Why You Must Own Gold

Money-printing galore... $1.14 trillion in interest payments... $8.1 trillion out of thin air... The ever-strengthening U.S. dollar... Two ways to think about the dollar... Why gold is a solution... Finance and physics...

You must own gold...

I (Dan Ferris) need to be clear about this.

I don't simply recommend that you own gold.

I don't think you should own gold as a good portfolio diversifier.

What I'm telling you is that not owning gold is simply not an option.

The reason is very simple...

The U.S. government is in so much debt, it'll need to print a lot more money just to cover the interest.

Governments always get themselves into financial trouble. They spend too much, which eventually requires them to borrow in order to keep up their spending.

Sooner or later, their debts become prohibitively large, and they simply don't bring in enough revenue to service them.

In the U.S., federal spending (minus interest on the national debt) totaled $6.3 trillion in the fiscal year ended September 30, 2026. Federal tax receipts and other income came to $5.4 trillion. That's a pre-interest deficit of $900 billion.

The interest on the national debt added another $1.14 trillion to federal spending in 2026.

In other words, the government doesn't come anywhere close to covering even a single penny of the interest on the national debt.

It's borrowing to pay the interest on its debts. Eventually, it'll have to print enough money to pay the interest.

This won't happen instantly...

The U.S. government can't get away with printing money into existence out of thin air forever... But because it prints the world's reserve currency, it can and will get away with running massive deficits. It will get away with borrowing trillions more to cover those deficits with printing money longer and in greater quantity than anybody would ever have believed.

It has arguably already done so, to the tune of $8 trillion in less than two decades...

Exactly 20 years ago, in October 2006, the Federal Reserve had some $850 billion in assets. Then it printed up a bunch of money and bought bonds and mortgage-backed securities. Its total assets eventually hit $8.9 trillion in April 2022 – more than 10 times its 2006 level. Today, the Fed holds around $6.7 trillion in total assets.

The entire roughly $8.1 trillion difference from 2006 to 2022 was printed out of thin air. The Fed literally just types it into existence on Fed computers. Then the Fed goes into the market with that money and buys Treasury and mortgage bonds.

And the dollar has not crashed. The U.S. Dollar Index ("DXY") has strengthened considerably over the past two decades.

As you can see below, the dollar entered a new, stronger regime around 2014 to 2015. From an index reading of roughly 85 in 2006, the Dollar Index typically stayed in the upper 80s to low 100s from late 2014 to 2022. And it has been even stronger since early 2022, trading between 96 and 114...

Here's how the dollar pulled off this trick... 

The Dollar Index measures the strength of America's currency relative to its counterparts... primarily the euro, but also the Japanese yen, British pound, Canadian dollar, Swedish krona, and Swiss franc.

So the Dollar Index doesn't prove that the dollar is strong. It can just show that other currencies are even weaker.

Now let's look at gold...

In October 2006, gold cost less than $600 per ounce. It surged past $5,000 per ounce during the precious metals spike in late January of this year, and it still trades just below $4,200 today.

Also during that period, the S&P 500 Index rose roughly 460%. Total cumulative inflation during the period as measured by the consumer price index was just 67%.

In other words, as the Federal Reserve printed up $8 trillion in new money, the U.S. dollar increased in value against other major currencies... gold increased dramatically against the dollar... and U.S. stocks made you plenty of money.

Learn to think of the dollar in two different ways...

First, think of gold as priced in U.S. dollars.

The dollar can be printed up in any quantity the U.S. Treasury and the Federal Reserve deem appropriate (or at least politically expedient). So you should expect the dollar to continue to lose value against gold... and everything else you buy with dollars in the U.S.

That means you'd need more dollars to buy the same amount of gold. In other words, that means a rising gold price.

Second, think of the U.S. dollar as being priced in the Dollar Index currencies.

If you do this, then you won't waste time expecting the U.S. dollar to collapse... as I myself did many years ago. You'll understand that it makes all the sense in the world for gold to keep rising against the dollar, as the dollar keeps rising against other currencies.

But it absolutely will continue to lose value compared with gold over the long term. That's just how fiat currencies work. They're designed with devaluation in mind.

President Donald Trump has been saying that quiet part out loud...

As we wrote last week...

