Gold Enters the "Long Positions" Era, Expected to Reach $8900 by 2030

The global political and economic order is increasingly turbulent, and gold is returning to the center stage of the capital market. A recent report from an investment company points out that the world is experiencing a new round of financial restructuring, with gold, as a currency asset that has no counterparty risk and is immune to inflation, becoming increasingly strategically significant. From the deindustrialization of the United States and uncontrolled fiscal deficits to the rise of non-state credit assets like Bitcoin, and then to central banks' large-scale gold purchases, these trends together form the backdrop of the "gold long positions" pattern.

The report compares the current gold bull market to the opposite of the movie "The Big Short": against the backdrop of a global financial and monetary system reshuffle, strategically investing in gold will bring considerable returns. For a long time, gold has been marginalized in the Western financial system, but the situation has begun to change in recent years.

According to Dow's theory, a complete bull market can be divided into three phases: accumulation phase, public participation phase, and mania phase. Currently, gold is in the second phase "public participation phase". In the past five years, global gold prices have risen by 92%, and the actual purchasing power of the US dollar against gold has decreased by nearly 50%. Last year, gold set 43 historical highs, second only to 57 in 1979, and as of the end of April this year, it has already set 22 new highs.

The report proposes a new concept of the 60/40 investment portfolio, rethinking the traditional 60% stocks/40% bonds allocation:

• Stocks:45%
• Bonds: 15%
• Hedge Gold: 15%
• Performance Gold: 10%
• Commodities: 10%
• Bitcoin:5%

This reflects concerns about the current market environment, especially regarding the loss of trust in traditional safe-haven assets such as government bonds.

The key factors affecting gold include:

1. Geopolitical restructuring accelerates, benefiting gold.
2. The profound impact of Trump's policies on the U.S. economy and the global economy
3. Europe's fiscal policy, especially Germany's, has undergone a 180-degree turnaround.
4. Central bank demand becomes a key pillar for "long positions".
5. The continuous depreciation of fiat currency
6. The excellent performance of gold as portfolio insurance

The report retains the concept of "shadow gold price" ( SGP ), which refers to the theoretical gold price based on a monetary supply that is fully backed by gold. According to current market prices:

• The total support for USD M0 requires $21,416
• The M0 in the Eurozone requires full support of 13,500 euros
• The US M2 fully supports $82,223
• Swiss M2 fully supports 29,101 CHF

Report on the gold price model forecast proposed in 2020:

• Basic scenario: Approximately $4,800 by the end of 2030, $2,942 by the end of 2025
• Inflation scenario: approximately $8,900 by the end of 2030, $4,080 by the end of 2025

Currently, the price of gold has exceeded the mid-term target of $2,942 in the basic scenario by the end of 2025.

The report warns that the possibility of a second wave of inflation, like in the 1970s, should not be ruled out. Deflationary trends may still emerge in the coming months, but that does not mean the risk of inflation has been eliminated. A strong response from the Federal Reserve may just be a matter of time.

The report suggests that even if gold returns to the spotlight, a large-scale gold rush among Western financial investors is still a long way off. Silver and mining stocks have a considerable potential for catching up in the current decade.

Bitcoin may benefit from the reorganization of the world order. The report suggests that by the end of 2030, Bitcoin could reach 50% of gold's market value. Assuming a conservative gold price target of around $4,800, the price of Bitcoin would need to rise to about $900,000 to reach this level.

Despite the intact long-term upward trend, the report points out factors that may lead to short-term adjustments:

• Unexpected decline in central bank demand
• Investors reduce positions and long positions decrease
• Geopolitical premium declines
• The US economy is stronger than expected.
• High-tech and sentiment-driven risks
• The US dollar strengthens

The report suggests that in the short term, gold prices may pull back to around $2800, or even consolidate sideways. This adjustment may be part of the process of consolidating the bull market and will not threaten the medium to long-term upward trend.

Overall, the report believes that the gold bull market has not yet ended and is in the mid-term of public participation stage. Gold is transitioning from being viewed as an outdated relic to a key asset in investment portfolios, providing both defensive stability and offensive potential. The long-term rise in gold is based on several mutually reinforcing pillars, and the current price increase may be the first harbinger of a "golden swan moment." As traditional safe-haven assets lose trust, gold is re-emerging as a core component of long-term investment strategies.