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We have often decried here the untruth uttered by those who don't like gold (your banker, Christine Lagarde, the finance minister, the obsessive stock marketer): "Gold, it doesn't pay!"

The argument is meant to be definitive and irrefutable. However, it is not true, since the price of gold has been rising year after year. But until now, a precise and indisputable calculation was missing. This has now been done: Nicolas Delourme (Editions Jean de Portal) has calculated the returns on gold since the beginning, i.e. 1971, the date on which the yellow metal lost its fixed convertibility with the dollar ($35 an ounce, on August 15 precisely).

This study considers the price of gold in dollars rather than in euros, for two main reasons: firstly, because the single European currency has only existed since 1999, and secondly because gold prices are set in the American currency; it is the reference on the gold market. That said, if we had used the euro, the figures would not have been very different. Over the last twenty years, the two currencies have certainly oscillated, but without one taking the lead over the other.

The strong point of this study is that it has observed all possible cases: a gold purchase made in 1971 (January 1) and resold in 2021 (January 1), but also all conceivable cases between these two years: from 1971 to 1972, from 1971 to 1973, from 1971 to 1974 and so on until 2021, then from 1972 to 1973, from 1972 to 1974, etc. until 2021, from 1973 to 1974, from 1973 to 1975, etc. In total, this represents some 1,275 combinations of gold purchases and resales.

The result is clear: over fifty years, the entire period, we note an average performance of +8.17% per year, then +8.69% per year over the last twenty years. No liquid asset (easy and quick to resell) has performed this well over such a long period. It is reported that an investment offering an annual return of +7.18% can double its capital in ten years. Therefore, gold investors have, on average, doubled their investment every ten years for half a century!

Of course, there are periods of losses, but they only affect those who have sold this investment in a hurry, which is conceived in the long term, i.e. at least four years, and even then only for a few very specific moments. Thus, there were six years of losses after the 1980 peak, five years after 1988, five years after 1996, and that's it. This means that an investment of at least seven years, at any time during the period 1971-2021, has proven to be profitable. Gold is a long-term investment, we repeat.

This study, for which I have provided some comments, is available for free download in its short version (in french). You will find all the 1,275 combinations of purchase and resale. Here are precise figures (and certified by bailiffs) to oppose the detractors of gold investment. And on the other hand, who can say better?