Gold investors are often labeled as doomsayers. In the past few years, gold was frequently recommended by investment gurus whom feared rampant inflation. Their predictions did not become reality, weakening the reputation of holding gold as an investment. Is that justified? Is gold really only a good investment when we are faced with an imminent economic collapse?

We will come to understand that the two most popular definitions of inflation are inadequate, leading to incorrect forecasts.

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In many gold-related articles, the term real interest rate is often used; or in other words, the nominal interest rate corrected for inflation. It is often said that low real rates are favorable for the gold price, while high real interest rates are unfavorable. This is often supported with multiple graphs, correlations, and sometimes even statistical models. But does it make sense theoretically? As we investigate, we will see that it is a half-truth. Low real interest rates create the conditions