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PIMCO, Texas Teacher Retirement System, Soros Buy GLD; Paulson Sells

Tyler Durden's picture




 

From GoldCore

PIMCO, Texas Teacher Retirement System, Soros Buy GLD; Paulson Sells

Gold’s London AM fix this morning was USD 1,725.50, EUR 1,309.88, and GBP 1,099.33 per ounce.

Yesterday's AM fix was USD 1,721.00, EUR 1,303.10, and GBP 1,091.80 per ounce.


Currency Ranked Returns – (Bloomberg) 

Gold ticked higher in Asia to $1,730/oz but has again shown weakness in early morning trade in Europe and is trading at $ 1,725.90.

Gold is being supported by the never ending Greek debt saga and increased tensions between Israel and Iran which has seen US crude rise above $101 per barrel.

Gold continues to consolidate between $1,700/oz and $1,763/oz. After the strong gains seen in January, more consolidation at these levels may be necessary prior to gold challenging $1,800/oz.

Significant macroeconomic and geopolitical risk and the appalling fiscal state of most major industrial nations means that all fiat currencies will almost certainly fall against gold in the coming months.

These risks have led to total gold ETF holdings rising to near record levels and the SEC filings make for interesting reading.


Cross Currency Table – (Bloomberg) 

While much of the focus has been on Paulson & Co., the hedge fund founded by billionaire John Paulson, cutting its stake in the SPDR Gold Trust by 15% in the fourth quarter, possibly of more importance is the fact that PIMCO, the Texas Teacher Retirement System and George Soros all increased their holdings of the biggest exchange-traded product backed by gold.

Paulson cut his gold ETF bullion holdings by about 600 million dollars in Q4, a reduction that was likely driven by client redemption needs as he and his fund remain upbeat on gold – primarily due to inflation concerns.  

Paulson’s reduction in SPDR was offset by other important buyers such as PIMCO, which oversees $1.36 trillion and is home to the world's biggest bond fund and significant institutional buying from the likes of the Texas Teacher Retirement System and billionaire investor George Soros.

‘Bond King’, Bill Gross recently wrote about gold as a “store of value” and PIMCO’s allocation to GLD may be ongoing as they seek to diversify their portfolios and hedge against inflation.

Soros, who once suggested gold was or would be "the ultimate asset bubble," raised his stake in the SPDR Gold Trust (GLD), a gold-backed exchanged-traded fund, to 85,450 shares, up from 48,350 shares in the period. Soros, who had disclosed call and put options on the gold fund in the prior period, reported no such investments in the fourth quarter.

Soros’ GLD position is worth a mere $13 million, however it suggests that he is not as bearish on gold as portrayed and that he sees further upside for gold.

Eton Park Capital, run by Eric Mindich, retained its stake. 

Vinik Asset Management, the Boston-based hedge fund founded by Jeffrey Vinik, who formerly ran the Fidelity Magellan Fund, held 2.6 million shares in the SPDR gold ETF as of Dec. 31, down 775,000 shares from the end of the third quarter.

Tudor Investment, the $11 billion hedge fund based in Greenwich, Connecticut, sold in entire stake of 200,000 shares of the SPDR gold ETF. Patrick Clifford, a spokesman, declined to comment.

Steven A. Cohen’s SAC Capital and New York-based Touradji Capital Management LP cut SPDR gold positions.

SAC Capital, which manages $14 billion and is based in Stamford, Connecticut, held 179,601 shares, compared with 184,601 in the third quarter. Jonathan Gasthalter, a spokesman for SAC Capital, declined to comment.

Touradji Capital, founded by Paul Touradji, sold its entire stake of 45,000 shares in the SPDR gold ETF. The hedge fund bought the securities in the third quarter. Leslie, also a spokesman for Touradji, declined to comment.

Lone Pine Capital LLC, the hedge fund run by Stephen Mandel Jr., acquired 3.75 million shares of the SPDR gold ETF. 

Stevens Capital Management Holdings Ltd. sold its entire stake of 77,019 shares in the SPDR gold ETF. GLG Partners LP sold its full stake of 94,675 shares.

Overall holdings in the SPDR Trust rose nearly 2% in the fourth quarter, following a 2% gain in the third quarter. 

