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The Rumors Were True: Paulson Liquidates A Third Of His GLD Gold Share Class; Buys More Bank Of America And Capital One
Well, he may not be liquidating, and he may be telling others he has experienced barely any redemptions, but Paulson's gold share class, represented entirely by the fund's GLD holdings would beg to differ: as of September 30, Paulson's total holdings of GLD were down by a third from 31.5 million shares or $4.6 billion at the end of Q2, to 20.2 million or $3.2 billion. And as is well known, GLD is not an actual investment for Paulson, but merely a representative asset class for those who opt to have their fund holdings represented in gold (the smart ones) instead of in dollars. Indicatively the only Paulson & co investors who made any money, or at least did not lose much, were those who opted for a gold share class. Either way, it is now safe to assume that at least a third of the fund has been permanently redeemed, further confirmed by the drop in the AUM from $29 billion to $20.7 billion as per the actual filing. But wait, there's more: while Paulson was busy selling across the board, in the process liquidating all of his JPM holdings as well as his positions in Comcast (no CNBC for you), Savvis, NYSE Euronext and State Street, and following in Tepper's footsteps in selling across the board, the former Bear trader did what all other allegedly doomed institutions do and added to, you guessed it, the biggest loser Bank of America, increasing his position by almost 4 million shares... even as the total value of his 64 million BAC stake, which closed Q3 at the same price it is today, dropped by $269 million! And that's why he is a billionaire and you are not. At least we know who Tepper was selling to. But that's not all: Paulson also added 1.1 million share to his CapitalOne position, bringing the total to 22.2 million shares, even as the total value of his revised position dropped by $210 million to $880 million. And so forth. Some other names in which he took brand new stakes in (picture that: he did not spend all of Q3 selling) in Motorola Mobility, Nalco, Cephalon, AMC and a bunch of irrelevant others. So to all those who are now in the same place they were in 2008: tough, but at least your fees made JP into a multi-billionaire. Congratulations.
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Whale watching the misled gold dumper
But Why?
Why what?
The Dick Bovine school of trading.
US Gov to Paulsen: Buy BAC or we'll "revisit" that Abacus/Goldman shit!
For all we know he could be taking his GLD money and buying real gold.
No. Can you say margin calls? When you're a leveraged hedgie you sell what you can, not what you want when the margin clerk comes callin'. Selling GLD, at least you get to book SOME profits for the qtr.
My guess: anticipation of Dilution Day
www.pmbug.com
Some comments by a US trader on gold.
Says paper to physical is now 110 to 1.
http://goldandsilverlinings.com/?p=1731
Shit, does he and Celente take the same hallucinogens?
But why?
Because he can... and BAC represent a better ROI /LOL /sarc
Maybe it's a George Costanza thing..., you know, just do the opposite!
JP is laughing all the way to the bank....just not the ones he's invested in......
do nothing
BAC and Capitol One. I cannot believe that. This is a really smart guy. He now owns Countrywide and Merrill. Oh my. I think I will stay with my simple thinking and not go there.
What's in yerrrrr wallet?
Mines filled with 2/3 gold, 1/3 silver (bullion and miners.....)
:)
I am right next to you JohnG. And a few miners to sweeten the pot..
I smell another taxpayer government bailout of the TBTF banks coming soon
Throwing bad money after good?
...isn't it by now bad money after bad?
Not sure this was the smartest move I've ever seen. But hey, that's why we have markets. I'm sure he thinks BAC is TBTF so WTF. The Bernank put in all its glory is on display for the world to see. When this turd gets liquidated at 0.02 I think I'll be snickering and wondering again: WTF - why?
http://vegasxau.blogspot.com
Paulson is TBTF, the taxpayer will essentially be bailing out his positions.
So, the lesson from this quarter's whale watching: Buy BAC and HFC. WTF???
Looks like a classic case of doubling down. Sell the winners and pile onto the losers. This will end badly for them. Redeem everything now.
I believe the correct term would be double-up and throw up. But I suppose anyone who's stayed with Paulson this year will get what's coming to them.
Wow, what a rookie move, averaging his losers. It'd be very interesting to see his entire position statements as this is his long only positions.
