Gold prices soar to a high of $4,300 | Can the half-century gold bull market continue?

Since ancient times, gold has occupied an important position in economic transactions due to its unique properties—high density, strong ductility, and lasting preservation. From currency circulation to the jewelry industry, gold’s applications are extensive. When we review the evolution of gold prices over the past 50 years, an impressive fact emerges: despite turbulent times, the overall trend during this period has been a continuous rise, with gold prices in 2025 setting multiple historical records. So, will this half-century-long bull market reappear in the next 50 years? And how should we evaluate the investment value of gold?

Starting from the Collapse of the Bretton Woods System | Gold Price Reaching $4300 per Ounce

On August 15, 1971, then-U.S. President Nixon announced the detachment of the dollar from gold, ending the fixed exchange rate regime of the Bretton Woods system (which pegged 1 ounce of gold at $35). This pivotal moment marked the beginning of the modern era of free gold price movement.

From the detachment period’s $35 per ounce, gold prices have experienced a spectacular upward trajectory over more than 50 years. By the first half of 2025, gold had reached $3700 per ounce, and by October, spot gold broke through the critical level of $4300 per ounce for the first time. This means that gold prices have increased over 120 times in the past 50 years. Taking 2024 as an example, the annual increase in gold prices exceeded 104%, creating one of the few single-year high-yield performances in financial markets.

Four Waves | Revealing the Price Trajectory of Gold Over Half a Century

First Wave: Trust Crisis (1970–1975)

After the dollar was detached from gold, market confidence in the dollar plunged. Previously, the dollar was a certificate of gold; now, it became an unanchored asset, leading the public to sell dollars and buy gold. International gold prices rose from $35 to $183, an increase of over 400%. Subsequently, the oil crisis erupted, with the U.S. increasing money supply to buy oil, further pushing up gold prices. However, as the oil crisis eased and confidence in the dollar’s convenience was restored, gold prices fell back to around $100.

Second Wave: Geopolitical Turmoil (1976–1980)

A series of international events such as the second Middle East oil crisis, the Iran hostage crisis, and the Soviet invasion of Afghanistan triggered global recession and soaring inflation. Driven by these geopolitical risks, gold prices surged from $104 to $850, an increase of over 700%, over about three years. However, excessive speculation led to inflated prices, and as crises subsided and the Cold War eased, gold prices entered a volatile period over the next 20 years, mostly fluctuating between $200 and $300.

Third Wave: War and Financial Tsunami (2001–2011)

The 9/11 terrorist attacks triggered a decade of global anti-terrorism wars in the U.S. To fund the military, the U.S. government began lowering interest rates and issuing bonds, which eventually boosted housing prices. Later, to combat inflation, interest rates were raised, culminating in the 2008 financial crisis. The Federal Reserve launched quantitative easing(QE), and gold entered a prolonged 10-year bull market. By 2011, amid the European debt crisis, gold peaked at $1921 per ounce. After the crisis, gold prices gradually stabilized around $1000.

Fourth Wave: Global Risk Reorganization (2015–Present)

The upward momentum of gold during this period has become more complex and diverse. Policies such as negative interest rates in Japan and Europe, the global de-dollarization trend, new rounds of QE in 2020, the Russia-Ukraine war in 2022, the Israel-Palestine conflict and Red Sea crises in 2023, among others, have collectively kept gold prices above $2000.

Entering 2024–2025, gold prices have shown unprecedented upward momentum. Uncertainties in U.S. economic policies, continuous central bank gold reserve accumulation, escalating Middle East tensions combined with new variables in the Russia-Ukraine conflict, trade worries triggered by U.S. tariffs, stock market volatility, and a weakening dollar have all contributed to pushing gold prices higher. The highest gold price reached $4300 per ounce, setting a record.

How Good Is Gold Investment? | 50-Year Returns Outperform Stocks

Comparing gold with other major assets over the long term yields interesting results:

• Gold has increased 120 times since 1971
• The Dow Jones Industrial Average rose from 900 points to around 46,000 points, an increase of about 51 times

This indicates that over a 50-year ultra-long-term horizon, gold’s returns even surpass stocks. From early 2025 to now, gold has risen from $2690 per ounce to around $4200, a short-term increase of over 56%.

However, it is important to note that gold returns are not linear. Over the 20 years from 1980 to 2000, gold prices stagnated between $200 and $300. Investors who bought gold during this period faced long-term no gains. This highlights the time cost problem of a simple buy-and-hold strategy—how many 50-year periods does one have in life to wait for a turnaround?

Five Gold Investment Paths Compared

1. Physical Gold

Buying gold bars or other tangible forms of gold. Advantages include asset concealment and dual-use (assets and jewelry). Disadvantages are limited liquidity.

2. Gold Accounts

Banks store gold and issue certificates. Investors can check or withdraw physical gold at any time. Advantages include portability and record-keeping; disadvantages are larger bid-ask spreads and no interest income, making it more suitable for long-term allocation.

3. Gold ETFs

Exchange-traded funds tracking gold prices, with better liquidity than accounts, tradable directly on stock markets. Disadvantages include management fees charged by issuers, and if gold remains stable long-term, value may slowly erode due to costs.

4. Gold Futures and CFDs(CFD)

These derivative instruments are popular among retail investors due to leverage. Both futures and CFDs are margin-based trading with low transaction costs. CFDs are more flexible than futures, with higher capital efficiency, especially suitable for small funds and short-term trading.

5. Gold-Related Stocks and Funds

Investing in mining company stocks or gold-themed funds, indirectly participating in the growth of the gold industry.

Gold, Stocks, Bonds Triangle Comparison | The Art of Choice

The return mechanisms of these three asset classes are fundamentally different:

• Gold: Gains come from price differences, no dividends, moderate investment difficulty, depends on timing of entry and exit
• Bonds: Returns from interest, require judgment of central bank policies, lowest investment difficulty
• Stocks: Gains from corporate growth, require stock-picking ability, highest investment difficulty

In the past 30 years, stocks have led in returns, followed by gold, with bonds performing the weakest. Although gold has performed remarkably over the (50 years) long-term, in terms of investment efficiency, it may not be the best.

The Wisdom of Asset Allocation | Economic Cycles Determine Allocation Ratios

Macroeconomic conditions influence the relative attractiveness of different assets:

During periods of economic growth, corporate profits are optimistic, stocks are most favored; the fixed income of bonds and the hedging function of gold are less attractive.

During recessions, stocks lose appeal, while gold’s safe-haven properties and bonds’ stable yields become safe harbors for investors.

Therefore, the core investment principle is: allocate stocks during economic growth, allocate gold during recessions, and hold bonds throughout for stability.

Considering market uncertainties and the potential for sudden political and economic risks—such as the Russia-Ukraine war, inflation, and interest rate hikes—holding a balanced mix of stocks, bonds, and gold can effectively hedge individual asset volatility and build a more resilient portfolio.

Conclusion | Will Gold Reappear in the Next 50 Years?

The past 50 years of gold price increases have been driven mainly by deep factors such as dollar credit decline, geopolitical risks, and inflation expectations. If these factors persist in the future, the long-term upward trend of gold may continue.

However, successful gold investment is not simply about “buy and hold,” but about going long in bull markets and short during sharp declines, grasping the wave rhythm. Even if the bull market ends, the lows of gold prices will gradually rise, reflecting increasing difficulty and costs in gold mining.

For individual investors, the most practical strategy is to adjust the proportions of stocks, bonds, and gold dynamically based on personal risk preferences and economic cycles, finding a balance between risk and return.