Wall Street Keeps “Chasing” the Gold Price with “Revised” Predictions
Jeffrey Gundlach, the Founder and CEO of DoubleLine Capital, was crowned as the “bond king” of Wall Street by Barron’s back in 2011, but lately he clearly favors gold over most bonds. When gold first crossed $3,000 this year, he predicted $4,000 gold, while saying an investment portfolio with 25% in gold is “not excessive.” Like I have done for years, he is now describing gold as an “insurance policy.”
Following his lead, several Wall Street firms have upped their gold forecasts, chasing the price up:
• Goldman Sachs increased its gold price forecast to $3,700 per ounce by the end of 2025 – a price which gold has already eclipsed – adding that gold could stage a potential rise to $4,000 by mid-2026. Goldman cited strong central bank purchases and ETF inflows as key drivers, emphasizing gold's ability to hedge against equity (stock market) risk.
• Morgan Stanley also raised its gold forecast to $3,800 per ounce by the end of 2025, citing a weaker U.S. dollar, a possible return to inflation and investor demand as gold’s major tailwinds. I would point out that Gold has already topped $3,800! Morgan’s Chief Investment Officer, Michael Wilson, has endorsed a portfolio strategy that includes a 20% allocation to gold.
• JPMorgan/Chase also raised their gold price forecast in September 2025, saying gold could surpass $4,000 in early 2026. They noted a shift in the primary gold catalyst from central banks to investor demand, fueled by expectations of Federal Reserve rate cuts. A scenario where investors pull out of the dollar could push prices to $5,000, they said.
I have to ask: What good does it do to predict prices after they have already happened – or are about to happen? That is not a prediction and you just let your clients lose money. Wouldn’t it be more profitable for their clients to make these forecasts far earlier? JPMorgan/Chase is the typical example of Wall Street firms “chasing” the gold price as it rises, embarrassing themselves when gold surpasses their new price target. Congratulations, you lost money for your clients by not getting them into gold sooner and riding the upward trend.
First Nine Months of 2025 Favor Precious Metals Over Stocks
Since January 1, 2025 through September 30, 2025 gold is up over 46%, silver is up over 61% and platinum is up over 80%, as the industrial uses in silver and platinum are soaring. This is mostly due to a strong economic recovery (+3.8% GDP in the second quarter and +3.9% in the third quarter), which helps demand, especially for platinum in auto manufacturing, silver in various electronic applications and, of course, gold as a hedge against inflation and portfolio protection. These massive gains are compared with +13.7% in the S&P 500, +9.1% in the Dow and +17.1% in the tech-heavy, more speculative NASDAQ.
Below, I have included the four major stock indexes with dividends added, since some skeptics of gold say that gold “offers no interest.” As you can see, metals still prevail and dividends have been fairly low.
So far, this year has delivered precious metals gains averaging almost five times stock market gains. Part of this is due to a 10% decline in the U.S. Dollar Index (DXY) through the first three quarters. Even though the dollar gained about 1% in the third quarter, it lost 12% from in the first two quarters from January 10 to July 1, 2025.
Here are some other comparisons for the year-to-date, in Currencies and Commodities:
As you can see from the commodity groups, precious metals are running circles around most other commodities with some doing much worse, for example, natural gas prices are down over 22% in the first nine months of 2025.
Don’t Pass On This Special San Francisco Mint Gold Coin Offer
As promised, I have been poring over values, mintage statistics and sales trends to find another often overlooked coin that I strongly recommend in certain grades for this particular year. And, yes, it is part of our highly successful 20/20 Program. I am referring to the sleeper 1890-S $20 Liberty Gold coin, which is an excellent value in MS63 condition.
In fact, it’s a better grade than the coin currently on display in the National Numismatic Collection at The Smithsonian Institution’s National Museum of American History in Washington, D.C. and we have only one of these hidden treasures for our clients at this time.
