Why Banks Are Up and Gold Is Down

The video discusses the concept of risk in financial markets, focusing on the contrasting performances of banks and gold since August 1st. Banks have shown growth, indicating a 'risk-on' environment, while gold has declined. The video explains how to chart the relationship between bank and gold prices using a simple ratio. It suggests investment strategies, emphasizing banks with high earnings growth, and highlights the valuation differences between banks and the S&P 500.

What is the main reason banks are considered a risk-on investment?

• They make loans as the economy grows.

• They are a safe haven like gold.

• They have stable prices over time.

• They offer high interest rates.

How is the relationship between banks and gold measured in the video?

• By evaluating their dividend yields.

• By creating a ratio of their indices.

• By comparing their market capitalizations.

• By analyzing their historical prices.

What recent trend is highlighted in the relationship between banks and gold?

• A stable relationship with no changes.

• A consistent decline in both indices.

• A breakout in the banks-to-gold ratio.

• A reversal in the gold index.

Which banks are noted for having at least 10% earnings growth?

• Bank of America, Key Corp, and SunTrust

• Wells Fargo, Citibank, and HSBC

• Goldman Sachs, Morgan Stanley, and JPMorgan

• Deutsche Bank, Barclays, and Credit Suisse

Why might investors consider buying banks over gold according to the video?

• Gold prices are expected to rise.

• Banks are trading at lower earnings multiples.

• Banks are less volatile than gold.

• Banks have higher dividend yields.