can damage sensitive instruments. Gold's reflective properties help mitigate this by bouncing off harmful rays, protecting onboard equipment. The metal is also used in visors in astronauts’ helmets to provide UV protection.
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In thermal control systems, gold’s ability to reflect infra-red radiation is crucial in managing the temperature of spacecraft, allowing instruments to operate within their optimal ranges. This is particularly vital for missions involving satellites and space probes, which encounter extreme thermal variations. As more satellites are placed into orbit, the requirement for gold – as an indispensable element in the advancement of space technology - increases.
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<h2> Electronics</h2>
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Gold also plays a pivotal role in the production of electronic items. As with many other industrial uses of gold, the metal’s conductivity and reliability is key, allowing the seamless flow of electric current and ensuring efficiency in electronic circuit boards: the power behind the world’s laptops and smartphones.
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Gold's resistance to corrosion makes it an ideal choice for manufacturing connectors, switches, and relay contacts. Unlike many other metals, gold does not oxidize, ensuring long-lasting and stable connections. This is essential for devices that require high precision and reliability, such as computers, smartphones, and medical equipment.
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Gold is also used in the production of advanced microchips and semiconductors, where thin layers of gold plating are applied to silicon wafers to enhance the performance and longevity of the components.
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As gold does not corrode, it can be recycled from old devices to aid sustainability, estimates for the carbon footprint of recycling gold versus newly mined output vary from 1/20th to as low as 1/600th. Researchers have calculated that the cost of retrieving gold from used computer motherboards is 50 times lower than the value of the metal recovered. As technology continues to advance, the demand for gold in this sector is likely to remain strong.
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<h2> Dentistry and medicine</h2>
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Gold has been used within dentistry for centuries – the first ever printed book on dentistry, from 1530, provides advice on treating tooth decay, recommending cleaning the cavity and filling it with gold leaf. There is also evidence that gold wire was used to treat teeth in Ancient Egypt. By the early twentieth century, gold was the standard material used for dental fillings, implants and crowns.
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Gold’s malleability allows dentists to precisely shape it to fit a patient's teeth. Despite the advent of newer materials, gold remains a preferred choice for many dental restorations due to the reliability and longevity resulting from its resistance to corrosion.
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In medicine, gold plays a crucial role in diagnostics and treatment. Gold nanoparticles are employed in various medical applications, including targeted drug delivery and imaging techniques. These nanoparticles can be engineered to bind to specific cells or tissues, allowing for precise treatment of conditions such as cancer. Additionally, gold is used in rheumatoid arthritis treatments, where compounds like sodium aurothiomalate are administered to reduce inflammation and slow disease progression.
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Gold also plays a pivotal role in enhancing the performance of biomedical sensors - monitoring physiological conditions, detecting diseases, and guiding medical treatments - due to its excellent conductivity and ability to form stable and reactive surfaces. These properties have led to its use in the booming wearables market, as well as in more specialized medical technology.
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<h2> Jewelry</h2>
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Gold has been revered for its beauty and rarity, making it a symbol of wealth and status across cultures and epochs. Ancient Egyptians crafted magnificent gold pieces for pharaohs, while Indian weddings often feature intricate gold jewelry, signifying prosperity and blessings. In Western cultures, gold has been associated with milestones such as weddings and anniversaries. Its appeal seems to transcend national boundaries, making gold a universal emblem of prestige.
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The purity of gold, measured in karats, significantly affects its value and wearability. Pure gold is 24 karats, but its softness makes it less practical for everyday jewelry. Consequently, gold is often alloyed with other metals to enhance durability and allow it to take different forms, shades and shapes. Commonly used alloys include 18-karat gold (75% pure) and 14-karat gold (58.5% pure). Higher karats indicate higher purity and value, but lower karats provide greater resilience and affordability.
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With growing awareness of environmental and social impacts, ethical sourcing has become crucial in gold jewelry production and other gold metal uses. Responsible practices include fair mining conditions, minimizing ecological footprints, and supporting local communities. Certifications like Fairtrade and the Responsible Jewelry Council ensure that gold is sourced sustainably and ethically, allowing consumers to make informed choices that align with their values.
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<h2> Recognition</h2>
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“Gold medal” and “going for gold” are synonymous with success, and gold has long been revered as a symbol of victory and prestige. Its shine, rarity and expense make it a coveted material for recognizing outstanding achievements. In sports, gold medals and trophies are awarded to winners, most famously at the
<a href="https://www.bullionvault.com/gold-news/infographics/olympic-medals-real-gold-silver-bronze-medal-count" target="_blank">Olympics</a>, where the metal clearly outranks silver and bronze on the winners’ podium.
