Tuesday, May 17, 2011

Time to sell???

George Soros dumps $800 million gold stake

Billionaire hedge fund manager George Soros sold nearly $800 million of gold during the first quarter, as the precious metal surged to record highs. While gold made up a relatively small slice of the Soros Fund Management's $8.4 billion portfolio, the sale suggests that Soros does not expect prices to continue much higher.

Posted by mark @ 07:24 PM (3187 views)
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18 thoughts on “Time to sell???

  • George is a true expert. Having flogged off his gold, he will now try to talk down the price.

    When the price has dropped significantly, he will buy on the dip. As the old Stock Exchange expression goes: “where there’s a tip, there’s a tap”.

    Yup, I will buy in when it drops some more….then watch it hit $1650 by Christmas (as Moneyweek forecast).

    Has anyone any predictions on QE3 by the Fed….September or October (?). Ladies and gentlemen, place your bets !

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  • Alan,
    Good luck in outsmarting Soros… and ‘don’t bet more than you can afford to lose’ is not a bad adage.
    Nick

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  • Worrying times for the General?

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  • general congreve says:

    @3 – Not worried at all Alan_540. This is just noise. Perhaps I should trade back into pounds and let all that lovely inflation loose on my savings? What do you think?

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  • Good for you General. Hope for your sake that Soros is making a big mistake.

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  • Well I’ve hopped back into cash for a while. We’ll see if Gold drops back to the 144 day moving average as it did in January. That proved a very good entry point for Gold and Silver. But we’ll see. It’ll work until it doesn’t.

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  • Soros v China? No contest.

    You will know when the time comes. I haven’t heard the big bang yet.

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  • @str 2007 – have you heard from techie lately? he’s not provided any input on here for several weeks – I’m anticipating some significant market volatility (commodities included) in the forthcoming weeks and thought he might by now have put in the odd appearance.

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  • 1. alan said…Has anyone any predictions on QE3 by the Fed….September or October (?). Ladies and gentlemen, place your bets !

    That just about concludes the subject. lol

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  • No jack, not heard anything.

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  • cornishman says:

    I reckon a lot of people sold gold during the first quarter – in order to buy silver…

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  • Beware Soros, the man is an absolute shark.

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  • Soros knew his sell price, and stuck with it.

    How many of the gold bulls here know their sell price?

    Few, I suspect…

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  • Hi UT,
    I think you are right, people are reluctant to get rid of a store of value. But what would you hold instead? Is anyone proposing that Soros holds dollars for the “$ rally”?

    In the words of Moneyweek’s Frisby, “I see no reining in of spending, no paying down debt, no cutbacks, no steps towards greater efficiency. I see plenty of signs among the American people, but none in its government. And, ultimately, the US dollar is the issuance of government”.

    I could also drone on about China and India wanting to establish themselves as “top nations”. For this, more gold reserves would add to their credibility. So, gold it is for now!

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  • Some of you guy’s might also find this article of interest http://www.fundweb.co.uk/fund-strategy/issues/2nd-may-2011/tight-focus-presents-a-false-picture/1030141.article

    Here is the trailer – “The author examines the possibility of a “dollar crash” in a country that has exploited its strength, but he ignores questions of why and how America messed up its economy and accumulated debt. The uncertainty over the fate of the dollar as the world’s international reserve currency encapsulates some of the key economic changes taking place today”

    There is also Barry Eichengreen’s publication – Exorbitant Privilege: the Rise and Fall of the Dollar

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  • Alan,

    Depending on a variety of factors, the price of gold will always tend to oscillate around a central value, over the longer term.

    It does not make money, it pays no dividend, it has no coupon. The amount of gold ‘above ground’ has been growing faster than the world’s population since the price was less than half what it is today; and the mining rate is to a large degree determined by the gold price, as much of the extractable gold can only be viably mined when the price is high.

    However, there is a significant time lag between the gold price rising, and more being extracted; so one can expect production to be rapidly ascending at present.

    Taking these factors together, the current price of gold is probably over twice the central value – a value that it will, in time, fall below again.

    The price of gold might now spike high as it did 30 years ago, but there is no certainty of that. Importantly, when the price did spike high before, the number who sold at the peak was tiny compared to those who saw their holding collapse in value.

    If you are going to play with gold today, you need to be absolutely clear – as Soros was – about the price at which you will sell..

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  • general congreve says:

    What we have to remember is that the price gold is today is exactly the same as it was only about 5 or 6 weeks ago. It had a quick sprint to $1575 and fell back almost as rapidly to where it started. Similar story with silver. It is a pattern of ‘make new high, fall back sharply, consolidate, then steadily establish and maintain new high near previous high’ that I have witnessed many times before in this bull market. Also bear in mind the Sterling price has been much more resilient and have hardly budged back down at all.

    @6 – It will work until it doesn’t. Don’t get greedy. Remember gold and silver (especially gold) is about wealth protection first and wealth accumulation second. Don’t get caught with your pants down. When the next crisis comes, it will probably happen in a matter of hours, without warning. Trading in and out of a gold position (especially if it’s a core physical position) is like picking up pennies in front of a steam roller. I wish you all the luck with your trades, but I firmly believe that luck must run out at some point and if you’re on the wrong side of the trade, it won’t be pretty.

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  • GC
    Sorry, for some reason I haven’t been able to log into the comments until now.

    I understand where you’re coming from, but also feel, perhaps as Soros does, that Gold and Silver are fairly high at present. My ‘trading’ stand point on it may seem aggressive but it’s actually conservative IMO to lock in some gains.

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