October 16, 2025 • 8 mins
The U.S. Dollar Index, which values the U.S. Dollar against a basket of the world’s leading currencies shows that the U.S. Dollar is stronger today than it has been for all but about five years out of the past 40.
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Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:04):
You have questions, Brian has answers. It's time for today's
Q and A of today. This is the Brian mud Show. Yeah,
good morning, hopeing it is for you as we take
a look at today's Q and A. Is Gold's record
run a sign of trouble for the US economy? This
is brought to you by my listen ashes check mark collections.
(00:26):
Each day a feature a listener question sent by one
of these methods. You may email me Brian Mudd at
iHeartMedia dot com, hnd me up on social at Brian Mudradio.
May also use the iHeartRadio talk back feature. Just go
into the app find us, make us your number one
pre set. While you're in there, you'll see a little
microphone button. Tap it. You may lay out a message
right there, maybe for a future A Q and A.
(00:46):
Today's note is this at Brian Mudradio. Do you think
Gold's move to recordize above forty one hundred dollars is
a sign of trouble? As some are saying, yeah, actually
in real time it's above forty two hundred, And that
being said, the short answer is no, I don't. That
is unless you also view with the current price of
(01:08):
commodities like gallium, palladium, lithium, rhodium, indium, silver, and for
that matter, crude oil as signs of trouble as well,
and also the current value of the stock market. And
I mentioned all of them because there are all examples
of assets that have appreciated at a faster rate than
gold from the onset of commodities trading until today, there
(01:30):
is no doubt the gold has been on a historic
run this year of fifty eight percent plus, a figure
that year to date outperforms just about any investible asset,
and such a search and value amit a time of
turbulence globally within our own country as US deficits persist.
The federal debt has surpassed thirty seven point six trillion.
(01:51):
All that stuff can can make people nervous. So yeah,
to be sure, gold's performed spen phenomenal this year, for
that matter, in recent years. With that said, in a
historical context, which I think is important in this conversation,
not so much even factoring in the recent record run.
As of yesterday's price, the average annual rate of return
(02:12):
for gold all time has only been four and a
half percent, and that's a rate that is well below
that of other commodities mentioned, as well as less than
half the rate of appreciation of stocks as well. Now,
some will point to price controls that were in place
fixing the price of gold until the end of the
gold standard in nineteen seventy one, and to be sure
that factored in during the years of the price controls,
(02:33):
no doubt. However, it would be easy in the open
market for price appreciation of the commodity to well more
than account for the previous performance with an enormous catch
up rally. So, in other words, as we're fifty four
years removed from price controls, there's been ample time for
gold to adequately adjust an account for all historic controls.
(02:54):
When you take a look at what really goes on here,
this is the piece of the conversation that I think
is most instructive and widely unknown. How is it that
you think gold is mostly used? Where is the majority
of the demand for gold? Forty four percent of all
(03:19):
gold is being used in jewelry. That is number one
for demand, and it's not particularly close. Next up, twenty
six percent of gold demand is coming from investors. You'll
often hear a lot of advertisements and things, and oh,
you know, governments and central banks. They are big buyers,
(03:43):
but they are the third leading driver at twenty three percent.
So in other words, investors have been buying gold at
a faster and more pervasive rate than government central banks
have been doing. And then the remaining seven percent is
being used in technology devices. So a couple of really
(04:05):
instructive points here. It's often said and advertised that governments,
as mentioned, stocking up on gold to guard against the crisis.
What have you? I mean, there's an element of truth
to it. However, in reality, the demand for gold jewelry
still runs at twice the run rate of demand by governments.
What's more is that demand from investors is greater than
(04:27):
that of governments in central banks, and rising investor demand
has been driving the price more than the action of
those central banks. On that note, given that gold is
a commodity with pricing based on supplying demand, the risk
factors both for higher prices and potential lower prices are
there as well, with gold jewelry remaining the largest factor
and driving close to half the demand of the commodity.
(04:49):
Combined with the use of gold and certain technology devices,
you take a look at that in over half of
the total demand for the commodity is consumer based. Of
gold demand is consumer based, So if consumer demand remains strong,
it's likely the price of gold it's going to remain strong.
That's a key dynamic in addition to investors and government demand. Now,
(05:11):
of course, mining supply is also something that's always worth
keeping an eye on as well. Now, relative to the
concerns about the strength of the US dollar, the potential
for a federal government collapse, all those things a couple
of dynamics to consider. Did you know that the value
of the US dollar on a relative basis is higher
today than it was on the same date in nineteen
eighty seven? No kidding. The US Dollar Index, which values
(05:35):
the US dollar against the basket of the world's leading currencies,
shows that the US dollar is stronger today than it
has been for all but five years out of the
past forty no kidding. The US Dollar Index is currently
about ninety nine dollars. It's all time high was one
hundred and twenty two in nineteen eighty six. It's all
time low was eighty two dollars in two thousand and eight.
