Gold Isn’t Going Up, Your Money Is Just Losing Value 💵

Fall 2025

Inflation is caused by the growth of the money supply, and gold is a strong hedge because it rises alongside it.

Gold is soaring because fiat currencies are rapidly eroding.

Let’s begin with a clear visual. The chart below shows gold’s performance since 2007 across several major world currencies: the U.S. dollar, euro, British pound, Swiss franc, Canadian dollar, Japanese yen, and Australian dollar. As the chart reveals, gold has surged by average of 450% in most world currencies, with gains ranging from a low of 270% in Swiss francs to a staggering 748% in British pounds.

This chart offers compelling visual evidence of a critical truth: it’s less about gold rising in value and more about fiat and paper currencies losing purchasing power at an alarming rate.

These flaws have led to rampant inflation and growing financial instability. That is why people around the globe are turning back to gold in increasing numbers, helping drive its price to more than double over the past 3 years. This move is still in its early stages.

The Consumer Price Index (CPI) tracks the average change in prices over time for a fixed basket of goods and services. The resulting chart closely mirrors the gold-based purchasing power chart shown earlier, with the steepest declines occurring during 2 key periods: 2007 to 2012 and 2020 to 2024. Both of these were periods of heavy monetary expansion during recessions or crises.

In fact, if measured by the original CPI formula from the 1970’s, when the government conspired to make inflation lower. The actual CPI inflation rate today is 13.5%. – more than 4 times higher than the ‘official’ 2.9% rate the government claims. Which explains why the U.S. dollar has lost another 12% of purchasing power year-to-date in 2025.

Most people have noticed that the price increases they experience in the real world don’t line up with the tame inflation numbers coming from ‘ official’ government statistics. Trust what gold is telling us, and it is saying that ‘official’ inflation metrics are understating reality dramatically.

Another reason is that savvy players such as central banks and hedge funds, who have superior access to information and a far deeper understanding of the global macroeconomic, fiscal, and monetary situation, have dominated gold buying and have been the main drivers of the gold bull market in recent years, with relatively little participation from retail investors.

Their actions indicate that gold’s surge is not random but is anticipating much higher future inflation as a byproduct of today’s excessive global debt levels. That debt burden will certainly require aggressive debasement of fiat currencies in the coming years. In this scenario, the inflation reflected in the price of gold is actually leading the official inflation that eventually appears in consumer price indexes.

Now let’s examine why currencies steadily lose purchasing power over time: inflation, or the persistent rise in the cost of living. It’s important to understand that inflation isn’t fundamentally caused by wars, tariffs, supply shocks, strikes, droughts, or energy crises. These factors may contribute to short-term price spikes, but they are not the underlying driver.

At its core, inflation results from the debasement of currency. In other words, it is the dilution of a currency’s value through creation of new money. As Nobel Prize–winning economist Milton Friedman famously said, “Inflation is always and everywhere a monetary phenomenon.” As the chart below illustrates, the global M2 money supply, one of the most widely used measures of total currency in circulation, has surged by 205% since 2007, rising from $38 trillion to a staggering $115 trillion. This massive expansion of the money supply is the driving force behind the soaring cost of living worldwide and a key reason why the price of gold has surged in every major currency across the globe.

Once the world abandoned the gold standard, which was the practice of backing currency with gold, governments and central banks gained the power to expand the money supply without restraint. And that’s exactly what they did. The result was a relentless rise in the cost of living.

In fact, long-term data shows the U.S. dollar has lost 97% of its purchasing power since 1913, when the Federal Reserve was created.

Another key point to highlight is this: as long as the world remains on a fiat money regime, inflation isn’t going away, and gold will continue to rise. That’s because fiat currencies all suffer from the same terminal flaw. Over time, they devalue, deteriorate, and eventually die. History shows that no fiat currency has ever escaped this fate, and neither will the dollar, the euro, or the yen. It’s not a question of if they fail, but when.

One of the most alarming forces sealing the fate of the world’s fiat currencies is the explosive growth of global debt, which has surged tenfold since the mid 1990s, reaching an estimated $250 trillion. This towering debt burden is the ticking time bomb that will ultimately bring fiat currencies to their knees.

As debt levels spiral out of control, they begin to choke economic growth and destabilize entire financial systems. Eventually, governments and central banks are left with little choice but to fire up the printing presses to service that debt and pay their bills. The result? A tsunami of rapidly devaluing paper money and a skyrocketing cost of living, which is the classic setup for hyperinflation.

That chart is a historical preview of what will unfold in the years ahead, when gold hits $4,000, $5,000, $7,000, $15,000, even $20,000 per ounce, and ultimately some mind-boggling figure like $20 quadrillion when the dollar and other major fiat currencies are on the brink of worthlessness.That inevitability is one of the main reasons I keep urging people to stop worrying about short-term corrections in the price of gold.

But that excitement is tempered by a sobering reality, which is that gold is soaring because fiat currencies, including the U.S. dollar, are taking yet another hit to their purchasing power. Still, I’d much rather be watching that unfold from the safety of owning gold than from the sidelines without it.”

* In 2008, the Bubble report was recognized by the London Times for predicting and warning millions of people about the upcoming Global Financial Crisis and stock market selloff. And has an exceptional track record—including accurately predicting gold’s $1,500 surge in 2024 just hours before it took off. It is frequently quoted in the media, and widely published on leading sites such as ZeroHedge, Kitco, The Jerusalem Post, King World News, Forbes, GATA.org, MiningFeeds.com, and many others.