Gold soared to a record US$1,944 an ounce on Monday, overshadowing its 2011 peak. This is likely due to expectations of another share-market crash and a strong inflation boost triggered by trillions of dollars of monetary stimulus implemented in response to COVID-19.

ASX-listed gold miners were among the main winners of this rally, as the gold price rose to AU$2,707 per ounce.

A combination of persistent central bank support, the US dollar softening, and a revival of U.S. inflation expectations has sent this year’s gold price skyrocketing. The rise has killed the market bears, leading a covert rally in Bitcoin and government bonds, telling a more ominous tale than what the stock market output may indicate.

On Monday, the price of silver reached US$23.27 an ounce, and has now nearly doubled since March, hitting a seven-year Australian dollar record.

Dennis Karp, chairman of Manuka Resources, said the Silver Institute is tipping a 5% decline in global production in 2020. That will mean declines in output over five consecutive years. We will be back down to the point of 2009 and the environment has changed with new technology companies eating up demand.

The silver price has historically been valued on a multiple of the gold price. On Monday one ounce of gold at US$1944 is 81 times an ounce of silver. The ratio ballooned to more than 100-to-1 in March as COVID-19 dislocated asset markets, but Mr Karp said it should go back to a traditional 40-year average of 40 to 80 in time.

If this cheap money and inflation rich environment continues, physical assets like gold, silver, and property could be the real winners as investors see the writing on the wall. In uncertain times, a physical asset that you can touch will inevitably bring comfort and certainty.