(05:59):
The dollar is weak than it was earlier this year,
so the value is worth watching. As all commodities are
US dollar denominated, and the value of the dollar directly
impacts inflation as well. However, there's nothing about the current
value that is close to alarming. For additional perspective, ten
years ago today, the value of the US Dollar index
was ninety six dollars. Many gold bulls. We'll talk about
(06:23):
a consistently declining dollar value. That is a fundamentally false argument.
It's just not true. The fact of the matter is
that the dollar is worth more than it was a
decade ago today than it was on the same date
in nineteen eighty seven. This is why, for example, our
stock market has been enjoying recordized along with historical high
(06:44):
employment amid other macroeconomic events. They're just not consistent with
the collapse. Now, this isn't to say that a country's
dead and deficit problems aren't significant. They are, and they
need to be meaningfully addressed. However, there's certainly no imminent
collapse in the horizon, nor is there any for the
foreseeable future. One of the things you take a look
at is inflation, and if you're going to have a
(07:08):
collapse of a currency and that kind of inflation runs
off the charts not below three percent, So my outlook
wid change at the US dollar dropped near or broke
below its two thousand and eight levels during the onset
of the financial crisis that led to the Great Recession.
For now, the dollars value remains twenty percent higher than
those levels and again above its historic average value. So
(07:30):
the bottom line from my perspective is that if you
want to add gold to an investment portfolio as part
of a strategic decision, okay. Might make sense based upon
your circumstance. But as always my first role of money,
never let your money and emotions cross pass. If you're
feeling emotionally pressured into hoarding the commodity because you have
fear of an economic collapse, probably not a good thing.
Speaker 2 (07:52):
Fucks Unshet.
Speaker 3 (07:54):
Any good assistant should be able to manage your schedule,
research and pull together notes before a big meeting and more.
And now every major tech company is racing to become
your go to assistant platform. Amazon has introduced quick Suite
and Agenic AI application that AWS users can use to
automate tasks. AWS vice president of AI told Fox Business
(08:16):
that quicksuite has access to all of your docs and
information to be as helpful as possible.
Speaker 2 (08:22):
It connects to all your data across data viruses, to
docs in MS three sixty five Google Docs, to systems
like a SAP and Service Now, and can run many more.
Speaker 3 (08:34):
On Thursday, Google launched Gemini Enterprise. It's powered by the
Tech Giants' AI models and allows users to ask questions
about their company's data, documents, and applications, all in a
conversational manner like you would a human assistant for Fox
on Tech. I'm Madison Alworth, Fox Business
You have questions, Brian has answers. It's time for today's
Q and A of today. This is the Brian mud Show. Yeah,
good morning, hopeing it is for you as we take
a look at today's Q and A. Is Gold's record
run a sign of trouble for the US economy? This
is brought to you by my listen ashes check mark collections.
(00:26):
Each day a feature a listener question sent by one
of these methods. You may email me Brian Mudd at
iHeartMedia dot com, hnd me up on social at Brian Mudradio.
May also use the iHeartRadio talk back feature. Just go
into the app find us, make us your number one
pre set. While you're in there, you'll see a little
microphone button. Tap it. You may lay out a message
right there, maybe for a future A Q and A.
(00:46):
Today's note is this at Brian Mudradio. Do you think
Gold's move to recordize above forty one hundred dollars is
a sign of trouble? As some are saying, yeah, actually
in real time it's above forty two hundred, And that
being said, the short answer is no, I don't. That
is unless you also view with the current price of
(01:08):
commodities like gallium, palladium, lithium, rhodium, indium, silver, and for
that matter, crude oil as signs of trouble as well,
and also the current value of the stock market. And
I mentioned all of them because there are all examples
of assets that have appreciated at a faster rate than
gold from the onset of commodities trading until today, there
(01:30):
is no doubt the gold has been on a historic
run this year of fifty eight percent plus, a figure
that year to date outperforms just about any investible asset,
and such a search and value amit a time of
turbulence globally within our own country as US deficits persist.
The federal debt has surpassed thirty seven point six trillion.
(01:51):
All that stuff can can make people nervous. So yeah,
to be sure, gold's performed spen phenomenal this year, for
that matter, in recent years. With that said, in a
historical context, which I think is important in this conversation,
not so much even factoring in the recent record run.
As of yesterday's price, the average annual rate of return
(02:12):
for gold all time has only been four and a
half percent, and that's a rate that is well below
that of other commodities mentioned, as well as less than
half the rate of appreciation of stocks as well. Now,
some will point to price controls that were in place
fixing the price of gold until the end of the
gold standard in nineteen seventy one, and to be sure
that factored in during the years of the price controls,
(02:33):
no doubt. However, it would be easy in the open
market for price appreciation of the commodity to well more
than account for the previous performance with an enormous catch
up rally. So, in other words, as we're fifty four
years removed from price controls, there's been ample time for
gold to adequately adjust an account for all historic controls.
