Let be clear - I am not a “gold bug”. In fact I used to make fund of gold bugs all the time. Fred Hickey, who apparently was a “technology strategist” used to devote most of his newsletter to gold, and gold mining stocks, while missing the greatest bull run in tech stocks ever seen. Long gold miners, while recommending short Tesla and Nvidia is probably about as mentally deficient as it gets. I always had two big problems with gold bugs. First, why if fiat currencies are so bad did we get a bear market from 1980 to 2000, and then again 2011 to 2020? What changed in these periods?
Gold bugs often wave away bear markets in gold as some sort of government conspiracy, which may well be true. But in the fund management game, owning an asset in a 10 or even 20 year bear market is one way ticket to unemployment. As long time readers will probably guess, I see gold as a reflection of political attitudes to rising wages. And the recent surge in gold, in my view is inline with President Trumps use of tariffs to boost American wages.
