Gold’s value hinges on collective perception, historically moving opposite to U.S. Treasury Inflation‑Protected Securities (TIPS) yields. The link held until Russia’s invasion of Ukraine shattered the relationship, as sanctions made TIPS less attractive for some investors. Since then, gold’s price has been driven by speculation about central banks, sovereign wealth funds, China, Tether, and preppers, with no clear consensus. Recent data shows gold prices again moving inversely with bond yields, reminiscent of pre‑February 2022 dynamics, but the trend reversed in September as yields rose while gold fell. The article highlights the confusion and suggests readers explore apophenia—the tendency to find patterns in randomness—while noting gold’s current drop below $4,000 as it joins a broader market sell‑off.
Key points: Gold’s portal‑asset theory, the impact of sanctions, and the recent divergence between gold and TIPS yields.
Source: Financial Times Markets · Summarized by HeadlinesBriefing