Gold has never been more valuable
October 9, 2025
The price of gold this week smashed through the $4,000-an-ounce barrier for the first time.
The precious metal has been steadily rising this year as investors look to “safe haven” investments to hedge against trade uncertainty and fears of a slowing economy.
Also contributing to anxieties are the weakening U.S. labor market, rising inflation and now a government shutdown that has entered its second week. Governments around the world are also facing increasing budget pressures. And President Donald Trump’s attacks on the Federal Reserve have shaken confidence in the safety of U.S. Treasury bonds for some investors.
“$4,000 is a historic breakthrough for gold,” analysts at ING wrote on Thursday. “Gold has long reflected global economic and political stress, with its price typically rising during periods of heightened uncertainty.”
They noted that during the 2007-08 global financial crisis, gold surged past $1,000, while during the pandemic it climbed to $2,000. Earlier this year, as Trump rolled out his aggressive global tariff plan, it surpassed $3,000.
It has kept going. Since this time last year, gold is up nearly 50%, even as stocks, which carry more risk, have hit records. Individual investors have been a big reason why.
One of the most popular gold investments, an exchange-traded fund that trades under the ticker symbol “GLD,” has seen more than $35 billion of investor funds flow into it this year, an all-time record, according to State Street, which runs the fund. The previous record was $29 billion, in 2020.
Gold ETFs are popular among individual investors because buyers can invest at a price lower than what one bar of gold goes for. Each share of the GLD ETF represents a fractional interest in a trust that holds physical gold in high-security vaults run by JPMorgan and HSBC in London and New York.
Gold fever isn’t just limited to exchanges. Costco executives said in their Sept. 25 earnings conference call that sales of gold bars helped fuel its e-commerce sales. The bulk retailer said gold sales rose by double digits in the three months that ended Aug. 31.
The sagging value of the U.S. dollar is also fueling gold’s record run.
As trade and political uncertainty lingers, the dollar index, which measures the dollar against foreign currencies such as the pound sterling, the euro and the yen, has declined about 9% this year.
A falling dollar can make gold less expensive for buyers in other currencies, which continues to push up the price.
But investor beware: Gold is an “unproductive” investment, as many market gurus have said.
Warren Buffett, the legendary CEO of Berkshire Hathaway, cautioned investors in a 2011 letter that gold has “two significant shortcomings.”
“True, gold has some industrial and decorative utility, but the demand for these purposes is both limited and incapable of soaking up new production. Meanwhile, if you own one ounce of gold for an eternity, you will still own one ounce at its end,” he wrote.
Unlike interest generated by savings accounts, certificates of deposit, stock dividends or other investment vehicles, gold produces no income until it is sold.
However, Buffett said, “when people a century from now are fearful, it’s likely many will still rush to gold.”
Search
RECENT PRESS RELEASES
Related Post