(02:54):
When you take a look at what really goes on here,
this is the piece of the conversation that I think
is most instructive and widely unknown. How is it that
you think gold is mostly used? Where is the majority
of the demand for gold? Forty four percent of all
(03:19):
gold is being used in jewelry. That is number one
for demand, and it's not particularly close. Next up, twenty
six percent of gold demand is coming from investors. You'll
often hear a lot of advertisements and things, and oh,
you know, governments and central banks. They are big buyers,
(03:43):
but they are the third leading driver at twenty three percent.
So in other words, investors have been buying gold at
a faster and more pervasive rate than government central banks
have been doing. And then the remaining seven percent is
being used in technology devices. So a couple of really
(04:05):
instructive points here. It's often said and advertised that governments,
as mentioned, stocking up on gold to guard against the crisis.
What have you? I mean, there's an element of truth
to it. However, in reality, the demand for gold jewelry
still runs at twice the run rate of demand by governments.
What's more is that demand from investors is greater than
(04:27):
that of governments in central banks, and rising investor demand
has been driving the price more than the action of
those central banks. On that note, given that gold is
a commodity with pricing based on supplying demand, the risk
factors both for higher prices and potential lower prices are
there as well, with gold jewelry remaining the largest factor
and driving close to half the demand of the commodity.
(04:49):
Combined with the use of gold and certain technology devices,
you take a look at that in over half of
the total demand for the commodity is consumer based. Of
gold demand is consumer based, So if consumer demand remains strong,
it's likely the price of gold it's going to remain strong.
That's a key dynamic in addition to investors and government demand. Now,
(05:11):
of course, mining supply is also something that's always worth
keeping an eye on as well. Now, relative to the
concerns about the strength of the US dollar, the potential
for a federal government collapse, all those things a couple
of dynamics to consider. Did you know that the value
of the US dollar on a relative basis is higher
today than it was on the same date in nineteen
eighty seven? No kidding. The US Dollar Index, which values
(05:35):
the US dollar against the basket of the world's leading currencies,
shows that the US dollar is stronger today than it
has been for all but five years out of the
past forty no kidding. The US Dollar Index is currently
about ninety nine dollars. It's all time high was one
hundred and twenty two in nineteen eighty six. It's all
time low was eighty two dollars in two thousand and eight.
(05:59):
The dollar is weak than it was earlier this year,
so the value is worth watching. As all commodities are
US dollar denominated, and the value of the dollar directly
impacts inflation as well. However, there's nothing about the current
value that is close to alarming. For additional perspective, ten
years ago today, the value of the US Dollar index
was ninety six dollars. Many gold bulls. We'll talk about
(06:23):
a consistently declining dollar value. That is a fundamentally false argument.
It's just not true. The fact of the matter is
that the dollar is worth more than it was a
decade ago today than it was on the same date
in nineteen eighty seven. This is why, for example, our
stock market has been enjoying recordized along with historical high
(06:44):
employment amid other macroeconomic events. They're just not consistent with
the collapse. Now, this isn't to say that a country's
dead and deficit problems aren't significant. They are, and they
need to be meaningfully addressed. However, there's certainly no imminent
collapse in the horizon, nor is there any for the
foreseeable future. One of the things you take a look
at is inflation, and if you're going to have a
(07:08):
collapse of a currency and that kind of inflation runs
off the charts not below three percent, So my outlook
wid change at the US dollar dropped near or broke
below its two thousand and eight levels during the onset
of the financial crisis that led to the Great Recession.
For now, the dollars value remains twenty percent higher than
those levels and again above its historic average value. So
(07:30):
the bottom line from my perspective is that if you
want to add gold to an investment portfolio as part
of a strategic decision, okay. Might make sense based upon
your circumstance. But as always my first role of money,
never let your money and emotions cross pass. If you're
feeling emotionally pressured into hoarding the commodity because you have
fear of an economic collapse, probably not a good thing.
Speaker 2 (07:52):
Fucks Unshet.
Speaker 3 (07:54):
Any good assistant should be able to manage your schedule,
research and pull together notes before a big meeting and more.
And now every major tech company is racing to become
your go to assistant platform. Amazon has introduced quick Suite
and Agenic AI application that AWS users can use to
automate tasks. AWS vice president of AI told Fox Business
(08:16):
that quicksuite has access to all of your docs and
information to be as helpful as possible.
Speaker 2 (08:22):
It connects to all your data across data viruses, to
docs in MS three sixty five Google Docs, to systems
like a SAP and Service Now, and can run many more.
Speaker 3 (08:34):
On Thursday, Google launched Gemini Enterprise. It's powered by the
Tech Giants' AI models and allows users to ask questions
about their company's data, documents, and applications, all in a
conversational manner like you would a human assistant for Fox
on Tech. I'm Madison Alworth, Fox Business
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