Tom Burroughes, Group Editor , London, 22 July 2020
The Swiss private bank sets out the reason for holding the yellow precious metal in portfolios. The commentary is another turn in the debate about the role gold should play in wealth management.
The case for gold often arises when risks appear to be higher than normal, or when fears erupt that the value of government “fiat” money is going to erode. Massive central bank quantitative easing – aka money printing – and the impact of the global pandemic create plenty of risks in the investor’s mind, even if it turns out that central bank new money gets mopped up before problems arise. This is a classic “safe haven” asset. Debate remains: the very time that a person might want to access their gold might be a time when governments try to seize it – as happened during the 1930s in the US.