To The Moon

Recently, gold has entered a frenzied rally mode, consecutively breaking through the $4,600, $4,700, and $4,800 thresholds, charging straight toward the $5,000 mark:

Driven by gold prices, gold ETFs have emerged as the year's top-performing assets. $MicroSectors Gold Miners 3x Leveraged ETN(GDXU)$ has surged by as much as 66% year-to-date, while the non-leveraged $VanEck Gold Miners ETF(GDX)$ has climbed over 20%. Even $SPDR Gold ETF(GLD)$ , which closely tracks gold's movements, has risen more than 10%:

On the news front, gold has been seeing an overwhelming number of bullish developments recently. First came the highly unusual move by the United States to deploy forces to seize Venezuelan President Nicolás Maduro. Soon after, Trump turned his firepower fully toward Greenland, with the European Union even sending troops to the island in what appeared to be a symbolic show. Trump then went a step further, threatening to impose tariffs on eight European countries.

If the capture of Maduro was merely an appetizer, then the U.S. stance on Greenland has completely overturned the global order. As Canadian Prime Minister Mark Carney said, recent events show that the so-called “rules-based international order” has, in reality, already become largely meaningless.

Carney said, “Stop talking about a ‘rules-based international order’ as if it still functions the way it is advertised. We need to recognize what this system truly is: a period in which the most powerful country uses economic integration as a weapon of coercion to pursue its own interests.”

Carney called for the formation of new alliances to counter pressure and intimidation from major world powers.

Belgian Prime Minister Bart De Wever said at the Davos forum, “We must stand together, or we will fall apart,” adding that “if we are divided, an era will come to an end. The Atlanticist era that has lasted for eighty years will become a thing of the past.”

De Wever openly admitted that he no longer views the United States as an ally.

French President Emmanuel Macron criticized Trump’s trade strategy, arguing that Europe needs to strengthen its sovereignty to avoid “vassalization and power politics.”

Macron warned that Trump’s trade policies are harming Europe’s export interests and are “demanding the greatest concessions.” He urged Europeans not to accept a “new form of colonialism.”

Another senior European official said that many colleagues have already reached a consensus: the post–World War II international order has come to an end, and Trump’s territorial expansion will reshape the global political landscape.

This development has sparked investor concerns that Europe may offload U.S. Treasuries, causing the yield on 30-year U.S. Treasuries to jump 8 basis points to 4.92%. U.S. stocks also faced selling pressure, with the S&P 500 plunging over 2%—marking its steepest single-day decline in three months!

Europe is the second-largest holder of U.S. Treasuries after Asia, accounting for 40%.

Currently, Danish pension fund AkademikerPension plans to sell off its holdings of U.S. Treasury bonds by the end of this month, citing concerns that U.S. President Donald Trump's policies have triggered significant credit risks that cannot be ignored.

The fund's Chief Investment Officer Anders Schelde stated: “The U.S. fundamentally lacks sound credit standing, and its government finances are unsustainable in the long term.”

Beyond U.S. debt, Europe also stands as the largest overseas holder of U.S. equities, with holdings approaching $10 trillion:

Even if selling U.S. Treasuries and U.S. equities would push up global financing costs, for Europe — with its relatively weaker economic fundamentals — the damage could be even greater than for the United States.

Moreover, unlike Asia’s holdings of U.S. Treasuries, which are largely held by central banks, European holdings are more concentrated among private investors, making it difficult for governments to order large-scale selling.

As U.S. Treasury Secretary Scott Bessent pointed out, claims that Europe is dumping U.S. Treasuries are largely a false narrative — and that argument does carry weight.

That said, regardless of the mechanics, U.S. credibility is clearly eroding. As a safe-haven asset, gold under Trump’s presidency is likely to rise more easily than it falls. In that light, the $5,000 price targets previously floated by Wall Street banks now look rather conservative.

Investors bullish on gold may consider relevant ETFs. Among these, leveraged ETFs offer the highest volatility, such as $MicroSectors Gold Miners 3x Leveraged ETN(GDXU)$ suitable for short-term bets on continued gold price appreciation. However, these carry significant risk and are not recommended for the average investor.

Gold mining ETFs like $VanEck Gold Miners ETF(GDX)$ , $VanEck Junior Gold Miners ETF(GDXJ)$ , and $iShares MSCI Global Gold Miners ETF(RING)$ hold gold mining stocks as underlying assets, providing substantial volatility while maintaining relative stability.

Conservative investors may consider gold-linked ETFs like $SPDR Gold ETF(GLD)$ or $Gold Trust Ishares(IAU)$ . These track the price of gold more closely, offering greater stability and making them more suitable for regular investments.