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Beyond sports, gold is widely used in military and civilian honours. Medals and badges crafted from gold are bestowed for acts of bravery, exceptional service, or notable contributions to society. These items serve as tangible reminders of their accomplishments and sacrifices, to be worn with pride and passed down through generations.
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Psychologically,
<a href="https://www.bullionvault.com/info/british-museum-luxury-power-exhibition-curator-interview" target="_blank">gold is associated as a reward with luxury, wealth, power</a>, and excellence beyond the commonplace. The allure of gold as a symbol of achievement continues to inspire and reward those who excel in their endeavours.
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<h2> Food and drink</h2>
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Gold has no odour or flavour and is chemically inert. So, why is it increasingly an ingredient in food and drink? Edible gold leaf is used by some chefs to increase the visual appeal and prestige of gourmet dishes. Thin sheets of gold leaf now adorn chocolates, pastries, and even sushi, steaks and cheeseburgers. Gold-infused coffee, tea, and spirits are also increasingly popular, adding a touch of opulence to everyday indulgence – at a price.
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As gold is biologically inert and passes through the digestive system without being absorbed, it has no nutritional value, but does add a visually striking element to a dish. Gold-enhanced food and drink can provide a unique visual spectacle and caters to those seeking to indulge in a lavish treat. The use of gold as a marketing tool in high-end culinary experiences underscores its role in enhancing the perceived value and sophistication of products, and as more money is spent on luxury dining, the use of gold as an adornment has increased.
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<h2> Future uses of gold</h2>
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Technological advancements could allow for various future uses of gold, not all of them predictable. Gold nanoparticles are at the forefront of medical innovation, and are being explored for their potential in targeted drug delivery systems, where they can transport medication directly to cancer cells. Additionally, gold-enhanced nanotechnology is aiding in the development of advanced diagnostic tools that can detect diseases at an early stage, offering hope for more effective treatments and improved patient outcomes.
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Gold is emerging as a valuable component in the push towards sustainable energy, where nanoparticles are being integrated into fuel cells, increasing their efficiency and extending their lifespan. Similarly, gold is being used in the production of solar panels, enhancing electrical conductivity and overall performance.
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The metal is also paving the way for breakthroughs in quantum computing. Its conductive properties make it an ideal material for qubits, the fundamental building blocks of quantum computers. Furthermore, gold's unique attributes are being harnessed in various futuristic technologies, including advanced sensors and communication devices.
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Gold's future applications could extend far beyond its traditional roles, positioning it as a key material in medical, energy, and technology advancements. Its contributions are set to help shape the future, driving innovation and sustainability across multiple sectors.
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<h2> Uses of gold FAQs</h2>
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<button aria-controls="faq-1-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-1-body" id="faq-1" itemprop="name" role="button">What is gold used for in jewelry?</button>
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<p>Gold has been used in jewelry for thousands of years primarily due to its appearance and natural lustre that doesn’t diminish over time due to gold’s inertness and resistance to tarnishing. Pure gold is relatively soft and easy to craft into delicate and intricate pieces and can also be combined or alloyed with different metals to change its colour and hardness.</p>
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<button aria-controls="faq-2-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-2-body" id="faq-2" itemprop="name" role="button">What is investment grade gold?</button>
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<p>The global wholesale gold investment market, centred in London deals in the London Good Delivery gold bullion bar. This London Good Delivery bar weighs 400 troy ounces - about 12.4 kilograms - and is about eleven inches long. It is stamped on the top (the larger face) with the manufacturer's name, the weight, and the assayed purity. The minimum specified fineness must be 99.5% pure gold, but improvements in the refining process mean that Good Delivery bars now reach 99.99% purity or higher.</p>
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<button aria-controls="faq-3-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-3-body" id="faq-3" itemprop="name" role="button">Is gold jewelry subject to VAT?</button>
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<p>In the UK gold jewelry is subject to Value Added Tax (VAT) at the standard rate of 20%. In the UK gold jewelry is considered a consumer good much like a mobile phone or TV. However, investment grade gold bullion in the form of London Good delivery bars or investment grade coins and small bars can be bought and sold free of VAT.</p>
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<button aria-controls="faq-4-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-4-body" id="faq-4" itemprop="name" role="button">What percentage of gold is used for investing?</button>
