The crowd lining up at the gold shop counter, bank investment gold bars frequently sold out, financial headlines dominated by gold prices—international spot gold has broken through $4300 per ounce, and domestic gold jewelry prices have risen to 1350 yuan per gram. Looking at the floating profit in their accounts, seasoned investors may recall that summer of 2019. Back then, London gold started at $1280, surged to $1510, with an annual increase of over 18%, and gold ETF holdings skyrocketed by 400 tons, allowing countless early investors to reap substantial rewards.
But today in 2025, the logic supporting gold prices is far more complex and stronger than it was back then. History may rhyme, but it is by no means a simple repetition.
1. The underlying logic of the 2019 bull market: interest rate cuts + safe-haven "gold triangle."
Looking back at 2019, the three drivers of gold price increases are clear.
Monetary policy shift: The Federal Reserve has initiated its first interest rate cut in ten years, with a total reduction of 75 basis points throughout the year, reducing the attractiveness of the dollar and causing funds to flow into gold, a "non-yielding asset."
Geopolitical storm: The tug-of-war over Brexit, ongoing Middle Eastern conflicts, and escalating trade frictions are pushing safe-haven sentiment to the "C position" for gold.
Central banks continue to stockpile: Central banks around the world net bought 374.1 tons of gold in the first half of the year, providing solid "national team" support for gold prices.
2. The "super doubling" of 2025: similar script, stronger drivers.
The current market environment is strikingly similar to 2019, but every link is "super doubled":
Monetary Policy: The interest rate cut cycle is just an appetizer.
The Federal Reserve officially began the interest rate cut cycle in September 2025, and Goldman Sachs predicted another 100 basis points cut in mid-2026. Compared to the three interest rate cuts in 2019, this round of easing cycle is longer and stronger, continuously lowering real interest rates and directly igniting the allocation value of gold.
Geopolitics: From localized conflicts to system reconstruction.
The Russia-Ukraine conflict continues to be stalemated, the situation in Palestine and Israel is heating up, and the Iranian nuclear issue is escalating — the risks in 2019 were characterized by "pointed explosions," while in 2025, they are "fully upgraded." The traditional logic of "buying gold in troubled times" has been vividly interpreted in the modern financial system.
Central Bank Gold Buying: From "allocation demand" to "strategic choice."
In the first three quarters of 2025, global central banks net purchased 634 tons of gold, far exceeding the level of the same period in 2019. In October alone, net purchases of gold reached 53 tons, setting a new high for the year. Central banks in Poland, Brazil, and other countries continue to increase their holdings, with a World Gold Council survey showing that 95% of surveyed central banks plan to continue increasing their holdings in the next 12 months. This is not a simple allocation but a hedge and reconstruction of the dollar credit system.
3. Capital aspect: from "steady flow" to "flood and beast."
In 2019, gold ETFs experienced a "gradual inflow," while in 2025, it is a "frenzied buying" market:
• Global gold ETFs saw net purchases exceeding 700 tons, an unstoppable momentum.
• China's gold ETF scale skyrocketed from 73 billion yuan at the beginning of the year to 236.1 billion yuan, an increase of 223%.
• The domestic futures market gold sector has accumulated over 150 billion yuan, with off-market funds accelerating their entry.
This kind of capital "replication" is more like a "supercharged version" of 2019.
4. New variables that cannot be ignored: The era of currency system reconstruction.
In 2019, there was only a "safe-haven + interest rate cut" dual drive, while in 2025, two entirely new supports are added:
The hard logic of anti-inflation: Global inflation remains sticky, and the risk of currency devaluation in major economies has not been eliminated. The value preservation attribute of gold has shifted from a "choice" to a "necessity."
Currency credit crisis: The US debt has exceeded 35 trillion US dollars, and the three major rating agencies have rarely downgraded its sovereign credit rating. Central banks around the world are buying gold to "de-dollarize," raising the strategic value of gold to the height of national security. This is not an investment choice but a historic reconstruction of the global reserve system.
5. Survival Guide for Ordinary Investors: How to "survive" in the gold frenzy?
In the face of a frenzied market, maintaining clarity is more important than chasing returns:
1. Long-term value preservers: Reject FOMO, embrace regular investment.
Don't chase highs! Don't chase highs! Don't chase highs! Use a regular investment strategy to buy gold ETFs or paper gold, spread out costs, smooth out fluctuations. Going all-in at high levels might not let you endure short-term pullbacks.
2. Physical gold enthusiasts: buy "gold bars" not "gold jewelry."
Prefer to invest in gold bars rather than gold jewelry. Gold jewelry has a premium of 20-30 yuan per gram, and when repurchasing there is also a discount of 5-10 yuan per gram, making it very low in investment cost-effectiveness. Gold bars are real hard currency.
3. High-risk tolerators: Stay away from futures leverage.
The leverage effect of gold futures may magnify losses instantly. Newcomers in a volatile market are easily "washed" out. If you don't have more than three years of commodity futures trading experience, don’t touch it!
6. Risk Warning: The "ghost" of short-term pullbacks is still lurking.
In times of market frenzy, risks are often overlooked. Several current signals are worth heeding:
Technical indicators are overbought: KDJ has entered the overbought zone, and historical data shows that when gold prices are high above 4000 dollars, the probability of daily fluctuation exceeding 2% significantly increases.
Chasing highs and getting trapped: In the 2019 bull market, about 40% of investors were trapped during pullbacks due to chasing highs. History does not repeat itself, but human nature is always similar.
Operational advice: Be sure to set take-profit and stop-loss lines; do not blindly increase positions out of "fear of missing out." Set yourself a discipline, such as taking profits on 10% of your position every time it rises by 5%.
7. Conclusion: Gold is still that gold, but the world is no longer that world.
The gold bull market of 2025 indeed replicated the core drivers of 2019, but greater fundamental forces are reshaping gold's positioning — it is no longer merely a safe-haven asset but a strategic choice for hedging currency credit risk and optimizing asset allocation.
When gold prices dance above 4000 dollars, the tug-of-war between bulls and bears will only intensify. Has your investment logic kept up with the times?
In the face of this round of gold frenzy, your choice is:
• A. Fully invested: firmly believe in the logic of "gold in troubled times" and continue to be optimistic about the future.
• B. Regular investment: use discipline to counter emotions, steady flow.
• C. Waiting and watching: wait for a pullback to enter, avoid standing guard at high positions.
• D. Take profits: secure the gains, preserve the fruits of victory.
Feel free to leave your choice logic and reasons in the comments!
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