Minted at the famed San Francisco Mint, this coin has a combined population in this grade, according to the Numismatic Guaranty Company (NGC) and the Professional Coin Grading Service (PCGS) – two of the leading coin grading services in the world – of only about 338 coins.
Call your professional account representative today and ensure that you don’t miss out on this very special gold coin. Many of my previous weekly rare coin recommendations sold out almost immediately. In fact, I had to reach out to our private vendor networks and offer even more money to secure enough inventory to cover our orders, which also increased the value of those coins on dealer trading networks.
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Silver is Set to Make New Highs Over $50 Before Year-End
Gold trails silver and platinum this year but gold is setting new record highs almost every week since mid-August, while silver and platinum have not yet reached their all-time highs of $50 (for silver, in 1980 and 2011) and $2,250 (for platinum, in 2008). Silver is close to its all-time high and may hit its magic number later this year or in early 2026. This time, silver’s gain would be more solid and dependable than the “market cornering” bubble of 1979-80 or the later spike to $50 in 2011.
Silver fundamentals this year are driven by a market deficit – when demand outpaces new supply – plus the surprising recent rise in industrial demand, especially in green energy and technology. Add to that the rising investment demand for its safe haven hoarding due to geopolitical uncertainty and a weaker dollar, and we have the accumulation of fundamentals that many silver investors have been expecting for years.
At current prices, silver only needs to rise $3.25 or so to surpass $50 and reach a new all-time high.
FY 2025 Ended September 30 With Another Likely $1.9 Trillion in Red Ink
We won’t know the final deficit levels for FY 2025 for 10 or 12 days but it appears the 2025 federal deficit will approach or surpass $1.9 trillion, the largest deficit since 2021, and the third largest ever. All of the hopes surrounding the DOGE budget and program cuts, more tariff income and other moves under President Donald Trump have failed to convert the Big Spenders in Congress from trying to spend more of our money.
Some in Congress have threatened an extended government shutdown, mostly since they can’t figure out how to craft a 2026 budget. The Democrats are most adamant about reversing the “Big Beautiful Bill’s” cuts in wasteful Medicaid spending, plus pet programs like PBS and NPR. They also insist on more protections for federal workers and over $1 trillion in new Medicaid spending.
The Wall Street Journal's opinion page, on September 30, featured an article pushing back on Democrats' claims.
Putting a $2 trillion average annual deficit in perspective, the U.S. Treasury ran up a total of $13.8 trillion in debt during its first 220 years in operation, 1789 to 2008. Deficit levels since 2020 have approached that total, at $12.7 trillion, an average of over $2 trillion per year in the five years from 2020 to 2025.
Tax collections are not the problem. Income taxes (including Social Security) totaled $3.972 trillion in the 11 months through August 31, 2025, compared with $3,743 the same 11 months of the previous year. That means the IRS collected 6% more in 2025 from Americans but federal spending grew faster. Total tax revenues (from all sources) through the first 11 months of FY25 were $300 billion above all the tax collections from a year ago – led by a $182 billion increase in individual income taxes. Due in part to rising tariffs, customs duties were $95 billion higher this year than in the same 11 months in 2024.
This boom in tax receipts won’t last forever. Tax collections are up due to a growing economy but what if we enter a recession? Tax collections will decrease while the demand for benefits will increase and the deficit will probably increase.
If the government shuts down – now or later – President Trump’s OMB director Russ Vought said that if the Democrats force a shutdown, he will order “reduction in force” (RIF) notices for “all employees in programs, projects, or activities.” Once the shutdown ends, he added, federal agencies will be directed to retain only a “minimal number” of employees needed to function. Take time off, and you may be jobless.
September was another strong month for metals with Silver rising 17.1%, Gold up 11.8% and Platinum up 18.2%. By comparison, the Dow rose by less than 2% and the S&P rose only 3.5%. Crude oil prices fell by 1.5% in September and agricultural products fell by 3.6%, so there is little or no consumer inflation.
Gold rose 3% in the final week of September to close the quarter with a bang, at a new all-time high in the futures market at $3,890.