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<p>Since 2010 the percentage of gold used for investing has averaged 29%. 2013 saw the lowest investment percentage at 18% and in 2020 during the Covid pandemic the percentage of investment gold peaked at 49%. If you include Central Banks reserves as gold investment of sorts, then between 2022 and 2024 this reached 23% of gold demand.</p>
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<button aria-controls="faq-5-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-5-body" id="faq-5" itemprop="name" role="button">What percentage of gold is used for technology?</button>
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<p>Between 2010 and 2024 the percentage of gold used in technology has averaged 8% with little variation over the past decade. In comparison over the past 15 years gold used in jewelry has accounted for 50% of total gold demand.</p>
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<button aria-controls="faq-6-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-6-body" id="faq-6" itemprop="name" role="button">Why is gold used as an investment?</button>
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<p>Gold is an enduringly popular investment for its ability to retain value over time and serve as a hedge against inflation and economic instability. Analysts say that’s because physical gold doesn’t rely on anyone else’s financial survival or performance, getting you ‘off risk’ for credit, economic and stock-market volatility. Modern data says that gold prices have tended to do best when other assets did poorly, most especially the stock market.</p>
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<button aria-controls="faq-7-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-7-body" id="faq-7" itemprop="name" role="button">What are the primary industrial uses of gold?</button>
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<p>While historically known for coinage, jewelry and investments (including bullion), gold is used in electronics, computing, aerospace, medicine, dentistry, glassmaking, and many other chemical and industrial processes. Gold has retained and even increased its usefulness through the application of gold nanoparticles in innovative technologies, including supporting renewable energy and in modern diagnostics.</p>
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<button aria-controls="faq-8-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-8-body" id="faq-8" itemprop="name" role="button">What properties of gold make it useful in industrial processes?</button>
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<p>Gold has high electrical conductivity, excellent resistance to corrosion, high malleability and ductility, and chemical inertness. These properties make it ideal for usage in electrical components, the aerospace industry and in medical technology. Gold's malleability allows it to be drawn into thin wires and sheets, leading to its use in intricate applications. Gold's catalytic properties also make it valuable in chemical processes within fuel cells and automotive catalysts. Its biocompatibility ensures its safe use in medical devices and implants.</p>
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<button aria-controls="faq-9-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-9-body" id="faq-9" itemprop="name" role="button">Is gold used in any environmental applications?</button>
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<p>Gold is being explored for use in environmental applications such as pollution control and clean energy solutions, due to its catalytic properties. Gold nanoparticles’ large surface area and ability to act as catalysts make them ideal for breaking down harmful substances, leading to use in catalytic converters and water purification systems. In environmental monitoring, sensors utilize the conductive properties of gold to detect changes in the environment, allowing for prompt action to mitigate pollution.</p>
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<button aria-controls="faq-10-body" aria-expanded="true" class="collapsed" data-toggle="collapse" href="#faq-10-body" id="faq-10" itemprop="name" role="button">What role will gold play in future technologies?</button>
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<p>Gold nanoparticles are being used in cutting-edge medical technology and in sustainable energy innovations. Gold’s properties make it ideal for the manufacture of qubits, the building blocks of quantum computing. Advances in nanotechnology, materials science, and engineering continue to uncover new ways to harness gold's properties, and as the demands for clean energy, pollution control, and environmental monitoring grow, along with advances in wearables and space technology, gold's properties mean that the metal’s role is expected to expand – while maintaining its traditional uses as investment, decoration and store of wealth.</p>
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<link>https://www.bullionvault.com/gold-news/infographics/main-uses-of-gold</link>
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<pubDate>Tue, 18 Mar 2025 04:32:00 GMT</pubDate>
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<title>Gold Up, Inflation Next</title>
<description><p><em>Same thing, in truth...</em></p>
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<p> <strong>WHEN </strong>the price of gold rises – in other words, when more money is needed to buy an ounce of gold – that usually means that the Dollar's value has decreased, <em>writes Nathan Lewis of <a href="https://newworldeconomics.com/" target="_blank">New World Economics</a>, quoting his 2022 book Inflation: What It Is, Why It's Bad, and How To Fix It in this article first published at <a href="https://www.forbes.com/sites/nathanlewis/2025/03/11/another-round-of-inflation-on-deck/" target="_blank">Forbes</a>.</em></p>
