The number of posts I’m seeing about gold in investing forums is noteworthy. Of course not surprising given the recent rally - it’s bound to get attention. But it’s interesting to see and raises a few thoughts for me.
I think gold has been viewed from different perspectives between eastern and western cultures (the average person, not referring to central banking systems here). For many eastern cultures, it’s a store of value and safety. For many western cultures, perhaps due to the heavy financialization of those societies, the sentiment is pretty much the opposite - gold is a nonproductive and speculative investment. And this shows in many of the responses in these posts. Many people treat the recent rally as if it resembles the rise of crypto or nfts. And I think that’s a very wrong comparison to make. There is no other “money” on earth that has more consensus - from the average citizen to central banks- around its value as a wealth preserver.
This makes gold less a speculative asset and more a protection against currency devaluation. The current price may fluctuate/ drop etc in the short term, but in the long term it is a safety play. And now western societies are starting to think more seriously about and appreciate this. This will only be a long-term tailwind for gold.