Billions of dollars are spent by global investors year after year in hedge fund performance fees, sell-side equity research and brokerage costs to gain access to sophisticated fund management or stock recommendations that spectacularly under-perform gold . Overall, gold has consistently come on top or on par with equities (see chart 1) over the last 30 years. Further, when one considers risk-adjusted returns, given much higher volatility of equities, it’s not just outperformance by gold, but a trouncing.
What’s driving it?
Richard Nixon may have junked the gold standard and ushered in a new global monetary order of fiat currency, but that cannot alter the fundamentals of economics. Too much money chasing too few goods triggers inflation that debases fiat currency. Geopolitical uncertai