Gold ETF holdings increased even though the price of bullion fell around 4% in the fourth quarter – showing how ETF gold demand is just one facet of global investment demand and demand for physical bullion from investors in Asia and internationally and from central banks remains more important than ETF demand.

Global holdings in exchange-traded products backed by gold were 2,390.7 metric tons, approaching a record high, according to Bloomberg data. They rose 4.8 percent in the fourth quarter and 7.8 percent in 2011. Central banks around the world added 157 tons to their holdings in the six months ended Nov. 30, World Gold Council data show.

The SEC GLD data shows that diversification into gold continues by some of the largest hedge funds and institutions in the world. 

It is worth noting that some hedge funds and institutions are on record as having sold their GLD holdings in order to own gold bars in allocated accounts.

This was done in order to avoid the transparency and scrutiny that comes from owning the GLD (quarterly SEC filings). Others such as Kyle Bass and David Einhorn have bought gold bars in allocated accounts due to concerns about the significant counter party risk in the world today. 

UBS point out that looking solely at SEC GLD data as a guide to sentiment towards gold may be deceptive as “it could very well be the case that exposure to gold is merely transferred to other less-visible channels”.

Bullion dealers internationally have seen a significantly increased preference for gold bullion (coins and small and large bars) in allocated accounts in recent months – especially in the aftermath of the MF Global fraud and theft of clients assets. 

Given the degree of counter party, re hypothecation and systemic risk in the world the preference for outright legal ownership of real physical metal is set to continue in the coming months.

This will rightly lead to an increased preference for legal ownership of bullion coins and bars over exchange traded vehicles and trusts with high levels of indemnification and significant counter party risk.

OTHER  NEWS
(Bloomberg) -- Shanghai Futures Exchange Lowers Gold Margins to Boost Trading
The Shanghai Futures Exchange, China’s biggest metals bourse, lowered the margins on gold for trading the contract in the final month before its expiry to boost volumes and attract more investors.

The margin requirement, or the minimum amount of cash that investors must keep on deposit, will fall to 10 percent from 15 percent from the first trading day of the month before delivery, the Shanghai exchange said in a statement on its website. The margin is also lowered to 20 percent from 40 percent for the last two days before the final trading day of the contract.

Margins for contracts are initially set at 7 percent from the day they are listed on the bourse, according to the statement. The changes will be effective from March 1.

“The exchange’s move is aimed at boosting trading at a time when volatility seems to have been tamed,” Zuo Xichao, manager at Beijing Antaike Information Development Co., said by phone from Changsha today. “Lower margin requirements will make these investments easier and more attractive because trading now requires less money to be locked up.”

Gold futures on the Shanghai exchange gained 3.4 percent in 2011, climbing for the third year, as the escalating debt crisis in Europe, slowing economic growth in the U.S. and rising inflation in China boosted demand. Still the yuan-denominated gold futures gained less than the 10 percent increase last year in the spot-delivery gold traded overseas.

The June-delivery contract in Shanghai gained 0.5 percent to 352.18 yuan a gram today.

SILVER 
Silver is trading at $33.76/oz, €25.67/oz and £21.49/oz. 

PLATINUM GROUP METALS 
Platinum is trading at $1,636.00/oz, palladium at $681/oz and rhodium at $1,500/oz. 

NEWS
(Reuters)
Gold firms on hopes of Greek deal‎

(Bloomberg)
Soros Increased Stake in SPDR Gold Trust in Fourth Quarter

(BusinessWeek)
Paulson, Vinik, Tudor Sell SPDR Gold ETF Shares; Soros Buys

(Reuters) 
Paulson cuts gold ETF more in Q4, upbeat view stays‎

(MarketWatch)
Gold ends lower, logs third-straight session loss

COMMENTARY
(Moneyweek)
Bonner: Tune out. Buy gold. Be happy.

(Adam Smith Institute)
The Government Bubble

(GoldSeek)
Monetary Inflation versus "Price Inflation"

(ZeroHedge)
Jim Grant On Gold-Backed Bonds And 'The Hope Leeches'

 

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Wed, 02/15/2012 - 09:09 | 2161184 EBR MOD 0
EBR MOD 0's picture

first, bitchezzz

Wed, 02/15/2012 - 09:26 | 2161259 Pladizow
Pladizow's picture

From what I read, none of them bought gold, they all bought PAPER!

