Morgan Stanley Shifts: Will Wall Street FINALLY Stop Belittling Gold Investors?

Well, we may finally be seeing a sea change on Wall Street, with major investment house Morgan Stanley abandoning its long-held asset allocation strategy of 60% equities and 40% fixed income. According to Chief Investment Officer Mike Wilson, the firm now recommends a 60/20/20 mix, with the final 20% being allocated to gold.

Better late than never, I suppose.

But will other Wall Street firms follow suit, or will they continue misleading their customers regarding the safety of bonds? We know from years of conversations with Money Metals customers just how overwhelming the criticism of gold has been from these supposed investment experts. Many have been belittled as gold bugs and doomsayers.

The pressure from these fast money "paper bugs" not to allocate funds into physical gold and silver is one big reason why virtually all Americans have none – and it's why the American investors have sat out the massive rally in gold and silver over the past two years.

It makes sense that Wall Street has not recommended gold – they had no incentive to do so. When a client puts money into physical bullion, it is largely taken off the table for trading, rebalancing, and generating brokerage fees. When someone owns the metals, they are often held for years or even generations.

Our customers at Money Metals should be proud of themselves for having seen through all the misinformation and conflicts of interests – and buying gold and silver anyway. While recent gains are impressive, we could still be in the early stages of a long-term trend.

Even with investment demand for gold surging, it remains very much “under owned” according to a State Street Investment Management analyst.

That means the yellow metal still has plenty of upside.

Gold is up more than 88 percent since January 2024. Asian investment and central bank gold buying primarily drove the early stages of the bull market.

Asian investors tend to favor physical metal (although there is growing interest in ETFs in the East). Bar and coin demand was up by 11 percent in the first half of 2025, with Chinese and Indian investors leading the way.

Chinese bar and coin demand grew by 44 percent year-on-year, the strongest period for physical gold buying since 2013.

India bar and coin demand grew by 7 percent through the first half of this year.

But in the U.S., selling has been the dominant theme in the physical bullion market. Year-on-year bar and coin sales plummeted by 53 percent through June.

However, ETF investing has exploded in recent months and we're finally seeing a pickup of demand in the retail bullion market as well, indicating Western investors are starting to hop on the gold bandwagon.

While ETFs are a convenient way for investors to play the gold market, although many Western investors prefer paper gold, owning ETF shares is not the same as holding physical metal and comes with counterparty risk.

State Street Bank expects investment demand to remain robust and expects $4,000 per ounce gold in the not-too-distant future.

The bullish factors include weakening demand for dollars across the globe, budget turmoil in Washington DC, war, and the ongoing realignment in global trade. And for now, at least, these conditions are not likely to go away.

As for the weekly market action, gold is pushing higher for the 7th consecutive week now. The yellow metal checks in at $3,893, right at an all-time high as of this Friday recording, and good for another 3.2% advance on the week.

Silver is surging again here today in what has been yet another day where the white metal is up $1 on the day. For the week silver is up nearly $2 to come in at $48.18 – good for a 4.1% gain and, like gold, a 7th consecutive weekly advance.

The silver move is being fueled by what may be a physical shortage, as indicated by a situation in the futures market referred to as backwardation. Normally the price of the metal in the future is a bit more expensive to account for the cost of funds to hold that position. This is known as contango.

But right now, we’ve got backwardation, with the price of silver on the December contract, for instance, currently sitting at about 1% lower than it is in the spot market. We’ll keep our eyes on this somewhat unique situation in the coming weeks as we parse through what is driving this deviation from the norm.

Finally here, platinum and palladium are a bit more muted this week. Platinum is up 1.8% and checks in at $1,621, while palladium is unchanged on the week at $1,283.

*********