Bill Gross says that Gold, of all things is a better investment than bonds or stocks. Has he lost his mind? Here is a guy who manages something like $1 trillion and he thinks that GOLD is better than stocks or bonds? Uh…what if he decides to start to buy some Gold as a hedge? PIMCO of course has a “commodities” fund which has recently upped it’s stake in Gold but what about the huge flagship funds? He said that “long term”, stocks and bonds will not return much…so maybe he’ll want to “sprinkle” a little bit of Gold dust around the portfolios to tweak his returns? Well, maybe not because of prospectus but it’s certainly a humorous thought!
Last month we found out that George Soros and John Paulson have exited their financials and built up their Gold positions, now this news from Bill Gross…I must be dreaming! Speaking of dreaming, I came home from my daily ride with my trusty amigo Principe’ to see Gold UP $34…what’s up with this? Isn’t today a non farm payroll reporting day? Doesn’t Gold and Silver get smashed 99% of the time before and during these reports no matter what they report? What the heck happened?
We’ve turned the corner, that’s what’s happened. We went 1 full year with an “official foot” on the throats of Gold and Silver and as illustrated by the Bill Gross interview, people are finally figuring it out. The “correction” that was so carefully orchestrated did nothing other than irritate sentiment and get investors, some very big investors to start scratching their heads as to why the metals acted the way they did. I would not expect the Bill Gross’s of the world to come out now and say “Gold and Silver are artificially low because their prices have been suppressed,” no, but they will at some point and are beginning to act…vote…with their capital.
Everything that Bill Gross said is correct and nothing he said is anything that you haven’t heard before like a broken record from my writings and many others. What he said is at most, basic, solidly grounded and pure common sense and logic. 5 years ago, what he said would not have been acceptable nor would it have been carried by Bloomberg. He would have been ridiculed, laughed at and possibly even blackballed by the financial media. He did not put a number out there when he was asked at the end. Maybe he didn’t want to get pinned down, maybe he didn’t want to sound like one of us “lunatics” or…maybe he has done ALL of the logic and understands that you CANNOT put a number on Gold because it is a finite resource that will be chased by unlimited paper?!!
In any case, this is big, VERY BIG, when the biggest money manager in the world speaks the truth and tells us exactly the conclusion that we’ve already come to. Is Gold up today because of Bill Gross? Maybe, maybe not, but there is certainly no selling based on his comments. I would even add that we are now getting close to the point where it will be “cool” to be bullish on the metals. Just on his own, Bill Gross, because he is so mainstream and widely accepted, has made it at least “OK” to be bullish. Not “in the closet” bullish. PUBLICLY bullish!
We are not done yet for the day and there is still time for the cabal to make an attempt to put Gold back in its 2% box. I would absolutely love to see a 3 or 3 1/2% day here and stuff the shorts but that remains to be seen. Whether it is now, next week or next month, it is coming. Go back to last Friday and you’ll remember the same upwards action as today, …going into a weekend…? Someone really wants in…over the weekend…remember…WEEKEND? (I have maintained all along that the “reset” will be over a weekend). This by the way is happening while the Dollar is weakening versus other paper currencies. I wrote 5 or 6 weeks back that I thought the upside momentum was waning tor the Dollar, it has finally rolled over and now we are beginning to see liquidation. 30-60 days from now could be a very DIFFERENT landscape altogether. A waterfall move by the Dollar would not be surprising at all and of course, a moonshot move by the metals would go hand in hand should this occur. I do want to add that a weakening Dollar is no longer necessary for higher metals prices as ALL paper currencies have the same problem and investors of all nationalities are faced with the same problems as are owners of Dollars. Welcome Bill Gross, you haven’t lost your mind! Hold on to your hats and ounces folks.
P.S. for your weekend humor (horror), Peter Schiff walked around the convention last night and asked whether or not corporate profits should be abolished or capped. I am sure much of this was edited out but the answers are astounding and a truly sad commentary on the intelligence of many Americans. No longer is it acceptable to excel, now we are faced with the prospects of a populace that believes it is better to drag the winners down as opposed to the laggards improving performance. I guess this is what you get when even little Johnny who plays on the last place team gets a trophy at the end of the season. Please watch the 4 min. video:
This is not what made America the greatest nation in the history of the planet.