The rise of the price of gold over the last 12 months has been breathtaking — but also a little frightening.
The rocketing cost of the precious metal has become a referendum on how investors see what could become a shaky global economy.
The World Gold Council says 2025 was already a record year: total demand topped 5,000 metric tons for the first time, gold hit 53 all-time highs, and ETF holdings grew by 801 tons, the second-strongest year on record. And so far gold in 2026 has continued to climb in value.
What’s happening with gold matters because the rally does not appear to be driven by hype or “gold fever” alone. There is clear evidence of real demand: bar-and-coin buying reached a 12-year high, central banks bought 863 tons in 2025, and the World Gold Council says safe-haven buying, diversification, and price momentum all played a role.
This means broad institutional and retail purchases of gold make it an asset that many investors continue to treat as a store of value when they are uneasy about rising debt, geopolitics, tariffs, or the weak dollar’s long-term outlook.
Nevertheless, gold’s recent behavior also undercuts the old idea that the Midas metal is always a calm, steady refuge. In this economy gold can become surprisingly volatile and suddenly drop like a lead weight. Gold plunged 9.5% in a single day on Jan. 30, its steepest daily drop since 1983, after hitting a record high. Days later, it posted its biggest rise since 2008. That kind of whiplash suggests that even a classic safe haven can become a momentum trade when speculative money rushes in.
History shows gold can fall fast after sharp run-ups, especially when the dollar strengthens, real yields rise, or traders lock in profits.
Bitcoin, by contrast, is acting much more like a risk asset. It was trading around $64,085 on Feb. 24, well below earlier 2026 levels. Cryptocurrency analysts report that Bitcoin has been hit by tightening-liquidity fears and wider “risk-off” selling. That is a different signal than gold: gold is rising because investors want protection; bitcoin has been sliding because investors are shedding volatility.
Guest:
David Woo is a globally recognized economist, investor, and founder of David Woo Unbound.
"The Source" is a live call-in program airing Monday through Thursday from 12-1 p.m.
Leave a message before the program at (210) 615-8982.
During the live show, call 833-877-8255, email thesource@tpr.org.
This episode will be recorded on Wednesday, February 25, 2026, at noon.
