The World According to Gold: Goodbye US Treasuries
You’ll have to forgive my incessant focus on gold as the most important development for investors in 2025. The rise in gold price and its usurpation of Treasuries’ role in sovereign portfolios is a sign that there is indeed justice in the universe.
For more than half a century, U.S. Treasuries held mythic status in global finance. They were the bedrock of sovereign reserves, the ballast of pension funds, and the unquestioned refuge for capital in times of geopolitical uncertainty. The premise was simple: the full faith and credit of the United States government was, in practice, unimpeachable. It was the elite risk-free foundation upon which portfolios were anchored.
But that era is drawing to a close. A slow, grinding, but unmistakable rotation is underway—away from Treasuries, and toward gold.
According to the World Gold Council 2025 Survey, “Central banks have accumulated over 1,000t of gold in each of the last three years, up significantly from the 400-500t average over the preceding decade. This marked acceleration in the pace of accumulation has occurred against a backdrop of geopolitical and economic uncertainty, which has clouded the outlook for reserve managers and investors alike.”
BlackRock: The Safe Asset Isn’t So Safe
When the world’s largest asset manager starts questioning the very foundation of reserve management, the attentive investor takes note. BlackRock now openly frames Treasuries as “a risky safe asset,” warning that soaring deficits and persistent inflation have eroded their hedging utility. The company is not suggesting Treasuries will vanish, but the message is clear: their perceived role as unquestionable ballast in a portfolio is compromised.
Simon Wan and Tom Becker, writing in Blackrock’s Multi-Asset Strategy Newsletter, said, “April’s sharp sell-off of long-dated US Treasuries highlights risks in the world’s largest bond market, particularly in the current regime of high deficits and elevated inflation. The imposition of tariffs on trading partners is likely to increase geopolitical fragmentation, prices, and deficits while decreasing the incentive for foreigners to finance additional US government borrowing.”
BlackRock strategists also point to the increasing correlation between U.S. Treasuries and the dollar itself, meaning the diversification argument no longer holds. Instead, they recommend expanding gold allocations as the more effective volatility hedge.
Morgan Stanley Chief Investment Officer Mike Wilson, speaking at a Reuters conference earlier in September said “Gold is now the anti-fragile asset to own, rather than Treasuries. High-quality equities and gold are the best hedges.”
He said he favours a 60/20/20 split going forward among equities, fixed income and gold, which constitutes a radical departure from the decades-old mantra of wealth managers for a weighting more toward 60/40 equities to bonds.
Central Banks: Actions Speak Louder than Words
If the private sector was the first to sound the alarm, central banks have confirmed it with action. The World Gold Council’s 2025 survey of central banks found that nearly three-quarters expect their U.S. dollar holdings to diminish over the next five years, while many plan to increase gold reserves.
WisdomTree reports that this is the first time in decades that central banks collectively hold more gold than U.S. Treasurise. That data point is historic—marking a definitive pivot away from the dollar-Treasury nexus that defined global reserves since Bretton Woods.
The Official Monetary and Financial Institutions Forum says “central banks are not merely buying gold, they are repatriating it, moving bullion from foreign vaults back to domestic soil. This is more than a portfolio rebalance. It is a sovereign assertion of autonomy in the face of geopolitical risk and sanction-driven weaponization of the dollar.”
Gold accumulation reflects geopolitical alignments
More than half of reported gold accumulation since 2009 was from China and Russia, with another quarter coming from a handful of emerging market central banks (Turkey, India, Kazakhstan, Uzbekistan, and Thailand), according to the New York Federal Reserve— the guardian of dollar orthodoxy, who acknowledges that diversification away from Treasuries is no longer marginal. Its own research notes a visible decline in the share of dollar assets within official foreign exchange reserves, coinciding with increased allocations to gold. The language is measured, but the implication is stark: what was once unthinkable is now accepted as a rational policy choice.
The Inescapable Logic
The logic underpinning this shift is irrefutable. U.S. debt now exceeds $35 trillion, rolling over more than $9 trillion annually. Financing that burden requires perpetual Treasury issuance at ever-higher yields, eroding confidence that these obligations can remain indefinitely sustainable.
Gold’s appeal lies in its lack of counterparty risk. It is not a promise of future repayment—it is payment. That elemental fact, combined with the waning utility of Treasuries as hedges, explains why the world’s largest financial institutions and sovereign actors are pivoting.
A Post-Treasury World
The reconfiguration of global reserves is not a theoretical forecast. It is a present-day reality. BlackRock tells private investors to shift into gold. The World Gold Council records central banks voting with their feet. WisdomTree marks the tipping point: gold reserves now outweigh Treasuries. Even the New York Fed concedes the trend.
The era of US Treasuries as the default safe haven is over. What replaces it is not a single asset but a recalibrated framework—one in which gold once again asserts itself as the foundation of monetary trust.
For investors, the takeaway is unambiguous: if central banks and BlackRock are buying gold at the expense of Treasuries, so should you.