Gold prices in the United States and worldwide have risen sharply in recent months, driven by a combination of economic, financial, and political factors.

This trend — in which gold has outperformed the US GDP and the four major American stock indexes — began in 2000 and continues to this day.

Below are 13 reasons explaining why gold has outperformed most major investments and why it is likely to continue attracting both retail and institutional investors:

1. A Safe Haven in Times of Uncertainty

Throughout history, people — from merchants to monarchs — have held gold as a hedge against inflation, economic instability, and war. Owning gold has enabled individuals to survive political crises, especially during the collapse of fiat currencies.

2. Geopolitical Tensions

Global instability has recently become a key driver of gold’s rally. Conflicts in the Middle East, the war in Ukraine, and the decline of Hong Kong’s autonomy under the Sino-British agreement have all contributed to higher gold prices.

3. The US Federal Reserve

For over half a century, gold prices have risen partly as a hedge against inflation and weak US monetary policy. According to the Bureau of Labor Statistics, today’s dollar buys only 16.78% of what it could purchase fifty years ago. If the dollar were still backed by gold, it would have retained its full purchasing power.

4. Inflation and the US Dollar

For much of its history, the US dollar was backed by gold and/or silver. In the early 20th century, 100 one-ounce gold coins could buy a mid-priced home. In 1980, gold averaged about 615 dollars per ounce, while the average US home cost around 64,600 dollars.

According to the Federal Reserve Bank of St. Louis, the average home price today is 422,600 dollars, while gold stood near 4,203 dollars per ounce as of October 15, according to Yahoo Finance.

In 1980, buying a new home required about 100 ounces of gold — roughly the same amount as today — showing that gold has preserved and grown wealth, unlike the dollar, which has lost much of its real value.

5. Central Banks

Many central banks and governments buy gold as a hedge against inflation and to mitigate concerns about the US dollar’s value. For instance, the US national debt has risen from less than 6 trillion dollars in 2000 to nearly 38 trillion dollars today.

6. National Debt and Global Imitation

US national debt now exceeds 37.85 trillion dollars — about 124.86% of GDP, compared with 34.68% in 1980. That equals roughly 110,176 dollars per citizen or 326,500 dollars per taxpayer. Excessive government spending isn’t unique to the US; Japan and China face even higher per-capita deficits.

7. Political Instability in the United States

The US federal budget deficit stands at roughly 1.9 trillion dollars annually, with little chance of reduction given the lack of political cooperation. Reversing this trend would require policies that support both economic growth and fiscal discipline.

8. Global Policy Divisions

Disagreements over trade, taxation, food production, and electric vehicle manufacturing have fueled global tensions, contributing to gold’s upward momentum.

9. Economic Philosophy and Growth

In the US and other nations founded on free-market capitalism and the rule of law, increasing regulation and declining entrepreneurial spirit have stifled growth, pushing investors toward gold as a safer store of value.

10. Stock Market and GDP Performance

From 2000 through the end of September 2025, gold has outperformed the four major US stock indexes, as well as silver and US GDP growth, easily outpacing inflation and reaffirming its resilience as a long-term store of value.

11. The Real Goal of the BRICS Alliance

BRICS nations — Brazil, Russia, India, China, and South Africa — along with other countries less aligned with the US, are buying large quantities of gold in an effort to replace the dollar as the world’s reserve currency. If successful, it would make global transactions costlier for American producers and consumers and weaken US foreign policy influence.

12. Technological Advancement and the AI Boom

Gold’s use in technology grew significantly between 2000 and 2010 before dipping slightly. With the rapid rise of artificial intelligence and new energy systems, demand for gold has climbed again thanks to its superior conductivity and corrosion resistance.

13. Limited Supply vs. Rising Demand

Global gold demand hit record highs in 2024 and 2025, while new supply has failed to keep pace. Unless one or more of these underlying factors change, gold prices are likely to continue rising in the years ahead.

Conclusion

On October 9, gold closed at 3,946 dollars per ounce, down about 100 dollars on the day, as markets rallied following a ceasefire announcement between Gaza and Israel.

But the next day, major markets fell more than 800 points after China announced new restrictions on rare earth exports to the US — sending gold back above 4,000 dollars per ounce.

The report concludes that the only sustainable way to lower gold prices is through sound political and economic policies that promote both economic and political freedom — policies that give people everywhere the opportunity to live in a more open, competitive, and prosperous environment, where success stems from hard work and innovation rather than government intervention.

US stock indexes rose sharply on Monday as markets focused on corporate earnings results for the third quarter of 2025.

With the US earnings season underway, several major companies are set to report this week, including Netflix on Tuesday, Tesla on Wednesday, and Intel on Thursday.

Meanwhile, optimism is growing that the ongoing US government shutdown — now in its twentieth day — could end this week.

Kevin Hassett, Director of the National Economic Council, told CNBC in an interview that the shutdown is likely to be resolved within the week.

Hassett added that moderate Democrats are expected to meet this week to reach an agreement, while emphasizing that the White House is prepared to take stricter measures to end the shutdown if no deal is reached.

In trading, the Dow Jones Industrial Average rose 1.1% (498 points) to 46,688 as of 18:20 GMT, while the broader S&P 500 gained 1.2% (77 points) to 6,741. The Nasdaq Composite climbed 1.5% (342 points) to 23,023.

Copper consumption in the United States and India is expected to emerge as a key driver of global demand over the next decade, after decades of dominance by China — where growth in copper use is beginning to slow.

