John Paulson on Gold

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Hal
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John Paulson on Gold

Post by Hal » Mon Aug 30, 2021 5:48 pm

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D1984
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Re: John Paulson on Gold

Post by D1984 » Mon Aug 30, 2021 8:19 pm

I don't know if we will have higher inflation than the markets are predicting right now.

I don't know if gold will do well, badly, or kind of meh in the future.

I do know that John Paulson was an inflation hawk back in early and mid-2011 and made some huge bets (both with his own cash invested in his funds and also with the money of other investors in his hedge funds) on gold and gold mining stocks in the spring and summer of that year at what was near the 2011 multi-year price peak for gold miners and pretty close to the top for gold (gold itself would kind of fluctuate in 2012 but would not go appreciably above its mid-2011 highs). In some cases he even used leverage and/or derivatives to amplify the expected outcome of said bets.

The results:

https://www.institutionalinvestor.com/a ... on-in-2011

https://www.reuters.com/article/us-paul ... K920130507


Paulson did very well shorting subprime mortgages in 2007 and then well in again in late 2008 and 2009 by buying depressed gold mining stocks.

Apparently that caused some people (including maybe himself) to see him as an investing genius....rather than what he was; a guy who just made one or two very lucky in-the-right-place-at-the-right-time calls.

Given the above I don't know if I'd trust his advice/opinion on investing in gold (or anything else for that matter).
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Mark Leavy
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Re: John Paulson on Gold

Post by Mark Leavy » Mon Aug 30, 2021 8:35 pm

D1984 wrote:
Mon Aug 30, 2021 8:19 pm
Given the above I don't know if I'd trust his advice/opinion on investing in gold (or anything else for that matter).
I like to read these sorts of articles (thanks Hal!) for the information nuggets they bring to the table. I totally skip over the conclusions and analysis - because it is almost always flawed. But I do enjoy being exposed to a different set of data or an oblique question or theory.

These screeds are informative and interesting in the same way that technical white papers are. Examine the data and the experiment and the methodology and form your own conclusions - because the authors are either clueless or lucky or brilliant - and there is no way to know. But god bless them for collecting the data.
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Re: John Paulson on Gold

Post by glennds » Thu Sep 02, 2021 11:31 am

D1984 wrote:
Mon Aug 30, 2021 8:19 pm


Paulson did very well shorting subprime mortgages in 2007 and then well in again in late 2008 and 2009 by buying depressed gold mining stocks.

Apparently that caused some people (including maybe himself) to see him as an investing genius....rather than what he was; a guy who just made one or two very lucky in-the-right-place-at-the-right-time calls.

Given the above I don't know if I'd trust his advice/opinion on investing in gold (or anything else for that matter).
From what I can tell Michael Burry is the one character that came out of the 2007 crash with a fortune made from shorting the housing market, AND has also had a stunning continuing track record since.
Although I noticed he's placed huge short bets against Tesla and ARK Innovation Fund, and neither of those bets don't look very good right now.
Nobody has done well shorting Tesla but maybe he will be the one.
If not, it just goes to show following any of these gurus around carries its risks.
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