Cathie Wood, known as "Sister Wood," warns that gold prices are likely to fall, and the bubble is not in the AI ​​sector but in the gold sector.

Renowned investor Cathie Wood posted on the X platform that the likelihood of a gold price decline is high. During today's trading, the ratio of gold's market capitalization to the US money supply (M2) reached a record high, exceeding the peak of 1980, when inflation and interest rates rose by around ten percentage points. Even more alarming, the gold-to-M2 ratio has reached the highest level ever recorded during the Great Depression of 1934. In that crisis, on January 31, 1934, the dollar depreciated by nearly 70% against gold, the government banned private gold ownership, and M2 collapsed. Today's US economy is vastly different from the double-digit inflation of the 1970s or the deflation and depression of the 1930s. While foreign central banks have been reducing their reliance on the dollar for years, the 10-year US Treasury yield peaked at 5% at the end of 2023 and has now fallen to 4.2%. Finally, she stated, "While parabolic rallies often push asset prices to heights that most investors wouldn't expect, such astonishing surges typically occur at the end of a cycle. We believe the bubble today isn't in artificial intelligence, but in gold. A stronger dollar could prick this bubble, just like it did between 1980 and 2000, when gold prices fell by more than 60%."