Gold is flexing right now. New highs. Headlines screaming. Group chats suddenly full of “eh should buy gold or not?” energy.
So the big question everyone is asking is simple: after running up so hard, is gold about to faceplant?
Short answer? Possible dips, yes. Full-on crash like history books love to scare you with? That one needs a reality check. Let’s break this down properly, no drama, no charts that make your eyes blur.
First, let’s set the stage
Actually, gold didn’t just do “okay.” It went full main character mode.
In 2025, gold jumped about 64%.
Meanwhile, the S&P 500 gained roughly 16%.
So yeah, gold didn’t just win. It lap-ed everyone.
Zoom in on the one-year view and honestly, it looks calm. Steady climb. No crazy vertical candle that screams “bubble leh.”
But zoom out. Way, way out. Thirty years. Fifty years.
Suddenly the chart looks… intense. Like kopi that’s way too strong. And naturally, people start saying, “Confirm crash coming.”
But here’s the thing.
Gold doesn’t crash just because it’s expensive
This is where many people blur already.
Gold does not fall because it hits new highs.
Gold falls when people trust money again.
That’s the real trigger. Always has been.
So let’s rewind to the famous moments everyone keeps quoting.
What really happened in 1980
Honestly, 1980 gets misunderstood all the time.
Back then, inflation was wild. Oil shocks. Global chaos. People had zero faith in the US dollar. Gold surged because cash was basically leaking value every day.
By January 1980, gold peaked near $850 per ounce, then dropped about 65%. Sounds terrifying, right?
But here’s why it fell.
The US Federal Reserve, under Paul Volcker, did something that today sounds unhinged. They pushed interest rates close to 20%.
Yes, twenty.
Mortgage rates were brutal. Businesses died. Recessions hit. People suffered. But inflation broke.
Most importantly, interest rates went higher than inflation. That meant holding cash finally made sense again. You got paid to save money instead of punished.
Once that happened, gold’s job as protection became unnecessary.
Gold didn’t fall because it was “too expensive.”
Gold fell because trust in money came back.
Now let’s talk about 2011
Different story, same logic.
After the global financial crisis, central banks printed money like there was no tomorrow. Gold surged as insurance.
By 2011, gold hit around $1,920 per ounce.
Then… nothing exploded. No dramatic crash. Just a long, painful slide. By 2015, gold was down about 45% from the peak.
Why?
Because inflation never really showed up. Globalisation, weak wages, excess supply — all of it kept prices calm. The US dollar strengthened. Stocks recovered. Risk appetite returned.
Gold quietly lost its purpose.
Again, same lesson.
Not price. Purpose.
The common thread behind every gold crash
Honestly, it’s always the same combo meal:
- Real interest rates turn positive and stay there
- The US dollar strengthens for a long time
- People trust monetary policy again
When all three show up together, gold suffers.
Technical indicators? Overbought? RSI nonsense? Gold doesn’t care. It listens to real yields and credibility.
So what about today?
This is where comparisons to 1980 or 2011 start falling apart.
First, real interest rates are still negative.
Yes, rates are higher than before. But inflation is still eating faster than savings can grow. Cash is still quietly losing value.
Second, US government debt is massive.
Back in 1980, debt-to-GDP was about 30%.
Today? Over 120%.
That matters because it limits how high rates can realistically go. Push rates too far and interest payments alone become a nightmare.
Third, deficits are still huge.
Fiscal discipline? Don’t make me laugh. Trillions are still being spent like it’s normal.
Fourth, central banks are buying gold like crazy.
This is new. They’re diversifying away from the US dollar, and that creates a strong base of demand that didn’t exist in previous peaks.
Fifth, the dollar isn’t the undisputed king anymore.
De-dollarisation is slow, messy, but real. And that weakens the long-term case for blind faith in one currency.
So… can gold still fall?
Of course can. Don’t be delusional.
But let’s be realistic.
Here are the scenarios that actually make sense.
Scenario 1: Sideways movement
Gold chills. Moves in a range. Tests patience. Bores everyone.
Scenario 2: Sharp pullbacks inside a bull market
Gold drops 10–15%. People panic. Twitter explodes. Then it stabilises. Totally normal.
Scenario 3: Full bear market
This one needs serious policy changes. Sustained positive real rates. Tight budgets. Strong dollar. Central banks selling gold. Political willingness to accept long-term pain.
Look around and ask yourself honestly…
Does that sound likely?
Between You & Me
Gold isn’t some magical money tree. But it’s also not about to implode just because headlines say so.
What I see is this: trust in cash is shaky, debt is heavy, and policymakers love the easy way out. In that kind of environment, gold doesn’t need perfection. It just needs things to stay a bit messy.
And let’s be real — messy is kind of our default setting now.
If you’re expecting gold to go straight up forever, relax lah.
If you’re scared it’s going to zero, also relax.
Volatility? Sure. Drama? Confirm.
Total collapse? That one needs way more things to go right than history suggests.
Gold doesn’t crash because it hits new highs.
It crashes when money earns trust again.
Until that happens — properly, painfully, and consistently — gold still has a seat at the table.