<p> Daily price movements may not be significant. But, if the price goes up and stays there for an extended period, or if it fluctuates but the general trend is up, that signals a downturn in the value of the Dollar.</p>
<p> When we first wrote this in 2022, it took about $1800 to buy an ounce of gold. Today, it is more like $2900. That implies an $1800/$2900 = 0.621 or a 38% decline in Dollar value over that period.</p>
<p> Prices will eventually adjust, over a period of years, to the new, lower value of the currency, with some prices moving faster and some moving slower. "All things being equal" (they never are but it is a good principle), we should expect a $2900/$1800 or 61% rise in prices of goods and services going forward, compared even to the inflation-boosted prices that we have had to get used to in 2022-2024.</p>
<p> Compared to prices in 2018, when it took about $1200 to buy an ounce of gold, we should expect a $2900/$1200 or 141% increase in nominal prices. Doesn't seem like much fun, does it.</p>
<p> This is why we say "you can't devalue yourself to prosperity." No country ever got rich with a weak currency. They get rich with a stable and reliable currency, which means: a currency of unchanging stable value.</p>
<p> You would have to increase your nominal income by 141% just to break even. Maybe more than that, on an after-tax basis. Even if we do accomplish this, eventually, what it would mean is that we broke even, over a period of perhaps ten years. Instead of getting richer over ten years, we just made it back to flat. In other words, stagnation.</p>
<p> This is basically why the Latin American countries never get anywhere. They are always just catching up to the chronic depreciation of their currencies.</p>
<p> This might be confusing to some people, especially those with "Monetarist" leanings, and also those with "Keynesian" leanings – between them encompassing 90%+ of all formally-trained economists.</p>
<p> The "Monetarists" are concerned with "money supply". They have a sort of narrative which goes like this:</p>
<p> Expanding the money supply leads to more money chasing fewer goods, leading to rising prices. It is actually a pattern common throughout history, related to inflationary wartime finance. But, that has not been the common pattern since the Bretton Woods international gold standard era ended in 1971.</p>
<p> Instead, what we tend to see is: A currency loses value, for whatever reason. Often, there is no particularly unusual "expansion of the money supply" going on, or any pressure from governments to somehow finance deficits with the printing press. It doesn't fit the Monetarist narrative at all – which is why they can't figure out what's going on.</p>
<p> Later, as the economy reacts to this decline in currency value, nominal prices and nominal GDP tend to climb. Central banks typically "accommodate" this greater nominal GDP with a proportional increase in base money supply.</p>
<p> During the 1970s, the whole world suffered from dramatic "inflation". The value of the Dollar fell from $35 per ounce during the 1960s, to around $350 per ounce during the 1980s and 1990s. It was a 10:1 or 90% decline in the value of the Dollar, compared to gold.</p>
<p> Commodity prices, and prices for everything else too, verified that the decline in the Dollar vs. gold reflected a real decline in Dollar value. Oil rose from $3 a barrel in the 1960s to around $20 in the 1980s and 1990s.</p>
<p> But, there was no particular "expansion of the money supply" going on during that whole decade. It wasn't much different than the gold standard era of the 1960s, or the disinflationary "Great Moderation" of the 1980s and 1990s. Government deficits were relatively small, and "printing press finance" was nowhere to be seen.</p>
<p> During the 2000s, another major decline in the value of the Dollar vs. gold took place. From an average of about $350 per ounce during the 1990s, it fell to about $1200 in the 2012-2019 period – roughly a 4:1 decline. Commodity prices again soared higher, confirming that the Dollar's real value was indeed declining. A barrel of oil went from an average of about $20 in the 1990s to $60-$100 afterward.</p>
<p> But, during this period, the base money supply grew at its lowest rate of the previous fifty years!</p>
<p> I bring this up because we are again seeing the same pattern. The "inflation" of 2022-2024 was preceded by a gigantic increase in the base money supply of central banks, as a response to the Covid outbreak. This did amount to direct government financing, as governments ran gigantic deficits, issuing bonds that were effectively bought by central banks. It fit the Monetarist (or "Austrian") narrative well.</p>
<p> But today, we are seeing another big decline in the Dollar's value vs. gold, with very little expansion – even some contraction – in central bank base money supply.</p>
<p> This will again confuse the Monetarists and Austrians (they are easily confused), but we should recognize that this is actually a common pattern, just as we saw in the 1970s and 2000s.</p>
<p> But, that's why we had to write a book about Inflation.</p>
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<link>https://www.bullionvault.com/gold-news/history/inflation-gold-price-031820252</link>
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<pubDate>Tue, 18 Mar 2025 01:09:00 GMT</pubDate>
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<title>$3000 Gold! But For How Long?</title>
<description><div>
<em>Comex gold price breaks $3000, just like the hot-money bet...</em>
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<strong>SO the PRICE of GOLD</strong> is already through $3000 per ounce on Comex gold futures and London bullion
<strike>
is barely 50 cents away right now
</strike> has broken it too,
<em>writes Adrian Ash at BullionVault.</em>
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Cue much excitement in the market
<a href="https://www.bullionvault.com/about-us/in-the-press/2025/uk-r4-today-3000-mar" target="_blank">and the media</a>. Just like we saw at $1000 in 2008 and $2000 gold in 2020.
