If you follow “tradition” and look back to beginning of 2008 9...

If you follow “tradition” and look back to beginning of 2008 9 months before the crisis officially started, Gold was falling off a multi year rally. That multi year rally was fueled by global/US growth regardless of triggers. As the early signs of crisis started through bank runs and failures leading into Lehman moment, so did gold’s safe haven. In the eye of Lehman's collapse, safe haven was replaced by USD/cash.

My observation based on this cycle is that gold=inflation hedge in a booming economy. The following gold boom off GFC came from the anticipated inflationary/hyper through the perceived money printing. The very tepid inflation in US that ensued post QE2 had market then realizing it wasn’t the simplistic Econ101 as professed by classic economist.

Again based on the relationship so far bearing in mind QE has no precedence globally since Japan is not a global influence of global economic policy, I suspect the current rally in gold does require economic boom rather than the perceived safe haven defense play of market crash or collapsing USD.

As an after thought, Japan at the height of their economic power was the number 2 economy that went on a deflationary decline for decades without causing major global economic decline and the current focus on China replacing Japan I suspect again is over blown. Chinese economic growth although an envy among the developed nations has been contracting for many years. It has not really impacted US economy as many were expecting, me included. However that perspection is different on Oz economy which are intimated tied to the commodity exports.

Unlike the blind goldbugs I’m not wishing for an economic or USD collapse to propel gold to the moon! Price mechanics dictate that the faster the rate of valuation expansion, the more painful the sell off because a quick momentum is usually not sustainable. Gold, bitcoin, cobalt, IO, Zinc, Nickel and I’m sure every asset class is not immune to such haircut including Apple or Amazon. .

How did gold perform in 2018? Not the result of a big sell off safe haven play?