The price of gold has been making new highs practically on a daily basis – until recently. Those who sold too early missed on further gains. Year to date 2025, the yellow metal truly exploded, from below 2,600 USD to a record of above 4,300 USD. Little surprisingly, gold mining stocks have seen even bigger gains, as at this price level every miner should be extremely profitable, even the worst operators. Instead of becoming greedy, I (just in time) decided to close my two active gold mining cases for my paid-members, realizing fat gains. Why have I decided to do so?
Summary and key takeaways from today’s Weekly
– Gold is a commodity with a special status and different types of followers.
– I think it is important to understand gold properly, especially what it is not doing.
– After the vertical move up, I turned cautious. Gold mining stocks could get slaughtered.
The gold price has risen very quickly this year with no end in sight.
Such a move tends to paralyze many people. Humans extrapolate the current trend, assuming (in some cases: hoping) prices will rise even further. When greed comes into play, a dangerous cocktail disables our rational decision making process.
Oh great, after 3,000 USD comes 4,000 USD. After that 5k isn’t that far off. Why not 10k at the end of the year? I am sure many people had exactly these thoughts and still have them. Each new milestone turns into a stop-gap, rising expectations for new, higher price targets.
Of course I do not know whether this has been it, to make it clear from the beginning.
But after having fought with myself for quite some time, I finally made a decision and closed the two gold mining cases I had opened for my paid members (one for each membership). We realized fat gains, especially for relatively short periods of time.
While it is possible that gold continues to rise, I think the easy money has been made.
If you’re looking for attractive, overlooked stock ideas the majority has a blind eye on, look no further. I am offering compelling non-mainstream cases in concise 12-page member-exclusive reports.
Want to outsmart the market? Get active now! Become a supporting paid-member and receive my best stock ideas (plus updates).
The average total return of my best stock ideas is ahead of the S&P500 and the Dow Jones. With my risks-first approach (paired with high upside), I am able to find stocks with great returns.
Join me and my members on our journey to beat the markets!
both as per 22 October 2025 market close – since August 2022
Gold: misunderstood, creating many victims
The headline is meant to be understood as “from an investment perspective”.
I had written it already in the past, but for my newer readers (and as a refresher for all) it makes sense to understand my viewpoint towards gold.
Unlike most public commentators, I do not belong to the two big camps.
The first one are the gold bugs who see the world crashing every day, with gold being the holy grail. All other assets according to them are doomed to fail, and without gold one is lost. As if stock markets would crash to zero which never happened in history. And by the way, during a liquidity shortage, metals are being sold off, too, as cash is king then as the most liquid and flexible asset.
The second, clearly much more moderate group are people who are generally optimistic or concerned, but not going through a life-long mental depression. They see gold being linked to inflation and as such a prime hedge against rising consumer prices.
Self-explanatory, the first group is a quasi-religious, in extreme cases fanatic and even dangerous club. These people can be split into two more camps. The gold sellers, who make their living of this fear-mongering, and those who have fallen victim to them. Both will tell you gold is everything, everything else is manipulated anyhow and will lose its entire value.
I do not belong to either of those – despite having spend much time with this philosophy and despite having a diploma from the Austrian School of Economics even.
For me it is clear gold is not an exclusive savior, nor is it an inflation hedge.
To the contrary, it can even be extremely impractical if you want to store much of it, cross country borders with it, or just hypothetically if we had such a scenario the gold-promotors and fear-mongers are painting on the wall, it would be idiotic to buy a loaf of bread for an ounce of gold – assuming the bread is for sale at all, which might be in doubt depending on the circumstances.
This is not a crisis or prep blog, I am discussing stock investments. But I think you get my point. Common sense and rationality must not be thrown away.
To destroy this inflation-nonsense: In times of inflation, most assets tend to rise, especially energy and commodities. Haven’t food and temporarily energy prices exploded? Homes, used cars, insurance policies, different services, and equities have risen in prices either.
So gold being the sole inflation protector falls short.
And, if you look closer, you will find periods where gold has not risen during times of inflation, making this deeply rooted thesis highly questionable.
If you don’t believe me, just look at the two screenshots below. I do not want to bore you with stats and charts from 30 or 40 years ago. Just look a few years back. You will likely remember the huge inflation spike.
Gold likely would have protected you, right?
Well…
By the way, gold mining stocks – the “gold on steroids” during this high-inflation period got absolutely destroyed. Pundits and ideologists simply forgot to take massively rising costs from energy and labor into account – something I had spoken and warned about in advance on stage multiple times when I was still employed. The more seasoned people laughed. I laughed a few years later.
And the subsequent rise in gold occurred with falling inflation rates.
A theory or thesis must be bulletproof, not work out sometimes as you wish. Else, it is at best not working, at worst pure propaganda to sell something to people who live in fear.
This inflation-hedge view might work out for very long time periods (or if cut out of context) and if you act as if no other assets ever existed in parallel. You will likely know the saying about the purchasing power of an ounce of gold and a bespoke suit or a Roman tunica.
If you slip into a gold market like between 1980 and 1999 (–70% from peak to trough with stressing ups and downs in between), this will hardly console or motivate you. Don’t tell me that purchasing power was stable during these 20 years. Assets like equities or homes haven’t risen? What has gold done?
What is gold driving then?
For me it is clear that gold is a barometer of stress. This can be tied to the financial system being on shaky footing like during the Euro crisis 2010–2012, in times of war and big escalations, or if trust in public authorities is breaking on a major scale.
Decide for yourself regarding the above. I shared my view.
Now turning to the core of this Weekly, why did I close my gold mining cases? It was not an easy decision. But my gut was pressing me more and more each day. When you see such a chart like below, what’d you think?
If it helps, assume it is not gold, but any other commodity you’re not emotionally married to.
