Gold Surges $100 To New Record High Above $4,300 As Bond Yields Dive

By Mish Shedlock of MishTalk

Thursday, October 16, 2025 3:43 PM EDT

(Click on image to enlarge)

The price of Gold vs Faith in Central Banks

Gold vs. Faith in Central Banks Major Timeline

August 15, 1971: Nixon ended convertibility of gold at the then fixed price of $35.00 per ounce. Nixon’s actions allowed the Fed and Congress to inflate at will.

January 21, 1980: Gold spiked to a then high of $850 per ounce in the wake of Nixon shock.

March 1980: Volcker restored faith in central banks by jacking up interest rates to 20 percent. Volcker was followed by Alan Greenspan, labeled the “Great Maestro” for keeping inflation under control.

May 7, 1999: Brown’s Bottom! On the BOE announced plans to dump gold for other assets. Gold was $282. The notice drove the price to $252. The event is named after Gordon Brown, then the UK Chancellor of the Exchequer.

August 23, 2011: Gold hit a then record high of $1923 with a European debt Crisis.

July 26, 2012: ECB president Mario Draghi made his famous “Whatever it Takes” speech. “Within our mandate, the ECB will do whatever it takes to preserve the Euro, and believe me it will be enough.” What did Draghi do? Curiously, nothing at all. However, his statement calmed the bond markets and equity markets. Gold was clobbered.

December 17, 2015: Gold bottoms as faith in central banks peaks again.

What followed was QE to absurd levels, three rounds of massive free money fiscal stimulus during Covid, and the Fed misjudging the ensuing inflation.

Now we have insane tariff policy by Trump, a Fed that still does not understand inflation, and Trump pressure on the Fed to cut rates.

If that was not enough, US debt now grows by $1 trillion every 150 days.

Today’s Action

Today, gold spiked another $100+ dollars to a new record high over $4,300.
Silver hit a new record high of $53.49.
Crude continues to sink. It’s down to $57.62 from a high of $120 in April of 2022.
Copper is near a record high, just under $5.00.
The 10-year treasury yield is under 4.0 percent, down 8 basis points to 3.97.
The 3-month T-bill yield is 3.95 percent nearly the same as the 10-year yield.

Bond Yield Message

Yields are down today but are very elevated from what Trump wants.

Bonds can’t seem to make up their mind whether it’s stagflation, an ordinary recession, or simply persistent inflation.

A case can be made for each of those. After all, who knows what Trump will do?

Regardless, gold’s message is consistent.

A Word About Faith

Gold does not believe the Fed is under control, Congress is under control, budget deficits are under control, or Trump is under control.

And neither do I.