MARKETWATCH/Arvind Subramanian

The coronavirus has exposed political cracks, leading to a disintegrating Europe, a declining America and a shrinking China

“The COVID-19 crisis augurs three watersheds: the end of Europe’s integration project, the end of a united, functional America, and the end of the implicit social compact between the Chinese state and its citizens.

As a result, all three powers will emerge from the pandemic internally weakened, undermining their ability to provide global leadership.

We have been living for some time in a G-minus-2 world of poor leadership by the U.S. and China. Both have been providing global public “bads” such as trade wars and erosion of international institutions, instead of public goods such as stability, open markets, and finance. By further weakening the internal cohesion of the world’s leading powers, the COVID-19 crisis threatens to leave the world even more rudderless, unstable, and conflict-prone. The sense of three endings in Europe, America, and China is pregnant with such grim geopolitical possibilities.

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Gold rises on global growth fear; firm dollar caps gains

gold bar and coins“Gold prices gained on Thursday after a batch of somber economic data heightened fears over global growth, while a stronger dollar and the easing of coronavirus-driven lockdowns by many countries limited the upside.

Spot gold was up 0.4% at $1,691.95 per ounce. U.S. gold futures rose 0.6% to $1,698.

Julius Baer analyst Carsten Menke said prices had hovered around $1,700 for a while.

He said there was “a bit of a tussle” as some anticipate another deterioration of the economic backdrop and enter the market while another camp, which anticipates a gradual recovery as lockdowns ease, is considering not adding more gold to portfolios.”

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CNBC/Anjali Sundaram

Barrick CEO says there’s rising demand for gold as a ‘self-funded insurance policy’ in a global crisis

gold comex“As gold prices climb back towards their all-time highs, Barrick Gold CEO Mark Bristow sees his industry providing certainty during an uncertain crisis.

“We’re giving investors the opportunity to have a self-funded insurance policy against a global financial crisis,” Bristow told CNBC’s “Squawk Box” on Wednesday.

“In response to Covid, we’ve taken quantitative easing to another level, and of course that puts pressure on paper money, and you measure that with the price of gold,” Bristow noted. “We’ve seen prices go up across the world.”

Gold, seen as a bellwether for economic uncertainty, has crossed the $1,700 mark for the first time in seven years, though it was trading around $1,689 on Wednesday. The commodity hit a high of $1,900 in 2011, but dropped back in 2013 to start a trough..”

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Gold gains ground as investors brush off equity strength

gold coins“Gold prices rose on Thursday, finding support even as stocks rallied in the wake of aggressive monetary easing by major central banks and efforts to begin or continue reopening economies closed by the COVID-19 pandemic.

June gold GCM20, 0.79% rose $9.20, or 0.5%, to $1,697.70 an ounce on Comex. Meanwhile, July silver SIN20, 1.76% rose 15 cents, or 1%, to $15.165 an ounce. Gold losses of more than 1% on Wednesday, as the U.S. dollar strengthened and the reopening of some economies around the world, appeared to dent demand for the haven.

The U.S. dollar was mixed, with the ICE U.S. Dollar Index DXY, 0.27%, a gauge of the currency against a basket of six major rivals, up 0.1%. Gold often trades in an inverse relationship with stocks and the U.S. dollar.

But some analysts argued that gold was likely to see only limited downside as appetite for risky assets remains strong.”

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