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Financial Times/Paul Britton/6-8-2020
“Covid-19 has brought us to a historic turning point in financial markets. A fundamental investment strategy that has protected institutional and retail investors alike for decades — balancing equity risk by holding high-quality government bonds — has finally run its course. When the Fed lowered short-term rates to zero in response to the pandemic, the last shoe dropped.”
USAGOLD note: In this down-to-earth assessment of the effects of collapsing rates, gold makes the short list of assets that will add “ballast for balanced portfolios.” Britton is the chief executive officer of Capstone Investment Advisors in New York.