DarkRange55
We are now gods but for the wisdom
- Oct 15, 2023
- 2,035
Gold is trading near $3,490/oz as of September 1, 2025, well above its prior nominal peak of $850/oz in January 1980. On a CPI-adjusted basis, however, that 1980 high equates to roughly $3,330–$3,630/oz in today's dollars, depending on whether one applies the annual average CPI or the specific January index (with some variation if intra-day highs are considered). As a result, while current levels have approached—and briefly surpassed in April 2025—the real, inflation-adjusted record has not been sustainably exceeded. In short, gold has established new nominal records, but the 1980 spike remains the enduring benchmark for long-term valuation in real terms.
Gold had a 20 year bear market starting in the 1980's. The price of gold rising above inflation is most directly attributable to the rapid growth of India and China over the past two decades, as they are the two largest demanders of gold and together account for more than half of annual global jewelry consumption. In India, demand is anchored in weddings, savings, dowries, and jewelry, while in China, a rising middle class has steadily increased jewelry purchases alongside some gold investment as broader wealth accumulated. Since the early 2000s, China has also overtaken India as the world's largest gold producer and one of the top two consumers, with urbanization and rising incomes driving demand and the People's Bank of China steadily adding to its reserves to diversify away from U.S. Treasuries. As the GDPs of both countries grew dramatically since 2000, their gold demand surged in tandem. This sustained physical demand has been a large—though not the only—driver of gold's price increases, with monetary policy, global financial crises, and central bank diversification also playing important roles.
- Dow / Gold ratio or the DAX / Gold ratio.
As of now, one Bitcoin trades at roughly 31 ounces of gold (BTC ≈ $107,000; gold ≈ $3,450/oz). The relative high occurred in 2021, when Bitcoin reached about 36 ounces of gold. Since that peak, Bitcoin has underperformed relative to gold: although its USD price has advanced, in gold terms it remains 20–25% below the prior high, underscoring gold's resilience as a store of value during the period.
When you measure U.S. stocks in gold terms, the picture looks very different from the dollar charts. The S&P 500, priced in ounces of gold, peaked around the year 2000 during the dot-com boom at roughly 5–6 ounces of gold. Since then, even with strong nominal gains in dollars, the index has never regained that high in real terms. The ratio collapsed through the 2000s, bottomed near 0.5 ounces in 2011 when gold surged, and today sits well below its 2000 peak — meaning that one unit of gold still buys more of the S&P than it did 25 years ago. In other words, U.S. stocks have underperformed gold for a quarter century in real terms, despite appearing much stronger when measured only in dollars.
When you measure the S&P 500 including dividends, the picture changes dramatically. Since the U.S. left the gold standard in 1971, gold has risen from about $35 an ounce to roughly $3,450 today—a gain of around 9,700%. That's impressive on its own, but the S&P 500 with dividends reinvested has compounded at roughly 9–10% per year, translating into a total return of more than 20,000% over the same period. The difference comes from compounding: each year's dividends get reinvested, generating new dividends, and that snowball effect over 50+ years doubles what gold achieved. So while gold has outperformed stocks during certain crises—the 1970s stagflation, the 2000–2011 commodity boom, and even parts of the 2020 pandemic—in the long sweep of history, dividends tilt the scale heavily toward equities, making the compounding difference between 20,000% and 9,700% truly massive.
Gold doesn't automatically spike whenever there's a geopolitical crisis, terror attack, or disaster, even though people often assume it should.
1974 – Watergate / Nixon resigns
• Gold: no special spike ('70s inflation trend) — verify in monthly series.
• Safe haven: none distinct beyond broad hard-asset bid that decade.
1979–80 – Soviet invasion of Afghanistan
• Gold: surged into the Jan-1980 peak (~$850 nominal; >$2.7k CPI-adj) — see 1979–80 spike.
• Safe haven: gold itself; oil also bid amid Iran/oil shocks (contextual).
1980–82 – Volcker disinflation
• Gold: fell hard ($850→~$300) as real rates jumped.
• Safe haven: USD & U.S. Treasuries (flight-to-quality/liquidity into Treasuries well-documented).
1982 – Falklands War
• Gold: no special move (downtrend from 1980).
• Safe haven: USD dominance in early-'80s.
1988 – Lockerbie bombing
• Gold: little to no move in series.
