Editor’s Note
This article examines the sudden, sharp reversal in precious metals markets, where gold and silver prices plummeted dramatically after a prolonged rally. The analysis explores how this crash occurred despite a backdrop of geopolitical and economic factors that typically support higher prices.
Gold and silver prices experienced an unprecedented crash. Within a few hours, gold lost around 15 percent of its value, silver almost 40 percent. A market that had only known an upward trajectory for months suddenly fell like a stone. This happened despite an environment seemingly perfect for rising prices: wars, tariffs, geopolitical tensions, a weak dollar, and falling interest rate expectations. Since the beginning of the year, gold had risen by around 30 percent, silver by even 45 percent, with new record highs every day. By the end of January, the metal reached its all-time high of over $5,400 per troy ounce. A few days later, the price was below $4,700. It has now stabilized around $5,000 [as of 12.02.2026].
The trigger, as so often lately, came from Washington.
Donald Trump nominated Kevin Warsh as the future head of the US Federal Reserve – a monetary policy hawk, not a loyalist.
It was precisely this fear that had previously driven gold higher. When it subsided, the price fell. And fast.
However, the crash cannot be explained by the personnel decision alone – even though it steers the world’s most influential central bank.
Normally, the rule is: weak dollar, strong gold. But this time, the equation no longer fits.
The market had decoupled from reality.
Gold lives less on facts than on feeling anyway.
No interest, no cash flow, no intrinsic value. Only belief. In crises, central banks lower interest rates, currencies lose purchasing power – gold does not. That makes it attractive. And nervous at the same time. Because when the world situation calms down, the safe haven also loses its appeal.
Ironically, the same Trump who triggers so many crises now manages to restore short-term confidence in the American monetary system.
Because of the independent central bank. And because the US always pays.
Trump openly attacked the US Federal Reserve, threatening legal action against outgoing Fed Chair Jerome Powell at the end of May. The central bank’s independence suddenly became an open question.
A second doubt was added:
This was enough to sow uncertainty. Investors sought safety – and no longer found it in government bonds, but in gold.
And then Trump nominates Kevin Warsh, a candidate the markets trust. Suddenly, US bonds seem safe again. Capital flows back. Gold is sold. Profits are taken. Was this calculation or coincidence? Kriwoluzky shrugs his shoulders:
Further twists cannot be ruled out.
