GOLD, Inflation, lost faith in the dollar, is this just the beginning of the reckoning?

KOYNGUY · September 27, 2025 5:06PM

If you think inflation is tame, you are not seeing the big picture. Hold on to your bullion coins.
The canary in the coal mine is dead, and none of the miners are paying attention.
Central bankers heard the canary's call and have been rapidly increasing their positions. I'm guessing they have a few fortune telling economists that can read the writing on the wall on speed dial.
Since Jan 1980 when metals peaked, inflation has been cruising along. Most things like groceries, cars, homes, electricity, college tuition, are all 5 times what they were at the end of 1979. Gold and silver indexed for inflation should be $3600 and $195 today.
45 years ago the national debt was 870 BILLION and was 31% of our GDP. Today, we are near 38 TRILLION and in December was at 124.3% of GDP.
The recent rise in metal is not just about inflation. It is also about concerns about people losing faith in the dollar. Spending is growing increasingly out of control at capitol hill.
Other counties are doing the same and that is why the dollar is not falling against them. We are all falling into an inflationary spiral and spending more to ease the pain.
The dollar has been devalued four times in the since 1792 when our gold was pegged to a fixed price,
"$19.75/oz in 1792, to $20.67/oz in 1834, to $35.00/oz in 1934, and then $38.00/oz in 1972, before being set at $42.22/oz in 1973. Since 1973, the price of gold has been determined by the market, not by government decree." A half cent coin in 1793 is the same value of the dollar today.
I think this devaluation will continue until the world loses faith or all currencies crash and we make a new plan. Perhaps that is why the Bitcoin is also becoming more popular.
Those that say we can never go back to the constraints of a gold standard are not using their imagination. Think gold at $50,000 for a new official price. Far fetched you think? There is 147.3 million ounces at Fort Knox.
Gold at $258,000 an ounce would wipe out our national debt of 38 Trillion. Remember when there was talk of making trillion dollar coins to pay it off? Remember these are politicians not regular working Joes. Anything is possible.
Charlie Munger said that gold was not an investment option for a civilized society,
"civilized people don't buy gold" But most civilized people know that spending more than you make or more than you are worth will end badly. J.P. Martin

braddick · September 27, 2025 5:11PM

This conversation has been going on for decades.
Rinse and repeat.

KOYNGUY · September 27, 2025 5:30PM

That' true. But it has been doubling every 10 years.
Debt vs GDP is 124.3% Consider this:

The Penn Wharton Budget Model concluded that a U.S. debt-to-GDP ratio exceeding 200% would likely make it impossible to avoid default without a combination of massive spending cuts and tax increases. The value of everything in the United States is 160 Trillion.
The national debt has been doubling every 10 years. Our national debt is just under 38 trillion, In 2035 it will be 76 trillion and possibly exceeding the value of everything we own by 2050.
J.P. Martin

Catbert · September 27, 2025 5:53PM

I’m waiting for a U.S. coin to be discussed here since we are in the U.S. Coin forum. Seems like we’ve been having more off topic threads lately.

KOYNGUY · September 27, 2025 6:19PM

Catbert,
I have a complete seated half collection less the 1878-s. took me 30 years! Back on topic.
The Recent rise in metals have made silver coins 33x face and set gold coins at a minimum $184 to the dollar. This recent dramatic increase in value to everyone's collection and the chilling effect on future buyers. It affects every coin collector
In my mind this will have major repercussions on the hobby and is worthy of discussion. If
you think this is off topic, I respectfully disagree. with only 4 other members on the board at this time I don't feel like I'm wasting a lot of peoples time.
Younger collectors will have more difficulty collecting non-clad coins as their dollars won't go as far. Much as clad coinage reduced collecting in the 1960's
As far as expounding on the reasons as to why this is happening, You're right. It would probably be better suited for a bullion thread. If that is true this thread will be short and die.
Either way problem solved. J.P.

Downtown1974 · September 27, 2025 7:01PM

@KOYNGUY we don’t know for certain how much gold is in Fort Knox. When was the last real audit? 1953?

Mr Lindy · September 27, 2025 7:17PM

I've been sitting on better silver & gold bullion related I planned to sell last few months. I'm under water on platinum as it was sourced when it sold for more than gold. Oopsie. It's been fun watching two the three continue upward. Golds about doubled since I cashed out of my less desirables & that enabled me to add some amazing error coins. No regrets on bailing at 2k.

BillJones · September 28, 2025 7:19AM

I don’t think the bankers are that smart. In a way, gold is a dead asset. It does not pay interest or dividends. The only way you make money on it is from the price going up and you sell it. It’s amazing that these bankers are not smart enough to find better places to park their money. Instead they are buying gold, inflating the market for it and setting themselves up for a crash. Bad mortgage loans were crap 2008, and so is over priced gold.

