No one is exactly sure where gold came from. It’s now believed gold, created as stars were formed, was deposited on and in the earth at the earliest moments of the planet’s formation.
The yellow metal, which is soft and easy to work, has attracted people from the very earliest times. It was used to make jewelry. It has been used in coinage. It was seen as a store of value for people and governments.
You can see gold bars that belong to various nations in the highly secure vaults in the basement of the Federal Reserve Bank of New York. If one country buys gold bars, often what happens to settle the transaction comes down to officials moving the appropriate quantity from one pile at the Federal Reserve Bank to another.
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Starting late Thursday afternoon, gold briefly was doing something never seen before. Its price crossed $3,000 a troy ounce in futures trading. It may close above $3,000 on Friday.
(A troy ounce is an old measurement, dating from the Middle Ages. It’s equal to 31.1034768 grams, according to the British Royal Mint. The standard ounce is only 28.35 grams.)
The price of gold is up about 13.5% this year after rising 27% in 2024. It has jumped (valued in U.S. dollars) more than 150% since the beginning of 2015. The SPDR Gold Shares exchange-traded fund (GLD) exchange-traded fund is likewise higher: up 13.6% in 2025 on top of a 26.7% gain in 2024.
Why? Let us posit four primary reasons:
- The most immediate now is all the market instability wrought by the Trump Administration tariff fights and moves to chop federal spending.
- Many gold enthusiasts believe gold holds its value in periods of inflation or instability. And the Federal Reserve has been worried about inflation over the last few years.
- Countries use it to peg the value of their currencies. The United States maintained gold convertibility for domestic transactions until 1933. Gold convertibility in the world ended in 1971 when Richard Nixon was President. That led to futures trading in gold starting in 1974.
- People ascribe deep cultural, religious and social values to the metal. Individuals in India are heavy buyers of gold.
Right now, its the turmoil in U.S. financial markets that defines the interest in gold. The turmoil has been set off by tariff disputes between the Trump Administration and any number of countries and the potential of a U.S. government shutdown on Friday.
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Gold’s history also suggests it’s vulnerable to bouts of heavy speculation. Gold jumped nearly 59% in 2011 on inflation fears. The Consumer Price Index rose just 3.2% that year.
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Gold’s gain is offset by the decline in the Standard & Poor’s 500 Index, It’s down more than 10.1% in just 20 days after reaching its all-time closing high of 6,144.15 on Feb. 19. A 10% decline from a top to a bottom is the popular definition of a market correction.
This is the sixth-fastest 10% decline for the index since 1950, according to Thomas Lee of Fundstrat.
The Nasdaq Composite Index has fallen 14.2% since its Dec. 16 peak. The Dow Jones Industrial Average has fallen 9.4% from its Dec. 4 closing peak.
As a result, “Nowhere to hide but park cash in the shiny metal posting all-time highs,” Robert Yawger of Mizuho Securities USA said in a note to investors.
If you want in on gold, you can buy a futures contract, a complex and risky possibility. You can also buy an ETF like SPDR Gold Shares ETF.
You could also buy a gold producer. Newmont Mining (NEM) , the biggest U.S. gold producer, is up 22.6% this year.
Or you can hope the stock market will bottom. And maybe there’s a break ahead. Futures trading late Thursday suggests the market will open higher on Friday.
Related: Fed chairman has blunt 9-word response to recession talk