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Thing is, getting to those levels gave the gold price a bad case of 'watched pot' both times. And once the gold price in Dollars broke through, it edged back...and then took a while to get there again and hold it.
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Eighteen months for $1000 gold. Three-and-a-half years for $2000.
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The $3000 level is nothing special in itself. But big round numbers have fired up the market only to spook it twice in the past. Might the same happen again?
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<h2> $1000 gold</h2>
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Gold flirted with $995 for 2 weeks in March 2008 before finally topping the $1000 level on the Monday morning after US investment bank Bear Stearns collapsed.
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<img alt="Chart of gold's 2008 approach, touch, retreat and then return to $1000 per Troy ounce. Source: BullionVault" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/1000-gold-2008-2009.png" title="Chart of gold's 2008 approach, touch, retreat and then return to $1000 per Troy ounce. Source: BullionVault" referrerpolicy="no-referrer">
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But gold traded with a $1000 handle for just 3 days before the Fed's fire blanket smothered fears of contagion. Which showed up with Lehman's failure that September. It boosted the Dollar and
<a href="https://www.bullionvault.com/gold-news/opinion-analysis/truth-about-gold-prices-today-01142009" target="_blank">sucked speculative credit out of all markets, including gold</a>.
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The price fell hard in USD (while setting new ex-Dollar highs). Then, as QE and zero interest rates fought to stem the collapse in world equities, gold traded back below $1000 for the next 18 months before decisively breaking that level.
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In fact, after the Bear Stearns' top, bullion prices took 369 trading days to get there again, only to flip $10 above and $10 below before finally taking out the $1000 level on the last day of September 2009 and never looking back.
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Well, not quite. Gold fell as low as $1045 six years later.
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<h2> $2000 gold</h2>
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Despite jumping 7-fold during the Tech Crash and then global financial crisis, gold missed $2000 by $80 at its 2011 peak.
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Bullion then took 9 years to get near that level again, when Covid sent gold prices soaring...
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...because lockdowns crushed the price of useful stuff (oil futures briefly went sub-zero), whereas the ultimate safe haven was and is supremely useless for anything much beyond storing wealth and value.
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Perfect for the prison planet of 2020.
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<img alt="Chart of gold's 2020 approach, touch, retreat and then return to $2000 per Troy ounce. Source: BullionVault" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/2000-gold-2020-2024.png" title="Chart of gold's 2020 approach, touch, retreat and then return to $2000 per Troy ounce. Source: BullionVault" referrerpolicy="no-referrer">
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Gaining 1/3rd from the first Wuhan cough of late November 2019, gold hit $2000 per ounce in early August 2020, but stayed there for only 4 sessions.
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Priced in Dollars, gold then lost $70, bounced to $2008, but took another 388 trading days to get there again...
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...a feat it managed for only 2 sessions as Russia pushed towards Kyiv in its all-out invasion starting February 2022.
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From there, it was another 266 days before gold broke $2000 again, holding that level for almost 2 weeks before flipping below, and above, and then below 3 times in spring 2023 amid the 'mini crisis' in US tech-sector banking.&nbsp;
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Gold then kissed $2000 goodbye yet again that May. It waited a further 132 trading days to top it in the November, only to flip and flop some more, and then finally rise above it...
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...before dropping $10 below on Valentine's Day 2024...
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...and then finally, FINALLY, moving to have and hold $2000 from that day forth. So far.
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<h2> $3000 gold</h2>
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Gold priced in Dollars began last year at $2100 per ounce, and it came into 2025 at $2600.
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So its year-to-date rush is dramatic, repeating most of 2024's record Dollars-per-ounce gain inside 10 weeks.
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What's more, and rushing higher as Donald Trump delivers exactly the policy chaos he had promised in the US election, gold set 10 new all-time Dollar price highs in February. That matches the 1-month count of &lt;gulp&gt; Sept 2011.
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But markets move opinions, of course, and bank analysts are now rushing to revise their 2025 gold price forecasts higher, if only from $3000 to $3100 for the more bullish forecasters.
