Transcription
What was the best investment of the last year? I want you to guess. I want you to think about where was the best money that you could possibly invest. What was the best stock that you should have purchased in the last year? Now I bet that most of you wouldn't actually have a clue.
If you are saying it's Tesla or Palanteer or Nvidia, then you're absolutely wrong, because the best investment of the last year was gold. And this is something strange because gold prices never rise. Nvidia stock has actually grown by around 27% in the last year. Tesla stock has actually grown by around 43% in the last year. And Tesla is a very unusual stock. Elon is literally sitting there with the president of the United States. So no wonder why Tesla stock has grown by 43%.
And now let's take that and compare it to gold. Gold has also increased by 43% in the last year. And if you actually look at the numbers historically, then this is a major increase because gold prices don't rise that much. If you look at Nvidia, Nvidia produces some of the best chips in the world, if not the best chips. Without Nvidia chips today, we're not going to have any kind of AI. Tesla produces some of the best EVs in the world. But what exactly does gold produce? To be honest, not much.
So why on earth have gold prices risen by 43% in the last 12 months? And if you look at gold prices since 2022, then they have actually doubled. They have risen by 106%. Now if you compare gold prices since 2022 then to Tesla, for example, then Tesla stock has actually gone down by 20%. So ask yourself a question: Where would you want to be an investor—in gold or Tesla? How is that even possible that gold prices have actually doubled in the last—since 2022—while Tesla, which is one of the most innovative companies in the world, their stocks have fallen since 2022 by 20%? That is a huge drop.
Now let's compare gold to Apple, the world's most successful technology company that has ever existed in the world. And you see the exact same pattern. Apple has increased by 27%, and that is nothing compared to 106% in gold prices. So something weird is happening over here. So here in this video, let's try to figure out what exactly is happening. Why are gold prices rising so much? Will they keep rising? Is it a good investment to make in gold right now? Should you right now literally sell everything and just buy gold stocks or buy gold directly, maybe? We'll answer all of these questions and many more. So if you're ready, give this video a thumbs up and let's get right into it.
The most important question is: Why now? Why exactly right now did gold prices start skyrocketing? Because if you look at this graph, just a little over a year ago, gold prices were 2,300 per bar. Right now, they are 3,300. And if you look at different estimates, some people say that it will go to 3,500, which is very realistic to be honest. But some people even claim that this is going to go to $4,500. So if you're going to buy gold right now, you can actually make a substantial profit. But this is speculation because people are literally guessing. But in order to find out what exactly is happening, we simply have to take a look at the factors that are driving gold prices higher and higher. The better we understand those forces, the better we can actually estimate where gold prices are going to be a few months from now, six months from now, a year from now. Will they actually reach 4,500? And if that's the case, then yes, buying gold right now is literally one of the best investments that you can actually make.
Because if you look at what's happening with Tesla, there is a real possibility that Tesla stocks are going to keep going down. If you look at Apple, then there are so many tariffs, and the White House is working on a tariff on smartphones as well, which means that Apple will have to spend billions of dollars in order to move their manufacturing, which means that their profits are going to slim, which means that their stock is going to go down. On the other side, all of these events are pushing gold prices to keep rising.
One of the major reasons why gold prices have been rising so much is because central banks across the globe are buying gold, and that's because there is so much uncertainty, and countries around the world are actually buying gold because they don't know what to expect. Let me give you a very straightforward example. This is the central bank of China, and back in 2022, they had less than 2,000 metric tons. They have increased their reserves to almost 2,200. So they have purchased a few hundred metric tons of gold. And when you have so much demand—buying gold because you have to understand at the end of the day—because central banks are buying the exact same gold that you are buying, that everybody else is buying, and when there is so much demand from people with so many deep pockets—when a central bank—when a central bank buys gold, they're buying with billions of dollars, sometimes hundreds of billions of dollars, and that shoots gold prices to the roof.
