I’m undertaking a 1000-day reinvention project, blogging here daily to track my progress. In Monday Money, I write about money management.
The precious metals have been on a tear lately. My suggestion last April to take a look at gold proved prescient, or perhaps just lucky. Check out the incredible returns these assets have seenover the last twelve months:
| Metal | Est. Price Jan 2025 | Current Price (Jan 26, 2026) | 12-Month Gain (%) |
| Silver | ~$30.00 | $108.43 | +256% |
| Platinum | ~$938.00 | $2,722.10 | +191% |
| Palladium | ~$960.00 | $2,081.00 | +116% |
| Gold | ~$2,350.00 | $5,088.13 | +85% |
Is it too late to get in on this speculative frenzy? Is it just speculative frenzy? Or something else? Both, I suspect.
No one can predict the future. However, it appears that what we are seeing with precious metals is not just a FOMO/YOLO speculative rally but a paradigm shift in where to find stores of value in our world. The U.S. dollar is rapidly losing the trust of the world, because of the current presidential administration’s bluffing and bullying. Central banks around the world are looking for alternatives to U.S. Treasuries for their reserves. Other investors are waking up to see that we’re in the kind of macro situation where precious metals shine.
Over the next few years, precious metals may become an obligatory part of everyone’s portfolios: central bank, institutional, professional, retail. As that plays out, we may see massive corrections in prices of the precious metals, but they will end up on a permanently higher plateau.
The big four precious metals
There are actually eight precious metals, but the Big Four are the ones that matter for investing. They have their own ISO Currency Codes, are priced on the London Bullion Market Association (LBMA), and are the ones that can be held as investment assets on major commodity exchanges like the COMEX or NYMEX. Other precious metals like Rhodium and Iridium lack the liquidity and money-ness of the Big Four.
| Metal | Primary Role | Key Characteristics | Common Use Cases |
| Gold (XAU) | Monetary Reserve | Indestructible, chemically inert, and universally recognized as the “ultimate” store of value. | Central bank reserves, wealth preservation, high-end jewelry, and aerospace electronics. |
| Silver (XAG) | Dual (Industrial & Monetary) | The most electrically and thermally conductive element on Earth. Highly reflective and antibacterial. | Solar panels (PV cells), AI data center hardware, EV battery systems, and silver bullion. |
| Platinum (XPT) | Industrial / Green Energy | Extremely dense, high melting point, and a powerful catalyst that resists corrosion. | Hydrogen fuel cells, green hydrogen electrolyzers, medical implants, and luxury jewelry. |
| Palladium (XPO) | Industrial / Tech | Exceptional ability to absorb hydrogen; acts as a superior catalyst for chemical reactions. | Hybrid vehicle catalytic converters, electronics (chip capacitors), and specialized dental alloys. |
Silver is the most extended right now, with its price more than 100% above its 200-day moving average. Platinum is about 65% above the 200-day MA, palladium about 35% higher, and gold just about 20% above.
But silver, as you can see from the table, is not just a money-like asset; it has important industrial uses (as do platinum and palladium). Aside from its critical use in solar panels, it is used in multiple ways in AI hardware: in chip packaging and interconnects, thermal management, power distribution, and semiconductor substrates.
Silver is a physical bottleneck for the building of AI data centers. Engineers can use less silver to save money, for example, using copper instead of silver in a high-frequency interconnect. But this leads to a performance drop that costs a data center more in lost efficiency than the silver was worth.
Palladium and Platinum: New energy metals
Palladium and platinum as well are plays for the future. Hybrid engines need more platinum and palldium than internal combustion engines. Their catalytic converters (which turn toxic engine fumes into a less harmful form) must be overloaded with more platinum and palladium to handle the constant cycling on and off of a hybrid engine.
While hybrids might seem like just a step along the way to an all-electric population of vehicles, in fact, hybrids could be here to stay. Charging an EV can be not just a chore, but also a source of anxiety. Many aggressive federal and state tax credits that made EVs affordable have expired or begun to be phased out. Hybrids are less expensive than EVs in general. Early EVs have had poor resale value such that used hybrids have held their value better. And hybrids operate better in extreme cold.
In China, where the transition to new energy vehicles has progressed the most, more than 50% of all new cars are New Energy Vehicles (NEVs). But these include hybrids. Roughly 60% of these NEVs are battery electric and 40% are plug-in hybrid/extended range.
