Bond King Bill Gross Says Gold Acting Like a Meme Stock, Prices Have Topped Out

Bond King Bill Gross is renowned for his aggressive bond investing strategies and is credited with democratising the fixed-income securities market by making it accessible to all investors. He co-founded Pacific Investment Management Company (PIMCO), working tirelessly to establish it as the biggest active fixed-income fund management firm globally.

Before PIMCO, trading bonds was rare and primarily conducted via paper documents. Under Gross's leadership, PIMCO pioneered active trading and expanded into junk bonds and emerging markets. As of September 2023, the company managed assets worth over $1.7 trillion (£1.2 trillion). Gross resigned from PIMCO in 2014 and subsequently joined Janus Capital Group, where he remained until his retirement in 2019.

Gold's Recent Behaviour and Market Outlook

Last week, Gross posted on X (formerly Twitter) that gold has become a 'momentum/meme asset,' and urged investors to 'wait awhile' before buying the precious metal. Gold prices fell sharply after a record rally earlier this year. Many analysts believe that gold has run too far, too fast. Despite this, gold's gains are still over 55% year-to-date, highlighting its recent strong performance.

Gross also told Business Insider that gold is now trading more like a trending stock on Reddit than a traditional safe-haven asset. He added that prices might have topped out after the meteoric increase, and that gold remains 'sensitive to short-term interest rates.' This refers to the tendency of gold to increase in value when borrowing costs decline. Falling interest rates make gold more appealing to investors compared with bonds, as their yields are usually impacted by rate changes.

It's important to note that low interest rates can also fuel inflation, which makes gold an even more attractive hedge against rising prices. This dual role enhances gold's appeal during uncertain economic times.

Why Gold Has Soared in 2025

Gold has also surged significantly in 2025, largely due to central banks around the world stockpiling the precious metal aggressively. According to Gross, this behaviour is driven by ongoing global 'policy uncertainty.' Tensions such as US-China trade disputes, military conflicts, tariffs, and geopolitical clashes have increased volatility in stock markets and clouded the outlook for the global economy.

Gross explained that, in the coming weeks, gold is likely to 'hold up better than stocks.' However, he also warned that a disappointing earnings season could slow down the bull market. He anticipates a correction in gold prices after two months of strong performance, suggesting that it might be a better time to buy later, when the market stabilises.

The veteran investor emphasised that 'momentum, policy, and perhaps interest rates will be dominant factors' influencing gold's price trends. These elements are expected to continue shaping the market in the near term.

Calling Out Meme Stocks

Gross is well known for criticising stocks driven by social media hype and speculation. In 2022, he described AMC and GameStop as 'lottery tickets,' warning that while these stocks could rise in value, they were highly volatile and disconnected from fundamentals. He pointed out that each buying frenzy tends to end with a 'musical chair, me-first exit' by investors caught up in the hype.

In July 2024, he also commented on Tesla, stating that the EV maker was 'acting like a meme stock' as its share price surged over 35% in just one month. 'Tesla acting like a meme stock — sagging fundamentals, straight-up price action,' he wrote, highlighting the disconnect between the stock's fundamentals and its rapid price increases.

Disclaimer: Our digital content is for informational purposes only and does not constitute investment advice. Please conduct your own analysis or seek professional guidance before investing. Remember, all investments carry market risks, and past performance does not guarantee future results.