Gold Is Moving More in Tandem with Equities, Says Xu of Credit Suisse

The video discusses the inverse relationship between gold and real yields, highlighting how rising inflation expectations and the Fed's policies have driven real yields lower. Gold is now seen as a reflation trade, moving in tandem with equities, which challenges its traditional role as a safe haven. The shift from Treasurys to gold as a hedge is examined, noting the positive correlation between gold and equities. The video also explores equity-specific hedges and market complacency, emphasizing the pain trade in equities, particularly in the tech sector.

What is the primary factor driving the decline in real yields, according to the video?

• Rising inflation expectations

• Higher interest rates

• Decreasing nominal yields

• Increased gold production

How has the correlation between gold and equities changed in recent months?

• It has remained negative

• It has turned positive

• It has become unpredictable

• It has become irrelevant

Why might gold not be a reliable hedge for equity risk in the current market?

• Gold supply is decreasing

• Gold is behaving more like a risk asset

• Gold prices are too volatile

• Gold is negatively correlated with equities

What is the main risk highlighted in the video regarding the current market complacency?

• A rise in bond yields

• A decrease in gold prices

• A sudden increase in interest rates

• A protracted no-deal scenario in Congress

What is identified as the 'pain trade' in equities?

• A sell-off led by tech stocks

• A decrease in inflation expectations

• A rise in bond yields

• A sell-off led by value stocks