1990–91 – Gulf War
• Gold: brief pop to ~$400 in late '90 then faded after Desert Storm began (swift resolution).
• Safe haven: USD/Treasuries once outcome looked clear.
1997 – Asian Financial Crisis
• Gold: fell (strong USD) — see 1997 drop.
• Safe haven: USD and safe-haven currencies (CHF/JPY behavior).
1998 – Russia default & LTCM
• Gold: only mild bump in series.
• Safe haven: flight-to-quality/liquidity into Treasuries during LTCM.
1999–2000 – Y2K (millennium bug)
• Gold: flat ~$280; no systemic disruption.
2000–02 – Dot-Com Crash
• Gold: stayed weak/flat (~$260–$300) through the equity bust.
• Safe haven: USD & Treasuries (classic quality/liquidity preference).
2001 – 9/11 & Afghanistan invasion
• Gold: small blip, then back to $280–300 range.
• Safe haven: U.S. Treasuries (documented "fails" spike & Fed liquidity support).
2003 – Iraq invasion
• Gold: drifted from low $300s to mid-$300s; no discrete surge.
• Safe haven: USD/Treasuries remained core; oil had episodic spikes.
2003 – SARS
• Gold: negligible effect (check 2003 monthly).
2004 – Madrid bombings / 2005 – London bombings
• Gold: minimal moves.
• Safe haven: brief Treasury bids during shocks.
2005 – Hurricane Katrina
• Gold: modest rise (~$435→$470), not dramatic.
• Safe haven: energy markets reacted more; bonds steady.
2008 – Global Financial Crisis (early phase)
• Gold: fell first (~$1,000→$700) in the liquidity squeeze, then finished 2008 up alongside Treasuries.
• Safe haven: USD & Treasuries (flight-to-liquidity).
2011 – Fukushima disaster
• Gold: only modest effect; big 2011 gold move tied more to Euro-debt/U.S. downgrade.
• Safe haven: JPY appreciated enough to trigger coordinated G-7 intervention.
2014 – Crimea annexation
• Gold: brief pop toward ~$1,350–1,380, then faded.
• Safe haven: USD/Treasuries remained the main destination.
2014–15 – Ebola
• Gold: little effect (see monthly).
2016 – Brexit referendum
• Gold: brief pop (~$1,360), momentum faded.
• Safe haven: government bonds hit record-low yields on flows (U.S./U.K./Germany).
2016 – Trump election
• Gold: overnight spike reversed; fell in the weeks after (check Nov–Dec 2016).
• Safe haven: risk assets rallied; no persistent gold bid.
2020 – COVID crash (Feb–Mar)
• Gold: dropped sharply first (~$1,680→$1,450) in the "dash for cash," then surged later with policy easing.
• Safe haven: USD & Treasuries, with unprecedented market dysfunction documented by BIS/FRBNY.
2021 – Jan 6 Capitol riot
• Gold: no meaningful move (check Jan 2021).
2022 – Russia's full invasion of Ukraine
• Gold: brief run to ~$2,070, then fell as Fed tightening dominated.
• Safe haven: USD & Treasuries ultimately set the tone.
Margin trading in the gold market offers significant profit potential but is far from easy money, carrying risks often underestimated by new participants. Leverage allows traders to control large exposures with limited capital, amplifying gains when gold prices move favorably but magnifying losses just as rapidly when they move against you. For instance, at 10x leverage, a 2% price decline in gold can erase 20% of your position, and a 5% drop can wipe out your entire margin capital, underscoring the necessity of disciplined stop-loss orders, conservative position sizing, and rigorous risk management. Professional traders leverage advanced platforms, real-time market data, and skilled teams to navigate volatility and improve their edge, outpacing retail traders who lack such resources. Gold prices, near $3,490/oz in September 2025, are driven by multiple forces: U.S. interest rate expectations, dollar strength, and inflation trends; geopolitical events like wars or sanctions; and robust central bank purchases, particularly by emerging economies diversifying away from the dollar. Additionally, periodic market manipulation, evidenced by regulatory actions against major banks for spoofing in precious metals futures, adds complexity and fuels mistrust. These dynamics confirm that margin trading in gold is a professional's arena, where disciplined strategies, superior information, and careful capital management are critical for success, while casual or speculative approaches often lead to significant losses.
If you divide all of the accessible gold on Earth (already mined + known reserves) evenly between the world's population, each person gets almost exactly 1 troy oz.
