Gold continues to soar, we must know these things about it! The history of six sharp drops in gold and its core inspirations 1、 Six rounds of sharp decline, core review 1. 1980-1982: Epic Collapse · Background: In the 1970s, the oil crisis and the US dollar crisis pushed the gold price from US $35 to US $850 by 23 times, resulting in a serious foam. Causes: The Federal Reserve violently raised interest rates to 20%, the US dollar index surged by 50%, and the Hunter Brothers silver manipulation case collapsed. Result: The gold price plummeted 65% in two years, from $850 to $300, until the interest rate cut in 1982, and it took more than ten years to fully recover. 2. 1996-1999: stabbed in the back by a big shot · Background: The European Central Bank sold gold collectively, the US Internet foam attracted funds to leave the market, and the Central Bank Gold Sale Agreement triggered market panic. · Result: The gold price plummeted by 40% in three years, until the Internet foam burst in 2001, funds returned to gold. 3. 2008: Failure of safe haven assets Background: The bankruptcy of Lehman Brothers triggered global panic, causing the market to sell all assets in exchange for US dollar cash, and gold and commodities fell synchronously. Result: Within 7 months, gold prices plummeted by 32%. After the global quantitative easing began in 2009, gold prices returned to the era of thousands of yuan. 4. 2011-2015: Chinese Auntie Massacre Background: QE drove gold prices from $680 to $1920, and the Federal Reserve's signal to withdraw from QE triggered expectations of US dollar appreciation. Result: The gold price plummeted by 45% in 4 years, and Chinese women struggled to break free after buying at the high point for 5 years. 5. 2020: Unexpected events during the early stages of the pandemic Background: The outbreak of the epidemic has triggered global panic, and the market's pursuit of cash has led to a short-term surge in the US dollar and rising expectations of deflation. Result: Gold prices plummeted by 20% in a week, and after the global central bank's massive water release in May 2020, gold prices entered a surge mode and broke through $2000. 6. 2022-2023: Interest rate hike storm Background: The Federal Reserve's violent interest rate hikes combined with the strong US dollar have put pressure on gold once again. · Result: The gold price plummeted by 20% in 8 months. By the end of 2023, the market expected the end of interest rate increase, superimposed on the Russia-Ukraine conflict and other geographical risks, and the gold price resumed its upward trend. 2、 5 life-saving rules (core investment insights) 1. Watch out for the peak of foam: gold is easy to accumulate foam after a long-term boom, so we need to pay attention to valuation and macro signals. 2. Revere the Federal Reserve's policies: Gold is usually under pressure during interest rate hikes, while interest rate cuts are important signals of a rebound. 3. Recognize the limitations of "safe haven": In extreme panic, the market will prioritize chasing cash, and the safe haven nature of gold is not absolute. 4. Avoid chasing high prices and buying low prices: Blindly following the trend (such as the "Chinese Auntie" phenomenon) can easily lead to being trapped, and it is necessary to make rational judgments about the cycle. 5. Pay attention to the flow of funds and alternative assets: When alternative assets such as the stock market and the US dollar are more attractive, gold is easily abandoned by funds.