At Any Rate Global Commodities: Hypothetically, of course. Redirecting just 0.5% of foreign US asset holdings to gold could drive prices to $6,000
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May 9, 2025 In this insightful conversation, Greg Shearer, Head of Base and Precious Metals Research at J.P. Morgan, shares his expertise on the evolving gold market. He discusses the growing interest in gold among international investors, especially amid concerns over U.S. asset stability. The episode delves into the hypothetical scenario where a mere 0.5% shift of foreign U.S. assets into gold could push prices up to $6,000. Shearer emphasizes the significant potential returns and the structural bullish outlook for gold amid changing market dynamics.
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Foreign Investor Shift Risk
- Foreign investors hold nearly $57 trillion in U.S. financial assets, about 200% of U.S. GDP.
- Rethinking risks is prompting some foreign holders to consider alternatives like gold.
Gold's Small Market Share
- Investor gold holdings total about $5 trillion, roughly 2.6% of global liquid assets.
- Including official reserves, gold holdings rise to about 8.8 trillion or 4% of total assets.
Potential Gold Price Surge
- A hypothetical 0.5% reallocation of foreign US holdings to gold equals $274 billion inflow over four years.
- This could drive gold prices to $6,000 by 2029, with ~18% average annual returns.