Is it April 1st?
He was directed to do so by the Empire
How Corzine-like.....
Paper gold...Who cares!!
Capital One ... astonishing to me they have that quite insidiously double-meaning advertising slogan:
'What's in YOUR Wallet?'
Always suggested to me that the bank wanted to TAKE what was in your wallet.
Commercials seen in the UK as well as the US, whole bunch of them on YouTube. One of them even with pirates, Bluebeard-style, 'Aaargh, what's in your wallet?'
Fits some banks well.
Transfer from one tool to another by another. Paulson is no god, he's just another fuckshite.
Would have been better changing GLD in Cobra!
No one as smart as he is, does this without a backstop.No one.
Maybe the backstop is they promise not to bring charges against him for the ABACUS deal?
Maybe he just bought some of the real deal. Doesn't make sense holding a piece of paper that can't deliver and he knows it.
Fuck paper
Fuck equities
Fuck bonds
Fuck tbills.
Expensive wallpaper, gold however makes an expensive paper weight.
Has he looked at the 30 year chart of BAC? It hit a wall in 08 at high speed and is just bouncing down the road to zero. "It's dead Jim." The FED keeping it alive?
I know. Contrarian. Billions etc.
Trade war about to go hot on Obama "China gaming the system". USD bid, stocks down and Paulson should not underestimate China's liquidity issues. China goes, should take out the idea of a QE3 stock bull run.
Obama "gaming" quote
http://www.huffingtonpost.com/2011/11/14/obama-on-chinese-economy-_n_109...
ZH, check wires Brazil is also tag teaming with US on a China trade war beatdown. Tasty.
One for the banksters and the ink jets
I just don't see how BAC survives in its present form.
I'd love to hear how much their deposits have decreased in the last 60 days.
Too bad earnings aren't due. Should be able to ferret out something from that unless they start double counting accounts.
Would not surprise me in the least if they did.
Paulson sez: If you can't beat them join them.
selling the winners to make up for the losers........eventually leads to the walls are closing in on paulson
How about selling your losers and doubling up on your winners?
Hey don't say that...far too much sense. Paulson might read it and then things start moving again.
How to make a millionaire ...from a billionaire!
Reeks of desperation!
I'm reminded of the Mr. Show sketch, "more money means better" -- So, because he's a billionaire, Paulson's better than you!
But seriously, paper gold is better than the paper nothingness of BAC... He's gone full retard.
BWAhahahahahahahahaha! AaaaRrrrrgggggg mates! He's made a fools move, prepare to cut down his rigging and board that bastard.
Yarrr, it's drivin me nuts!
Best. Punchline. Ever.
Nuttier than a 6 balled tomcat.
That's all I got to say about that
Nuttier than a 6 balled tomcat.
Well played, sirrah, well played indeed.
Well, shit, why didn't he just buy up some Netflix shares? They're probably going to last longer than BAC and COF.
On a side note, this is scary shit. Who else out there is doing this sort of thing? And when these institutions come crashing down, what will be the effect? I can't believe that sane people are still dumping money into these zombie institutions. It's deranged is what it is ... and very frightening. I mean sell gold to buy BAC??? WTF is that?
Yeah, it makes absolutely 0% sense. Unless he plans to profit on expectations. Say, a bunch of whale watchers think he knows something they don't, and decide to pile on and buy into BAC. Price goes up. He promptly sells. PROFIT!!!
.. or am I just being obtuse?
I can understand that line of thinking, and it makes sense to me. So by simply taking a big position in a certain stock, he causes the stock to go up in value and thereby profits. I have to say, though, that I come at this whole thing from a fundamentals perspective (as an engineer by education). That's why I don't consider motives like this. And that's why I'm not a professional trader in this market. This market is not trading on fundamentals of capitalism. It is, instead, trading on the whims of human emotion and sentiment, neither of which is predictable. Perhaps a degree in psychology is more valuable to today's traders than anything else.
