CNBC announced that Bernstein was monitoring two key measures, both unprecedented since the Second World War: global public debt and gold purchases by the central bank.
The company says the current geopolitical environment is heading toward a period in which neither stocks nor bonds will work, reported CNBC.
"We show that, based on current stock valuations and similar items from previous cycles, gold and equities yield more similar returns … [to] risky assets such as equities, "said Bernstein.
"Significant change in geopolitical risk and near-record public debt accumulation make other potentially risk-free assets more risky and temptation to create inflation, reinforcing arguments for gold" , adds the note.
At the same time, for the Azerbaijani sovereign fund, nothing beats the security of gold in a world increasingly exposed to trade conflicts and geopolitical risk, said Bloomberg.
Known as Sofaz, the fund aims to nearly double its holdings of precious metals in 2019 to 100 tons after resuming its purchases in 2018 after a five-year hiatus. On the other hand, we must avoid big bets on bonds and especially stocks, an approach that, according to the executive director, Shahmar Movsumov, allowed the fund to avoid losses last year.
"We would like to have something that does not represent the credit risk of someone else," said Movsumov during an interview Friday in the capital, Baku. "In a world where you will see changes in geopolitics, changes in reserve currencies, changes in the dynamics between the superpowers and their imminent impact on the financial sector, you want to be on the safe side."
As a traditional refuge in times of turbulence, Bullion is experiencing a resurgence of demand after the US Federal Reserve announced that interest rate hikes could be ruled out for the time being. Signs of a global slowdown and the long trade war between the United States and China have added uncertainty to the financial markets.
With a renewed confidence in gold since mid – October, it ended last year with its best quarter since March 2017, stock market volatility and a partial halt to the stock market. US government has also stimulated demand.
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