A Different Way Of Looking At The Rally In The Price Of Gold

The price of gold has recently surged, leading some to believe investors are misinterpreting its significance. While financial expert Ken Fisher argues that gold has historically underperformed U.S. equities and is not a reliable inflation hedge, a different perspective suggests that gold's performance serves as a crucial indicator for the equity market. This viewpoint posits that gold's movement reflects true inflation, which is tied to the devaluation of currency, rather than solely consumer price changes. Historically, periods of rising gold prices, such as the 1970s and 2000s, coincided with stagnant or declining stock markets, as wealth was eroded by inflation. Conversely, when gold prices fell during the 1980s and 1990s, indicating arrested inflation, the stock market experienced significant growth. The article also challenges the notion of recent "Bidenflation," suggesting that price increases were due to disrupted production rather than true inflation as measured by gold. The current rally in gold pric... download the app to read more