Millions of Australians could be missing out on the benefits of gold because of a conflict of interest inherent in big super.
Chris Ratcliffe/BloombergThe year 2022 posed challenges for traditional 60/40 portfolios, hinting at a potentially pivotal moment in the relationship between shares and bonds amid a sustained period of higher inflation. In this environment, gold has demonstrated remarkable resilience, echoing its performance during past inflationary eras, notably the 1970s.A key reason for super funds to reconsider their stance on gold is its role as a diversifier.
This trend should not be unexpected, as historical data reveals a pattern of inflation resurfacing in successive waves after initially surging above 7 per cent.Gold’s significant outperformance during stagflationary periods in history such as the 1970s further emphasises its relevance in today’s economic context.
Despite the Australian dollar pricing out rate cuts in 2024, its persistent weakness suggests a lack of confidence in the economy sustaining higher interest rates, given the substantial level of household debt.The inclusion of gold could help meet this objective and protect the real value of members’ savings over time, particularly during extended stagnation periods when shares and bonds both underperform.
Australia Latest News, Australia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Price, speed and Elon Musk: why some Australians are ditching the NBNWhile politicians argue over who to blame for a decline in Australia’s broadband uptake, customers are seeking more affordable ways to get online
Read more »
Fast cars, forgery and a bogus Banksy deal: Australians caught in collapse lose millionsA suspected international scam has dissolved into acrimony and recriminations all played out on social media.
Read more »
Fast cars, forgery and a bogus Banksy deal: Australians caught in collapse lose millionsA suspected international scam has dissolved into acrimony and recriminations all played out on social media.
Read more »
Fast cars, forgery and a bogus Banksy deal: Australians caught in collapse lose millionsA suspected international scam has dissolved into acrimony and recriminations all played out on social media.
Read more »
$3 billion worth of HECS debts to be wiped out for millions of AustraliansAbout $3 billion worth of student debt will be wiped for more than three million Australians struggling with a cost of living crisis.
Read more »
Millions of Australians to receive $1,000 boostQueenslanders can expect a much needed rebate on their power bills with the government unveiling a key cost of living package only months out from the next election.
Read more »