After the price of gold fell 11 percent in the past six months, some investment managers began to question the status of gold as a protection asset.
According to Bloomberg’s report, BlockRock Global Allocation Fund Portfolio Manager Russ Koesterich thinks that gold cannot prove its effectiveness as a reliable protection against inflation in the current situation.
Koesterich even opposed the statement that gold is a protection asset: “The ability of gold to protect against inflation is overstated. While it may be a logical store of value in the very long run – mical centuries – it is not that reliable in the shorter term.
The short term is dominated by various interventions such as the consequences of the coronavirus epidemic and economic stimulus packages of the states.
The massive incentives spent to provide economic support are increasing inflation concerns.
Having reached an all-time high of $ 2,100 in the summer of 2020, gold has been on the decline ever since. Gold fell to almost $ 1,700 at the time of translation release.
With the decline in the gold price, there was a significant decrease in the savings of gold exchange traded funds. Some analysts think these coins were transferred to Bitcoin (BTC).
Unlike gold, Bitcoin has been rising since October 2020, and its increase in 2021 alone approached 90 percent.