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The speed of gold's ascent means that private investors sound equally 'meh!' with the New Year forecast from BullionVault users now looking all-too doable at $3070. That seemed a much bigger stretch when we asked back at $2600.
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Fast forward to mid-March and $3000 gold is just a heartbeat away (at pixel time). Which is right where the hot money wants it.
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Gold's hottest hot hotties love gold options, of course, because if they call it right, then each $1 staked a Comex bet can become many more.&nbsp;
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The most active contract is now April. And can you guess what the single heaviest strike-price is by far for April Calls?
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Yep, $3000 per ounce. As of Thursday night, that bet accounted for 6.7% of all open Call options in Comex gold derivatives, followed by $3050 with 4.3% of open interest.
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In fact, more than 2-in-5 April Calls are for strikes at $3000 or above. Whereas would-be sellers now holding Puts have staked less than half-a-percent of their Open Interest at $3k or above.
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So what happens now that April gold futures have touched and moved up through $3000 per ounce?&nbsp;
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The hot money's biggest bet has paid off, and those happy-clever traders will no doubt want to close their Calls and bank their profit. And if the history of $1000 and $2000 gold gives any guide, the metal might then struggle to stay there, at least at first.
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But does history apply here in 2025's Trumpian world?
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Yes, the 5 silliest words in finance always claim that "Things are different this time". But they really might be for gold right now.
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First,
<a href="https://www.bullionvault.com/gold-news/gold-investor-index/trump-gold-investing-030420251" target="_blank">gold has only just returned to favour among Western investors</a>, rather than breaking $3000 amid an investing mania. Second, the crisis which investment cash is trying to protect against has barely begun.
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Trump uncertainty and fear mean that US stocks have so far lost only 10% from their record high of just 1 month ago. He's still got the best of 4 years in the White House. And on a 5-year horizon, as we never tire of repeating,
<a href="https://www.bullionvault.com/gold-news/opinion-analysis/stocks-down-gold-98-time-07042018" target="_blank">gold has always been higher</a>&nbsp;when the S&amp;P500 index has lost value. Well, very nearly.
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Sure, things could be different this time. But if
<a href="https://www.bullionvault.com/gold-news/gold-price-news/gold-3000-trump-trade-war-031320251" target="_blank">the US trade war now</a> raises the cost of living while hurting growth like everyone expects, then the resulting stagflation will provide the perfect backdrop for investing in gold.
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Meantime, here's to $3000 gold and the furious re-writing of analyst forecasts it will provoke.
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</description>
<link>https://www.bullionvault.com/gold-news/opinion-analysis/gold-3000-price-record-031420251</link>
<guid isPermaLink="false">https://www.bullionvault.com/gold-news/opinion-analysis/gold-3000-price-record-031420251</guid>
<pubDate>Fri, 14 Mar 2025 02:16:00 GMT</pubDate>
<author>Adrian Ash</author>
<category>3000</category>
<category>gold</category>
<category>price</category>
<category>dollar</category>
<category>2000</category>
<category>1000</category>
<category>history</category>
<category>investing</category>
<category>trump</category>
<category>record</category>
<category>dollar</category>
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<title>Gold Mining Stocks Suck</title>
<description><p><em>Gold +50% since 2011, miner stocks down 50%...</em></p>
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<p> <strong>THIS IS </strong>a response to an article on gold stocks I read, <em>writes Gary Tanashian in his Notes from the <a href="https://nftrh.com/2025/03/11/gold-stocks-5/" target="_blank">Rabbit Hole</a>.</em></p>
<p> Be aware that the writer, at <a href="https://www.gold-eagle.com/article/gold-stocks-fantasy-vs-reality" target="_blank">Gold-Eagle</a>, does have 22 years of fact, of proof on his side.</p>
<p> His argument is that gold stocks suck, to put it technically. Those 22 years of ignominy are not to be taken lightly.</p>
<p> In his Gold Stocks: Fantasy vs. Reality, Kelsey Williams points out what all gold bugs know: How bloody terrible the miners have performed vs. their product.</p>
<p> So this response is not criticism. It is, however, a response with more color than just the cold hard historical facts.</p>
<p> Our all-everything chart shows the fact of the matter. I am not going to over-talk it. For that you can reference Friday's article on the subject. But the ratio between the HUI Gold Miners stock index and the price of gold itself has been Ignominy-Central since 2004 and, as I noted in my article, that is for good reason.</p>