Wed, 02/15/2012 - 09:27 | 2161263 Sean7k
Sean7k's picture

The better to be JPM proxies my dear...

Wed, 02/15/2012 - 10:34 | 2161329 Ag Tex
Ag Tex's picture

@ Pladizow:  In a recent interview, Kyle Bass, a fiduciary for the Teachers Retirement System of Texas, stated they took physical delivery of the gold.  The above indication of ETFs could be a newly acquired paper position in addition to the actual physical holdings.

http://www.youtube.com/watch?v=UQTa66gCggY  

Wed, 02/15/2012 - 10:42 | 2161573 Kobe Beef
Kobe Beef's picture

Let's hope so. GLD ain't gold. Furthermore, since so much gold is already in the hands of Int'l Bankers and can be manipulated as such, a silver currency/platinum reserve combo would suit the Second Republic better.

Your thoughts?

Wed, 02/15/2012 - 11:14 | 2161727 HoofHearted
HoofHearted's picture

Between Kyle Bass and me, we've got a lot of the physical gold...and more than 20.0001 million nickels too.

Wed, 02/15/2012 - 12:36 | 2162180 Kobe Beef
Kobe Beef's picture

Amen. Keep the good things coming, Hoof.

Wed, 02/15/2012 - 09:33 | 2161283 chubbar
chubbar's picture

If they are smart they would keep a small, but publically noted, position in paper gold and a LARGE off balance sheet physical position in actual gold. That's how I'd do it if I were trying to maintain a public posture of supporting the current paradigm and being a prudent investor while privately knowing it is about to collapse. I wouldn't count on any of these insiders being offside on gold when the ponzi collapses.

Wed, 02/15/2012 - 09:49 | 2161361 LedMizer
LedMizer's picture

Thus the headline, GLD

Wed, 02/15/2012 - 09:10 | 2161188 qussl3
qussl3's picture

“The exchange’s move is aimed at boosting trading at a time when volatility seems to have been tamed,” Zuo Xichao, manager at Beijing Antaike Information Development Co., said by phone from Changsha today. “Lower margin requirements will make these investments easier and more attractive because trading now requires less money to be locked up.”

 

LOL

Wed, 02/15/2012 - 09:13 | 2161203 disabledvet
disabledvet's picture

we sold our stake last year. ironically...right at the high. not that this should matter to the TD's..."GLD is bs" is pretty well known in these here parts.

Wed, 02/15/2012 - 09:16 | 2161212 Dorky
Dorky's picture

Gold, gold, gold. It is the next global woe after oil.

Wed, 02/15/2012 - 09:16 | 2161214 Dr. Engali
Dr. Engali's picture

Soros almost double his shares in gold. It's funny how they do the extract opposite as they say. It's even funnier how people believe them and don't realize they are trying to talk down a position to get in.

Wed, 02/15/2012 - 09:27 | 2161260 Hi Ho Silver
Hi Ho Silver's picture

Yeah that bitch has been running all over the world shooting off his mouth about how much gold sucks. So Soros now agrees with Glen Beck. Fucker.

Wed, 02/15/2012 - 09:17 | 2161219 The Axe
The Axe's picture

Thats an odd-lot for George S,,,,

Wed, 02/15/2012 - 09:22 | 2161236 Zero Govt
Zero Govt's picture

Does the Texas Teacher Pension Fund know GLD is a JP Morgan product?

Do they know the Gold in GLD is a hypothacated derivative of gold leaf from a fag packet??

Who put these morons in charge of teachers pensions, was it Goofy, Daffy Duck or Mickey Mouse?!!

Wed, 02/15/2012 - 09:28 | 2161254 goldfreak
goldfreak's picture

but didn't Soros say gold was the ultimate bubble?  or was that not what he didn't tell Old Warren secretly but he told others ?