So if you literally go to the gold prices, you suddenly realize that that increase started way before even 2024, since instability started rising and a lot of people started losing faith in the global economy, and the safest investments that we have out there—it's literally gold. It's nothing else. If you look historically, there isn't a single asset that you can literally think about that could replace gold. Back 2,000 years ago, gold was the major asset. 3,000 years ago, people knew what gold is. And right now, in 2025, it still remains the most fundamental, most important asset in the market. And a thousand years from now, most likely gold will remain the most important asset.
And what makes the dollar the global currency reserve is because the United States has more gold than any other country. And there is no even comparison. If you look at the United States gold reserve and you compare it to countries such as Germany, France, Russia, China, there is literally no comparison. The gap is so huge that nobody can actually compete with the United States.
Another reason is obviously that the US dollar is weakening for very obvious reasons. Donald Trump made it clear: We want a weak dollar because we want to boost exports of the United States. But that will obviously make the imports much more expensive because the United States right now has a very important goal right in front of it. It wants to decrease the deficit that it has with other countries, especially with China. And and if you look at the currencies—the Chinese yuan and the US dollar—then the US dollar is so strong compared to the Chinese yuan that it makes no sense. So if the United States wants to compete with China, then the United States has to devalue the dollar. And when you are making the dollar much weaker, then it becomes weaker against every other currency. And that includes gold as well, which is a form of money. And that is why gold is becoming much more expensive.
Since Trump became the president, since 2025, the value of the dollar has been going down from 110 to less than 99. And Trump wants to make the dollar even weaker than that. And that means that gold would obviously become much more expensive. Even if you take the dollar right now and you compare the dollar to other currencies such as the Swiss Franc, or if you compare the dollar to the euro, you will clearly see that the dollar is becoming less and less valuable.
At the end of the day, everything goes back to the fundamental principles of economics: supply and demand. If there is less demand for the dollar, obviously the dollar is going to become weaker. And when we talk about the demand for the dollar, we are talking about global demand—demand by other countries, not just by the citizens of the United States, not just by the institutions of the United States, but by federal reserves or the central banks of other countries. And because the United States has imposed all of these walls across itself—I call them walls because tariffs are literally wars that prevent the country to do trade with other countries—the United States literally imposed tariffs on every single country out there, and that means that less trade with the United States, that eventually means that less demand for the US dollar, and less demand while supply still the same. What does that tell you about the state of the dollar? The dollar becomes weaker. That is basically the objective that the White House wanted to achieve in the first place. So no wonder why the dollar is weakening and gold prices are rising as a reflection of these policies.
There is also a lot of news about the fact that there is a recession coming to the US economy. That's what Jamie Diamond said. That's what the Goldman Sachs CEO says, and that's what basically every other economist is predicting right now because with what's happening, there is going to be less economic activity within the US economy. And that's very normal. A recession isn't literally as bad as you could possibly think. It's literally simply two consecutive quarters of negative GDP growth. Now this quarter most likely is going to be a negative quarter, but that's just an estimation because probably the next quarter will be the negative GDP growth because the impacts of the tariffs will not be immediate, but rather they will be slow. So maybe by the end of the year we will actually have two consecutive negative GDP growth, which will mean that there is a recession literally coming. And when you have a recession, you have a central bank in order to stimulate the economy in such a way so that the economy starts—starts growing again—and we prevent a recession or get out of a recession. And how do you think the central banks fixes that problem? By decreasing the interest rates. So when you have less interest rates, that increases the supply of money within the economy, and when you have of something much more than it was in the past, it becomes less valuable. So if we suddenly discover somewhere in the world a lot of gold—literally, let's say the double amount of the gold that we have right now—gold will instantly become less valuable because now we have much more of it in the economy. The exact same logic applies to every other currency that you know. So if the US dollar—if the supply of the dollar will increase because of low interest rates—because now borrowing money will become much more accessible—the value of the dollar is going to decrease. And since investors are expecting that the Fed is going to cut the rates in the foreseeable future because of a recession, what happens to prices of the gold? Gold prices start to rise because investors are already selling their other stocks or other investments and taking that money and throwing it into a much more stable asset such as stocks such as gold.