Such a vertical pump is a clear warning sign, not the time to celebrate.
In stocks people call such a move a bubble. But why not in gold? It’s a precursor of a major crisis coming – always (irony off). A rise of ~60% year to date is a very extreme one. It can go higher, yes. But it can come crashing down very hard, too, after such a steep move.
This is what I have written to my paid members in my closing updates:
What concerns me is the gold price development. We need to keep in mind what is primarily driving gold stocks like our (placeholder): it is the gold price (also energy and labor, but this is the cost side). In the end, despite its special status, gold is a commodity nonetheless.
And commodities are highly cyclical. I could be too early with my call, but nothing goes up forever especially not at such a pace. Better to take the chips off the table now after a phenomenal run, instead of becoming too greedy, only to lose much again, and being under stress to find the right time to exit.
When something goes vertical, it is time to get really cautious.
Gold has gone vertical.
I continued:
Plus, on twitter, my primary tool to check sentiment on different things, some are posting pictures of people standing in long lines to buy physical gold.
This reminds me of 2011 / 2012. Usually, these are people who come late to the party, not those who buy when prices and sentiment are depressed.
Sentiment is becoming very bullish, especially among broader populations. I have seen multiple screenshots on twitter, showing people standing in queues to buy bullion. This is not a behavior you see when gold is cheap as chips, but when the train has left the station long ago.
I am fully aware that it’s not this group of the population that is driving the gold price. But such pictures usually can be seen at the end of a cycle. Some are joking and call this “exit liquidity” for the big boys.
Central banks, especially the Chinese but also others, have been buying gold in large amounts, driving gold demand. In this case, I do not think they are seeking exit liquidity so that demand could continue. But who says there’s no limit central banks are willing to pay?
At some point the story is finished.
Maybe today? I don’t know, but such violent moves down – honestly without apparent reason – do not make me confident this bull market has much further to run, if at all.
It is not that easy, though. There’s more to it.
If you live in a country with a notoriously weak and deprecating currency, maybe paired with an undeveloped stock market, it is an entirely different case compared to relative stability. Buying gold (or other tangible assets) is not always the same.
But to close the investment implications for gold mining stocks, here’s what I wrote specifically tied to the cases I closed:
Many gold mining stocks trade at extremely high price to book values.
[…]
Every gold (and silver) miner likely is highly profitable now. This is usually NOT the case, especially not with such extreme margins. Production costs on average are around 1,500 USD, with the weaker projects showing AISCs around 2,000–2,500 USD per ounce. Gold trades at 4,300 USD.
If it weren’t gold, but any other metal, it would be clear, we’re at the end of the cycle, when every producer is highly profitable.
What I want to add is that gold in physical form can remain around this price range, while gold mining stocks enter a sharp correction. Today, as I am writing this Weekly, is a prime example:
If you think this has hit only small shitcos with questionable dirt holes somewhere in the African desert, I must disappoint you:
When spot gold has a cough, gold miners freak out entirely.
One should better not forget that the leverage of miners works on both sides, not just to the upside when everything is shiny.
Valuations have become very extreme in many cases.
The thing is, if gold corrects by 10% which would be nothing unusual, gold mining stocks depending on their size, margins, and whether they are producers or just developers, could see their stocks crash really hard.
Minus 20–30% or even more would not be a surprise. I wanted to protect my members from such a “surprise”.
This is something I want to avoid when risk and reward have gotten out of hand.
The cases I presented to my paid members have generated
- +212% since May 2024 (Premium PLUS idea)
- +89% since August 2025 (Premium idea)
Make no mistake, these are phenomenal, significantly above-average returns. I was not keen on seeing these gains being cut in half.
Let’s just look how valuations of a few selected names have expanded in recent times (these were before the sell-off on Tuesday).
The list could go on and on.
I think you get my point. While there’s no guarantee this was indeed it, the easy money has been made. From a sheer risk and reward perspective, it would not be wise to hope for higher prices.
As gold for me is a barometer of financial and political stress, it has already priced in much of it. What this means in return is that any positive news have the potential to cause a major crash in gold (I had written that before Tuesday’s move).
I am not investing based on news and headlines, especially if they change on a daily basis, but the big money has been made. I am convinced of that.
This is what I see more and more often.
I am not so sure 5k is “increasingly inevitable”.
We’ll see.
To close the investment loop, my two successful gold mining picks have considerably benefitted all my closed cases for my members. To the left, my so-far three closed Premium PLUS cases vs. benchmarks, and to the right my in total 20 closed Premium ideas vs. benchmarks.
This is where I want my members to be: on the winning side, not joining the crowd of mainstream investors.
It is important for me to show these charts, as not paper gains are key, but what has been realized. I am investing for the long term, however, depending on each case, its development, and catalysts, the investment horizon can vary from a few months to multiple years.
Premium PLUS is where I am fishing for potential multi-baggers which don’t show up that often. I need really good fundamentals and setups. The beauty of it is that a few hits from time to time can already be enough to generate phenomenal returns.
But Premium with its much more ideas likewise shows that on average my picks do outperform the market.
If you want to benefit from my work which is where I am putting my lifeblood into, don’t hesitate to join my growing base of sophisticated members. Together, we uncover non-mainstream ideas, fundamentally analyzed, and assessed from a risk and reward perspective.
We don’t follow the herd. We think independently and freely.
Conclusion
Gold is a commodity with a special status and different types of followers.
I think it is important to understand gold properly, especially what it is not doing.
After the vertical move up, I turned cautious. Gold mining stocks could get slaughtered.
By becoming a Premium or Premium PLUS Member, you get instant access to all my already published research reports as well as several updates.
Likewise, you qualify for eight, respectively four more exclusive reports with my best investment ideas plus updates on the featured businesses over the next twelve months.