BNY Mellon Prefers Equities to Gold in Medium to Long Term

The video discusses investment strategies focusing on whether to underweight the S&P 500 in favor of gold, considering their correlation since March. It explores asset allocation, emphasizing equities with pricing power as a better long-term play compared to gold, which faces liquidity issues. The discussion also covers inflation expectations and their impact on real yields, highlighting the importance of monitoring economic indicators like the five-year forward break-even rate.

What is the current correlation between the S&P 500 and gold since March?

• Negatively correlated

• Positively correlated

• No correlation

• Inversely correlated

Which asset is suggested to be the best play over the medium to long term?

• Equities with pricing power

• Real estate

• Bonds

• Gold

What is a potential advantage of equities over gold in terms of inflation?

• Gold has better liquidity

• Equities have a fixed return

• Gold is more stable

• Equities can hedge against inflation over the long term

What is the significance of the 170 level in inflation expectations?

• It shows maximum inflation

• It is the minimum for an inflation overshoot

• It is irrelevant to inflation

• It indicates deflation

What might the Federal Reserve aim to do with inflation according to the discussion?

• Overshoot inflation

• Undershoot inflation

• Maintain current inflation levels

• Ignore inflation trends