Historic Price of Gold Graph

Why Sovereign Debt, Fiscal Dominance, and "Pushing on a String" Point to a Generational Run in Gold 

Cumulative Performance Since 2000: Gold’s Return Exceeds the S&P 500 by Over Threefold

Introduction

My name is Stephen Pfeil, and for more than 20 years, I’ve had the privilege of serving collectors and investors in the precious metals and rare coin market. I don’t write posts lightly, but I feel compelled to write this post at this moment because the facts on the ground demand attention. What I see today reminds me of lessons from history, but with one critical difference: the debt dynamics and fiscal realities now shaping the U.S. economy are unlike anything I’ve seen before in my career.

I want to explain why I believe we’re not at the end of a gold run, but at the very beginning of a generational opportunity.

 

---

 

The "Pushing on a String" Problem

The phrase "pushing on a string" was popularized during Congressional hearings in 1935. When Congressman T. Alan Goldsborough questioned Federal Reserve Chairman Marriner Eccles about the effectiveness of monetary tools during a depression, Eccles replied: "You cannot push on a string." In short, the Fed could provide liquidity, but it couldn’t force banks to lend or consumers to borrow.

Over the years, I’ve seen how this analogy plays out. Liquidity doesn’t always translate into prosperity. Today, despite aggressive interest rate policy, inflation persists and growth remains sluggish. Monetary policy is no longer steering the ship—fiscal imbalances are.

 

---

 

Monetary Dominance vs. Fiscal Dominance

Back in the early 1980s, Fed Chair Paul Volcker could hike rates above 20% to break inflation because U.S. debt-to-GDP was only about 35%. The government could absorb the pain. That kind of monetary dominance no longer exists.

Today, debt-to-GDP exceeds 120%. If the Fed tried Volcker-style rate hikes now, it would risk triggering a sovereign debt crisis. Every 1% increase in rates adds hundreds of billions to America’s annual interest bill. The Fed is boxed in: raise rates and you worsen the debt problem; keep them low and you debase the currency.

As Lyn Alden and other thoughtful analysts have pointed out, this is fiscal dominance—when monetary policy is dictated by government borrowing needs, not by what’s best for the economy.

 

---

 

Mini-Crises: The Gilt Crisis and What It Signals

One of the most important lessons I’ve learned in two decades is this: you don’t always need a “Black Swan” to change the game. Sometimes a series of smaller shocks can do more lasting damage.

Take the UK Gilt Crisis of 2022. Pension funds nearly imploded when bond yields spiked. It wasn’t a default—it was a liquidity squeeze. The Bank of England had to step in with emergency purchases. That event showed me, and should show you, that even advanced economies are fragile when debt loads are high.

These mini-crises are the reality of the next decade. And while they don’t always dominate headlines, they erode trust in paper assets over time. This is why I say monetary expansion is a form of slow, grinding default—stealth erosion of purchasing power that punishes holders of U.S. dollars.

 

---

 

What About Treasuries? A Broken Safe Haven

For years, investors have been taught to treat U.S. Treasuries as “risk-free.” But over the past five years, Treasuries have delivered some of the worst returns in modern history:

• The Bloomberg U.S. Treasury Index fell nearly 15% between 2020 and 2023.

• Long-duration bonds lost 30% or more.

That isn’t safety—that’s devastation for anyone who thought bonds would protect them. Meanwhile, gold has marched steadily higher, proving once again that it preserves wealth when paper assets fail.

 

---

 

Why Gold Is the Answer

Here’s why I believe gold and rare coins are essential right now:

• They are sovereign-free—no government liability attached.

• They protect against currency debasement.

• They hedge against inflation and interest rate repression.

Gold is not a panic asset. It’s a long-term, strategic asset that thrives when systems bend under their own weight. And in my view, the system is bending right now.

 

---

 

We Are Not at the Peak. We're at the Starting Line.

Too many people only think of gold at the end of a crisis. But in my experience, the best time to own gold is before the crisis crescendo.

• In the 1970s, gold rose 20x before inflation peaked.

• In the 2000s, gold climbed as deficits expanded—well before the worst moments of the financial crisis.

Today, with structural deficits locked in, geopolitical risks multiplying, and the Fed constrained by debt math, I believe we are entering the first inning of a generational run in gold and rare coins.

 

---

 

Final Thoughts: Why I’m Sharing This Now

I’ve seen cycles come and go, but I’ve never seen one where the U.S. carried this much debt while facing this much fiscal pressure. I am compelled to write this because I believe too many are still anchored to outdated assumptions—that Treasuries are safe, that the Fed can always tighten its way out of inflation, that the dollar’s purchasing power will hold.

The facts say otherwise.

At Global Coin, we don’t sell hype. We build clarity. My advice after 20+ years in this field is simple:

Don’t wait for the panic headline. Prepare now, while you can still choose strategy over fear.

Gold is rising not because the system is collapsing, but because the rules have changed. And in a world where monetary expansion is a slow default, owning tangible, rare, and investment-grade assets isn’t just smart—it’s necessary.

Own what lasts. Own what leads. Own gold.

Ready to protect your future with rare, vetted, and investment-grade metals?

Explore our curated selection at www.shopglobalcoin.com