Believe It Or Not, Gold Is Still Out Of Favor

Authored by John Rubino via Substack,

After the past year’s epic run, you’d think gold would have displaced at least some other assets in mainstream investors’ portfolios. But apparently not. These two charts have been making the rounds on X, showing that during the previous decade’s gold bull market, gold-related ETFs saw their share of “implied allocations” rise dramatically.

But that hasn’t yet happened in the current bull market, as both gold and gold miner ETFs seem to be an afterthought for the average investor.

That Might Be Changing. In China…

This Chinese expert is recommending middle class Chinese families to allocate 8% to 15% of their net-worth to physical #Gold.

He is recommending high-net-worth Chinese families to allocate 10% to 20% of their net-worth to physical #Gold.

I think ongoing Chinese demand for… pic.twitter.com/PJHdfCoyPO

— Eric Yeung (@KingKong9888) March 26, 2025

…While Costco Gold Buyers Have To Be Restrained

Purchase limits have tightened on Costco gold bars as popularity boomed

(USA Today) - Gold has become such a hot commodity that Costco is apparently limiting how much its members can buy.

The warehouse retailer began selling 24-karat gold bars to its members in 2023, with a limit of two bars per person. Now, that limit has changed to one per transaction and a maximum of two bars per 24 hours, when you look on the retailer website, as previously reported by Business Insider.

The price tag for a 1-ounce South African-made gold bar? $3,279.99, much higher than the $2,000 they were going for 19 months ago, shortly after Costco began selling them. However, that price increase is understandable as gold prices have risen more than 70% over that time – hitting record highs in April.

Another listing, for the 1-ounce Gold Bar PAMP Suisse Lady Fortuna Veriscan, limits members to one item per transaction and a maximum of two items per 24 hours, down from a limit of five items per 24 hours in January. The same product had a cap of two purchases per membership in September 2023, according to an archived snapshot of the listing.

The retailer also has limits on other precious metals including:

1-ounce American Eagle gold coin ($3,329.99; one per transaction and two per 24 hours)

10-ounce silver bar ($359.99; one per transaction and 10 per 24 hours)

Still Early In The Game

The above implies three things:

1. US generalist investors haven’t yet warmed up to gold or gold miners.

2. Chinese buyers are getting much better advice than their American counterparts.

3. Costco customers’ eagerness to put multiple ounces of gold on their store credit cards implies the kind of enthusiasm that could easily spread to equity investors.

The conclusion? Momentum is building, but this bull market has a long way to run before generalist money is fully on board. Keep stacking.