In a Time interview published October 1, Trump said that higher rates of economic growth would help pay off the country's $40 trillion (and rising) debt burden, then noted in an almost offhand manner:

"Certain levels of inflation will also pay off that debt very rapidly. Very rapidly."

That's a giant hint. It means that Trump and his advisers are seriously talking about using inflation – devaluing the dollar – as a tool to make the national debt cheaper to pay off.

It's not a rare strategy for the world's leading economies. But it's rare for a top global political leader to come right out and say it.

Another key point from last week: "Very rapidly... very rapidly" is also a hint. It's reminiscent of how Franklin D. Roosevelt devalued the dollar overnight in January 1934 by raising the official gold price from $20.67 per troy ounce to $35. Richard Nixon did it again in August 1971 when he cut the last ties between the dollar and gold.

Yes, I'm fully aware that gold has occasionally confounded many folks for several years at a time. When gold struggles for a bit, I tend to point out that it's up more than 1,400% so far this century, compared with a roughly 500% rise in the S&P 500.

Gold has been a store of value and widely used as real money throughout the world for thousands of years. It's unlikely to be unseated any time soon.

And gold's price absolutely must keep rising...

It's simply a function of how much debt the government will continue to issue and how much money it will eventually have to print to pay it off.

As I discussed last week and hinted at again today, the "printing" might come in one sudden shock, the way it did in 1934 and again in 1971.

As readers who lived through the 1970s know, it was an era of massively higher inflation. Gold soared from $180 an ounce in January 1975 (when it was finally once again legal for Americans to buy it) to as high as $850 – a near fivefold increase that also set off a huge boom in gold-mining stocks.

Today, we're in the early stages of a similar move. In the pages of Extreme Value and The Ferris Report, I've recommended various ways to take advantage of the ongoing gold bull market... from bullion trusts to gold miners to precious metals royalty stocks.

To protect your purchasing power, you should accumulate gold bullion coins or bars.

To leverage your upside, you can buy stocks in gold companies... Big, established players include Newmont (NEM), Barrick Mining (B), Franco-Nevada (FNV), and Wheaton Precious Metals (WPM).

And in Extreme Value, I've found a royalty stock that I believe will outperform all of the above names. My paid subscribers can read about it right here if they don't already own shares.

However you invest in gold, it'll protect you from the Fed's money-printing. Whether you buy the very best gold stock or just own some gold directly, exposure to gold is not optional.

A lesson from 1971...

Until that year, you could exchange U.S. dollars for a guaranteed amount of gold. Then Nixon separated the two.

So far, it sounds like I'm only talking about gold and the dollar. But that's just one example of a dynamic that applies to other real assets and abstract financial instruments.

In the Digest, I've repeatedly mentioned what I call "Finance vs. Physics."  

On one side is financialization – the idea that the financial sector has grown so large and ubiquitous that it's like a tail wagging the global economy "dog."

I interviewed the economist George Gilder for the Stansberry Investor Hour in 2021. Back then, he spoke of the "hypertrophy of finance," with roughly $7 trillion of foreign-exchange trading every day. That's the equivalent of global GDP about every few weeks, just in currency trading.

Today, we have another huge market, most of which is divorced from anything in the physical world: cryptocurrencies. According to coinmarketcap.com, $77 billion worth of some 64 million different cryptos trade every 24 hours on 981 exchanges. The total market cap of all cryptos is $2.7 trillion. Roughly 60% of that total market cap is in bitcoin.

In the equity markets, there are all kinds of pure financial wagers, including:

• Leveraged ETFs that add zero value to anything but the fund issuer's bank account

• ETFs that roll futures contracts and steadily destroy value year after year

• Single-stock futures, which do nothing to finance real businesses

In short, in the financial world, you can conjure up anything the regulators will let you get away with and sell it to whoever is dumb enough to buy it.

In the physical world, things aren't so easy... 

You can't print oil wells, petroleum refineries, or gold mines. And lots of folks in developed countries don't want anybody to ever build another one. It takes years to get the permits and approvals to build them, if you're able to get them at all.

I see the financial and physical worlds colliding in a number of ways today. A new one just hit the headlines again recently...

Jeff Currie, a veteran Wall Street energy analyst, says the Brent crude futures contract – the benchmark for global oil prices – "is not connected to the real world anymore."

