Commenting at the 2025 PDAC conference in Toronto ( Canada), Mr. Tavi Costa - partner and macro strategist at Crescat Capital - said that "if history repeats, gold could be revalued at a very high level".
He emphasized a scenario in which the US reviews the value of national gold reserves compared to the total value of government bonds in circulation.
The core problem lies in bonds. There are currently about $26,000 billion in US government bonds in circulation. The value of the gold that the US is holding is only about 2% of that figure, he said.
Speaking to Kitco News, Costa said that if the ratio of the value of US gold reserves to the total value of US government bonds returns to 17% as in the 1970s, gold prices could reach 25,000 USD/ounce. If it returns to the 40% level of the 1940, gold prices could reach 55,000 USD/ounce. Although he does not consider this a price target, Mr. Costa believes that these figures show great potential for gold revaluation in the future.
The latest report from Crescat Capital also shows that central banks are hoarding gold at their highest level in 50 years, while US gold reserves are at their lowest level in 90 years. This contrast could force Washington to reconsider its gold policy.
Notably, Costa warned that the US dollar is overvalued and may have peaked against other currencies. He cited historic times when the US dollar had a strong decline, such as the Plaza Earth in 1985 and the economic crisis of the 1930s.
Its certain that the dollar is at its peak. And that is the key factor. As an investor, you need to ask yourself what you will do in that context, he said.
According to this expert, the weakening of the US dollar will open up great opportunities for long-forgotten assets such as commodities, emerging markets and natural resources.
Along with gold, Costa said silver is preparing for a strong rally. He predicted that silver could soon reach $40/ounce - the highest level in many years.
According to Costa, the cup and handle model in the history of silver prices is taking shape, suggesting a possible breakthrough. Meanwhile, silver supply is currently tightening, while demand is increasing rapidly in the industrial and investment sectors.
Given these fluctuations, Costa recommends that investors consider restructuring their portfolios, reducing the proportion of technology stocks and increasing allocation to commodities, especially precious metals, as well as stocks in emerging markets.
He also pointed out that many large investors such as Warren Buffett are holding large sums of cash and may be waiting for investment opportunities when asset pricing becomes more reasonable.
