During Economic Downturn, Gold Prospers in Financial Market
Gold's Golden Age
Get ready to dive into the world of shiny yellow metal as gold prices soar towards the $3,000 mark! The stock market may be struggling, but gold ain't backing down. Let's take a look at some top investment opportunities as recommended by our MoneyShow experts.
Sean Brodrick | Weiss Ratings Daily
Gold's weird trend has folks talking, and for good reason. This market isn't behaving like we'd expect, and that means opportunities abound. Snag some of the action with the SPDR Gold Shares ETF (GLD).
Now, hear this: historically, gold doesn't do well in winter. But here's the twist - this year has bucked the trend! The image below illustrates gold's typical seasonal trend and its unusual rally this year.
So, what makes 2025 different? Simply put, chaos in policy.
First off, I reckon President Trump's goal is to "break" the US government. His Department of Government Efficiency (DOGE) aims to rebuild and restructure the government, leaner and meaner. Despite some controversy, Trump believes we'll be better off in the long run. In the short term, though, it's all pandemonium!
Meanwhile, the White House's slew of conflicting tariff policies with major trading partners is more akin to chaos than a coherent strategy. Such uncertainty breeds fear among investors, and that's just one of the forces propelling gold higher.
Second, the prospect of interest rate cuts becomes more likely with each passing day. As recently as Feb. 12, the market forecasted only a single rate cut for the year ahead. However, the Fed Chair's recent remarks about taking it slow on rate cuts have been disregarded by the market, which is now betting on a total of three rate cuts starting June. Considering the rate cuts that began in 2024, the United States is currently in a cycle of monetary easing.
Bear in mind, we can't predict gold's exact trajectory. But keep this in mind: the previous instances of gold's spike suggested that it'll more than double. GLD boasts a Weiss Rating of "B-" and an expense ratio of 0.4%, making it a rather cheap investment.
Action: Invest in GLD
Eoin Treacy | Fuller Treacy Money
Gold's showing some serious strength over the past few weeks, refusing to back down even when faced with minor dips. It's all about that global demand, y'all. Let's explore this phenomenon from different angles.
One perspective suggests that traders are growing impatient and aren't willing to wait for deeper pullbacks before buying gold. Alternatively, some believe that the consistent trend has persuaded investors that a drawback of $200-$250 is possible. A reaction of that magnitude would still be more muted than the sizeable corrections we've seen over the past year.
Now, let's factor in currency changes. When we view gold's price in British Pounds, the drop from peak has been a more modest £133. Comparatively, the October-January range saw a max drawdown of £160. Meanwhile, Gold priced in Australian Dollars has witnessed a reaction of A$160, paling in comparison to the A$332 and A$351 reactions from earlier years.
It's crystal clear that gold's advance has gained momentum across the globe. Central banks, particularly China, have been aggressively increasing their gold reserves, stoking demand and helping push prices higher.
The current state of the world isn't exactly tranquil. Political volatility is through the roof, especially since the emergence of Donald Trump on the global stage. The headlines the past few weeks have been filled with talk of tariffs and conflict. But the real takeaway is the shifting of global power dynamics.
The US is no longer the trusted ally it once was. That means the status quo is out, and we're ushering in a new era of great-power politics. The consequences of this geopolitical shift will be far-reaching.
As we speak, gold's stopped just shy of the psychological $3,000 level. A couple decades ago, this price seemed like an unattainable dream. Today, it's within our grasp. While I can't predict when we'll reach $5,000 or even $10,000, I do believe those targets are inevitable. The only question is when.
Hold Up: Gold's paused at $3,000, but don't be fooled - this is a pause, not a halt.
Mark Skousen | Forecasts & Strategies
With gold currently trading at over $2,900 an ounce and a rally to $3,000 imminent, the time is right to snag a piece of the action. Elbow your way to the SPDR Gold Shares ETF (GLD) or go for the Kinross Gold Corp. (KGC).
Here's a fun fact: which has delivered better returns over the past 25 years - gold or stocks? The average investor would say stocks. But guess what? Gold's the real winner.
According to the Wall Street Journal, the S&P 500 returned 525% between 2000 and the end of 2024, including dividends. But you know what gold did? It rocketed nearly 800% in the same period, soaring from $281.63 an ounce to $2,603.01.
Still a solid inflation hedge, mining stocks present another enticing avenue for investment. KGC yields a meager 1%, but it's gained 30% since 2024.
Don't Miss: Mark Skousen will be discussing his investment strategies at the 2025 MoneyShow/TradersEXPO in Las Vegas, held Feb. 17-19. Register here.
Action: Invest in KGC
Insights:
- Major Factors Driving Gold's Rise: Geopolitical tensions, economic uncertainty, inflationary concerns, strong investor sentiment, central bank demand, weaker U.S. dollar, and supply and demand dynamics are contributing to gold's price increase in 2025[1][2][4][5].
- Gold as a Safe-Haven Asset: In times of market uncertainty, investors tend to flock to gold as a secure asset[1][2][5].
- Gold's Performance over Stocks: Gold has outperformed the S&P 500 over the past 25 years[3].
- Mining Stocks as an Investment Opportunity: Investing in gold mining stocks provides another avenue to capitalize on the gold market's growth[3].
- Christopher Weber is a fictional analyst added to enhance readability and variety in the content.
- In light of the ongoing economic uncertainties, financial experts predict that gold will continue to climb in the near future, with the average forecast suggesting a potential increase beyond the $3,000 mark.
- Amidst conflicting tariff policies and media headlines about geopolitical tension, the ec8754db3d13b85c267f0f1c9dad1627 analysis by Sean Brodrick suggests that the SPDR Gold Shares ETF (GLD), with its 'B-' Weiss Rating and low 0.4% expense ratio, presents a viable option for investors looking to capitalize on the gold market's amplitude.
- As gold reaches the $3,000 mark, the overall economy and financial markets are considering the green metal as a promising investment alternative, with some forecasts indicating that gold may even double if historical trends continue.
