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Paul Singer, the hedge-fund billionaire behind Elliott Management, warned last month that the ultimate path of global stock markets is a drop of at least 50% from February highs.
What’s an investor to do in the face of such a grim outlook? Load up on gold, perhaps. After all, according to a report this week from the Financial Times, that’s what the smart money’s doing.
Gold, advised Singer, is “one of the most undervalued” assets available and it’s worth “multiples of its current price” due to the “fanatical debasement of money by all of the world’s central banks.” His fund gained about 2%, the FT reported, thanks primarily to profits from its gold position.
Andrew Law’s Caxton Associates and Danny Yong’s Dymon Asia Capital have joined Singer in seeking protection in their gold positions amid further loosening monetary policy.
“Gold is a hedge against unfettered fiat currency printing,” said Yong, whose fund is up 36%.
Caxton has also enjoyed double-digits gains, the FT reported, with its Global fund rallying some 15% and its Macro fund logging a 17% jump so far this year.
On Tuesday, however, gold GC00, -0.87% was posted its first loss in three sessions, amid optimism about the easing of business lockdowns in the U.S. and Europe.
“Risk appetite among investors improved with moves by major economies to ease lockdowns related to the coronavirus crisis,” analysts at ICICI Bank, wrote in a market update.
That hunger for risk was on display in the stock market, with the Dow Jones Industrial Average DJIA, -0.33%, S&P 500 SPX, -0.30% and Nasdaq Composite COMP, 0.27% all closing in the green on Tuesday. Futures on Wednesday are pointing to another advance.
Something strange is happening in the financial system…
And according to the Wall Street Journal, it's causing some investors –- including the world's biggest banks – to move massive amounts of cash out of the banking system.
I recently met up with widely-followed hard asset expert Bill Shaw at his firm's east-coast headquarters.
Over the past two decades, Mr. Shaw's firm has grown from tiny startup into a publishing powerhouse – serving more than a million readers in more than 150 countries.
Since 1999, the firm owes its legendary status as a trusted source of financial research to its eerily-accurate track record of often-controversial financial predictions, including:
- The Dotcom Crash…
- The bankruptcy of General Motors…
- The real estate bubble…
- The fall of General Electric…
- And the bankruptcy of Freddie and Fannie.
Recently, Bill revealed a brand-new prediction that has caught many by surprise.
He explained, “I'm not the kind of guy who gives in to hype and big predictions… that's why I've waited nearly a decade — to make sure the timing is right for the biggest prediction of my career.“
He went on to explain that over the next few years, he sees massive bull market developing in a sector of the economy that, over the years, has been completely ignored by nearly every investor in America.
The hard-asset expert said:
“Events happening around the world are about to come together at just the right time to create a perfect storm, causing some of the world's biggest investors to dump cash and stocks – and pile into this long-hated asset.
In fact, it's already begun.”
After dedicating hours to painstaking examination, ensuring he considered every possible angle, Mr. Shaw has put together a free presentation to explain exactly what he sees coming… and the best way for Americans prepare.