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When in doubt, go for the gold (investment).
That’s the sentiment among investors trying to navigate the ongoing fight between President Donald Trump and the Federal Reserve.
Gold set a record this week, eclipsing the $3,600-an-ounce mark. It’s up 36% this year, far outstripping the S&P 500’s 10% return.
And we’re not even close to the ceiling, writes BI’s Samuel O’Brient. Goldman Sachs could see the precious metal rallying to $5,000, which is about a 40% increase from where it currently sits.
The bank’s reasoning is straightforward: The president’s ongoing fight with the Fed will eventually spook investors enough to sell off their US government debt (treasuries) and reallocate money to gold.
Goldman’s not alone in being bullish on gold. Wells Fargo also recently cited precious metals as a good bet for the future.
Meanwhile, Trump’s Fed fight shows no signs of slowing down. The Justice Department opened a criminal investigation against Fed governor Lisa Cook, who Trump has already tried to fire, according to a report by the Wall Street Journal.
One person’s confusion is a business opportunity, though.
Investors’ flight to gold this year has been a boon for Costco. The warehouse club’s gold bars have built a rabid following since it started selling them in 2023.
But the real gold rush for Costco isn’t just in selling the actual gold. (In fact, the margins aren’t huge on the precious metal for the store.)
Instead, Costco’s benefit comes from a boost to its e-commerce business, writes BI’s Dominick Reuter. As big-box stores look to amp up their online sales, gold bars are a high-value item that can help juice Costco’s e-commerce numbers.
Dan DeFrancesco, deputy editor and anchor, in New York. Hallam Bullock, senior editor, in London. Akin Oyedele, deputy editor, in New York. Grace Lett, editor, in New York. Amanda Yen, associate editor, in New York.
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