Bloomberg Opinion columnist Allison Schrager challenges gold's reputation as a safe haven, asserting there is "nothing safe about gold as an asset" and no rational basis for its inherent value. Schrager argues gold's appeal is driven by irrational impulses, highlighting its price volatility and unreliability as a consistent hedge, citing a 6% drop during the 2008 financial crisis. She concludes that gold is suitable for speculation but not as a low-risk, market-beating investment, urging investors to resist its allure.
Bloomberg Opinion columnist Allison Schrager challenges gold's traditional safe-haven status, asserting there is "nothing safe about gold as an asset" despite its recent rally above $4,000 per ounce. Schrager posits that gold lacks inherent rational value, describing its appeal as driven by "primitive parts of our brain" rather than fundamental economic principles. The analysis highlights gold's price volatility, arguing it primarily adds risk to a portfolio. Schrager notes that while gold has delivered strong returns over the last six decades compared to the S&P 500, these returns compensate for significant risk, not a risk-free profile. Critically, she points out gold's unreliability as a consistent hedge, citing a 6% price decline during the 2008 financial crisis. Schrager concludes that investing in gold is suitable for speculation but not as a low-risk, market-beating asset. The "strongly negative" sentiment and "cautious" tone surrounding gold in this analysis underscore the columnist's skepticism regarding its perceived dual benefit of low risk and market outperformance.
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strongly negative
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