Gold & Silver Declines are Reminiscent of the 2008 Financial Crisis

Gold hit a monthly average high of 964.42 in March 2008. As the financial crisis took root, gold sold down to $758.04, a decline of 21.4%. Then gold outperformed stocks for the next decade!

Some investors have been surprised by the decline in the price of gold when the Iranian war seems to promise higher rates of inflation and global uncertainty than any time in recent memory. But as Alasdair Macleod opined in his missive today (published below) this is reminiscent in some ways of the decline gold suffered at the start of the 2008 financial crisis. In March 2008 as the financial crisis was just getting underway, the average price of gold that month was $964.42. But as the markets were melting down, gold did the same. By November the average price of gold for the month fell to $758.04, a 21.4% drop. People were also surprised at gold’s decline then. But from that November low, gold rose 136% by August 2011 to gold outperformed stocks for the next decade!

While the world’s attention is understandably stuck to every latest development in the Iran war, the news flow surrounding domestic ground zero for what could very well be the next financial crisis, private credit, keeps on getting worse. Gold may be starting a sell off now for similar reasons as in 2008 when a scramble for liquidity required people to sell what they were able to sell. Gold always has a bid so early in troubled times the yellow metal can face some downside pressure. So far this month, gold has sold off from a high of $5,182 to ~ $4,600 today or about 11.2%.

The problem now appears to be in the private credit markets. The first evidence of trouble in the credit markets came from BlackRock when around March 6, the company shut the door on redemption requests from investors. BlackRock’s $26 billion HPS Corporate Lending Fund (also known as HLEND) received withdrawal requests totaling about $1.2 billion in the first quarter—equivalent to roughly 9.3% of the fund’s net asset value. This exceeded the fund’s standard quarterly redemption limit of 5%.

• The fund honored only the 5% cap, paying out approximately $620 million.

• The remaining requests (around $580 million) were effectively deferred or blocked for that quarter, as the fund invoked its built-in gating mechanism.

This is the first time the fund has had to apply this limit since its inception, according to reports from Reuters, Bloomberg, The Wall Street Journal, and others. The move was designed to avoid forced sales of illiquid private loans (which could harm remaining investors’ returns) amid broader concerns in the $1.8–2 trillion private credit sector, including rising defaults, valuation worries, and investor caution. This is not a full freeze on all BlackRock investments or client accounts—it’s specific to this particular private credit fund (a non-traded business development company focused on lending to companies).

Private credit funds often have these liquidity restrictions built in because their assets aren’t easily sold quickly, unlike public stocks or bonds. Similar pressures have affected competitors:

• Blackstone faced record redemptions from its BCRED fund but aimed to meet them (even injecting capital).

• Blue Owl and others have taken steps like asset sales or halting redemptions in some cases.

While this may appear to be tied to sector-wide dynamics rather than a broader BlackRock crisis if the results of war are surging inflationary pressures due to a lack of life sustaining commodities, then we could indeed be facing a credit crisis reminiscent of 2008 when a scramble for liquidity resulted in a sell off in gold as investors had to buy dollars to pay their debts or meet other obligations.

Also, its not difficult to imagine the sell off in HydroGraph Clean Power over the past couple of days may also be related to this credit crunch, especially from uninformed investors who may have considered HydroGraph as a speculative gamble.

A Dollar Disaster Looms

The following comments from Alasdair Macleod in his March 19, 2026 Substack missive to paid subscribers:

“As the war against Iran unravels, investors’ guts tell them to buy dollars, not gold. It is a huge mistake on every level. The dollar is over-owned, and its purchasing power is set to collapse.

Gold and silver prices are declining at a time of increasing risk to the dollar and the entire fiat currency system. The situation echoes that of the 2008—2009 financial crisis, when gold was hit taking the price down from $1000 to $680, before there was a collective change of mind and gold tripled into its September 2011 high of $1920.

Investor psychology has not changed one iota.

The difference this time is that central banks are aggressive buyers. They will use any dip and any shake-out from weak holders to hoover up physical gold. Furthermore, in

the West speculative interest is minimal, so in paper markets price markdowns will achieve little. To the list of buyers we can add major investment banks, particularly those in China but also in the US stocking up for the next bull run.

The next bull run as a description of gold’s prospects and misrepresents what’s happening. It will be the next phase of a fiat currency collapse, led by the dollar rather than gold rising in value. History clearly shows that gold, which in everyone’s common law is final settlement for all forms of credit maintains its purchasing power over time. Price volatility is generally confined to the value of credit, commodities, energy, and raw materials.

Investors buying dollars are adding to an already crowded trade. They are selling their own currencies to add to the $44 trillion reported by the US Treasury’s TIC figures, in reality only part of the dollar story. There are also offshore dollars in so-called Eurodollar markets, and dollars in the middle of foreign exchange transactions, together adding a potential $100 trillion according to the Bank for International Settlements.

The dollar is about to unravel big-time.

Everyone is long of dollars, and the war-time funk funds are buying at the top, as is usually the case, measured against real money which is not credit in any form but physical gold in final settlement. Central banks understand this. Only the Europeans and Americans are frozen into inaction, the Europeans in thrall with the Americans. All other central banks are buyers, some coming late to the party.

The era of US hegemony is over. It was happening anyway, but its life is drastically shortened by the error of attacking Iran. Inflation, better described as loss of purchasing power for all fiat currencies will soar later this year as a consequence. Almost everything is affected by the soaring cost of energy and the withdrawal of oil-based chemicals from global markets.

Everyone hates America, and a nation is valued by its currency. The Iranians are letting tankers through Hormuz if they pay for their cargo in yuan. Goodbye to petrodollars.

America and Israel will lose this unprovoked war. That is coming clear. It was meant to be a weekend operation, with US markets opening the following Monday with it done and dusted. Geopolitical experts see Iran taking heavy civilian losses but a million-strong army broadly intact, the West’s stock of interceptors exhausted, and the real attacks by Iran against the Gulf and Israel about to begin. The Houthis have been strangely quiet, and are likely to kick off any time soon, blocking the southern end of the Red Sea which is access to the Saudi’s Yenbu terminal and Suez.

The only way this can stop is for the US and Israeli belligerents to admit defeat and for the US to withdraw its military bases from the region. It leaves Israel’s very future threatened, and plans for a greater Israel abandoned. Her protection from the US will end, and she will have to turn to China and Russia to secure her future.

By her actions it is clear than China expected this outcome. She understands that with the loss of US hegemony in west Asia and the end of the petrodollar the currency will collapse. China has prepared to protect her own currency from this outcome, first envisaged as likely in the 1980s when the POBC secretly began to accumulate gold. Only in recent months China has put her plans into action, opening gold vaults outside mainland China exchangeable for yuan and perfected her CIPS alternative to Swift: CIPS bypasses the dollar completely. And she recently instructed her banks and insurance companies to sell their US Treasuries.

Funk money going into dollars is a gut reaction, particularly when alternatives such as physical gold are not readily available. It buys into the myth that the King Rat of fiat currencies is the ultimate safety. It is not: everyone now holds it and when that happens there will be no buyers left. It is setting up the dollar and the entire fiat currency system for a rapid collapse.

Gold is the only form monetary safety in an increasingly dangerous outlook for all forms of credit.

I have had Alasdair Macleod as a guest countless times on my radio show and YouTube Turning Hard Times into Good Times shows over many years. I know of no one who has a better global understanding of the gold and silver markets than Aladair. I highly recommend that you subscribe to his Substack service. Click HERE to do so.

Best wishes,

Jay Taylor