Gold War From Headwinds to Massive Tailwinds with Matthew Piepenburg

In the next 10 minutes, I want to make gold's endgame crystal clear for long-term investors who understand the bigger picture of rising gold in a backdrop of dying paper money, even as the U.S. dollar enjoys a temporary but expected and fairly typical tailwind in the fog of war. I also want to put the chaos of war, oil, and the dollar into simple perspective. After all, most of us have heard that phrase that gold loves chaos, but in the month of March, with nothing but chaos in the headlines, gold lost over 15%. So what gives? Why isn't gold rising in the chaos? The answers we'll address here will make sense of this fog and this chaos. And more importantly, it should make it even easier to see that gold will indeed love this chaos, but not just in a single Twitter cycle or current headline. Instead, gold works more honestly, but more patiently and deliberately. And it is critical to have such an honest and patient and frankly deliberate understanding of gold if you wish to keep your head and your gold in this otherwise undeniably chaotic and insane moment in history. Okay, so what's happening with gold today? It's April 1st, 2026. Now, in prior videos, my colleagues and myself have addressed the traditional and not-so-traditional narratives, including the very important issue that war-related oil shocks have an impact on gold. But not always as you think. An oil shock creates inflation, of course. And with inflation, the markets predict or price predict higher rates and a stronger dollar, because rates make the dollar go up. And when the dollar goes up, gold can certainly go temporarily down, but not for very long. But there are other forces connected in part to this oil shock that are not so easily understood by most, as most are not getting really the broader picture, which involves a forced sale of gold by nations who don't want to sell their gold at all, but are forced to because of a war that the vast majority of the world doesn't seem to really want. But again, and as always, I'll stay out of the politics and just stick to the economics, and therefore the data, which we can all agree upon objectively. And toward this end, we must address the reality that major nations and central banks, after many years of stacking gold to move away from U.S. treasuries and the weaponized, unloved U.S. dollar, are now becoming forced sellers of their gold. And the reasons for this are directly tied to the black swan and the black smoke of this latest war. Now, let's start with Turkey. What it just did. You know, in Zurich, where we work out of, it just swapped 60 tons of gold in the last two weeks. That's more than 10 percent of Turkey's gold. Other nations and central banks in Poland and elsewhere have done the same. But what Turkey just sold was larger than all the ETF gold sales since the war began. That was 43 tons. So why did Turkey have to do this? Well, the simple answer is it needed dollars to buy oil. 90 percent of its oil and gas is imported. It must be paid for in petrodollars. That means U.S. dollar of oil. But oil has gone from 70 to 90 to 100 to 115 and beyond in a matter of weeks. And each $10 oil hike in price cost nations like Turkey an extra $5 billion. So they need the money. And they don't have any good options. What other options do they have? I mean, Turkey could kill its lira, print more lira to buy more dollars. But they've already suffered enough inflation based on the inflationary export in U.S. dollars since the 70s. But they could also empty their U.S. dollar reserves or their piggy bank. But that's very dangerous as well. So what do they do in the near term? As always, they sell the good in a bad situation. They sell the most valuable liquid acid they can to get dollars to buy oil. Because oil, regardless of your green energy ideology or thoughts or debates, we still live very far from a carbon neutral world and energy and oil still drive everything. Now, meanwhile, in addition to Turkey, we have the Gulf states. The oil states are selling gold, too, at massive levels. But they certainly have the oil. They're not like Turkey. They've got the oil. So why are they selling gold? The reasons are entirely different from Turkey. But sadly, the causes, namely war, are exactly the same. Now, the Gulf states like Saudi Arabia, Qatar, Oman, Kuwait are in their own kind of trap. In fact, in many ways, it's a much worse trap than Turkey finds itself in. In times of peace, oil sales keep their dollar flows pouring in in the GCC and the Gulf states and the OPEC nations. But with the Strait of Hormuz closed, those flows are stopping, which means the income to these oil nations is stopping at the very time their costs are rising. Now, think about it. Saudi Arabia imports 80 percent of its food. And those food bills still need to be paid. And their military costs are also rising. So they need more dollars. But they're not getting those dollars from the oil flows right now with this war. In addition, a lot of expats, wealthy expats with a lot of dollars, are leaving these sinking ships where, you know, residue was falling from the skies from missiles and bombs. They're leaving the Gulf states. They're leaving the oil nations. They're taking their