Further off, we can look to the possibility of the hydrogen economy, a potential transition to replacing fossil fuels with hydrogen gas, which emits only pure water vapor when burned. Some analysts call hydrogen the “new oil,” but it requires Platinum Group Metals (PGMs) platinum and iridium. As of 2026, China has officially moved hydrogen from “experimental” to a Central Strategic Priority. They are currently building the world’s largest hydrogen pipelines and refueling networks, creating a massive and long-lasting bid for platinum (and iridium, which is in exceedingly short supply).
Precious metals as money
Aside from their industrial uses, precious metals are becoming a more important kind of money in a world of high government debt and currency debasement. Gold and silver won’t just go to zero if a bubble pops. They are real money in a world of fiat.
The most important money story of 2026 is the final implementation of the Basel III banking regulations. Under these reforms, effective last July, physical gold now is recognized as a Tier 1 High-Quality Liquid Asset (HQLA) and can now be counted at 100% of its market value, placing it on the same level as cash and US Treasuries. This effectively remonetized gold for the global banking system, providing a massive and likely permanent demand floor. Previously, banks had to discount gold on their balance sheets.
Gresham’s Law in economics says that “bad money drives out good.” This means people tend to hoard good money (money with higher intrinsic value such as silver coins) and spend their inferior money (e.g. paper cash). Fiat currency is “bad money” compared to gold and silver.
| Feature | Fiat Currency (USD, EUR) | Real Money (Gold, Silver) |
| Supply | Unlimited (can be printed/digitized) | Finite (must be mined) |
| Intrinsic Value | None (based on “faith and credit”) | High (industrial & historical value) |
| Durability | Digital/Paper (can be deleted or rot) | Indestructible (chemically inert) |
| Counterparty Risk | High (requires a bank/govt to function) | None (if you hold it, you own it) |
Historic examples of commodity price recalibration
Looking at history, we’ve seen other times when a speculative frenzy turned out not to be a bubble, but rather a permanent reset of valuation. We’ve seen this happen before in history. I’ll give two examples: oil and gold in the 1970s.
Before the 1970s, oil was essentially a cheap utility, trading for about $3 a barrel for decades. The 1973 embargo made the world realize that oil provided geopolitical leverage and was the lifeblood of any modern economy. Prices went parabolic, reaching about $40 by 1980 (an over 1300% increase). While oil corrected sharply in the 80s, it never returned to the $3 level. It established a new, permanent baseline because every nation realized they had to own and control it.
Gold as well saw a revaluation. For decades gold was fixed at $35 an ounce. When Nixon ended the gold standard, the world entered a period of price discovery. It became a hedge against fiat debasement. It went from $35 to $800 in 10 years. It corrected for 20 years afterward but the new normal was hundreds of dollars higher.
We aren’t just in a speculative bubble and price spike around precious metals. We are seeing a total recalibration.
Advice for investors
If you’re not already in precious metals (or, like me, you feel your allocation is too low), you will want to be careful getting in. There are likely to be blow-off tops regularly where speculators get ahead of themselves and bid up the price very high only to see massive drops like 50% or 80%.
Now is a good time to get started by adding a precious metals ETF to your portfolio. Maybe you say to yourself, “I don’t want to buy at all-time highs!” but actually, that can be a great idea. For more cautious investors, you might start with gold only. For the riskiest, get into a silver position too. If you want to play all the metals, GLTR is a good choice and will smooth out excess volatility in one metal such as silver (the most volatile right now).
It’s a good idea to either dollar-cost average into your desired allocation (perhaps over six months) or buy on the dips (wait for a 10% or 20% correction in silver, a 5% in gold). Expect serious volatility in this space.
Here are some ETFs to consider (Note: I hold IAU, SPPP, and GLTR):
| ETF | Primary Metal(s) | Key Feature | Expense Ratio |
| GLD | Gold | Largest and most liquid gold ETF in the world. | 0.40% |
| IAU | Gold | Highly liquid with a lower fee than GLD. | 0.25% |
| SLV | Silver | The primary vehicle for high-volume silver trading. | 0.50% |
| PSLV | Silver | A trust that allows for physical delivery of silver bars. | 0.45% |
| SPPP | Platinum & Palladium | Direct exposure to the two metals used in exhaust systems. | 0.92% |
| GLTR | Basket (All 4) | A diversified “one-stop shop” for all four metals. | 0.60% |
A word of warning: when silver goes parabolic, it can be a warning sign for the rest of your portfolio, at least at times that look like the one we’re in. When silver outperforms the S&P 500 by a massive margin and stocks are at all-time highs (where we are now), it’s usually a sign that investors are panicking into hard assets, because they smell trouble. Historically, this has led to poor stock market returns over the next year.
I’ll be adding to my gold, silver, and platinum (ETF) hoard this week. What about you?