There's no objective way to value gold; its value is what people are willing to pay. It works in a portfolio as a hedge against fiscal issues in developed countries and growing geopolitical risk.

It is a hedge against dollar weakness. Post-COVID, longstanding correlations have broken down. Gold moving opposite the dollar is a fundamental correlation that holds. If you worry about US debasement or debt, gold does well.

Equities and gold have not been that negatively correlated. In 2025, they've moved together. Gold is a portfolio diversifier, not necessarily a day-to-day hedge for stock market fluctuations.

We're probably where we want to be. Gold can go down abruptly, as in 2022. In a classic 60/40 portfolio, a 3-5% position works well to compensate for hard-to-quantify risks.

Gold and silver are moving in tandem; silver is also a precious metal hedging risk. There's a broader rally in many commodities, like copper tied to electrification.

The move in Japan has been dramatic, but it's not a shock given Japan's exit from deflation and new prime minister using fiscal stimulus. Interestingly, despite Japan, US 10-year yields haven't broken out of their range, and US bond volatility is low.

Spillover effects aren't always dramatic. Factors supporting US bonds remain: no obvious short-term dollar replacement, inflation heading in the right direction, no stagflation, and opportunity to pick up yield in credit markets.