Anyone else rethinking gold's inflation hedge given the last few years?

Mark Adams

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Anyone else rethinking gold's inflation hedge given the last few years?

mark_adams👑Elite (1m-5m)

about 9 hours ago

Key Takeaways

•We're talking probably 10-15% of my total liquid net worth, so it's not insignificant, especially when you're managing a decent book yourself.
•I always felt pretty good about it, especially with the Fed printing like crazy post-2008 and then again during COVID.
•My rationale was always straightforward: when the dollar gets debased, gold shines.

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I've been holding a pretty significant chunk of my personal gold allocation in a Gold IRA for the better part of a decade now, mostly as an inflation hedge and a bit of a crisis parachute. We're talking probably 10-15% of my total liquid net worth, so it's not insignificant, especially when you're managing a decent book yourself. I always felt pretty good about it, especially with the Fed printing like crazy post-2008 and then again during COVID. My rationale was always straightforward: when the dollar gets debased, gold shines.

The last few years, though, have me scratching my head a bit. We saw inflation hit levels we haven't seen since the 80s, and while gold certainly did okay, it didn't exactly launch to the moon like I expected it would. We're talking 9% CPI for a minute there! I mean, sure, it held its value better than a lot of other assets, but the parabolic move I always anticipated as the ultimate inflation protector just... didn't happen. Meanwhile, the S&P rode out the wave, and even crypto had its moments (though obviously more volatile). Maybe I'm just spoiled living in Greenwich, seeing these wild gains in tech and private equity, but it felt like a missed opportunity for gold to truly prove its mettle.

I'm rethinking my strategy a bit. I still believe in gold's role as a store of value, especially with geopolitical uncertainty always simmering. But as a primary inflation protection play, I'm genuinely wondering if my assumptions were off, or if the market dynamics have simply changed. Are we seeing a new paradigm where other assets are stepping into that role, or was this just a blip?

For those of you who also hold gold specifically for inflation, how are you feeling about its performance recently? Are you adjusting your allocation or your thesis? I'm curious to hear if others are having similar thoughts, or if I'm just overthinking it.

3 comments

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ruth_perez📊Growing (50-100k)

Totally feel this. I actually sold off a good chunk of my gold a couple years back for a similar reason, just feeling like it wasn't performing as I'd historically expected as an inflation shield. It's tough when you've got a long-term strategy and then the market does something completely different.

Comments (3)

ruth_perez📊Growing (50-100k)•less than a minute ago

jason_morgan💰Established (100-250k)Real Investor✓ Verified•less than a minute ago

Totally get where you're coming from. It's tough seeing something you rely on for a specific purpose not quite deliver in the way you expected, especially when it's a big chunk of your holdings.

You mentioned "the last few years" – are you specifically thinking about the recent surge in inflation where gold didn't quite keep pace, or more generally about its performance since you started your Gold IRA?

nancy_hall💰Established (100-250k)Real Investor•less than a minute ago

Honestly, I hear you, but I think it's a bit premature to write off gold as an inflation hedge just yet. The "last few years" have been pretty wild, with unprecedented levels of government spending and a supply chain nightmare. Gold *did* perform well when inflation really started to bite in 2021-2022.

Maybe the issue isn't gold's hedging ability, but rather the *type* of inflation we're seeing, or even just the short-term noise. A decade is a decent run, but sometimes these things play out over longer horizons. Just something to consider before jumping ship entirely.

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