Discover the Hard Asset That Surpasses Apple, Nvidia, and Microsoft Combined

In recent years, shares of Apple, Nvidia, and Microsoft have seen remarkable growth as investors flocked to stocks poised to benefit from the rise of artificial intelligence (AI). As of March 25, these three companies boast a combined market capitalization of over $9.2 trillion.

Despite the impressive valuations of these tech giants, they are dwarfed by a hard asset that has experienced significant appreciation and is expected to continue its upward trajectory. According to a Wall Street strategist, this asset could eventually reach a staggering $40 trillion market cap.

Addressing a Potential Debt Crisis

Gold has long held an inverse relationship with the U.S. dollar, which provides a backdrop for understanding its recent price movements. Surprisingly, gold prices have soared despite the strong performance of the U.S. dollar over the past two years, significantly outperforming the broader S&P 500 index. The market cap of gold has now surpassed $20 trillion.

The fluctuations in gold prices are often unpredictable, as investors typically view gold as a safe haven during times of economic uncertainty. With the U.S. national debt exceeding $36 trillion and the government running a fiscal deficit, concerns about the sustainability of U.S. debt levels have grown. In fiscal 2024, the deficit reached $1.83 trillion, leading to annual interest payments that now account for around 13% of the federal budget.

These financial pressures have consequences for those investing in U.S. Treasury bonds, with fears that higher yields may be demanded to account for the increasing risk. Luke Gromen, founder of Forest For the Trees, believes that the growing national debt points directly to gold as an attractive investment. During a recent podcast, he stated, "Once sovereign debt becomes so high that it is evident the U.S. cannot pay the interest and entitlements without printing money, the question arises: what is the point of holding a sovereign bond? Gold's value will rise regardless of inflation levels."

Central banks have recognized this shift in sentiment. Gromen indicates that since 2014, central banks have sold $400 billion in U.S. Treasuries while purchasing $600 billion in gold. In regions experiencing currency devaluation, such as Argentina and Brazil, market watchers observe that rising gold prices, despite increasing interest rates, signal an impending debt crisis.

Can Gold Maintain Its Upward Trend?

Currently, with gold's market cap exceeding $20 trillion, the price per ounce is roughly $3,040. Gromen believes this rally is just beginning. Despite skepticism in previous years about gold reaching $3,000 an ounce, this milestone has been achieved. He suggests that if gold rises to $4,000, $5,000, or even $6,000 per ounce, it could reach a market cap of around $40 trillion.

Gromen's encouraging outlook stems from his view that recent policies aimed at weakening the dollar align with an environment that would further support gold prices.

While I do not specialize in gold investment, I recognize that the current fiscal situation in the U.S. presents challenges unlikely to resolve easily. Should the circumstances deteriorate or merely remain stagnant, gold may continue to be a desirable asset. For investors, allocating a portion of their portfolio to gold might provide a sensible hedge against economic turmoil or debt crises.

Bram Berkowitz has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Apple, Microsoft, and Nvidia. The Motley Fool also recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

Gold, Investment, Debt