Unhedged Gold now! Gold forever! Only gold! Gold! Gold!
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Oct 7, 2025 Gold prices are soaring, reaching nearly $4,000, and the hosts discuss the factors driving this frenzy. They explore the link between falling real rates and gold’s allure as a safe haven. The debate heats up over whether gold is a speculative bubble or a genuine portfolio hedge. Central banks are loading up on gold amid global uncertainty, while retail demand surges through gold ETFs. Concerns about Japan’s economy lead to recommendations for shorting the yen and investing in Japanese stocks, highlighting volatility amid changing policies.
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FT Festival Recording Meet-Up
- Katie recalls recording at the FT Weekend Festival with Robert Armstrong traveling from New York.
- The hosts used the anecdote to set up a follow-up about a prior gold call they made together.
Real Rates Drive Gold Demand
- Falling real interest rates reduce the opportunity cost of holding non-yielding assets like gold.
- That relationship helps explain part of the recent strong rally in gold prices.
Past Spikes Preceded Long Drawdowns
- Past straight-line spikes in gold often preceded long periods of poor returns.
- Historical episodes (1970s and post-2008) suggest strong rallies can be followed by lengthy underperformance.