Has Gold Really Reached An All-Time Record High?
Gold’s $3,780.50 COMEX close marks a new nominal high, but inflation adjustments and contested CPI data raise the question: was it truly the record price ever?
On Tuesday this week, the price of gold closed on the COMEX at $3,780.50 (rounded to the nearest quarter). As measured in U.S. dollars, that is the all-time record high COMEX close for gold.
But was it really the effective record high gold price ever?
The reason for this question is that the value of the U.S. dollar has itself diminished over time, especially since then-President Nixon closed the Treasury Department’s gold exchange window to foreign central banks on Aug. 15, 1971.
Perhaps the most commonly used statistic to analyze the decline in the value of the U.S. dollar is the U.S. Bureau of Labor Statistics Consumer Price Index-All Urban Consumers, CPI-U. The baseline of 100 for this Index is the average from the years 1982-1984.
The latest CPI-U data is for August 2025 at 323.976. If you divide Tuesday’s COMEX close of $3,780.50 by 323.976, the result is 11.669. Let’s compare this ratio against other peak gold prices in the past.
In January 1980, gold topped $800, with some reporting that it peaked at $850. The CPI-U for January 1980 was 77.8. If you divide $850 by 77.8, you get 10.925. In September 2011, gold’s price surpassed $1,900 for the first time. If you divide $1,925 by the September 2011 CPI-U of 226.889, the ratio was 8.484.
Thus, the COMEX gold close on Tuesday this week, when compared to the CPI-U of other peaks, would appear to indicate that it did reach an all-time record high.
However, such a contention depends on whether the BLS data on the Consumer Price Index-All Urban Consumers is itself accurate. It has long been my contention, along with many other analysts, that these statistical reports consistently understate the decline in the U.S. dollar over time.
The Bureau of Labor Statistics regularly revises its methodology for calculating its statistical reports. Almost always, the modifications result in reporting smaller increases in the Consumer Price Index than did the former methodology. Analyst John Williams earns his living by recasting current BLS reports into what they would show if using the standards of prior years. He consistently reports that consumer prices are annually rising by greater percentages than stated by the BLS
The assertion of the distortion in the Consumer Price Index and other government statistical reports will become more publicly discussed next week with the release of a new book, The Mismeasurement of America, on September 30. The author, Gene Ludwig, was previously the vice chairman and senior control officer of Bankers Trust New York and served from 1993 to 1998 as the U.S. Comptroller of the Currency.
In the August news release from the non-profit Ludwig Institute for Shared Economic Prosperity, of which Ludwig is the co-founder and chairman, the author stated, “Despite headlines heralding growth and prosperity, most Americans have fallen behind. They’re working harder year-upon-year not to get ahead but to merely survive. For the American dream appears to be slipping farther and farther away.”
In the forthcoming book, Ludwig proposes more accurate ways to understand what is really happening in the American economy.
It is my contention, along with Williams, Ludwig, and others, that the reported BLS statistics for the CPI-U are too low. If, for example, the August 2025 CPI-U would really be 346.1 or higher, that would signal that Tuesday’s COMEX closing gold price didn’t really represent a record high.
It seems like every analyst uses a different method of judging what price gold would need to reach to effectively represent an all-time record high. Some would say gold did accomplish that level this week, while others would want to see even higher prices to merit the record. Therefore, gold’s price would probably need to reach significantly higher prices than it is now for a consensus to concur that it is at record levels.
Last column’s numismatic trivia question.
Last time I asked—Which design element on Brutus’s Ides of March Roman Silver Denarius has also appeared on some U.S. coins? The reverse side of this coin depicts daggers on the left and right sides, a pileus cap in the center, and the words “Eid Mar” (Ides of March) at the bottom. It was issued 43-42 B.C. to commemorate the March 15, 44 B.C., assassination of Julius Caesar. The pileus cap was a Roman symbol of freedom, often worn by freed slaves. Called a Liberty Cap, the pileus cap is on the obverse of U.S. Half Cents struck from 1793-1797 and Large Cents from 1793-1796. There are some early U.S. Gold Coins with turban-like caps that are not pileus caps. In the early 1800s, many U.S. silver coins show a mobcap on Liberty’s head, which was also not a pileus cap.
This week’s trivia question
Here is this week’s question. The original reverse design of the U.S. Shield Nickel that debuted in 1866 had rays between the stars. Why were the rays removed from the design partway through 1867? Come back next week for the answer.