As the nearby chart shows, the Brent crude futures price has risen about 46% since the start of the Iran war. However, the price of Dated Brent – representing physical global oil trading – has risen 78%.

Currie told Bloomberg...

Those futures markets are absolutely critical to the function of an industry in modern society. You take away that pricing, you don't get adequate investment, you don't get adequate behavioral changes.

The disconnect between paper and physical oil markets has caused many traders to exit the market, with open interest in Brent futures recently hitting its lowest level since March 2025. Currie says the futures contracts are failing just when those who need to hedge against oil price movements need them most.

Like with gold, you should really own oil stocks right now. I've recommended them in both Extreme Value and The Ferris Report.

The situation reminds me of the one I described to attendees of our 2026 Stansberry Conference a few weeks ago in Las Vegas.

I told them how home mortgages became complex derivatives that eventually became completely untethered from homes. Wall Street manufactured pure financial wagers that blew sky-high and required bailing out to the tune of more than $180 billion.

Ultimately, I'm not making any value judgments about financialization...

The markets don't care about our moral and political opinions, so we should keep them away from our investment portfolios.

In a breakout session in Vegas, I listed a bunch of stocks you could use to exploit financialization in your portfolio. I also named several stocks that can profit from real shortages and needed investment in the physical stuff that makes our modern standard of living possible.

So far, I've learned to think about the U.S. dollar in better ways, and I've learned to see opportunities in the manufacture of critical commodities.

I ultimately don't know where my quest to learn more about the conflicts between finance and physics will lead me. I think I'll be focusing on this idea for at least another couple of years, if not longer.

My biggest winners born of this idea are still the independent oil refiners, which I've mentioned a few times in the Digest and which continue to make new highs. Valero Energy (VLO) is up more than 170% and Marathon Petroleum (MPC) is up 190% since I recommended them in The Ferris Report last December. My latest issue contains a nearly identical setup in another energy-related industry.

I'm excited about it because I believe a lot more opportunity is out there right now than most folks recognize, and I think I've found out where it lives.

So as the Fed prints dollars to pay down the national debt, you can't afford to hold onto cash. Put it into stocks and real assets like gold and oil.

New 52-week highs (as of 10/15/26): Alpha Architect 1-3 Month Box Fund (BOXX), Exelixis (EXEL), Gilead Sciences (GILD), Hagerty (HGTY), Coca-Cola (KO), Kimbell Royalty Partners (KRP), Pfizer (PFE), SharkNinja (SN), Visa (V), Veeva Systems (VEEV), Waters (WAT), and State Street Health Care Select Sector SPDR Fund (XLV).

In today's mailbag, one man's observation about inflation at drive-thru breakfasts... and thoughts on souring public sentiment on data centers, which we mentioned again in yesterday's Digest... Do you have a comment or question? As always, e-mail us at feedback@stansberryresearch.com.

"3% inflation?... Things have gone crazy. I don't go much, but I thought I'd get an Egg McMuffin [at McDonald's]... The Sausage McMuffin (English muffin, cheese, sausage) is $1.50. The Sausage McMuffin with Egg (only difference is an egg) is... $7.19??!!? A $5.69 delta for an egg!?!?!!

"I don't know what's crazier, the price or the line of people waiting to pay that price.

"I bought the $1.50 Sausage McMuffin, went home, fried an egg. I don't know how GDP would track that substitution, but my egg was better than theirs anyway lol. Thanks for all your excellent work." – Subscriber John H.

Corey McLaughlin comment: While it makes sense that the egg sandwich would be more, I wonder if you might also be referring to the difference between a value-menu McMuffin-only option and a pricier Egg McMuffin combo deal with the coffee and hash browns (which we might know something about). Nevertheless, the point about higher prices is taken...

"If public sentiment is down with the most needed more data centers, why are the social media giants not promoting them or educating their customers [why] we need these data centers? [They could say we need data centers and] if not, we will be charging $5, $10, $15 a month to use our platform for your social media page.

"So many users don't think they use data centers, but we use them hundreds if not thousands of times a day [when we use] credit cards, eating out at restaurants, getting an Uber, Instacart, Facebook, betting platforms, streaming movies. It is just unending..." – Subscriber Tony G.

Good investing,

Dan Ferris
Medford, Oregon
October 16, 2026