Saturday, September 21st, 2019 MST

Heavy hitters take positions in gold

Some of the world’s most famous and successful investors have taken positions in gold. It pays to note what successful people do with their money.

“Some regard [gold] as a metal, we regard it as a currency, and it remains our largest currency allocation… – Stanley Druckenmiller.

Druckenmiller was chairman and president of Duquesne Capital, which many years earned his investors 30% annually.   He and George Soros “broke the Bank of England” when they shorted British pound sterling in 1992, reputedly making more than $1 billion in profits. Gold is Duquesne’s largest currency allocation.

“If I had to pick my favorite trade for the next 12 or 24 months, it’d probably be gold.  I think if it goes through $1,400 an ounce, it goes to $1,700…quickly. It has everything going for it in a world where rates in the US are conceivably going to zero…”  – Paul Tudor Jones.

Paul Tudor Jones is another hedge fund manager and has $18 billion under management.  One of Jones’ earliest and major successes was predicting Black Monday in 1987, tripling his money during the event due to large short positions.  Jones’ comment was made during a TV interview when gold was below $1300.

“[Assets] that will most likely do best will be those that do well when the value of money is being depreciated and domestic and international conflicts are significant, such as gold…” — Ray Dalio.

Dalio founded Bridgewater Associates, one of the world’s largest hedge funds. Bloomberg ranked him as the world’s 58th wealthiest person in June 2019.

Jeffrey Gundlach, often referred to as “The Bond King,” said in June, “I am certainly long gold.”  He expects the dollar will finish the year lower.

Gundlach manages $130 billion of assets at DoubleLine Capital.  He sees a 40% to 45% chance of a recession within six months, and a 65% chance in the next year.

Anthony Deden, founder of Edelweiss Holdings, has 35% of his investment company’s portfolio in gold.  Although Deden is not often in the news, nonetheless he is a very successful investor.

It is worth noting that these investors are not classified as “gold bugs.”  Apparently, they recently invested in gold for a myriad of reasons, such as massive money creation by the world’s major central banks, U.S. budget deficits for as far as the eye can see, signs of a worldwide recession, financial difficulties for the EU’s southern nations, and instability in the stock and bond markets.

Inflows into gold-backed ETFs continue

Gold-backed ETFs and similar products added 52 tons of gold in July, in addition to the 125 tons added in June, increasing their collective holdings to 2,600 tons – a level not seen since March 2013.  ETFs are preferred by many institutional and large investors, while smaller investors (and some large investors) like to buy

Gold on the march

Record-breaking central bank and ETF buying boosted 2019’s first half demand to a three-year high, according to the World Gold Council.  Also contributing to demand was a more positive environment for Indian consumers, which have always been big jewelry buyers.

IRS goes after cryptocurrency investors

Cryptocurrency advocates have long maintained that the primary benefit of “cryptos” is that they are not centrally controlled, actually residing on cell phones.  Transfers from one holder to another do not go through a “central bank,” such as the Fed, but from one phone to another.  This was supposed to be beyond the reach of

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