The Fundamentals Suggest Gold is Headed Higher

The mainstream press seems compelled to refer to the growing demand for gold as a “safe haven” demand.  Here’s a CNBC account just days ago:  “Gold — typically viewed as a safe haven asset — has had a stellar 12 months, gaining 66% over the course of 2025.”

It doesn’t hurt to call it safe haven demand, except that it suggests that someone is looking for a hidey-hole or a bomb shelter for what it to come.  We think it is more accurate to describe things in a straightforward manner.  In this view, financial institutions and people the world around are recognizing that the money printing fraud – what we have long called legalized counterfeiting – is at last being seen for what it is and is coming to an end.  

So the dynamic at work is simply a matter of fleeing from the fiat money fraud.  It is not different from Bernie Madoff’s investors realizing that something is wrong, withdrawing their money, and closing their accounts.  It is not sudden new demand for a safe haven, as much as they are putting distance between themselves and the scene of the crime.

So it is with gold and silver investors.  They are leaving the scene of the monetary crimes.

As in the case of Bernie Madoff’s funds, it is only in the final stages that people all leave at once, storming the offices and demanding their money back.  But in the early stages the alert, suspicious about what they are seeing and being told, pull out.  But other new investors, not as diligent, are still coming in the door.

And so it is with the gold and silver markets.  Some are coming in, and some are leaving.  And so markets move up, correct, pause, and move again.  A Bloomberg News account captures this dynamic perfectly last week announcing that “gold shines again” after a quick burst of profit taking.  It reported that a Fidelity fund that recently sold bullion is ready to buy again. “A lot of the froth has been taken out,” portfolio manager George Efstathopoulos said.” 

It is crucial to keep your eye on the ball.  On the fundamentals.  People can be persuaded to accept a token, a warehouse receipt, or a bookkeeping entry as evidence of wealth.  But when the custodians of those instruments prove themselves untrustworthy, when for example debt is allowed to spiral out of control, those tokens will not long retain their value.  

The interim moves of profit taking and gains are interesting, but these corrections don’t tell you much about the underlying global monetary reset.  So we repeat the observation of gold expert Alasdair Macleod:  “The dollar is on its way to zero, and it is increasingly difficult to see how this outcome can be stopped. This is what the end of a fiat currency system looks like. Those who do not understand it stand to lose everything.”