At gold shops, a gram of pure gold is priced at 1,250. On the same day, Bitcoin was at 82,000, still well below the 88,800 it stood at at the beginning of the year.
On the night of October 15, spot gold closed at $4,170 an ounce. Futures on the New York Mercantile Exchange hit a high of $4,197. Just a little more, and it would have been $4,200. Silver rose even harder, gaining more than 3% in a single day to settle at $57. Even wilder than gold.
Different brands quoted different prices that same day. Chow Tai Fook and Chow Sang Sang were at 1,250, Lukfook at 1,248, and Laomiao at 1,247. A difference of a few yuan. On a single bracelet, that adds up to a hundred or two. Ask at the counter, and even the sales staff can’t explain what accounts for those few yuan.
A lot of people think inflation drove this rally. In fact, that day’s inflation data was bad news for gold.
U.S. PPI rose 1.3% month over month in September, its biggest jump in four and a half years. CPI was up 3.7% year over year, and core CPI 2.6%—both higher than expected. By the old rules, numbers like these should have pushed gold prices down.
The downward pressure did come, just from another direction. The 10-year Treasury yield fell sharply over those days, and the dollar weakened along with it. Gold pays no interest. When yields fall, the cost of holding it gets lower.
The hand lifting gold prices is on the interest-rate side. Fear is just standing nearby watching. They’re two different things.
Bitcoin, meanwhile, is quiet. Very quiet. People looking to get away from sovereign credit haven’t necessarily turned to it first this year.
The root of the difference is in the buyer lists. Central banks around the world are on gold’s buyer list. Every month, there’s a report on their gold purchases: who’s buying, how many tonnes, which quarter saw the fastest increase. Open it up and you can see it all, down to the decimal point. Want to know which country was supporting the market in the last three months of last year? Its name is in the appendix. Bitcoin, by contrast, has no such column. Leverage, though, is never in short supply.
Leverage leaves no monthly report of its comings and goings. It leaves liquidation prices. One report a month—that’s central banks. When the liquidation price rings, the position is gone. Just like that.
At 1,250 a gram, what does that mean for an ordinary person? A 30-gram bracelet costs 37,500. Work out for yourself how much Bitcoin that amount could buy this year. Once you’ve done the math, you’ll probably pause for a moment. You really will.
The people queuing at gold shops five years ago and the people buying Bitcoin five years ago are probably feeling very different right now. No one should rush to celebrate on the other’s behalf. The market hasn’t finished its run.
What I’ve been thinking about is something else. Gold’s most powerful move this year was siphoning away money that would otherwise have gone into non-sovereign assets. That money wanted something deliverable, auditable, and backed by monthly reports.
Why? Because gold has all three, and gold shops and central banks can both provide them. That’s it. Besides, the bank counter closes at five in the afternoon, but you can still carry a gold bar home.
There’s no telling how far this rally can go. The Fed meets on October 27 and 28. San Francisco’s Daly first said there was no need to raise rates, then said rates would have to go up if inflation didn’t fall. Even she hasn’t settled on a consistent line.
For now, remember these two numbers. The price tags on gold jewelry in China have changed several times this year. Bitcoin’s 82,000 was already around this level at the start of the year. Put the two numbers side by side, and they’re more honest than any opinion.
If you want to keep seeing comparisons like this, give me a follow.
#黄金 #比特币 #美联储 #金饰价格 $BTC $PAXG $XAUT
On the night of October 15, spot gold closed at $4,170 an ounce. Futures on the New York Mercantile Exchange hit a high of $4,197. Just a little more, and it would have been $4,200. Silver rose even harder, gaining more than 3% in a single day to settle at $57. Even wilder than gold.
Different brands quoted different prices that same day. Chow Tai Fook and Chow Sang Sang were at 1,250, Lukfook at 1,248, and Laomiao at 1,247. A difference of a few yuan. On a single bracelet, that adds up to a hundred or two. Ask at the counter, and even the sales staff can’t explain what accounts for those few yuan.
A lot of people think inflation drove this rally. In fact, that day’s inflation data was bad news for gold.
U.S. PPI rose 1.3% month over month in September, its biggest jump in four and a half years. CPI was up 3.7% year over year, and core CPI 2.6%—both higher than expected. By the old rules, numbers like these should have pushed gold prices down.
The downward pressure did come, just from another direction. The 10-year Treasury yield fell sharply over those days, and the dollar weakened along with it. Gold pays no interest. When yields fall, the cost of holding it gets lower.
The hand lifting gold prices is on the interest-rate side. Fear is just standing nearby watching. They’re two different things.
Bitcoin, meanwhile, is quiet. Very quiet. People looking to get away from sovereign credit haven’t necessarily turned to it first this year.
The root of the difference is in the buyer lists. Central banks around the world are on gold’s buyer list. Every month, there’s a report on their gold purchases: who’s buying, how many tonnes, which quarter saw the fastest increase. Open it up and you can see it all, down to the decimal point. Want to know which country was supporting the market in the last three months of last year? Its name is in the appendix. Bitcoin, by contrast, has no such column. Leverage, though, is never in short supply.
Leverage leaves no monthly report of its comings and goings. It leaves liquidation prices. One report a month—that’s central banks. When the liquidation price rings, the position is gone. Just like that.
At 1,250 a gram, what does that mean for an ordinary person? A 30-gram bracelet costs 37,500. Work out for yourself how much Bitcoin that amount could buy this year. Once you’ve done the math, you’ll probably pause for a moment. You really will.
The people queuing at gold shops five years ago and the people buying Bitcoin five years ago are probably feeling very different right now. No one should rush to celebrate on the other’s behalf. The market hasn’t finished its run.
What I’ve been thinking about is something else. Gold’s most powerful move this year was siphoning away money that would otherwise have gone into non-sovereign assets. That money wanted something deliverable, auditable, and backed by monthly reports.
Why? Because gold has all three, and gold shops and central banks can both provide them. That’s it. Besides, the bank counter closes at five in the afternoon, but you can still carry a gold bar home.
There’s no telling how far this rally can go. The Fed meets on October 27 and 28. San Francisco’s Daly first said there was no need to raise rates, then said rates would have to go up if inflation didn’t fall. Even she hasn’t settled on a consistent line.
For now, remember these two numbers. The price tags on gold jewelry in China have changed several times this year. Bitcoin’s 82,000 was already around this level at the start of the year. Put the two numbers side by side, and they’re more honest than any opinion.
If you want to keep seeing comparisons like this, give me a follow.
#黄金 #比特币 #美联储 #金饰价格 $BTC $PAXG $XAUT