dollars with them. That puts more pressure on these Gulf nations to come up with more dollars to fill their reserves. So like Turkey, these oil nations only have bad choices. They need dollars fast. And the best way to get them is to sell their gold. With their currencies, many of them pegged to the dollar, at least for now, these oil nations can't just burn through their dollar reserves or print more of their own local currencies to buy dollars. So they have to sell their best asset. Again, gold. Now, the IMF and Saudi Arabia don't have to report this. And I can't verify it. But the word on the street, from Zurich to New York, is that Saudi Arabia has sold almost 50 tons of gold since the war started. These forces, from Turkey to Saudi Arabia to Oman and Kuwait, have a massive impact on the short-term price of gold. So there's also another short-term risk ahead for gold, which, again, is always the first, best, most valuable liquid asset to be sold to cover losses in a tanking stock market. And that stock market is ticking behind us as I speak. The Nvidia-led tech sector, which carried the S&P in 2025, is in obvious bubble territory. But that AI wave, which is so dystopian in so many ways, which we won't discuss here, runs on energy too, i.e. on oil. And that energy cost is rising, which means the tech sector in particular, and thus the S&P in general, is now positioned for an historical uh-oh moment in the current oil war. So a sell-off in stocks could be another headwind for gold. Now again, such market signals and broader oil-related and oil-forced sell-offs in gold is undeniably bad for gold in the short term. And we've seen that in the numbers and in the paper price. But what's building behind this gun smoke and fog is in fact the setup for a boom for gold longer term. And so what do I mean by that? Let's keep this simple, and not stupid, because it is that simple. For example, supply and demand still matter. Russia, one of the world's largest gold producers, is restricting gold exports. And there's a reason. Keep in mind that gold, unlike dollars, can't be printed at will. They're still the same stock-to-flow ratios. They remain the same. And so supply is tightening. And this tightening of supply is about to collide with a renewed demand for gold. And you know, so what will send gold demand higher is a key question we have to think about. And the answer to that is really hard to believe. It's a falling dollar. But how can the dollar be falling when it's in such demand in times of war? Well again, you've got to think beyond the short term and look at the longer term. And it's not that much longer to look forward. It's not that far at all or hard to see. The simple fact is the U.S. cannot afford a strong dollar. Literally, it needs inflation. It won't report it correctly. It won't say it out loud. It needs debasement. The USA, the home of the world's reserve currency, despite its current and faded inflation nightmare, can't afford to raise rates to fight inflation because the U.S. can't afford to pay its own bar tab, its $39 trillion bar tab, at higher rates. Like all debt-strapped nations, the U.S. will sacrifice the currency to monetize its debt. Inflation is just another war that the U.S. can never win. The Fed will have no choice but to cut rates and print more money, that's yield curve control, to keep bonds from falling or tanking and hence yields and rates from rising. Because those rising rates are the kind of rising rates which kill banks like, remember, Signature Valley Bank or Silvergate or First Republic in 2023? And those rising rates and bond yields are also the kind of rates and shark fins that kill cheap debt-driven stock bubbles. Now, we saw this pivot from higher for longer or high rates to fight inflation, which failed. And we saw this pivot from higher rates and monetary tightening to lower rates and quantitative easing in a weaker dollar in 2024 and 2025 when gold ripped after Powell basically threw in the towel and failed to beat inflation with higher rates in 2022 and 2023. And we will see this exact same setup again. The USA has no choice but to inflate its wad of debt, debase its dollar, yield curve control, and QE to the moon. And just because the dollar is rising right now on these inflation backdrops and these rising rates under the war scenario, regardless of where this war goes, the end game for the dollar is very simple. The dollar will lose value. It doesn't mean the dollar disappears. It'll just be repriced. It will be debased to monetize Uncle Sam's bar tab. And this explains why Russia is reducing gold exports. Gold is the new ammunition in the currency war that's been unfolding for us for years and accelerated when we weaponized the dollar in 2022. Russia needs to keep its gold because, like China, it's playing the long game. This long game is very important. And here at Von Graetz, we play the long game, too. We favor the lessons and signals of basic debt math and debasement history over the current and alarming and admittedly disturbing headlines. But this math and this history give us conviction in a time of otherwise undeniable geopolitical and market uncertainty. So I hope this puts things into some perspective for those of you thinking longer term on gold. Thank you.