Gold hit a new record price in sterling terms of £1,593 per ounce as investors took fright at the slumping share prices of some of Europe's leading banks.
In pound terms, the metal's price was up from just over £1,530 a week ago and £1,500 a year ago.
Five years ago, the sterling gold price was less than £1,000 an ounce.
Why wouldn’t you buy gold right now?
Inflation’s been on the move for more than a year, US banks are wobbling, the fabled Swiss banking system is under more scrutiny than it’s ever been before, and every single significant central bank in the world has been printing money hand over fist ever since 2008.
And so, with the collapse of SVB, a new round of bailouts in the offing, Credit Suisse sinking at last down to the depths it should have been consigned to long ago, the gold price hit a new all-time record in sterling terms.
That gold didn’t also hit a record in terms of the dollar, the currency in which it’s most usually priced, speaks largely to the current weakness of the British economy as against the US economy.
Or to put it another way – things aren’t quite yet bad enough globally for gold to hit an all-time high in absolute terms.
But we’re not far off that, either, if the current trend is anything to go by.
The huge amount of ordinance that NATO is now shipping east in the direction of Russia testifies to a hardness of purpose and danger of resolution.
Note, that the greatest of all Russian writers – who was westward-leaning too – Tolstoy, argued in his greatest work, War and Peace, that wars are not made by big top-level decisions, but by thousands or millions of decisions that are made lower down the line.
When Napoleon invaded Russia, the soldiers and weapons went first, Tolstoy argued. The orders came later.
If that is what we’re now seeing, and those who argue that the US is encouraging the war in Ukraine to mask its own economic weaknesses – viz, inflation, SVB, money printing, the Fed turning loss-making and a whole host of others – then you ain’t seen nothing yet as far as gold is concerned.
The US gold price has now pushed back up beyond the US$1,900 per ounce mark, in spite of the best efforts of the Fed and its ongoing programme of interest rate rises.
If the US Federal Reserve, the world’s most powerful bank is committed on an ongoing basis to raising rates, and gold, the safe-haven asset which famously has no yield, is still at or near to all-time highs, then something isn’t working.
Could it be that the fabled relationship between the dollar and gold is about to break?
Actually, that doesn’t seem likely.
What’s more probable is a new type of relationship, where both become more aligned to each other.
After all, with banks collapsing and war looming, who could argue with the proposition that your best assets are dollars (in cash) and gold?