We have an oil denominated economy now vs a gold-backed one. It's not what drives us. America isn't invading another country for a gold mine. The joke is America invades any country that finds new oil reserves. It's why America kisses Saudi Arabia's ass. If you want to cripple America, shut down the oil supply. Oil is what we run on.
Gold had a 20 year bear market starting in the 1980's. The price of gold rising above inflation is most directly attributable to the rapid growth of India and China over the past two decades, as they are the two largest demanders of gold and together account for more than half of annual global jewelry consumption. In India, demand is anchored in weddings, savings, dowries, and jewelry, while in China, a rising middle class has steadily increased jewelry purchases alongside some gold investment as broader wealth accumulated. Since the early 2000s, China has also overtaken India as the world's largest gold producer and one of the top two consumers, with urbanization and rising incomes driving demand and the People's Bank of China steadily adding to its reserves to diversify away from U.S. Treasuries. As the GDPs of both countries grew dramatically since 2000, their gold demand surged in tandem. This sustained physical demand has been a large—though not the only—driver of gold's price increases, with monetary policy, global financial crises, and central bank diversification also playing important roles.
- Dow / Gold ratio or the DAX / Gold ratio.
As of now, one Bitcoin trades at roughly 31 ounces of gold (BTC ≈ $107,000; gold ≈ $3,450/oz). The relative high occurred in 2021, when Bitcoin reached about 36 ounces of gold. Since that peak, Bitcoin has underperformed relative to gold: although its USD price has advanced, in gold terms it remains 20–25% below the prior high, underscoring gold's resilience as a store of value during the period.
When you measure U.S. stocks in gold terms, the picture looks very different from the dollar charts. The S&P 500, priced in ounces of gold, peaked around the year 2000 during the dot-com boom at roughly 5–6 ounces of gold. Since then, even with strong nominal gains in dollars, the index has never regained that high in real terms. The ratio collapsed through the 2000s, bottomed near 0.5 ounces in 2011 when gold surged, and today sits well below its 2000 peak — meaning that one unit of gold still buys more of the S&P than it did 25 years ago. In other words, U.S. stocks have underperformed gold for a quarter century in real terms, despite appearing much stronger when measured only in dollars.
When you measure the S&P 500 including dividends, the picture changes dramatically. Since the U.S. left the gold standard in 1971, gold has risen from about $35 an ounce to roughly $3,450 today—a gain of around 9,700%. That's impressive on its own, but the S&P 500 with dividends reinvested has compounded at roughly 9–10% per year, translating into a total return of more than 20,000% over the same period. The difference comes from compounding: each year's dividends get reinvested, generating new dividends, and that snowball effect over 50+ years doubles what gold achieved. So while gold has outperformed stocks during certain crises—the 1970s stagflation, the 2000–2011 commodity boom, and even parts of the 2020 pandemic—in the long sweep of history, dividends tilt the scale heavily toward equities, making the compounding difference between 20,000% and 9,700% truly massive.
Gold doesn't automatically spike whenever there's a geopolitical crisis, terror attack, or disaster, even though people often assume it should.
1974 – Watergate / Nixon resigns
• Gold: no special spike ('70s inflation trend) — verify in monthly series.
• Safe haven: none distinct beyond broad hard-asset bid that decade.
1979–80 – Soviet invasion of Afghanistan
• Gold: surged into the Jan-1980 peak (~$850 nominal; >$2.7k CPI-adj) — see 1979–80 spike.
• Safe haven: gold itself; oil also bid amid Iran/oil shocks (contextual).
1980–82 – Volcker disinflation
• Gold: fell hard ($850→~$300) as real rates jumped.
• Safe haven: USD & U.S. Treasuries (flight-to-quality/liquidity into Treasuries well-documented).
1982 – Falklands War
• Gold: no special move (downtrend from 1980).
• Safe haven: USD dominance in early-'80s.
1988 – Lockerbie bombing
• Gold: little to no move in series.
1990–91 – Gulf War
• Gold: brief pop to ~$400 in late '90 then faded after Desert Storm began (swift resolution).
• Safe haven: USD/Treasuries once outcome looked clear.
1997 – Asian Financial Crisis
• Gold: fell (strong USD) — see 1997 drop.
• Safe haven: USD and safe-haven currencies (CHF/JPY behavior).
