Measure Assets in Gold, Not Dollars

A new round of tariff announcements from the Trump administration sent markets reeling, with cold coming down from its all-time high over $4,050, only to settle above $4,000, signaling collective doubt in the system itself as investors rush to protect themselves with hard assets. 

Collectively, markets are reaffirming gold’s role at the center of sovereignty, monetary stability, and global reserve strategy, even as it has become a favorite target of Keyneseian ridicule as everything from a “barbarous relic” to a waste of physical and financial space in investment portfolios and balance sheets.

Yet, confidence in US debt continues to decline, with the “safe” status of Treasuries increasingly being questioned. That’s why now, for the first time in decades, collective central bank gold holdings have surpassed the value of their Treasuries. Central banks now hold 20% of all gold ever mined, protecting themselves from the effects of currency debasement even as they, ironically, cause it. Instead of earning yield by holding Treasuries, they continue stocking up on gold, which is a powerful statement against the results of their own monetary experiments.

Because gold is very difficult to manipulate compared to other asset classes, and isn’t subject to the whims of central bankers or the ability of an overindebted, over-spending country to pay back what it owes, central banks are rushing to stock more of it. While uncontrolled debt issuance, dollar weakness, and a massive sovereign balance sheet, central banks buy gold to protect themselves from exactly the same problems that were caused by centralized control.

Meanwhile, investors, commentators, and asset managers, love to sing about stock market highs while ignoring the problem: those stocks are being measured in a currency that’s constantly being debased. When you price them in gold, you’re using a true measuring stick that hasn’t been reconfigured by central bank wizards. Suddenly, denominated in real money, most other “booming” assets don’t look nearly as good.

USD vs. Gold, 1-Month

Equity indexes like the S&P 500 are well off their nominal highs when you measure them in gold instead of dollars. Even as equities rise in dollar terms, zoom out, and those gains often fail to beat gold’s rise. That’s because asset booms are being driven by manipulations in the form of money printing, low interest rates, and liquidity instead of real fundamentals.

'Dow Jones to Gold Ratio is about to cross a level only seen 3 times in history. 2008, 1973 and 1929' via @FinanceLancelot 📉 pic.twitter.com/MhyCyhCHM1

— Davide Iacovozzi (@davideiacovozzi) October 10, 2025

Bitcoin is no different. Bitcoiners, who love dunking on gold, are celebrating recent latest all-time highs, but love to ignore the fact that real gold is massively outperforming “digital gold.” A spectacular Bitcoin crash after Trump’s recent tariff announcements brought Bitcoin down from its highs of over $125k down to $107k, all while gold held its ground.

Bitcoin is crashing. It just dropped below $112,000. In terms of gold, Bitcoin is now down over 25% from its record high set in August. It still has a long way down to fall.

— Peter Schiff (@PeterSchiff) October 10, 2025

As Peter Schiff said on X, formerly Twitter, last week:

“Today is another example of why Bitcoin is not digital gold or even digital silver. Gold closed the week up 3%, above $4,000, and silver rose 4.4%, closing above $50. Both represent record-high weekly closes. In contrast, Bitcoin dropped over 5%, double the decline of the Nasdaq.”

Despite being the subject of status quo ridicule, gold is still the king of financial assets. Wall Street’s reflexive scorn of gold is due to the fact that gold exposes Keynesians as frauds and sometimes thieves, and threatens the premise of the existence of an entire category of academics and professionals, from Ivy League academics to mom-and-pop retail investment advisors. If a 5,000-year old rock performs just as well as a traditional 60/40 stock-bond portfolio, a lot of people are wasting their time and money.

When you measure much of the financial world in gold, many of the supposed winners lose their luster. All you needed was a honest yardstick.