China’s industrial boom and infrastructure expansion fueled a rally that pushed copper prices above 10,000 dollars per metric ton, compared with about 1,500 dollars twenty-five years ago.

While China will remain the world’s largest copper market throughout the next decade and beyond, analysts expect other regions and factors to play a growing role in influencing demand and prices.

They note that shifting regional policies, infrastructure investment cycles, and geopolitical transitions will require producers, consumers, traders, and investors to adapt to a market driven by multiple forces — rather than a single dominant one as before.

Tom Price, an analyst at Panmure Liberum, said: “China’s pace of copper consumption and stockpiling will slow, and we’ll return to the traditional demand drivers such as replacement and renewal cycles outside China.”

He added that the full impact of these changes has yet to be seen, but that policy shifts in the United States and other countries to encourage domestic manufacturing will likely curb China’s export and industrial activity, reducing its demand for refined copper — estimated at about 15 million tons this year.

Meanwhile, data centers needed to support artificial intelligence technologies, along with upgrades to power grids, are expected to drive copper demand outside China, becoming the main engine for prices.

Price explained: “China has already built out its infrastructure, including its power grid, so its activity will gradually decline in line with its needs,” predicting that Chinese demand in 2031 will be about 6% lower than in 2026.

He forecast that China will account for 52% of global primary copper consumption — about 27 million tons — in 2031, down from 57% in 2026.

By contrast, US demand is projected to reach 2.2 million tons by 2031, up nearly 50% from 2026, while India’s demand is expected to exceed one million tons, a rise of more than 30%.

Growing Resistance from Western Nations

Analysts expect that the new 50% tariffs imposed by US President Donald Trump on imports of copper pipes and wires will boost domestic production.

For China, these measures are likely to result in the loss of one of its key export markets for copper products. Data from Trade Data Monitor shows that the United States is the fourth-largest market for Chinese copper pipe exports.

Last year, Washington imported 14.4 million tons of copper pipes from China, and during the first seven months of this year, imports reached eight million tons — highlighting the scale of the market Beijing risks losing.

Duncan Hobbs, Research Director at Concord Resources, said: “China’s manufacturing of export-oriented goods is likely to slow due to growing resistance from Western countries.”

These exports include copper wires used in power grids. In its last review of energy infrastructure a decade ago, the US Department of Energy found that 70% of the nation’s transmission lines were more than 25 years old.

At the same time, India is expanding its power transmission network to support its goal of achieving 500 gigawatts of non-fossil fuel energy capacity by 2030.

Across Asia (excluding China), consultancy Benchmark Mineral Intelligence (BMI) expects copper demand to increase by 25% to more than 9.2 million tons between 2025 and 2030.

For electrical infrastructure — including power grids, data centers, and telecommunications — BMI forecasts demand growth of 35% to 2.2 million tons, compared with more modest increases of 4% and 11% projected for Chinese firms, respectively.

Infrastructure Renewal in the West

Efforts to modernize power grids in Western economies are primarily focused on upgrading existing infrastructure — a slow, gradual process that is less copper-intensive than building entirely new networks, as China did.

Robert Edwards, Principal Analyst at metals consultancy CRU, said he had long expected China’s influence over the copper market to fade, but that this did not happen earlier due to Beijing’s heavy investments in electric vehicles, renewable energy, and power grids.

CRU now expects China’s share of global consumption of mined and recycled copper to fall to 57% of 31.36 million tons by 2030, down from 59% of 27.62 million tons this year.

Edwards concluded, “China’s demand growth potential is limited, and we should see more expansion in the rest of the world.”

In US trading on Monday, copper futures for December delivery rose 0.9% to 5.01 dollars per pound as of 17:00 GMT.

Bitcoin rose on Monday, extending the recovery that began over the weekend, as easing fears of a trade war between the United States and China spurred a new wave of risk-on buying across cryptocurrency markets.

Cryptocurrencies also drew support from ongoing bets that the Federal Reserve will cut interest rates later in October, alongside broader gains in high-risk assets that have positively influenced the crypto sector.

Bitcoin climbed 3.5% to 110,608.3 dollars as of 1:20 a.m. Eastern Time (05:20 GMT). The world’s largest cryptocurrency had recently fallen to around 103,000 dollars amid escalating trade tensions between Washington and Beijing.

Concerns over the health of the US economy have also weighed on digital assets, as the federal government shutdown entered its third week, delaying the release of several key economic indicators and leaving markets uncertain about the outlook for the world’s largest economy ahead of next week’s Fed meeting.

Bitcoin Rebounds as Trump Softens Tone Toward China

Bitcoin’s recovery came largely after US President Donald Trump said on Friday that a prolonged trade war with China would be “unsustainable,” adding that he still plans to meet Chinese President Xi Jinping in about two weeks.

Meanwhile, US Treasury Secretary Scott Bessent said that high-level trade talks with Chinese ministers would continue this week.

These remarks reflected a more conciliatory tone toward the US–China trade dispute, strengthening expectations that Trump will not move forward with his threat to impose 100% tariffs on Chinese goods — a shift that sparked broad gains in risk assets.

Altcoins Rally as Ethereum Reclaims $4,000

Digital currencies rallied across the board on Monday in tandem with Bitcoin’s rebound, with most major altcoins staging sharp recoveries after recent losses.

Ethereum, the world’s second-largest cryptocurrency, rose 4.1% to 4,057.96 dollars, reclaiming the key psychological level of 4,000 dollars for investors.

Ripple climbed 4.2% to 2.4510 dollars, while BNB gained 3.6% to 1,130.20 dollars.