“Gold was present in the dust that formed the solar system four-and-a half billion years ago”
Gold and gold miners are back in a downtrend. Occasionally, there are glimmers of hope, only for the sellers to come piling back in. The slide began shortly after the commodities spike in the spring following Vladimir Putin’s invasion of Ukraine, and it has been relentless. Your author shakes his head. Isn’t gold supposed to go up during times of war? Isn’t it the go-to asset in times of inflation? Apparently not.
However, if one views gold as simply another currency, then its performance has not been as bad as the headline numbers suggest. It has not done as well as the dollar, but it has outstripped the pound and the euro. Even though gold is quoted in US dollars, the dollar price of gold is irrelevant to us British investors. If you pay pounds to buy gold, and you will eventually sell for pounds, all that matters is the sterling price of gold.
The chart on page 24 shows gold in pounds over the past ten years. Gold cost £700-£800 an ounce (oz) in 2014 and 2015, and is now just shy of £1,475/oz. It is not far off its highs around £1,575/oz and remains in a clear long-term uptrend. In other words, gold has done its job and hedged investors against the mess that has been sterling these last five years.
The ideal backdrop
But, really, you want to see gold rising against all currencies. Panicking capital has been fleeing to the US dollar, which
