Central Banks Drive Gold Rally

FINANCE
Central Banks Drive Gold Rally

Gold has long been a hedge against inflation and market volatility, and its price recently surged past $3,000 amid President Trump’s tariff uncertainty. However, liquidity remains a challenge, especially for smaller investors. While central bank buying has fueled the rally, concerns about economic uncertainty and inflation have also driven demand for gold as a safe haven.

Gold’s price has risen tenfold since 2000, outperforming the S&P 500, but liquidity issues persist. Unlike cash or stocks, selling gold can be harder for retail investors than for large institutions. Rob Haworth of U.S. Bank Wealth Management warns that gold isn’t easily convertible for everyday use, saying, “You’re not sending gold to buy your Domino’s pizza.”

Meanwhile, central banks, particularly China, have been accumulating gold as part of a broader de-dollarization trend. As trade policies shift and inflation expectations rise, gold’s role as a financial hedge remains strong, though its long-term prospects remain debated.

ECONOMY
Senate Passes Bill, Avoids Shutdown

The Senate passed a six-month funding bill Friday, narrowly avoiding a government shutdown just hours before the deadline. The 54-46 vote saw two Democrats joining Republicans, with Senate Minority Leader Chuck Schumer ultimately opposing the bill after initially backing its advancement. The bill, already passed by the House, now heads to President Trump for approval, ensuring government funding through September 30.

Schumer and others argued that a shutdown would give Trump and his administration excessive control over federal operations. House Democrats, frustrated by the move, had pushed for a 30-day stopgap bill to allow more time for negotiations. Meanwhile, the GOP bill includes $13 billion in domestic spending cuts and a military budget increase.

Republicans defended the measure, blaming Democrats for last year’s budget delays. With tensions high, the bill's passage prevents immediate disruption but leaves open concerns about long-term funding battles and Trump’s influence over federal spending priorities.

FINANCE
UBS Adopts Hybrid Work Policy

Swiss banking giant UBS is adopting a hybrid work model requiring employees to be in the office at least three days a week, with a ban on consecutive remote Fridays and Mondays. This approach, detailed in an internal memo, follows a similar move by Deutsche Bank last year.

UBS argues that office-based work fosters innovation, collaboration, and productivity, aligning with its “office-centric with flexibility” policy. The shift aims to balance office attendance and optimize space utilization, particularly after UBS consolidated staff and integrated Credit Suisse employees post-acquisition.

Many firms, including JPMorgan and Goldman Sachs, have pushed for full-time in-office work. UBS, however, remains more flexible, though concerns persist about productivity dips around weekends. The decision also addresses real estate challenges, as companies struggle with underutilized office space on Mondays and Fridays. Unlike JPMorgan’s stricter mandate, UBS maintains a compromise between remote flexibility and in-office collaboration.

DISCLAIMER: None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.