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Billionaire Stanley Druckenmiller Loads Up On Gold, Makes It His Largest Position For First Time Ever
Over the past several years, one of the biggest critics of the Fed's ruinous monetary policy has been billionaire investor Stanley Druckenmiller, who in 2010 announced he would be shutting down his legendary Duquesne Capital Management, and convert it to a family office. Yet, despite his constant drumbeat of warnings that the period of ZIRP/QE/NIPR will end in tears, he had yet to put money where his mouth was (aside for a brief period in mid-2012 when we bought a lot of GLD calls, only to unwind the almost instantly).
This ended on June 30, when following Friday's filing by the Duquesne Family Office, we learned that as of the end of Q2, the largest position for Stanley Druckenmiller was none other than gold, following the purchase of 2.9 million shares of the GLD ETF shares. In other words, as of this moment, gold amount to over 20% of Druckenmiller's total holdings.
In a world in which starved for ideas alpha-chasers do anything and everything that billionaires report they did a month and a half ago, we wonder if this marks the end of the relentless liquidation in the GLD, which recently hit a multi-year low, as a result driving the price of paper gold to multi-year lows even as physical demand has approached record levels.
So with Druckenmiller now back and strapped in for the ride, we wonder which other prominent investor will promptly follow?
h/t Shane Obata
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This may be a smart move especially if Yellen does not tighten in September. If you believe that things are starting to get hairy and knowing how the fed will react then interest rates aren't going anywhere. If that's the case, gold has a floor and the mining index will catch a serious bid. Now consider what the chances are that something is going to really blow in the near term that will send our economy into recession (a long shot? maybe not). That would mean more QE as the liquidity trap becomes blantantly obvious which would send gold soaring. The sentiment toward gold is very bearish but I'm watching the miners to stabilize, that might be the precursor . . . the next 30 days will tell.
He's loaded up of paper gold? This guy is a complete fool.
I see it as a matter of timing. He's a complete fool if he accepts a cash payout as COMEX contracts, and the fiat falls in relative value at that time. When gold becomes in vogue again, there will be a mega-horde of ignorant muppets with nary a clue to what's what! They've never heard of, spare having received even a single email dispatch from GATA as I have for over a decade. Fear and discussion as to what's "cool" should make this another 1980, waiting in the wings.
In other words, Stanley is losing his shirt.
He's not dumb, he's not looking for physical ( which he most likely already ownes) he looking to make a trade and make money, this is what traders do make money, or in this case lots of cash, of which he can turn into whatever physical asset he chooses.
How could this guy not know that GLD is a scam?
If you have more than a certain number of GLD shares, you can execute an agreement to take physical delivery, or so I read long ago.
If your not JPMCitiGMS or so, good luck with that.
Moarey loves hisself some paper gold. As for physical, well that's none of your business. Thank you very much!
Oh my.
But what if he says he is going to stand for delivery? Maybe he should go ahead and splurge a couple million on a vault just in case there's still some real gold left.
Buying GLD still means he's betting on gold. When gold goes up, lots of people buy will GLD even if GLD has no gold. For trading purposes, betting on GLD makes a lot more sense than betting on physical gold. GLD can be sold instantly for $10 commission. Selling physical gold is time consuming and expensive because every piece of gold needs to be checked for purity and weight, and you need to find a buyer who wants physical gold.
Ever consider taxation and counterparty risk....?
Tick tock, tick tock...
That chart has been modified. It says June 30, 2015 on both columns - which doesn't make any sense. I can tell where the image has been edited. Looks like GLD is playing us folks. If I can't hold it, shoot it, eat it or drink it - i don't fucking want it.
Unless he buys 20% of all the shares of GLD he does not have crap! I hope he is trying to amass 20% of all the GLD shares so he can then, as a top-5-holder of all the GLD shares, demand the physical.... then we'll see if he gets Fort Knox back in physical gold or if GLD is proven to be as worthless as most on ZH believe it is.
Unless he buys 20% of all the shares of GLD he does not have crap! I hope he is trying to amass 20% of all the GLD shares so he can then, as a top-5-holder of all the GLD shares, demand the physical.... then we'll see if he gets Fort Knox back in physical gold or if GLD is proven to be as worthless as most on ZH believe it is.
Too bad he doesn't demand delivery...
Paper v Physical. The only way AU and AG will go up legitimately (not a manipulated swing) is when a large enough percentage of people who hold them on paper demand delivery.
That is the ONLY way.
BTW - last week I placed another gold order from my favorite dealer - but was told there was a 'problem' but they would try to get the order out as soon as possible. I suppose the 'problem' was the fact that China has bought it all up, quietly, and there is none left?
Never buy a fund down from 180 to 106: the magnetic pull of that buck level will take GLD into the terrible twos, 80 and then 60, as the deflationary commodity collapse envelopes PMs, banks and credit:
http://bigcharts.marketwatch.com/quickchart/quickchart.asp?symb=gld&insttype=&freq=2&show=&time=13
Facebook is #2, so this guy clearly doesn't know what he's doing.
He doesn't have gold, he has a paper promise for gold. And if that promise cannot be fulfilled he will be able to sue a bankrupt entity.
You are being to hard on the Druck! Two months ago I posted where is that guy that likes to be a pig when there are so many naked shorts on Gold and silver. He just turned up on cue. This could get very interesting. Be happy, don't worry..... .
Oy vey goyim! Is Sunday night? Check. Is article goyim buy gold? Check. Is right on schedule? Check. Heh heh. We take gold under 1000. Last week? No. This week? Maybe. Before September 21? Yes! Everything abstract. Everything paper. Always make goyim confused. Make goyim think paper real. Make goyim think computer digits real. Kosher tribe always expert bait and switch. Kosher tribe expert make goyim believe what eyes see and ears hear be real. Hahaha! Make you think up is down, black is white. Be like billionaire. Stupid goyim always kill us with laughter. OY! OY! OY!!
I thought 100,000 shares permits conversion to physical?
Except they don't have it, so they won't.
Drunkenmiller has obviously been tasked (by the important people) with trying to add some credibility to paper gold...what else could possibly make sense?