Wed, 02/15/2012 - 09:25 | 2161255 Sean7k
Sean7k's picture

gold, gold, the invisible loot

the more you buy

the less you toot

the less you toot

the more you conceal

So let's buy gold 

cause it's a steal

Wed, 02/15/2012 - 09:25 | 2161256 Slartebartfast
Slartebartfast's picture

They're just doing as their told.  Buying the uber worthless GLD to try to attract suckers back into the tent after MF Global scared them off.  Same reason CME dropped margins last week.  Nothing to see here but more Wall Street cat herding.

Wed, 02/15/2012 - 09:27 | 2161265 ratpack1968
ratpack1968's picture

If I'm not mistaken, the Teachers Retirement System of Texas (advised in part by Kyle Bass) took physical delivery of their gold.

Wed, 02/15/2012 - 11:16 | 2161735 HoofHearted
HoofHearted's picture

You get enough shares of GLD and you can do exactly this. Turd has been talking about high premiums to get a large delivery of the phyzz, so maybe this is a way to circumvent that premium.

Wed, 02/15/2012 - 09:27 | 2161266 RobotTrader
RobotTrader's picture

Looks like Paulson is throwing in the towel on GLD and Anglo-Gold and buying AAPL instead.

 

Can't blame him, most of the gold bugz are absolutely disgusted with the gold action and gold stocks have been hands down the worst investment of the last 2 years.

Might as well join the party and ride AAPL up to Cramer's target of $800.

LOL....

Wed, 02/15/2012 - 09:30 | 2161274 goldfreak
goldfreak's picture

poor robot....

Wed, 02/15/2012 - 09:29 | 2161267 Dermasolarapate...
Dermasolarapaterraphatrima's picture

 

 

 

Northwestern Mutual Makes First Gold Buy in 152 Years (Update2)

 

“Gold just seems to make sense; it’s a store of value,” Chief Executive Officer Edward Zore said in an interview following his comments at a conference hosted by Standard & Poor’s in Brooklyn. “In the Depression, gold did very, very well.”

(Bloomberg) -- Northwestern Mutual Life Insurance Co., the third-largest U.S. life insurer by 2008 sales, has bought gold for the first time the company’s 152-year history to hedge against further asset declines.

 

http://www.bloomberg.com/apps/news?pid=newsarchive&sid=aByZIkH6PwkI

Wed, 02/15/2012 - 09:32 | 2161280 Ganja Jane
Ganja Jane's picture

GLD goes down, and gold goes up.  One is worthless, one is priceless.  Decoupling, bitchez.

 

Wed, 02/15/2012 - 09:39 | 2161312 kito
kito's picture

I'll trade you some gld and my crackerjack toy for some of your u.s. t bills.....

Wed, 02/15/2012 - 09:50 | 2161362 EBR MOD 0
EBR MOD 0's picture

Robo and Cramer in the same comment block, now there is a winner, ya reckon.

Wed, 02/15/2012 - 12:06 | 2162014 junkyardjack
junkyardjack's picture

I bet they wish they bought AAPL instead

Wed, 02/15/2012 - 12:24 | 2162118 Arkilokoos
Arkilokoos's picture

If you are going to buy paper gold, is there any benefit to Sprott PHYS  vs. GLD???

Wed, 02/15/2012 - 15:05 | 2162886 WallStreetRanter
WallStreetRanter's picture

All the talk is always about GLD and sometimes SLV. But what about platinum? PPLT? More rare than gold and currently cheaper.....

The Wall Street Ranter

Wed, 02/15/2012 - 15:44 | 2163050 Chuck Walla
Chuck Walla's picture

Soros lies until his position is on?  Well, who'd a thunk it?

Thu, 02/16/2012 - 06:26 | 2165199 boogey_bank
boogey_bank's picture

I don't think Soros is a liar or a bls seller. When he said that gold will be the ultimate bubble he was misunderstood. I think he wanted to say something like: if gold falls than sky will fall. Needless to say, the sky will not fall, at least for usd and treas and gold etf owners (in the short time horizon) and  phys gold owners (in the long time).

Finally a question for zhers: In the central banks balance sheets you can find every kind of crappy things like mbs, unicorns assets marked to mith, soccer players and a small quantity of gold. Why isn't there something like physical silver too?

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