Speaking amid a glittering rally in the yellow metal, Lee cautioned that while bubbles can persist longer than expected, he prefers to focus on underlying economic fundamentals rather than chase price momentum. He aligned himself with the US central bank’s long-standing view that gold prices offer little actionable guidance for monetary policy.
“If you’re looking for a definition of a bubble, there it is,” Lee said, pointing to the historic pace of gold’s rise. “If you’re willing to take the bet, go right ahead and enjoy the ride. But as a westerner who’s less obsessed with gold, I would rather continue to worry about economic fundamentals.”
Lee said the only real signal he draws from gold’s surge is a “fearful” one. Historically, such desperate upward moves have coincided with moments when faith in political and social institutions begins to fracture. “The panic to buy gold at this pace — if it really foreshadows something — it’s going to be something really big, and I don’t want to be around for that kind of collapse,” he warned.
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Turning to the US Federal Reserve, Lee described the central bank as being in an unusually awkward position following the latest Federal Open Market Committee (FOMC) decision to hold rates steady. He said the situation is unlike anything seen since the 1990s, marked by strong productivity-driven growth that both contains inflation and suppresses labour demand, as firms can do more with fewer workers.
Lee argued that political optics are constraining the Fed’s policy choices. In his view, more members of the committee would have supported a rate cut if not for the risk of appearing to bow to pressure from Donald Trump. A cut, he said, would help offset the secular drag on labour demand and support interest-sensitive sectors that generate employment.
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On the upcoming appointment of the next Fed Chair, Lee said the field of potential candidates remains wide. He pointed to Chris Waller as a credible insider option who understands the importance of central bank independence and could provide stability. By contrast, he cautioned that an outsider candidate, currently favoured by betting markets, could introduce uncertainty, potentially focusing first on reshaping the Fed’s balance-sheet mechanics and payment systems rather than immediately adjusting monetary policy.
For the entire interview, watch the accompanying video
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