The entire market of bonds is $140 trillion all across the globe. And that's a huge market because every single government around the world—and that includes not just the United States but the European Union, South America, China, and the rest of the world—all those countries are issuing bonds in order to raise money to fund their operations. So we have such a huge bond market. So if you want stable assets, obviously you're going to go and you're going to buy government bonds, especially the US government bonds that are the most safest investments that you can possibly find. And now if you're an investor and you see so much instability in the market, you see so much uncertainty about the future, you are going to allocate part of your portfolio. So even if you're selling 1% of your portfolio and taking that money and buying gold, just imagine how much demand there is for gold right now in the market. And if we include within itself the stock market where the total value of the global stock market is $120 trillion, just 1% of that market is going to shoot gold prices to the roof. Which is exactly why gold prices have been rising dramatically over the last two to three years because instability literally started—I mean it started in 2020, but in 2022 it got much worse. China has been actually dumping their treasury bills because of the trade war or the worsening relationship between China and the United States, and they've been taking that money and they've been actually buying gold with it in order to increase their reserves, and you could clearly see that in the graph that I have right in front of me.
So China has accumulated trillions of dollars of treasury bills of the United States because they've been doing business in the United States, and when they get paid in dollars, they took those dollars and they lend that money to the government of the United States. So they have so many treasures of the United States. But because the relationship between the two countries has been worsening over time, China is like, you know what, the United States is an unreliable partner, and maybe the United States is going to dump us. So we have to diversify our investments. So China started selling their treasurables, as you can very clearly see that because at the peak they had like 30% of all of their assets in treasurables, and right now they have around $780 billion worth of US treasury bills. Back in the days, they had probably like 1.2 trillion. So they sold hundreds of billions of dollars worth of treasurable bills, and they took that money and they bought—and they bought gold. And you can even see that in the graph. This is how much gold reserves the Chinese central bank had. And in 2010, there was a very small spike. Then there was another spike in 2015. And since then it has been increasing dramatically. And you can literally see that this chart looks very closely to the chart of the price of the gold. And that's because the prices of the gold have been increasing dramatically because China took all of that money—hundreds of billions of dollars—and they literally started buying so much gold. And when there is so much demand and the supply is very limited—yes, you're still extracting gold from somewhere right now, but it's nowhere close to how much demand for it right now—which is why gold prices are rising.
So now you have a better understanding, or a much clearer understanding, why gold prices are rising. And that's extremely important because if you understand the forces that are driving the prices higher and higher, you can actually make a much better or a much more accurate estimate about where the prices are going to be in the foreseeable future. And that will allow you to make a much better investing decision.
Another important thing to pay a lot of attention to is that the more money supplies there are in the market, the more increase in price of the gold there is. Let me just give you a very straightforward example. Look at the balance sheet of the Fed, and you can see that since the year around 2000, the balance sheet started slowly increasing, and you can see the exact same thing with gold prices—that they have actually increased dramatically. This is 2008 where the crash actually happened, and this is when the Fed started printing massive amounts of money. This is when quantitative easing was actually massively introduced. So we throw trillions of dollars into the economy, and that makes the dollar much less valuable. And that's where gold prices have actually almost doubled. They even tripled from around $1,000 to $1,500. That's a 50% increase in such a short period of time. But because after that the Fed started stabilizing its balance sheet, they haven't actually printed that much money since then. You can see that yes, gold prices have actually gone down dramatically because there wasn't much demand, and other industries such as technology, such as other companies out there, started growing tremendously, and investors started investing in bonds. They started investing in stocks.
Here's the most interesting thing that you should be paying a lot of attention to: The supply of money is being decreased by the Fed because the Fed is trying to get all of those extra dollars out of the economy because it cares about the state of the dollar. It cares about the value of the dollar. So that should have actually caused an opposite effect where gold prices should actually go down. Taking so much dollars out of the economy should have made the dollar much more valuable in relation to gold. But we don't see that happening. There is less money in the economy, but on the other side, gold prices are still rising, and that means that the entire system is broken right now. The system hasn't been this broke since 1945. The system no longer works. So investors no longer view the dollar as valuable as gold, for example.
