Gold divides the experts

Investment professionals sharply disagree on gold's role in portfolios. Dave Ramsey says it doesn't belong. Morgan Stanley's CIO and Ray Dalio say it's essential. What should you do?

Gold's ancient history

Gold has been a medium of exchange for nearly 2,600 years, since the Lydians minted the first standardized coins around 600 BC. Yet it remains largely absent from modern portfolios.

Few investors actually own gold

Only about 15% of institutional investors hold any gold, averaging roughly 4% of their portfolios. Among Americans, direct physical gold ownership sits around 11%.

The case against gold

Dave Ramsey argues gold generates no income, has underperformed equity mutual funds over time, and no longer protects against inflation since the dollar isn't gold-backed.

“gold doesn't generate income, has a "lousy long-term track record" relative to equity mutual funds”

The case for gold

Morgan Stanley's Michael Wilson proposes a 60/20/20 portfolio: 60% equities, 20% bonds, 20% gold. Ray Dalio calls for 15% combined allocation to gold and Bitcoin as effective diversifiers against currency devaluation.

Central banks are buying

Central banks have shifted from selling gold to buying it since 2010, according to World Gold Council data. This shift supports the case that gold deserves a portfolio role.

Gold as a return driver

Gold's nominal peak from January 1980 wasn't matched again for 28 years, until 2008. However, the SPDR Gold Shares ETF has risen roughly 125% in the past three years as of August 2026.

Gold as a diversifier

Over 20 years, gold showed nearly zero correlation to U.S. large-cap and small-cap stocks while returning 9.8% annually. Even excluding the past three years, gold returned a solid 6.3% over the prior 17 years.

Diversification alone isn't enough

Gold spent nearly 30 years from 1980 delivering close to nothing. Being uncorrelated to stocks doesn't help if the asset itself goes nowhere for decades.

Gold as currency hedge

Gold's real value may be hedging against dollar debasement, not inflation directly. It works when real interest rates fall or policymakers devalue the currency.

America's debt is soaring

Federal debt has grown from $5.7 trillion in 2000 to $40 trillion today. Debt per capita rose from $20,000 to $112,000. The CBO projects debt reaching 190% of GDP by 2056.

Interest payments are crushing

Interest on federal debt is estimated at 14% of government spending and 19% of revenue in 2026. This excludes $88 trillion in unfunded Social Security and Medicare obligations.

Gold in a currency crisis

If the dollar falters, bonds and stocks both struggle since they're priced in dollars. Gold, with no counterparty risk, could provide stability and liquidity when other assets fall.

Decide gold's role first

Before buying gold, decide which role you think it should play: return driver, diversifier, or hedge. Each role has different odds of success based on your view of markets and currency risk.

“That's not a reason to own gold. It's a reason to ask whether you should.”