Anna Hartz
Almost everywhere you look, prices seem to be rising. From groceries to housing, from stocks to precious metals, the sense that money buys less than it used to is hard to ignore.
Even oil prices have jumped recently, despite a global glut that should normally push them down. For many investors and consumers, this feels less like a normal market cycle and more like a deeper shift.
Record Amounts of Debt
The common explanation is not that everything is suddenly becoming more valuable. It is that money itself is losing trust, writes El Economista. Governments across the developed world are issuing record amounts of debt and signaling even more borrowing ahead. Investors are starting to doubt how this debt will be handled in the future. History suggests the answer is often inflation.
Gold and silver are climbing fast. Stock markets sit close to record levels. Housing prices continue to rise in many countries. Living costs keep ticking up month after month. Brent crude is once again close to $70 a barrel. These moves are happening even though supply problems are limited in most sectors. Many economists point to the same cause. There is too much money chasing too few reliable stores of value.
Investors, households, and companies are trying to move away from cash. They are buying assets that may hold their value better over time. Central banks are doing the same thing. Despite being part of the system that weakens currencies, they are adding large amounts of gold to their reserves.
Urgent Buying
George Saravelos of Deutsche Bank says modern currencies rely on trust in government finances and institutions. That trust is under pressure. Public debt levels are at historic highs, even in countries once known for tight budgets. Central banks also appear less independent when debt risks grow too large.
Gold, silver, and Bitcoin reflect this shift. Ole Hansen of Saxo Bank says demand for tangible assets has accelerated as investors worry about inflation, debt, and political risks. What began as long-term protection has turned into faster, more urgent buying.
Still, this is not a collapse. The dollar remains the world’s main reserve currency. Financial stress is visible but controlled. Hansen notes that gold prices could rise further if risks grow, but steady inflows are needed to sustain such levels.
One sign of change is the strength of currencies from low-debt countries. Sweden, Norway, and Switzerland have gained favor due to their solid public finances. Investors are choosing trust over size.
Ray Dalio recently warned that confidence in fiat money is fading. That concern is growing, but for now, the system is holding.
Sources: El Economista