Most of my gold is numismatic, or in the case of my $20 gold pieces, used to be numismatic. Those purchases currently look like a financial mistake, but at least they have given me a fun ride.

jmlanzaf · September 28, 2025 7:28AM

@KOYNGUY said:
That' true. But it has been doubling every 10 years.
Debt vs GDP is 124.3% Consider this:

The Penn Wharton Budget Model concluded that a U.S. debt-to-GDP ratio exceeding 200% would likely make it impossible to avoid default without a combination of massive spending cuts and tax increases. The value of everything in the United States is 160 Trillion.
The national debt has been doubling every 10 years. Our national debt is just under 38 trillion, In 2035 it will be 76 trillion and possibly exceeding the value of everything we own by 2050.
J.P. Martin

Look at Japan. They've been over 200% for years.

And what does any of this have to do with coins?

In before the lock ..

Morgan White · September 28, 2025 7:34AM

Everything will be ok until it's not.

GoldFinger1969 · September 28, 2025 7:39AM

@Downtown1974 said:
@KOYNGUY we don’t know for certain how much gold is in Fort Knox. When was the last real audit? 1953?

1975

GoldFinger1969 · September 28, 2025 7:40AM

Banks don't hold gold for their own accounts for the most part. Regulators would crucify them if they did.

Debt/GDP ratios are not applicable for a global financial reserve currency that controls said currency.

If some of your fears turn out to be correct -- and I don't see it happening for decades, if that -- then gold coins and silver should do OK. My guess is gold would then be at or over $10,000 an ounce, though i think it peaks in this bull market at $7,500 or so.

JimTyler · September 28, 2025 7:53AM

@BillJones said:
I don’t think the bankers are that smart. In a way, gold is a dead asset. It does not pay interest or dividends. The only way you make money on it is from the price going up and you sell it. It’s amazing that these bankers are not smart enough to find better places to park their money. Instead they are buying gold, inflating the market for it and setting themselves up for a crash. Bad mortgage loans were crap 2008, and so is over priced gold.

Most of my gold is numismatic, or in the case of my $20 gold pieces, used to be numismatic. Those purchases currently look like a financial mistake, but at least they have given me a fun ride.

What’s the right answer ?

CaptHenway · September 28, 2025 8:00AM

I cannot express the reasons why I agree with J.P.'s assessment of the current situation without getting political and violating the forum's rules and guidelines, so I won't.

I can share some thoughts on what happened the last time the U.S. Economy got grievously destroyed, the Great Depression of let's say 1929-1933, though of course it did not make a full recovery until the wartime economy of the World War II era.

Back when I was working at the ANA I got to spend some time with Abe Kosoff. I was primarily doing research for my article about Thomas L. Elder, whom Kosoff knew from attending many of his auctions as a bidder. This led me to ask Abe what the coin business was like during the Great Depression.

He said that he was working for a company that had a strong cash position, which put them in a good place when desperate collectors came in to sell their collections, though the collectors often got pennies on the dollar compared to pre-crash prices. The company was able to hold many of these purchases for many years until the coin market recovered somewhat, when they could finally sell them at a good profit.

However, the company was selective in what it did buy, to conserve their cash reserves. Abe told me that one collector came in with a complete Proof set, Cent through $20. They paid $1 over face for the Cent through Silver Dollar set, and 25 cents each over face for the Proof $2-1/2 and $5. They told the Collector to spend the Proof Gold $10 and $20 because they did not want to tie up that much face value at 25 cents each over face!

So yeah, the Economy matters.

TD

ElmerFusterpuck · September 28, 2025 8:00AM

It pays to be an umbrella salesman if the sky is falling.

Otherwise this thread is junk. It's the same old lines repeated ad nauseum by small groups of people at coin shows for decades, except for the different numbers (and people).

BillJones · September 28, 2025 8:13AM

@JimTyler said:

@BillJones said:
I don’t think the bankers are that smart. In a way, gold is a dead asset. It does not pay interest or dividends. The only way you make money on it is from the price going up and you sell it. It’s amazing that these bankers are not smart enough to find better places to park their money. Instead they are buying gold, inflating the market for it and setting themselves up for a crash. Bad mortgage loans were crap 2008, and so is over priced gold.

Most of my gold is numismatic, or in the case of my $20 gold pieces, used to be numismatic. Those purchases currently look like a financial mistake, but at least they have given me a fun ride.

What’s the right answer ?

