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Gold is at record highs. Is this a warning for ASX shares?

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It’s a ho-hum kind of day on the ASX as we start a new week. At the time of writing, the S&P/ASX 200 Index (ASX: XJO) is up 0.44% after initially selling off this morning.

ASX blue-chips are stable, growth shares are up a little and everything looks settled in and comfortable at current prices.

But something else has happened today that I think is far more interesting.

The gold price has surged to over US$1,720 an ounce – levels not seen since November 2012 when the world was extremely worried about the European sovereign debt crisis.

But here’s where things get really interesting. Gold has never, in all of history, been more expensive than it has been this April in Australian dollar terms. Gold is always sold in US dollars, so for us Aussies to trade the yellow metal, we first have to convert our dollars to greenbacks before buying and selling.

And right now, an ounce of gold will set an Aussie investor back around $2,690 an ounce.

What does this mean for ASX shares?

Well, as you would expect, ASX gold miners are on fire today. Newcrest Mining Limited (ASX: NCM) is up 8% at the time of writing to $27.70.

Gold Road Resources Ltd (ASX: GOR) is doing even better with an 11.86% surge to $1.65.

Northern Star Resources Ltd (ASX: NST) is also having an auric day with a 10.86% pop to $12.72.

But I think the implications go beyond just ASX gold miners. If we look back to the GFC and the related stock market crash that took place from 2007-2009, Gold initially slumped along with the rest of the market before rallying to all-time highs in the subsequent periods.

We could be seeing a similar pattern playing out right now.

Last month, the gold price fell alongside stocks, but today’s rally means gold is really starting to outperform stocks as an asset class. The ASX 200 is still down nearly 20% since the start of the year, whereas gold has rallied 13% (in US dollar terms).

Should you invest in gold?

That’s a very personal question. Many famous and successful investors like Warren Buffett don’t bother with gold, viewing it as an unproductive asset. Many others like Ray Dalio say that every investor should have some in their portfolios as insurance against inflation and currency depreciation.

If you don’t want to buy bullion yourself, there are always the miners like Newcrest or Northern Star you can buy on the ASX. Or you can just focus on quality stocks outside the gold industry à la Warren Buffett. There are no right answers here, only the right questions!

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Motley Fool contributor Sebastian Bowen owns shares of Newcrest Mining Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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