<p> Gold miners should have under-performed, given the macro we had. And they did.</p>
<p> <img alt="HUI/Gold ratio and the backdrop for gold stocks" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/hgr-4-03202501.png" title="HUI/Gold ratio and the backdrop for gold stocks" referrerpolicy="no-referrer"></p>
<p> Now, I have no bone to pick with Mr.Williams, but his article appeared just after mine, which presented the potential of a view opposite his. So why not check his assumptions?</p>
<p> He starts off noting the period I noted, as well. That was 2001-2004.</p>
<p> <em>"Alas, that three-year period of super success for gold stocks compared to gold was followed by 22 years of declining performance, thus far.</em></p>
<p> "The current gold stocks-to-gold ratio is 0.11, just slightly above the 0.10 mark touched in 2024, and prior to that in 2015.</p>
<p> "The reality of the decline in the ratio from 0.60 down to 0.10 is exacerbated by the fact that not only are gold mining stocks underperforming gold bullion on a long term basis, they are net losers over the past 14 years, even in the face of a sharply higher gold price."</p>
<p> Mr.Kelsey is giving us the history of it, which any committed gold bugs of that era know all too painfully well. What's more...</p>
<p> <em>"Since the peaks for both gold and gold mining stocks in 2011, the gold price has increased by more than 50% ($1900 to $2900); whereas, gold stock prices have declined by 50%.</em></p>
<p> "As far as gold stocks being undervalued relative to gold bullion, well...of course they are. If they continue to underperform so drastically as has been seen, then how could they not be undervalued?</p>
<p> "Those who claim that gold stocks are undervalued mean that their prices have not gone up as much as expected, and, therefore, should increase substantially to make up for their failure to meet expectations. Good luck with that."</p>
<p> Again, history and the talk of gold stock bugs crying "value" is similar to when silver bugs cry "value!" because simply the Silver/Gold ratio is so depressed, based on distant historicals. That is not the way to measure value, so Mr.Kelsey is correct there as well.</p>
<p> 'Cheap' is a better word than 'value' in these cases.</p>
<p> <em>"There are a host of reasons to not own or invest in gold stocks, except on a short-term, very speculative basis.</em></p>
<p> "They are underfunded operations (in most cases), subject to a host of external risk factors including labor strikes, shut downs, nationalization, etc. The biggest risk factor for most investors is the continuation of historical long-term underperformance, coupled with the risk of outperformance on the downside.</p>
<p> "The biggest declines in gold stocks come when gold and/or stocks in general fall precipitously. That has been shown clearly with gold stocks versus gold 1980-2000; and with gold stocks versus stocks in general (most recently in 2020 and 2022).</p>
<p> "Earlier this year, I included gold stocks on my list of five investments to avoid in 2025. The reason for that warning is that I believe the risks outweigh the potential rewards. I still do.</p>
<p> "If anything has changed, it is that the risks are greater now than at the time I wrote the article."</p>
<p> Again, he is citing what has been. He cites facts. These are facts I have been aware of for many years. Gold stocks sucked for a majority of the 2004-2024 period.</p>
<p> Where I take issue is that he extrapolates the 2001-2022 macro into the future. There are no macro-fundamentals mentioned. No major chances in the macro backdrop. No conditions like gold now strongly out-performing the cyclical macro since 2022.</p>
<p> For most of the 2004-2024 period this was not the case and hence, gold stocks had leverage alright; negative leverage.</p>
<p> <img alt="Gold ratios important to gold stocks" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/gold-ratios-03202501.png" title="Gold ratios important to gold stocks" referrerpolicy="no-referrer"></p>
<p> However, I am not a robotic or automatic thinker. I am a rational and hype-averse thinker, but not set in stone with it. I am also a "what if?" thinker. As in, what if the blow out in the 30-year US Treasury yield "Continuum" which I have watched for years actually meant something as I thought it did at the time (2022) and still do?</p>
<p> What if it meant an end to the era of inflationary Fed policy AKA business-as-usual, circa 2003-2022...?</p>
<p> <img alt="30 year Treasury yield" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/tyx-1-03202501.png" title="30 year Treasury yield" referrerpolicy="no-referrer"></p>
<p> What if that, in combination with the 2001-2004 factors shown on my first chart above and in Friday's article 2001: A Historical Odyssey For Gold Stocks, we have a macro suited to that most unexpected of occurrences, an out-performance by gold mining stocks vs. their product, developing?</p>
<p> If this happens it will have taken the investing world by surprise, as Mr.Kelsey's article implies. If it happens as I think it very well may, it could be for another short 3-year phase or something longer. I do agree that gold mining positions should always be trades rather than investments. But a trade can last days and great trade can last years.</p>