Yes, that is very much the case. We have entered a rather rarified space, "..where no man has gone before". Quantum Trading! I am reminded of how the laws of physics break down and have basically no revelance when one reaches the quantum state. That's kind of like where the Market is now. All normal operative laws have gone straight out the window. Anything goes! Anything can happen! Expect the unexpected! So, yes. Normalcy has broken down. The ID, the unconcious now rules. Perhaps like a herd beast. Hmmm... perhaps I should stop now while I'm ahead..
"Who else out there is doing this sort of thing? "
Buying BAC? Warren Buffet?
"I mean sell gold to buy BAC???"
Please, do not mistake GLD (paper shares where someone promises to have gold for you) with the bullion you can store yourself. Not the same stuff. He sold paper to buy more paper, but with a different name on it.
Please, do not mistake GLD (paper shares where someone promises to have gold for you) with the bullion you can store yourself. Not the same stuff. He sold paper to buy more paper, but with a different name on it.
Oh certainly. I would never mistake GLD for physical. And yes, GLD is really nothing more than paper. But in principle, it represents an asset that will undoubtedly only appreciate in value as various forms of "quantitative easing" continue. Unless, of course, Paulson knows something we don't. Perhaps he knows that the paper market is about to go up in flames and skyrocket the price of physical. But I doubt that. Probably just following the herd, the conventional wisdom. He'll get burned again, my stash will gain value.
"Unless, of course, Paulson knows something we don't."
This is what I'd bet on. Remember, only the largest investors (such as Paulson) were able to receive physical in exchange for their shares. Could be that a little birdie told him that the time for holding paper that is rumored to outnumber actual physical quantities has come to an end, and best to convert it to a more protected investment. Although BAC appears to be in flames, they are still the largest bank (by deposits) in the U.S. Being the first to fail also protects their depositors as they would probably drain the FDIC instantly, and all others that hold counter party risk will go up in smoke - and their depositors are screwed. So, while it looks strange to hitch your future to s stumbling giant, there may be method to his madness.
I think it was a credit to JP that he was able to retain 2/3 of his GLD, given that it was the only winning position...and the fact that his (smarter than he) customers probably forced him to keep it and gas the others.
So Pelousy gave him some inside info; so what, peons?
"Reeks of desperation!"
It might or he is in the loop and the London metals exchange and comdex are about to explode then paper gold will be wortless,and benny and the ink jets are going into high gear to rescue tho banksters again
So... he's getting word from congress that they gonna start another TARP or what?
I got a feeling the hedge herd doesn't know what it's doing. Sell something good to buy something bad. QE3 or no QE3. Buy gold/Sell gold. Where's leader Ben to point everybody in the right direction. Once we get past Jan. 1, 2012 I think we are going to get QE3. High unemployment and deflationary fart vapors will be the reason.
johnnie boy sees the ss deflation heading to shore
Kyle Bass is buying homebuilders or whatever and Paulson added to BAC. Something stinks.
Chaos does have a distinct odor, doesn't it?
Good point fonzanoon, did not think of that....QE3 known just to the ones that care??
Of course, then gold would go ballistic as the dollar headed closer to the abyss, so why sell your gold? We will know soon enough and am sure Zero Hedge knows how to turn most of the filthy rocks and follow the stench for the answer for us. And we send Zero Hedge donations. Like it.
bunch of ex bear people at BOA - Paulson ex Bear person - Got to be a idiot to buy the stock unless one of his buddies tipped him off.
A guy I know bought a shitload of BAC, his reasoning? "Its undervalued and cheap man" My retort was "its cheap for a reason you effin dumbass"
yeh and a lot of people bought enron when it was going down thinking it would come back......
Only after their divestment of their WorldCom stock but lucky thing is most of those people enjoyed the spoils of BreX first by capitalizing on their Savings and Loans bonds issued during the 80's...
Do people ever learn? No. No they don't. Amazes me how dense the MSM is about the whole thing.
Buy it if it gets down to a buck and a quarter. I lost my ass on MCI, Global Crossing, AtHome, K-mart - I'm due to get lucky betting on a penny stock.
Even if they did QE3 and threw money out the window the last place I would invest it is in BAC. It makes absolutely no sense. Did Paulson go full retard? I think it's possible. Some people just get so full of themselves they are convinced they will be right.
selling gld and buying boa and cof ? is this prudent?