The right answer is you look for investment vehicles which combine income with the proper levels of risk. My portfolio manager does it for me. Insurance companies and other sorts of financial institutions do it also. It’s the kind of thing you learn in business school. Fortunately I studied accounting, finance and economics in college, not anthropology.

seatedlib3991 · September 28, 2025 8:20AM

Perhaps you should start a newsletter. Someplace else. James

Mr Lindy · September 28, 2025 8:25AM

Sourced 3 of these direct from Turkey 2 decades ago.
Sold 1 a few weeks later which made these 2 free.

Free gold images for this fun thread:

Pair of Turkish 1st strike brockages, 25K & 50K denominations:

Zwiggy · September 28, 2025 8:40AM

The US Dollar is the first really “global” currency since we have had fiat money - money not tied to any metal/something of intrinsic value. So we are in rather unchartered waters. In the past few centuries when a standard currency changed in a particular area, there was no change in intrinsic value (metals didn’t change) or at the most society moved between gold and silver and maybe cowrie shells.

With no historical precedent for fiat money, who’s knows what happens? Does it happen at 200% debt or 500% debt or do you need to have a major war instead? Do we move to a currency basket, or another fiat currency or to metals again? I doubt anyone fully knows - keeps life interesting!

Cougar1978 · September 28, 2025 9:14AM

I am bullish on gold, silver, and nice low pop keeper coins, especially CC.

heavymetal · September 28, 2025 11:49AM

Is it time for an ancient Jubilee? Every nation could use one.

JBN · September 28, 2025 12:07PM

Economic fretting. All the associated asset swapping and trading, some of it frenzied. People like the referenced individual who make billions over tracking this economic fretting and playing the other side. A fair amount of activity in and of itself - an industry if you will.
You said you have a collection of halves less the 78-s. Major kudos. Not many of us. Here is the 78-s from my collection; please post your favorite half from your collection. Thanks.
Please continue to enjoy your fretting and best of luck to you in your resultant financial moves.

KOYNGUY · September 28, 2025 1:39PM

JBN,
My most interesting is a flip over double strike, 2nd o/c S mint from 1870's

Walkerfan · September 28, 2025 2:15PM

I have a lot invested in retirement savings that has compounded over the years. But, with the dollar weakening and price of gold skyrocketing; I am glad that I diversified and purchased a lot of rare coins, too. I think it will make our holdings even more valuable and will stimulate clad collecting, which will become more expensive due to popularity. As you said, most people won’t be able to afford the higher end, gold and silver stuff, anymore, Which in turn will make clad more valuable, and the higher end stuff even more. A lot of the silver dollars that I purchased around 2020 have literally doubled in value, since then. I think that’s a pretty good return and will only increase. I have money in real estate and mutual funds, as well, so don’t flame me for promoting putting some money into rare coins.. plus it’s a heck of a lot of fun.

dcarr · September 28, 2025 2:16PM

@GoldFinger1969 said:
Banks don't hold gold for their own accounts for the most part. Regulators would crucify them if they did.

.

This is absolutely false.
In Europe, gold is a "tier 1" asset, used by banks at full market value to meet reserve requirements.

PS:

The "regulators" don't do squat - until after the fact. As evidence, look at 2008. Where were these "regulators" when 125% equity mortgages were being offered and then packaged into financial products and sold to "investors" ?

.

Cougar1978 · September 28, 2025 3:20PM

Over this weejend have decided go more with bullion related and some single digit pop CACG or PCGs material here and there.

Crypto · September 29, 2025 3:57AM

@Walkerfan said:
I have a lot invested in retirement savings that has compounded over the years. But, with the dollar weakening and price of gold skyrocketing; I am glad that I diversified and purchased a lot of rare coins, too. I think it will make our holdings even more valuable and will stimulate clad collecting, which will become more expensive due to popularity. As you said, most people won’t be able to afford the higher end, gold and silver stuff, anymore, Which in turn will make clad more valuable, and the higher end stuff even more. A lot of the silver dollars that I purchased around 2020 have literally doubled in value, since then. I think that’s a pretty good return and will only increase. I have money in real estate and mutual funds, as well, so don’t flame me for promoting putting some money into rare coins.. plus it’s a heck of a lot of fun.

I agree will all of this but the pricing people out of gold and silver will automatically push people to clad. It could just as easily stampafyi the hobby. Where the classic stuff trades albeit thinly and the modern stuff is all but worthless

Mr Lindy · September 29, 2025 5:39AM

Why would increasing precious metals values drive bullion & coin collectors to collect clad ?

Ike Dollars have 24 cents in metal

Kennedy Halves have 12 cents in metal

The two circulating coins worth more in metals are copper cents and nickels.

MilesWaits · September 29, 2025 6:34AM

Our future:

pcgs_education · September 29, 2025 6:37AM

Moved this thread to the correct forum.

GOLD, Inflation, lost faith in the dollar, is this just the beginning of the reckoning?

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