The recent historic tariff announcements have raised the risk of recession,
so how could investors hedge against this risk?
I'm Allison Nathan and this is Goldman Sachs Exchanges.
Today I'm joined by Don Streven, our co-head of global commodities research,
who's making the case that oil and gold are particularly well positioned to protect investors against recession risk today.
Don, it's great to have you back on the program.
It's great to be on, Alison.
Thank you so much.
So, Don, I want to start with gold.
We think of it as a safe haven asset.
We think of it as an asset.
You want to own in a portfolio when the economy is struggling, when risk markets are struggling, and in fact,
gold, as you're going to tell us, has had a tremendous performance in the recent period.
But it's been somewhat surprising, I think, to a lot of investors that hasn't been the case every day.
In fact, in some of the most volatile days in the recent week, I should say, gold sold off along with risky assets.
So first, give us some insight into those moves.
How do you explain them?
Yeah, so I think it's mostly because of forced selling,
basically, investors suffering losses on portfolios of risky assets,
such as equities, and being forced to come up with liquidity to meet those margin calls.