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Central banks are not making small adjustments at the margins. They are making decisive moves.
Last year alone, they purchased more than 1,100 tonnes of gold, the largest annual total ever recorded. That buying spree extends a streak that has now run for fifteen consecutive years.
Poland’s central bank governor Adam Glapiński has led one of the most aggressive campaigns, pushing gold to more than 20 percent of his country’s reserves. China has added gold for 18 straight months. Turkey, India, Kazakhstan, and Singapore are following the same path.
These are not reckless actors. They are professional institutions with deep insight into global risk. And they are choosing metal over American paper.
Debt And Sanctions Drive The Great Exit
The reasoning behind this shift is hard to ignore.
U.S. national debt is closing in on $38 trillion, with future obligations far beyond that figure. Spending continues to rise while serious reform remains politically untouchable.
In May 2025, Moody’s removed the United States’ final AAA credit rating, citing expanding deficits and a lack of political will to control spending.
Foreign ownership of U.S. debt has steadily declined. At its peak, nearly half of all Treasuries were held overseas. Today, that number has fallen to roughly 30 percent.
The dollar’s dominance is fading as well. Central banks once kept nearly 80 percent of their reserves in dollars. That share now sits in the mid-50 percent range.
China has reduced its Treasury exposure both in absolute terms and as a share of global holdings. Even Japan, long considered America’s most dependable creditor, is no longer stepping in the way it once did.
Nations also took notice when Washington used the financial system as a geopolitical weapon. Sanctions and asset freezes sent a clear message. Assets tied to U.S. control carry political risk.
Gold does not.
Gold stored in a national vault has no counterparty risk. It cannot be frozen, canceled, or erased by foreign policy decisions.
The “Barbarous Relic” Narrative Collapses
For years, critics dismissed gold as a “barbarous relic” with no yield and no relevance.
The data tells a very different story.
Over the past 25 years, gold has delivered a compound annual return of nearly 10 percent. That is roughly double the return of U.S. Treasury bonds over the same period.
From 2000 through 2024, gold outperformed the S&P 500, the NASDAQ Composite, and the NASDAQ 100 on an annualized basis.
During the 2008 financial crisis, gold rose 25 percent while stocks collapsed. From 2000 to 2009, equities delivered a lost decade. Gold investors saw gains exceeding 200 percent.
By late 2025, gold surged past $4,000 an ounce. Some analysts now expect prices to approach $5,000 by late 2026.
This is not speculative mania. It is a rational response to governments debasing currencies and accumulating debts that cannot realistically be repaid.
Rising Rates Signal A Dangerous Feedback Loop
The consequences for America’s borrowing costs are already visible.
As demand for Treasuries weakens, the government must offer higher yields to attract buyers. Treasury rates jumped roughly 100 basis points since September 2024 even as the Federal Reserve cut rates, a phenomenon economists have labeled a “reverse conundrum.”
Higher rates increase interest expenses. Higher expenses widen deficits. Wider deficits require even more borrowing. The cycle feeds itself.
The Congressional Budget Office estimates that a sustained 20 basis point increase in the 10-year Treasury yield could add more than $700 billion in interest costs over a decade. Current moves are far larger.
Since September 2024 alone, foreign institutions have reduced their dollar reserves by more than $100 billion.
That is not panic. That is planning.
The Warning Washington Cannot Ignore
President Trump inherited decades of fiscal recklessness. But time is no longer on America’s side.
If spending continues unchecked, central banks will keep buying gold and trimming U.S. debt exposure. And if the dollar loses its reserve currency status, the fallout will hit ordinary Americans hardest through higher prices, weaker wages, and reduced global influence.
The world is already casting its vote.
And it is doing so in gold.
