Not when the supply of gold isn't fixed even disregarding relative economic values.
A bit pedantic but even if the value of gold rises from increased demand the fact one can mine it and get in on it means they would have gained from it while being newer. Furthermore it technically takes from the older holders by reducing the demand slightly.
The price is going up for two reasons: 1) fear due to the virus and its economic consequences 2) the USD is falling rapidly.
Gold as a commodity is almost exclusively priced in dollars globally. If the dollar plunges, gold will spike higher accordingly.
US spending being out of control right now (pointing to aggressive dollar debasement as the Fed 'prints' - runs QE infinite to monetize the ever expanding debt) and concerns about the condition of the US economy near-term with the virus, have pummeled the dollar lately.
So the price of gold is up due to the drop in the dollar, and there is a considerable fear premium on gold right now as well (likely to the tune of several hundred dollars). As that fear fades you'll see a drop in gold, from whatever new high it puts in, as in 2011-2016. It'll set a new higher low due to the dollar losing real value it will never recover from the spending spree going on (there is probably going to be $5+ trillion in unexpected spending that will occur over several years due to the virus, which was not baked into the dollar or price of gold previously).
> 1) fear due to the virus and its economic consequences
so, in "lures investors and pays profits to earlier investors with funds from more recent investors", the mechanism of "luring" is fear.
> 2) the USD is falling rapidly
seems to be a part of 1)
> Gold as a commodity is almost exclusively priced in dollars globally. If the dollar plunges, gold will spike higher accordingly
Isn't gold priced by a market? if the market has to move, the people must be willing to pay more dollars (or to say it another way: they have access to cheap dollars). It seems like people are exchanging their cheap dollars for gold, this is the part that doesn't make sense to me.