Double down baby! OPM, it's a wonder to behold.
It's a call option at this point.
So funny that this should be such a mystery to so many. I get a kick out of the fact that so many on this site were running for the hills for the last two years with all of the liquidity of QE behind the markets. Now that the banks are absolutely decimated and offer some valuations of less than book value in most cases, why should it be a shocker that a hedgie such as JP would be willing to play that leverage with huge margins of safety priced in?
It was safer to fly on September 12th, same goes for the banks...
And as is well known, GLD is not an actual investment for Paulson, but merely a representative asset class for those who opt to have their fund holdings represented in gold (the smart ones) instead of in dollars.
I don't know...sounds like that's just a final, 100% of NAV leveraged bet on gold on top of whatever else the fund is positioned in (and levered up to). If Paulson is buying say, gold miner stocks with dollars and then hedging that dollar share price exposure with gold - that seems like a lot of friction genrating tail chasing.
But BAC....still....yikes. Pricing in gold won't make shit shine.
I don't think these guys know what the f*ck they are doing. Still can't believe they actually think a money print job will rally markets this time. The end is very close. And it aint Europe, although EZ will set it off...it's China. Defaltion/economic ice age from hell.
Take it...
and we have some CNY and CNH selling. Nice Asian bear signal for Europe/US opens.
like clockwork:
*The PBOC cuts the one-year bill yield in Tuesday's open-market operation for the second week in a row, signaling that Beijing is allowing monetary conditions to ease further.
There goes China.
Now the official race to the bottom...
this is a train coming off the tracks.. or is it? if Europes Banks Burn (along with their U.S. counterparty's) which banks would be left standing? which Banks would Bernake pump up? Is Paulson crazy? we all know better than that!
Averaging d(r)own? 'Cause that's some mighty bettin' on opening ta(r)ps.
Well......
US Banks should see Euros comming in
Buffett bought/invested in BOA follwing a trip to the white house
Us banks fail - everyone fails, should see bailouts as the host country can print and is the reserve currency
Computer generated printed backstopping not real currency in the system generating high inflations. Regulation and tough lending qualifications keeps velocity eased.
but I like Tepper so WTF? grabbing popcorn while some powder is dry and some is shiny.
QE Infinite is coming to Amerika. Probability for that is at 100% confidence level.
Sells paper gold..........sell the wind.
https://www.kitcomm.com/showpost.php?p=1573092&postcount=26
As a small trader who was told in 2008 that he could not short the banks I am upset. The propaganda machine has made a hero of Paulson. The man Paulson should be convicted of insidere tradiong. The CDO ABX scam where Goldman (TBTF) conspired with Treasuary and FED to protect the syntetic derivatives releated to both credit and housiong. The TBIF levered then sold back to GSE or other insurance fraud schemes creating a massive paper gain for the few deeply currupting any pretex of a free market. When you run fiat and the true meaning of "TRUST" is apparent. Now in my opinion BAC was forced into the CountryWide purcahse (probally discount window funds) putting not only the highly overpriced housing (defined as more than 3 times average income) and the highly levered derivative issued to the TBTF's. http://www.occ.gov/topics/capital-markets/financial-markets/trading/derivatives/dq111.pdf . Paulson both John and Hank told America to "TRUST" to protect the paper holders which were sovergns (both countries and state pensions) to cover up the crimes of in the know credit manuplitation of enterprise. That is where we are at... Now the choice that would make the market fuction and change the (Trust Me ie f%ck you) to a Webster Trust ( a: assured reliance on the character, ability, strength, or truth of someone or something b: one in which confidence is placed) . We don't need TBTF we need healthy sector rotation out of housing, financials, warfare and medical. We don't need Japan solutions.
Operative word of free market people should be "clawbacks".
The Rothschilds, and that class of money-lenders of whom they are the representatives and agents - men who never think of lending a shilling to their next-door neighbors, for purposes of honest industry, unless upon the most ample security, and at the highest rate of interest - stand ready, at all times, to lend money in unlimited amounts to those robbers and murderers, who call themselves governments, to be expended in shooting down those who do not submit quietly to being robbed and enslaved. Lysnadre Spooner from No Treason