Gold will bite Dust soon?
Should you buy Gold now?
Gold is finite..
The total amount of gold in Earth’s crust (and deeper) is limited by geology. We cannot create new gold naturally at rates relevant to human time scales.
Only a portion of that gold is discoverable and extractable with existing technology.
Over time, mining the “easy” deposits becomes harder, deeper, lower‐grade, or more costly.
but Gold is inexhaustible too!
Pure gold is extremely stable. It doesn’t rust, corrode or oxidize under normal conditions.
It’s hard to “destroy” gold chemically too. You can melt, dissolve, or alloy it, but the elemental gold atoms remain.
Phenomena like nuclear reactions might affect atoms, but for all practical reasons, gold is technically indestructible.
So, the gold we have now is all the gold we will ever have unless..
We start recycling gold from e-waste.
This offers a smarter way to recover gold. For example, a ton of old laptop circuit boards contains 40 to 800 times more gold than a ton of ore.
Yet only 20% of e-waste gets recycled, leaving billions of valuable metals like gold, silver, copper, and platinum buried in landfills.
As simple as that might sound, Gold’s finiteness and inexhaustibility are not the reason why gold prices have shown to keep going up…
Imagine this: Gold prices drop sharply overnight, falling so low that your precious family gold - shiny bangles, the fancy necklace from your grandma, the wedding ring that means so much becomes worth less than a bit of road dust.
Can that ever happen?
On October 21, 2025, gold prices dropped sharply by over 5%. This was its worst single-day drop since 2013.
Let’s first look at why that happened-
Gold prices have been climbing fast this year because people buy it as a safe option during economic worries like high inflation and global tensions, but after such a big rise (up over 50% since January), many investors started selling to take their profits, causing a quick drop which reflected on October 21.
There were also signs of reduced tensions, including progress in U.S.-China deals under President Trump, that made markets more optimistic, contributing to the gold plunge as risk appetite returned.
Other than that, Gold is always priced in U.S. dollars worldwide, so when the dollar gets stronger, it costs more for buyers using other currencies like the Indian rupee (INR), which weakens against the USD. meaning Indians need more rupees to buy the same amount of gold, making it pricier and lowering demand from big importers like India.
That day, the dollar rose sharply due to strong U.S. economic data, pushing gold prices down as international demand dropped; in India, this led to a fall in local gold rates, dipping to ~₹78,200–₹78,500,.
By the way, gold prices are directly correlated with rupee fluctuations too, because India imports most of its gold priced in U.S. dollars, so when the rupee weakens (like USD/INR climbing to 88 in 2025), it takes more rupees to buy the same amount, causing short-term spikes of 5-10% in local prices even if global rates stay steady.
After the sharp drop on October 21, 2025 at ~₹78,200, gold prices in India recovered modestly to ~₹78,800 on October 23 and ~₹79,200–₹79,500 by October 26.
It means even though Gold may have temporary fluctuations but they cant be Dead Cat Bounces…
So, it is ‘destined’ to grow forever?
Kind of..
Its true that Gold prices in Indian rupees (INR) have shown strong long-term appreciation, rising from about ₹4,400 per 10 grams in 2000 to over ₹79,000 as of October 2025.
That’s over 2,768%!
However, in investing, the one unshakeable principle is that past performance does not guarantee future results.
So, let’s do some reasoning about it..
Gold prices don’t crash much because gold acts like a reliable “safety net” for money, people rush to buy it when the economy gets shaky, inflation rises, or world events create fear, keeping demand strong and prices from falling too far.
Big banks around the world, especially in places like China and India, keep buying gold non-stop to build up their reserves—this steady demand soaks up most of the new supply and keeps prices from dropping too much.
Central banks worldwide, particularly in emerging markets like China and India, have continued steady gold purchases in 2025 to shift away from relying too heavily on the U.S. dollar for safety, so they treat gold like a long-term backup plan that doesn’t panic-sell during tough times, helping prices stay stable
Besides this, the world’s monetary system has changed and won’t let gold sink below certain levels.
What I mean by world’s monetary system is that, before 1971, the U.S. dollar was backed by gold under the Bretton Woods system, keeping currencies stable and tied to it, but when the U.S. ended that link, money started “floating” based on market trust in economies, leading to ups and downs.
Since the 2000s, countries like China and India have pushed back by using their own currencies more for trade, digital money, and deals to avoid U.S. dollar risks, making the world less dependent on one currency and more “multipolar.”
This shift boosts gold’s role as a neutral, trusted backup during inflation, debts, or conflicts (like 2025 tariffs), so prices stay higher as nations diversify away from dollar dominance, unlike old times when gold could still drop low.
If gold prices have consistently risen over the years and seem to always trend upward, should it be my only investment?
Putting everything into Gold isn’t wise because it doesn’t generate income like dividends or interest, lacks the explosive growth potential of stocks, and can sit flat or dip during stable economic times, leaving your portfolio vulnerable to missed opportunities in higher-return assets like equities.
To put simply, it can’t make you a millionaire like the classic Amazon stock case.
Figures like John Paulson gained billions by betting heavily against housing in 2008 while holding gold as a hedge, netting massive returns during crises, as gold surged 25% that year amid the financial meltdown, amplifying his short positions to $15 billion in profits from subprime bets.
Billionaires such as Ray Dalio, Stanley Druckenmiller, and Warren Buffett allocate 5–10% to gold for diversification, building wealth over decades through compounded gains rather than sudden windfalls, with Dalio’s Bridgewater using it to balance against inflation and currency risks in a broader portfolio.
So instead of going all in for gold, it’s always safe to make it a part of your portfolio, ideally 5-15% for stability against volatility in stocks or bonds, ensuring balanced growth without overexposure to any single asset.
So, how to incorporate Gold into your portfolio for smart investing
Good investment planning involves putting some of your money into gold for its reliability as a hedge against inflation and market dips, while devoting a good portion to stocks that have strong growth potential based on solid research into company fundamentals like earnings, market position, and future trends.
Stock picking is essential. It’s an Art and a Science. It requires you to find undervalued companies with competitive edges by digging into financial reports, industry news, and economic indicators to avoid hype and build a portfolio of 10-20 quality picks rather than chasing every trend.
Constant monitoring is key. Review your holdings quarterly, track key metrics like revenue growth and debt levels, and stay updated on global events that could impact your stocks, using tools like earnings calendars and alerts to spot issues early.
Don’t forget to exit strategically. Timing matters here. Sell shares when valuations get too high (e.g., price-to-earnings ratios above historical averages), rebalance annually to lock in gains, or cut losses on underperformers to free up capital for better opportunities, ensuring your portfolio adapts over time.
Get expert help. If all this hands-on work like picking stocks, constant monitoring, and timely exits feels overwhelming to manage yourself, you can simplify by investing in a smallcase from a promising asset management company (AMC) like Green Portfolio, which takes care of your investments end-to-end while charging you with a minimal subscription fee.
If you’re planning to invest soon, check out their SAMVAT portfolio that blends gold, silver (for safety cushion) and high-quality growth stocks for balanced growth. Read about it in depth HERE