1998 – Russia default & LTCM
• Gold: only mild bump in series.
• Safe haven: flight-to-quality/liquidity into Treasuries during LTCM.
1999–2000 – Y2K (millennium bug)
• Gold: flat ~$280; no systemic disruption.
2000–02 – Dot-Com Crash
• Gold: stayed weak/flat (~$260–$300) through the equity bust.
• Safe haven: USD & Treasuries (classic quality/liquidity preference).
2001 – 9/11 & Afghanistan invasion
• Gold: small blip, then back to $280–300 range.
• Safe haven: U.S. Treasuries (documented "fails" spike & Fed liquidity support).
2003 – Iraq invasion
• Gold: drifted from low $300s to mid-$300s; no discrete surge.
• Safe haven: USD/Treasuries remained core; oil had episodic spikes.
2003 – SARS
• Gold: negligible effect (check 2003 monthly).
2004 – Madrid bombings / 2005 – London bombings
• Gold: minimal moves.
• Safe haven: brief Treasury bids during shocks.
2005 – Hurricane Katrina
• Gold: modest rise (~$435→$470), not dramatic.
• Safe haven: energy markets reacted more; bonds steady.
2008 – Global Financial Crisis (early phase)
• Gold: fell first (~$1,000→$700) in the liquidity squeeze, then finished 2008 up alongside Treasuries.
• Safe haven: USD & Treasuries (flight-to-liquidity).
2011 – Fukushima disaster
• Gold: only modest effect; big 2011 gold move tied more to Euro-debt/U.S. downgrade.
• Safe haven: JPY appreciated enough to trigger coordinated G-7 intervention.
2014 – Crimea annexation
• Gold: brief pop toward ~$1,350–1,380, then faded.
• Safe haven: USD/Treasuries remained the main destination.
2014–15 – Ebola
• Gold: little effect (see monthly).
2016 – Brexit referendum
• Gold: brief pop (~$1,360), momentum faded.
• Safe haven: government bonds hit record-low yields on flows (U.S./U.K./Germany).
2016 – Trump election
• Gold: overnight spike reversed; fell in the weeks after (check Nov–Dec 2016).
• Safe haven: risk assets rallied; no persistent gold bid.
2020 – COVID crash (Feb–Mar)
• Gold: dropped sharply first (~$1,680→$1,450) in the "dash for cash," then surged later with policy easing.
• Safe haven: USD & Treasuries, with unprecedented market dysfunction documented by BIS/FRBNY.
2021 – Jan 6 Capitol riot
• Gold: no meaningful move (check Jan 2021).
2022 – Russia's full invasion of Ukraine
• Gold: brief run to ~$2,070, then fell as Fed tightening dominated.
• Safe haven: USD & Treasuries ultimately set the tone.
Margin trading in the gold market offers significant profit potential but is far from easy money, carrying risks often underestimated by new participants. Leverage allows traders to control large exposures with limited capital, amplifying gains when gold prices move favorably but magnifying losses just as rapidly when they move against you. For instance, at 10x leverage, a 2% price decline in gold can erase 20% of your position, and a 5% drop can wipe out your entire margin capital, underscoring the necessity of disciplined stop-loss orders, conservative position sizing, and rigorous risk management. Professional traders leverage advanced platforms, real-time market data, and skilled teams to navigate volatility and improve their edge, outpacing retail traders who lack such resources. Gold prices, near $3,490/oz in September 2025, are driven by multiple forces: U.S. interest rate expectations, dollar strength, and inflation trends; geopolitical events like wars or sanctions; and robust central bank purchases, particularly by emerging economies diversifying away from the dollar. Additionally, periodic market manipulation, evidenced by regulatory actions against major banks for spoofing in precious metals futures, adds complexity and fuels mistrust. These dynamics confirm that margin trading in gold is a professional's arena, where disciplined strategies, superior information, and careful capital management are critical for success, while casual or speculative approaches often lead to significant losses.
If you divide all of the accessible gold on Earth (already mined + known reserves) evenly between the world's population, each person gets almost exactly 1 troy oz.
We have an oil denominated economy now vs a gold-backed one. It's not what drives us. America isn't invading another country for a gold mine. The joke is America invades any country that finds new oil reserves. It's why America kisses Saudi Arabia's ass. If you want to cripple America, shut down the oil supply. Oil is what we run on.
