Saturday, July 31, 2010
What is George Soros up to in the gold market?
By Michael J. Kosares: The hubbub started when hedge fund guru George Soros proclaimed gold to be in a bubble, and it is still roiling nearly six months later. Gold advocates jumped to its defense, while critics took the offensive. As it turns out though, Soros was not really issuing a warning so much as he was explaining why he was making a considerable investment in gold bullion. Only days after calling gold the “ultimate asset bubble,” the financial press reported Soros had doubled his holdings of physical metal. Both the advocates and the critics had misinterpreted what Soros was trying to say.
Over the years, I have seen gold called among other things the asset of last resort, the ultimate safe haven, the fiduciary asset par excellence, and the investment of kings and the king of assets. I have never before heard it called the “ultimate asset bubble.” Let’s explore what might be behind Soros’ unusual description and his newly-found interest in the yellow metal.....read on