Analysis of Reddit Post Claiming Gold's Strong Bull Case Amid US Debt Crisis Concerns

A Reddit post (2025-11-25) argues gold has a strong bull case due to the US sovereign debt crisis (claiming $25.8T to refinance by 2028 at higher rates, leading to inflationary debasement). It references the 1970s, where gold outperformed stocks, and recommends 10%+ portfolio allocation to physical gold via PHYS (avoiding GLD). Counterarguments include defense stocks being better in a Taiwan invasion scenario, the post being a gold pump, China’s new 1500-tonne gold find reducing import demand, and 1929 crash recovery being incomparable to today.

Gold ETFs showed mixed immediate reactions:

• PHYS: Flat (0.00%) on 2025-11-25 after a 1.54% gain on 2025-11-24 [0].
• GLD: Down 0.24% on 2025-11-25 following a 1.42% gain on 2025-11-24 [2].
  Over 10 days (ending 2025-11-25), PHYS declined ~1.19% (from $31.98 to $31.60) [0], GLD declined ~1.53% (from $385.99 to $380.08) [2].

• China’s Gold Find: 1444-tonne deposit confirmed in Liaoning on 2025-11-17, aligning with the counterargument of ~1500 tonnes [3].
• 1970s Performance: Gold outperformed stocks during inflationary 1970s; $100 in gold (1971) grew to $33,687.86 vs $36,104.55 for S&P500, with higher volatility (26.9% vs 16.2%) [4].
• China’s Gold Imports: 2024 consumption (985 tonnes) far exceeded domestic output (377 tonnes), so new find may not immediately reduce imports [3].

• Unverified Debt Claim: The $25.8T US debt refinance figure lacks confirmation [1].
• GLD Avoidance: No explicit reasons given for avoiding GLD [1].
• Defense Sector: Counterargument about defense stocks outperforming gold in Taiwan scenario needs historical validation [1].

• Unsubstantiated Data: The debt claim weakens the bull case [1].
• Geopolitical Shift: Tensions could shift demand to defense stocks [1].
• China’s Supply: New gold find may reduce long-term import demand [3].
• ETF Risks: Investors should evaluate GLD vs PHYS structural differences [0][2].