The Coming AI Crash Could Trigger a Shockwave – But Gold's Still Your Best Bet
AI’s Rise Looks Like a Rocket Out of Fuel
AI stocks have been running hot—too hot. According to Saxo Bank’s Ole Hansen, this parabolic run-up is looking unsustainable. We’ve seen a massive surge in AI-related equities, pushing forward earnings far above long-term norms. That kind of disconnect always ends the same way: with a reset.
The Nasdaq is already showing signs of fatigue. Big banks are quietly warning about a 10–20% equity drawdown. If that happens, you know what comes next—volatility spikes, and everyone scrambles for the exits.
When Panic Hits, Everything Gets Sold—Even Gold
Here’s the key insight Hansen lays out: when volatility spikes, institutional portfolios are forced to reduce risk across the board. They don’t just sell bad bets—they sell anything liquid. That includes gold and silver. Not because the metals are weak, but because they’re easy to sell.
This isn’t speculation. We saw it happen earlier this year. After a surprise U.S. tariff announcement in April, the VIX exploded from 21% to 60% in just three days. The S&P 500 plunged 15%, and gold fell 6.6% despite bullish momentum. Silver dropped 17%.
But then? Gold snapped back and printed fresh highs within a week. That’s how fast fundamentals reassert themselves once the panic selling stops.
More Volatility Is Coming—But It's a Buying Opportunity
Hansen believes we’re still vulnerable to another volatility-driven liquidation if the AI sector experiences a sharp revaluation. Even though precious and industrial metals have already undergone some correction, they remain exposed to short-term, mechanical selling.
But don’t mistake that for a breakdown in the long-term outlook. These price drops aren’t driven by weakness in gold or silver—they’re driven by leveraged traders hitting the panic button.
This is the same story we’ve seen time and time again. Volatility events are like financial earthquakes. They shake everything loose—but the strongest structures survive and come out stronger.
Gold's Core Fundamentals Haven’t Changed
Let’s get something straight: none of this noise undermines the reasons you hold gold in the first place. If anything, it reinforces them.
Gold remains supported by:
- Fiscal uncertainty: Out-of-control government spending and ballooning debt.
- Sticky inflation: Despite official narratives, prices aren’t falling.
- Central bank and investor demand: Nations like China and Russia are buying gold hand over fist.
- Falling real interest rates: Even with hikes, inflation eats away at returns.
- Geopolitical hedging: Wars, trade tension, and global instability aren’t going anywhere.
Silver shares in this bullish case, especially with its critical role in electrification, power grids, and the AI-driven data center boom—all while suffering from chronic underinvestment in new mining supply.
Don’t Get Shaken by the Shakeout
Volatility will distort prices in the short term—but it won’t derail the long-term bull market in gold and silver. These metals are the financial lifeboats in a system that’s taking on water.
The AI boom may end in a bust. And when it does, Wall Street’s panic will create temporary dips in the metals market. But those are buying opportunities, not exit signs.
Protect yourself with real assets, not digital pipe dreams. Gold doesn’t default. It doesn’t get revalued by Silicon Valley. It doesn’t rely on a central bank or an internet connection.
When the volatility hits—and it will—own what lasts.
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Frank Balm
