What is the biggest problem in the world today — uncertainty or indifference? As tempting and amusing as it may be, the cheap wrong answer would be, “I don’t know and I don’t care”. In some respects, the big problem with the world today is exactly the opposite: not uncertainty, but a false sense of certainty.  

Yet, it is hard to get over the feeling that this is a worrying time. The war in Ukraine has now reached a stalemate and the longer it persists, the more likely Russia will find a way to manage its war economy. That means there is a good chance it will turn from defence to attack next year and finally, the sheer weight of its huge military and conscriptable population will grind down the ardent Ukrainian defence. Maybe, maybe not. Still, it is certainly not certain Ukraine will win. 

And that seems even more likely because of the war in Gaza, which seemed to spring out of nowhere to become an unforgivable human and diplomatic tragedy. I happen to think Israel is falling hook, line and sinker into Hamas’ trap; overreacting to a deliberately gruesome provocation to lose the PR game, but then, that’s an easy judgement to make from a distance.  

The two conflicts have driven a cleavage between nations and even within them. But more ominously, it seems to make any attempt by China to recapture Taiwan much less unlikely. Or is that just a bad dream?  

In a world desperate for leaders of great foresight and courage, we seem to have been dealt some of the worst cards in the deck. Recent polls in the US suggest another Donald Trump presidency is statistically likely. US President Joe Biden faces a public irritated by price increases that were the consequence of higher inflation, and a party split over the question of Israel. 

It would be so ironic if the Palestinian crisis were to push Trump over the line, despite a host of court cases that seem to be almost uniformly running against him. How does he remain so popular? It’s unfathomable. Can the population of the richest, most dynamic and most innovative nation on Earth really be so shallow? 

Financial Times columnist Gideon Rachman puts it well: “It is too fatalistic to say that we are now in an era when things can only get worse. But it is simple realism to understand that the strongest trends in world affairs are malign and gathering momentum.”  

Well, you know, as they say, every dark cloud has a silver lining, except in this particular case it’s gold. Gold as a commodity has had a pretty incredible year, as you would expect in these uncertain times. The gold price is now hovering just below $2,000/oz after coming very close to hitting its all-time high in March.  

That record was achieved in mid-2020, boosted by the outbreak of the Covid-19 pandemic, as you might expect. But what you might not expect is that it has more or less stayed there for the past three years.  

In rand terms, the gold price is well into record territory, which is why the best-performing large companies on the JSE this year are all gold companies. And it’s a good thing they are on the exchange because, without them, the JSE would be in deep trouble, with solid brands like Pick n Pay and MTN, among many others, having a terrible year. SA’s unlikeliest saviours, very old gold companies, have kept SA’s indices positive this year, which is kinda miraculous. 

Gold has other winds in its sails, like rising prosperity in India, a huge consumer. Technically, high inflation does support the gold price, but it’s interesting that even after inflation has started to come down in Europe and the US, gold has not followed that trend — or at least not yet. There are some other market issues too: technically there is an inverse relationship between bond yields and the gold price.  

But after all is said and done, I think gold just loves uncertainty. If you asked gold the question posed at the beginning of this column, I think it would say the big problem is definitively indifference. Uncertainty is not only the wrong answer but also not a problem. For gold, at least. DM