This chart is basically asking one explosive question as data on December 2025. What would gold be worth today if it kept pace with the money supply?
The yellow line shows the actual gold price. The red dashed line shows where gold could be if it tracked the same gold to M2 money supply ratio seen during the 1980 peak. The blue dashed line shows the same idea, but using the 2011 peak ratio. And that is where the chart gets spicy. Because actual gold has moved higher, yes, but compared with the growth of money supply, it still looks like it has not fully caught up.
Here is the big macro story. When money supply expands aggressively, every existing dollar competes against a larger pool of dollars. Over time, that can weaken purchasing power. Gold does not need a CEO, a factory, or a balance sheet. It is basically the old-school measuring stick against currency debasement. So when M2 grows faster than gold, the chart suggests gold may be undervalued relative to the amount of money floating around the system.
The cause and effect for commodities is huge. If investors start believing paper money is losing strength, capital often rotates into real assets. Gold usually moves first because it is the monetary metal. Then silver, copper, uranium, oil, and miners can catch a bid as the market starts pricing in inflation, currency weakness, and scarcity.
So this image is not just about gold. It is about the bigger question. Are hard assets still too cheap compared with the amount of money created since 1980 and 2011? If the answer is yes, then the commodity bull market may still have a lot more fuel in the tank.