In fact, I will tell you more than that. For the last 50 to 60 years, or since 1945, investors viewed the dollar even more valuable than gold because you could actually use the dollars to buy treasurables, and treasurables would pay you interest. But on the other side, if you have so much gold, then gold doesn't pay you interest. It simply stays there somewhere, and it doesn't even generate anything. It's a very passive asset that doesn't have any kind of use. Yes, you can use gold in certain technologies, but its use is very limited. On the other side, if you have treasurables of the United States, you're getting paid consistently a fixed amount of interest, and you can easily sell your treasurable bills because the US government bonds is the largest market that has ever existed for bonds.
That's why you have to be very careful since the market is filled with speculators. Even if you buy gold right now, you have to understand that those hedge funds with billions of dollars are trying to make a lot of money out of it. So they might be actually driving the price higher and higher. They might see an opportunity. But when things actually come down, when there is a deal between the United States and China, what do you think is going to happen? The speculators will instantly sell everything, and that will drive gold prices down and down. Now it doesn't mean that gold prices are going to go to zero like Dogecoin or some of those crypto coins, but it means that gold prices will stabilize. So even if they go to 4,000, they might come down to 3,500, to 3,000, or 2,500.
So will gold prices keep rising? That is the most important question because if you have an answer to that question, you can actually make a decision whether you can buy gold or not. It's very difficult to say right now, but unless there is a deal, as I told you, between the two countries, gold prices could actually keep rising. See, the problem with the gold is that gold is a very useless asset. It doesn't produce anything. Which is why it's very difficult to give it a very fair valuation. It's basically a tool in order to store wealth. But you don't want to store your wealth. You want your wealth to keep growing. You want your wealth to produce something. So if you buy a piece of real estate, you can rent it out to someone, and you can generate interest. If you have a business, your business will build something and will provide value to the clients and will actually make you money. But that's not the case with gold. And that is the problem with gold.
If you're actually trying to protect your wealth, yes, go ahead and buy a lot of gold. And that's why during crises investors buy a lot of gold because gold will help them to go through the entire crisis. But if you're actually paying attention to the smartest investors out there, then they're not actually buying a lot of gold. And let me tell you who is the smartest investor out there. His name is Warren Buffett. Right now, he's sitting on $334 billion worth of cash. And if you ask him why aren't you actually buying so much gold—just imagine for a moment how much gold Warren Buffett can buy right now—but he's not because the guy has been in the market for much longer than most of you watching this video have been alive, and he knows that a crisis is an opportunity. Yes, he can buy gold, and maybe he will make 10 or 15% on gold, but it doesn't mean that he will make much more than that, and he wants to make much more than that because when everything crashes and those stocks are being sold at a huge discount—for example, Tesla is down right now, but it doesn't mean that it will actually keep crashing, and it doesn't mean that Tesla will actually not recover—imagine after signing a deal between the United States and China, what is going to happen between the shares of Tesla? What is going to happen to Apple stock right now? Apple is being traded at less than a $3 trillion valuation. Just a year ago, it was almost reaching $4 trillion. The same thing with Nvidia, the same thing with other tech companies.
And that is why yes, there is a good opportunity to make money with gold, but it's a very limited opportunity and is a very speculative, especially during uncertain times when we don't have enough information to make any kind of judgment. So the best place at the end of the day will remain the stock market because right now when there is a crisis, when everything is crashing, this is when you should actually start buying stocks. When all of this will be over and we will go back to stable times again, gold prices are going to go down. On the other side, stocks are going to rise dramatically. But during peace times, stocks aren't going to grow as much as they will grow after a crash because they have lost a lot of their valuation, and a lot of them are being sold at a discount, and then suddenly they will jump dramatically and recover. So you might actually make 50%, 100%, 200%. On some stocks, you could be even making like 500% in such a short period of time. And if you want to find out how I am investing, which stocks I'm following, which stocks I'm buying, which stocks I'm selling, then you can check the first link in the description. That's it for today, guys. Thanks for watching, and I'll see you in the next.