Well it is none other than George Soros, he was just a "needle pad" to this man (can't mention his name) - this man was an ex-prime minister of a country that was north of Singapore. (separated by a small sea in between)
Well a real sorrow was he to this man (the ex-PM) when the 1998 Asian Financial Crisis broke out. Currencies fell starting from Thailand till IMF had to bail them out. Such was the magnitute of the crisis then. (hey people in every crisis there is always an oppurtunity) Now Mr. Soros has for the last one year at different time spoke of the ULTIMATE ASSET BUBBLE that is GOLD.
While he was one of the the largest investors of gold, he has dump a large amount of his gold according to regulatory fillings
Between January and February this year there were a sell down of gold of 2.5 million ounces. (at US$ 1400.00 an ounce you work out how much gold in absolute dollar was sold - yes in the region of US$ 3.5b)
36 years ago, back then, between 1975 to 1979 gold was hovering between US$ 100 - US$ 200 an ounce. It peak to slight above US$ 800 an ounce towards early 1980's. It then, within a year crash to around US$ 300 an ounce. Gold price then stayed in a range of US$ 300 - US$ 400 till 2004, for about 20 odd years the price of gold was sideways.
It has since rallied to a new all time peak of USD 1556.70 on the 2nd May 2011. Since then gold has closed at 1508.80 on the 20th May 2011.
My question is;
- Will the price of gold go into a hibernation again?
- This time around for HOW LONG?
- What PRICE RANGE?
If one of the worlds most prominent gold investor, George Soros is getting out, and, with the rest of the elites too. Does this mean that the gold bubble is about to burst?
So people take caution. Let's all of us be mindful of 'point of entry' in an asset class that does not yeild any capital growth. If we were to invest now at the US$ 1500.00 an ounce range and if gold price corrects and drop to US$ 800 an ounce! When will it return to US$ 1500.00 and how long before it will go above our investment cost?
So peole when an assets that don't yield dividends and it if stays side ways for the next twenty years again with no capital growth, where are your expected annual returns coming from?
Well even if you are told that gold will be a class asset of choice in an hype-inflationary period. Will your capital will be eroded at the rate of your annual inflation or at hype-inflation rate? Will your lost be substantial if in the next 20 years as gold price stays sideways? Will you enjoy capital gains/protection on your gold held, when all else shits up at hyper inflationary rates?
Even the Bretton Woods system of monetary management was remove in 1971. What else can be considered the ultimate asset to hold???
We will see but as always it is easier said, after one were to look back at historical data. Let us also be mindful of our own shortsightedness. We must be considering all cross cultures, events but not limited to just country risk, government risk and also geographical risk before we disqualify another invesment class asset.
Till then!
Can be also "soro-fool" for us too! ...if an individual's view is self-serving.
Till then!
Can be also "soro-fool" for us too! ...if an individual's view is self-serving.
TjLim
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