<p> An interim caveat to my view would be if the broad markets tank bearish for real and the gold bugs flip and lead the tank-o-rama. That is another past fact as illustrated by Kelsey Williams. So there are risks. There are always risks in all investments.</p>
<p> But risk vs. reward is a thing too, and I like the RvR in a sector that almost nobody thinks will ever perform and yet has ever more beneficial macro-fundamentals developing behind it.</p>
<p> The bottom line is my response is written by someone who abhors those who week after week, year after year have written bullish things about gold stocks. They are what we call promoters. Cheerleaders.</p>
<p> But I have presented facts of my own that lend color to the situation. Color that asks us to at least try not to be on autopilot where a potential big winner of a trade is concerned.</p>
<p> I have shown reasons why it could well be different this time. Fundamental reasons. The HUI/Gold ratio has not yet gotten off the ground, but it is something I am watching for.</p>
</description>
<link>https://www.bullionvault.com/gold-news/history/gold-mining-stocks-hui-031220252</link>
<guid isPermaLink="false">https://www.bullionvault.com/gold-news/history/gold-mining-stocks-hui-031220252</guid>
<pubDate>Wed, 12 Mar 2025 01:09:00 GMT</pubDate>
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<title>Silver Investing 'Goes Mainstream' at Record Ex-Dollar Prices</title>
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<em>The Economist magazine spots silver supply deficit...</em>
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<strong>With SILVER PRICES</strong> setting fresh record highs outside the US Dollar, investing in the precious metal "is inching towards the mainstream" reports
<em>The Economist</em> magazine as leading analysts forecast a wide deficit of supply to meet global demand for the 5th year running.
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Yet another new record for silver industrial demand will help offset weaker jewelry purchases – dented by silver's strong price rise – according to analysis from specialist consultancy Metals Focus for the Washington-based Silver Institute.
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<div class="embed-responsive embed-responsive-16by9 margin-bottom-sm">
<iframe allow="accelerometer; autoplay; encrypted-media; gyroscope; picture-in-picture" allowfullscreen="" frameborder="0" height="315" src="https://www.youtube.com/embed/y7xMzUVfcBI?si=zAqcQ9Bq1_x3NiXK" width="560" referrerpolicy="no-referrer"></iframe>
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Like silver's industrial and other productive uses – led by "ongoing structural gains in green economy applications" such as
<a href="https://www.bullionvault.com/gold-news/market-fundamentals/silver-solar-investing-tops-oil-needs-double-06282023" target="_blank">silver's solar energy technology</a>&nbsp;– silver bullion investing is forecast to rise 3% by weight in 2025, the Silver Institute says. Because "as Western investors adjust to new price levels, fresh investment is expected to improve, and profit-taking will also ease."
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Mining output will rise 2% and scrap recycling will rise 5% on Metals Focus' outlook,
<a href="https://silverinstitute.org/global-silver-market-forecast-to-remain-in-a-sizeable-deficit-in-2025/" target="_blank">cutting the gap</a> between total supply and global demand by 1/5th but "still sizeable historically".
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<img alt="Silver's month-average price since 1971 in US Dollars, UK Pounds, Euros. Source: BullionVault" class="img-responsive" src="https://www.bullionvault.com/gold-news/sites/default/files/03072025-silver-gbp-record-price.png" title="Silver's month-average price since 1971 in US Dollars, UK Pounds, Euros. Source: BullionVault" referrerpolicy="no-referrer">
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Setting its highest annual average price since 2012 at $28.20 per Troy ounce last year, silver bullion set a new all-time annual high in UK Pounds and the Euro at £22.10 and €26.13.
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Silver in February then set a new month-average nominal high in Pounds Sterling at £25.68 –topping April 2011 by 1 penny – and set its highest Euro-equivalent average since the historic peak of New Year 1980 (based on the Deutsche Mark conversion rate) at €30.91 per ounce.
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That still left the precious metal far below those tops after accounting for inflation, at barely 1/3rd the month-average value of January 1980 in real terms.
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For 2025, twenty-four of the 25 analysts entering their silver-price prediction into this year's
<em><a href="https://www.lbma.org.uk/forecast-survey-2025" target="_blank">LBMA Forecast Survey</a></em> are bullish. The other projects that silver's average price will match 2024's decade record in Dollar terms and also foresees an intra-year peak above $40, almost 25% higher than current levels.
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"Silver is to outperform all precious metals in 2025," sa |
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