Gold Going Up Is a Problem…

That is a problem.

Not for anyone who has owned gold for the last few years.

But for America, and for American families that have eschewed gold as an archaic rock, or who don’t understand why anyone would want to own gold when you can own stocks and real estate… that line is a problem.

Gold is up more than 60% this year alone.

Gold!

Up more than 60%.

That’s like saying a tortoise set a land speed record!

Gold doesn’t move like this.

Unless there’s a problem.

As I told the Twitteratti who follow me on Twitter/X:

Outside of jewelry and some electronic components, gold has zero purpose in this world other than to serve as the canary in the coal mine… and this canary is announcing that the coal mine (America’s dollar and debt situation) is about to blow up.

That could take several forms.

My bet… a financial reset is coming.

I have to stop there because the sentence after that was not one that my managing editor would allow me to print in Field Notes.

The gist of it was simply that Americans who are ill-prepared for this reset are going to face difficult challenges and even harder times managing those challenges financially.

We’re moving toward a new version of the US dollar. We had the gold-backed dollar until 1971; we’ve had the petrodollar since then. Now, another dollar is coming, but that’s a dispatch for another day.

In this switchover, lives will change.

Americans, by and large, are not ready for that because they’ve spent their lives under the influence of a dollar-centric world.

But that world is going away.

Gold’s unprecedented rise is telling us that.

The move by countries all over the world to reduce their exposure to the dollar is telling us that. (This is one of the reasons the dollar is having the worst year ever since the early ’70s.)

Central banks are giving us the same message. For the first time in decades, gold is now the #1 holding among central banks—not dollars. A survey conducted this past spring, from the Official Monetary and Financial Institutions Forum, a global think-tank, reported this shocking little factoid:

Perhaps most telling is the dollar’s dramatic fall in popularity among reserve managers. The once-dominant currency has plummeted from being the most preferred currency in the 2024 survey to seventh place in 2025—a remarkable reversal in just twelve months.

As I told attendees at my recent Future of Wealth event in Dublin, Ireland, “gold isn’t going up because it’s a great asset. Gold is going up because the dollar is a terrible asset.”

Lots of people will likely take offence at that—that I am somehow denigrating America.

I’m not. I’m simply analyzing the reality of the moment and the reality of America’s fiscal, monetary, political, and social situation.

Fact: America has nearly $38 trillion in debt and it’s overspending the budget by $2 trillion this year and every year until at least 2030. Simple math says that US debt will approach an astonishing $50 trillion before the decade is over—just five short years from now.

Fact: America will spend more than $1 trillion in debt repayment costs this year—more than 15% of the federal budget. That $1 trillion will rise from here.

Fact: A rash of countries are moving away from global trade based in dollars. China, the world’s #1 trading partner, now does more trade in Chinese yuan than it does in the dollar, meaning demand for the dollar is declining in global trade, which puts downward pressure on the dollar’s value relative to global currencies.

Fact: A weaker dollar means higher inflation in America since America has to import certain items or simply do without. I say this all the time, but America cannot grow enough bananas and coffee beans and cocoa beans to meet demand. America cannot mine manganese in the quantity needed for the US steel industry… nor enough uranium for the nuclear power industry. America has limited resources when it comes to rare earths and other metals.

Fact: Tariffs imposed by the current administration are causing serious problems in construction and agriculture. With food crops in particular, fruits and vegetables are going unpicked and rotting in the fields, leading to what will be worsening food-price inflation.

Fact: The US jobs market is falling apart, as shown by a bevy of public and private employment reports.

Fact: Inflation is well above the Federal Reserve’s preferred 2% rate. The Fed’s preferred inflation indicator—the so-called PCE or Personal Consumption Expenditures—is now a hair shy of 3%… and it’s rising.

Fact: The Federal Reserve is stuck between needing to cut rates to address a crumbling jobs market (which speaks to a worsening economy) and needing to raise rates to manage inflation that is running hot and threatening to heat up even more.

Fact: The current administration wants to rebuild the Federal Reserve Board of Governors so that Trump can achieve his aim of 1% interest rates. That would be a disaster on two fronts.

1. 1% interest rates would fuel vast inflation with all the free money floating around.

• The Fed’s historical and much-vaunted independence would be gone, and global investors would flee the dollar even faster.

I could go on with various further facts. But those who see what’s going on will reflexively understand the life-altering risks that gold above $4,000 represents. Those who remain loyal to the administration no matter what will vehemently disagree with those facts.

So be it. That’s what makes a market. Someone has to be wrong.

I know I will be right.

I’ve been pushing gold since it was selling for $1,000 an ounce. We’re now well above $4,000 and heading quickly for $5,000—probably before the year is out—because the world is rightly concerned that America is on the right road to the wrong destination.

Politicians clearly know this, too. But they do nothing to address it other than offer some lip-service about needing to cut back on spending.

But that won’t be enough.

A financial reset has to happen. It’s in the cards. Just a matter of when, not if.

When that reset happens, if you’re not holding gold, your financial life is going to suffer in ways Americans haven’t experienced since the Great Depression.

And that is why that chart I posted at the top of this dispatch is so problematic.

It’s not just announcing that gold investors have done well.

It’s announcing that the dollar is in deep trouble…