From 1981 to 2025｜Will the 50-year gold bull market repeat? Essential truths about gold prices investors must know

Gold has been a globally recognized store of value since ancient times, characterized by high density, oxidation resistance, and durability. Besides serving as currency, it is widely used in jewelry, industrial applications, and other fields. Looking back over the past half-century, gold prices have experienced frequent fluctuations, but the long-term trend has been clearly upward, especially after 2025, when new historical highs have been repeatedly set. The question is, can this 50-year upward cycle continue into the next 50 years? Is investing in gold a long-term hold or a swing trading strategy? This article will analyze each aspect for you.

From 1981 to now, how astonishing is the increase in gold prices?

August 15, 1971, was a pivotal moment—U.S. President Nixon announced the detachment of the dollar from gold, ending the Bretton Woods system established after World War II. Prior to this, gold prices were fixed at $35 per ounce. After the detachment, gold was allowed to float freely.

From 1981 (around 民國70年) to 2025, the increase in gold has exceeded 120 times. Specifically:

• 1971: $35 per ounce
• First half of 2025: surpassing $3,700
• October 2024: first突破$4,300
• 2025: continuing to reach new highs

In just 2024 alone, the increase exceeded 104%, and this accelerating surge over the past 50 years is extremely rare.

Detailed analysis of the four major bull markets over the past 50 years

Since 1971, gold has experienced four distinct upward cycles, each with its unique economic background.

First wave (1970–1975): Confidence crisis after detachment

After the dollar was detached from gold, concerns about dollar devaluation led to a flood of investment into gold. International gold prices soared from $35 to $183, an increase of over 400%. Subsequently, the oil crisis erupted, with the U.S. increasing money supply to buy oil, further pushing up gold prices. After the crisis eased, gold retreated to around $100.

Second wave (1976–1980): Geopolitical risks triggering a safe-haven frenzy

The second Middle East oil crisis, the Iran hostage crisis, the Soviet invasion of Afghanistan, and other geopolitical events triggered global recession and soaring inflation. Gold surged from $104 to $850, an increase of over 700%. However, excessive speculation caused the price to eventually fall back, fluctuating between $200–$300 over the next 20 years.

Third wave (2001–2011): A decade of super bull market

After 9/11, the U.S. engaged in prolonged military actions abroad, with huge military expenditures. The Federal Reserve cut interest rates and issued bonds, then raised rates to address the housing bubble, ultimately triggering the 2008 financial crisis. To rescue the economy, the U.S. launched QE programs, leading to a decade-long bull market in gold, rising from $260 to $1921, an increase of over 700%. After the European debt crisis, prices stabilized.

Fourth wave (2015–present): The contemporary political and economic chaos driving a new bull

Negative interest rate policies, global de-dollarization, aggressive QE in the U.S., the Russia-Ukraine war, Middle Eastern conflicts—these events continuously pushed gold higher. From 2015 to 2023, gold rose from $1,060 to $2,000. The 2024–2025 period has witnessed an epic rally, with gold soaring from $2,800 to $4,300 in just a few months, setting unprecedented new highs. U.S. economic policy risks, central banks increasing gold reserves, and geopolitical turmoil have become the main drivers of this surge.

Gold vs stocks vs bonds: 50-year return comparison

Is investing in gold profitable? It depends on what you compare it with:

Long-term return comparison

• Gold (1971–2025): up 120 times
• Dow Jones Index (1971–2025): from 900 points to 46,000 points, about 51 times increase
• Conclusion: Over the past 50 years, gold has performed better than stocks

But the story over the last 30 years is different

• Stocks performed the best
• Gold comes second
• Bonds performed the worst

From early 2025 to mid-October, gold rose from $2,690 to $4,200, an increase of over 56%, a short-term surge far exceeding stock market performance in the same period.

Returns come from entirely different sources

• Gold: gains from price differences, no interest, relies on timing of entry and exit
• Bonds: income from interest, requires increasing units to boost total returns, depends on central bank policies
• Stocks: gains from corporate growth, suitable for long-term holding after selecting good companies

In terms of investment difficulty ranking: Bonds easiest > Gold > Stocks hardest

In terms of return ranking: Gold performed best over 50 years, stocks performed best over the last 30 years

Is gold suitable for long-term holding or swing trading?

This is the most critical question for investors. The answer is: Gold is suitable for swing trading, not for purely long-term holding.

The reason is simple—between 1980 and 2000, gold prices stagnated between $200–$300 for a full 20 years. If you bought at the high and held on, your return over those 20 years would be zero. How many 50-year periods are there in life to wait?

But this does not mean gold is not worth investing in. The key is to grasp the bullish cycles: they typically follow a rhythm of “big surge → rapid decline → stable consolidation → re-initiation of the bull.” As long as you can go long during bull phases and short or hold cash during declines, your returns will far surpass bonds and stocks.

Another pattern worth noting: the cost and difficulty of gold mining increase over time, so even after a bull ends and prices retrace, the lows will gradually rise. In other words, gold will not fall to zero; each correction bottom is higher than the previous one. This provides relatively safe boundaries for swing traders.

How to invest in gold? Five tools compared

1. Physical Gold
Buying gold bars or jewelry directly. Advantages: asset privacy, can also serve as jewelry; disadvantages: inconvenient trading, need to find buyers, high transaction costs.

2. Gold Passbook
Bank-issued gold custody certificates, with records stored in the passbook, and can be exchanged for physical gold at any time. Advantages: portable; disadvantages: no interest, large bid-ask spreads, suitable for long-term static holding.

3. Gold ETFs
Exchange-traded funds tracking gold prices, with liquidity far superior to gold passbooks. After purchase, you hold corresponding stocks. Disadvantages: management fees charged by the issuer, and the value may slowly erode when gold prices are stagnant.

4. Gold Futures and Contracts (CFD)
Main tools for retail traders to perform short-term swing trading. Advantages: leverage to amplify gains, flexible long and short positions, low trading costs. Gold CFDs are especially suitable for small investors because of low margin requirements, high capital efficiency, flexible trading hours, and low entry barriers. Through CFDs, investors can leverage small capital to control larger positions, capturing every wave of market fluctuation.

5. Gold Mining Stocks
Buying stocks of listed companies engaged in gold mining, combining the characteristics of stocks and gold. Usually perform better when gold prices rise, but require research into company fundamentals.

Economic cycles determine gold allocation

The highest rule for investing in gold is: During economic growth, choose stocks; during recession, allocate to gold.

When the economy is booming, corporate profits are strong, stocks perform well; bonds, as fixed-income assets, underperform; gold, as a non-interest-bearing asset, is less favored.

During economic downturns, corporate profits decline, stocks fall out of favor; gold’s value preservation and bonds’ fixed yields become the preferred safe havens.

The most prudent approach is to set the allocation ratios of stocks, bonds, and gold based on personal risk tolerance. With frequent unexpected events like the Russia-Ukraine war and inflation hikes, holding all three assets can effectively diversify risks and make the investment portfolio more resilient.

Conclusion

The 120-fold increase in gold over the past 50 years is indeed astonishing, but it is not a linear rise—it is the result of multiple peaks stacking together. Will the next 50 years see a repeat? No one dares to guarantee, but one thing is certain: gold will continue to maintain its safe-haven value amid global economic uncertainties.

For investors, the key is not “can buying gold make you rich,” but “doing the right thing at the right time.” By understanding economic cycles, capturing bull trends, and flexibly using leverage tools, gold investment can translate into real returns.