Gold is just one of many commodities these days, mostly unconnected from most monetary systems for many decades. Treating it as the benchmark of value is really quite arbitrary, and I expect someone could compare the S&P to other random commodities and come up with completely different conclusions...
I mean, yeah, but the parallels OP is drawing really kinda feel like the lingering whispers of the “gold standard” crowd rather than anything more substantial.
For the working classes, the peak was the dotcom bubble - everything after that has been repeated speculative bubbles attempting to create explosive growth from nothing of substance, as much a deliberate decision of Capital to weaken the working classes while extracting wealth as it was a desperation gambit by an increasingly stable (but not yet stagnant circa mid-2000s) western hemisphere and its governments. Gold alone isn’t an indicator of this, so much as all asset prices skyrocketing to the moon while worker wages remained relatively flat and precarity increased. Metals, securities, housing, land, all of it has appreciated faster than working wages have kept pace, reflecting a siphoning of that wealth into fewer hands.
Gold just makes the story “neater” to tell to folks lamenting the heyday of Breton Woods.
Totally misleading, S&P with dividends reinvested blows away gold since 1950 or 1971.
S&P 500 Investment (with Dividends Reinvested)
Historical data shows that $10,000 invested in the S&P 500 at the start of 1950, with all dividends reinvested, would grow to approximately $3,836,763 by the end of 2025.
Gold provided pure price appreciation (no yield or dividends). The multiplier is about 124.7× ($4,360 ÷ $35), or an annualized return of roughly 6.8% over 75 years.
Ounces purchased in 1950: $10,000 ÷ $35/oz ≈ 285.71 ounces
What is the point of this chart? It would make more sense to price in terms of hamburgers or any other reasonably consistent item of real consistent value/utility.
I sometimes wonder if we should be measuring money in some other unit besides dollar/etc. to reveal inflation. We could report bank balances and wages that way so the effect of inflation is obvious instead of being a trick to silently steal money off people. But it's tricky because there's no natural measure of inflation. Gold seems like a good idea in a way but I don't understand enough to know.
I wonder if this was a 2013 article that linked to live updating charts (with data from 2025) since there are Google+ and Twitter buttons at the end, and two 2013 timestamps below those.
The price of gold pre-1971 was always a fantasy as there was no free market for it, due to the policy rate sitting on it at $35/oz.
The price of gold before 1933 (EO 6102) was also not a terribly good indicator, as the friction of taking physical delivery of it also kept it suppressed in most circumstances, with explosive swings in times of crisis.
Arguably it's even more gamed after 1971 as it's not even used for exchange, and has a ton of rehypothecation and elaborate derivative networks.
Gold's drawback was always its physicality. Arguably its heyday was before the invention of the telegraph, when at least the expectation was that money was going to be slow, and the only way to move it across most distances was physically, unless you had some handy Knights Templar or Hawala network handy.
That we still cling to it despite all of this is a good indicator of just how fucked up fiat is though. Thankfully, we have a better alternative network being built out.
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[ 5.4 ms ] story [ 36.1 ms ] threadFor the working classes, the peak was the dotcom bubble - everything after that has been repeated speculative bubbles attempting to create explosive growth from nothing of substance, as much a deliberate decision of Capital to weaken the working classes while extracting wealth as it was a desperation gambit by an increasingly stable (but not yet stagnant circa mid-2000s) western hemisphere and its governments. Gold alone isn’t an indicator of this, so much as all asset prices skyrocketing to the moon while worker wages remained relatively flat and precarity increased. Metals, securities, housing, land, all of it has appreciated faster than working wages have kept pace, reflecting a siphoning of that wealth into fewer hands.
Gold just makes the story “neater” to tell to folks lamenting the heyday of Breton Woods.
S&P 500 Investment (with Dividends Reinvested) Historical data shows that $10,000 invested in the S&P 500 at the start of 1950, with all dividends reinvested, would grow to approximately $3,836,763 by the end of 2025.
Gold provided pure price appreciation (no yield or dividends). The multiplier is about 124.7× ($4,360 ÷ $35), or an annualized return of roughly 6.8% over 75 years.
Ounces purchased in 1950: $10,000 ÷ $35/oz ≈ 285.71 ounces
Current value: 285.71 oz × $4,360/oz ≈ $1,246,700
I need to see both of them priced in loaves of bread.
The price of gold before 1933 (EO 6102) was also not a terribly good indicator, as the friction of taking physical delivery of it also kept it suppressed in most circumstances, with explosive swings in times of crisis.
Arguably it's even more gamed after 1971 as it's not even used for exchange, and has a ton of rehypothecation and elaborate derivative networks.
Gold's drawback was always its physicality. Arguably its heyday was before the invention of the telegraph, when at least the expectation was that money was going to be slow, and the only way to move it across most distances was physically, unless you had some handy Knights Templar or Hawala network handy.
That we still cling to it despite all of this is a good indicator of just how fucked up fiat is though. Thankfully, we have a better alternative network being built out.