The Historical Pattern Behind the Rise of Gold, Silver, and Copper Together

As the precious metals market collectively rises, it often triggers widespread market attention. Recently, the simultaneous increase in assets like gold, silver, and copper has led more investors to consider: what economic signals might be hidden behind this phenomenon?

How Crazy Is the Current Market?

Recently, discussions about precious metals have reached unprecedented levels. Gold has stabilized above 4,500 points, rising a total of 150% since early 2024. Silver’s performance is even more remarkable—climbing from 33 points in early April last year to 72 points, a 150% increase in just half a year. Even traditional online communities like B圈 are now frequently discussing gold, silver, and other precious metals. This全民参与热情 (nationwide enthusiasm) reflects a market that has become highly active.

However, from a historical investment logic perspective, the old adage “sell when the market is boiling, buy when no one cares” still applies. When ordinary people are discussing gold, silver, and copper, does it mean the market has entered a dangerous zone?

Two Historical Gold and Silver Price Surges

To answer this, we need to review similar historical phenomena. Over the past decades, there have been two periods of coordinated surges in gold, silver, and copper.

The first occurred from 1979 to 1980. During this period, gold skyrocketed from 200 to 867 points, a fourfold increase. Silver also performed astonishingly—rising from 9 points in August 1979 to 48 points in 1980, a more than fivefold increase.

The second occurred from 2009 to 2011. Notably, this gold rally began as early as 2001, when prices were in the 200s, reaching over 700 points by 2006—tripling in five years. Although there was a correction during the 2008 global financial crisis, gold’s market in 2009 accelerated sharply, rising from over 700 points to over 1,900 points in just two years, more than doubling. Silver’s volatility was even greater—its major rally started in July 2010 at 17 points, peaking at 50 points in May 2011, tripling in less than a year.

The Underlying Economic Logic

Why did gold, silver, and copper surge simultaneously during these two periods? The answer points to the same economic phenomenon: inflation.

In 1979, the collapse of the Bretton Woods system led to the dollar losing its “value anchor.” Without constraints, the dollar experienced excessive issuance. Simultaneously, two oil crises further pushed up prices. That year, the US core CPI reached 11.3%, soaring to 14% in 1980. In this high-inflation environment, real interest rates remained negative for a long time, causing the currency to rapidly depreciate. Asset holders naturally sought safe havens, making gold and silver prime choices.

The 2009–2011 surge was a consequence of the aftermath of the 2008 global financial crisis. US banking systems faced collapse, prompting the Federal Reserve to launch large-scale easing policies. From November 2008 to March 2010, the Fed implemented the first round of $1.7 trillion QE; then from November 2010 to June 2011, a second round of $600 billion QE; finally, from September 2011 to December 2012, a third round of $667 billion QE. These astronomical liquidity injections fueled inflation expectations.

The common features of these two events are clear: inflation + very low or negative real interest rates + debt crises. This deadly combination drove the collective rise of gold, silver, and copper.

Economic Cycle Judgment and Future Trends

Some may ask: currently, there is no obvious inflation; official inflation rates are kept below 3%, and interest rates remain at 3.75%, not negative. So, what is driving the recent rise in gold, silver, and copper?

There are various interpretations. Some believe that the US government will inevitably face severe debt issues, and inflation could be a way to ease debt burdens, leading some to preemptively position for future currency devaluation. Others worry about high stock market bubbles, potential corrections in AI industries, or the possibility of a major financial crisis, prompting early allocation of safe assets like gold.

From a macroeconomic cycle perspective, based on current economic conditions, the economy can be divided into four phases. Currently, CPI is under control at a reasonable level, monetary policy is beginning to loosen (including some short-term debt releases), and further rate cuts are expected. This indicates we are no longer in high inflation or monetary tightening phases, but in an economic expansion. From this view, the overall outlook until 2026 appears stable, with the main risk being the government debt ceiling issue. If triggered, the global economy could plunge into a downturn, and no one would be immune.

Correspondingly, the cryptocurrency market is closely linked to the US stock market. If US stocks continue to rise, crypto markets are unlikely to lag far behind.

The Rise of Gold, Silver, and Copper Is Coming to an End; Risks Must Be Watched

Historical patterns show that whenever gold surges and drives silver, copper, and other metals higher, it is often already in the late stage of this rally. The current market sentiment is highly active, indicating that risks should be closely monitored.

Looking back at the peaks in 1980 and 2011, gold’s correction cycles were quite long. After reaching 867 points in 1980, gold fell back to around 300 points in 1982—a decline of over 60%. It then remained subdued until 2000, with lows touching around 250 points. Similarly, after peaking above 1,900 in 2011, gold was halved to about 1,000 by 2015, a four-year process. During this period, the markets in 2016 and 2018 also performed poorly.

However, every time gold begins a long-term decline, the US stock market tends to enter an upward cycle. After 1982, the S&P 500 and gold moved in opposite directions. From 1982 to 2000, stocks soared from 100 to 1,500 points. Despite the dot-com bubble burst in 2000 and the 2008 financial crisis, after 2011, US stocks resumed their bull run, rising from 1,000 to 4,500 points.

This pattern suggests: When gold, silver, and copper start to decline, it often marks the beginning of a stock market rally. According to economic cycle theory, rising precious metals prices typically correspond to inflation and currency depreciation, while rising stocks reflect economic prosperity and GDP growth. If we are currently in an economic expansion, there is still room for stocks to rise, which also explains why the long-term rally in gold, silver, and copper might be nearing its end.

For investors, it is wise to be cautious of the risks of a correction after synchronized surges in gold, silver, and copper, and to pay attention to capital flow shifts triggered by this.