{"id":36307,"date":"2013-02-20T22:33:55","date_gmt":"2013-02-21T03:33:55","guid":{"rendered":"http:\/\/countingpips.com\/forex-news\/?p=36307"},"modified":"2013-02-20T20:34:57","modified_gmt":"2013-02-21T01:34:57","slug":"why-would-you-ever-want-to-own-gold","status":"publish","type":"post","link":"https:\/\/www.investmacro.com\/forex-news\/2013\/02\/20\/why-would-you-ever-want-to-own-gold\/","title":{"rendered":"Why Would You Ever Want to Own Gold?"},"content":{"rendered":"

By Bill Bonner, billbonnersdiary.com<\/a><\/strong><\/p>\n

Stocks up another 53 points on the Dow yesterday. Gold down another $5.<\/p>\n

The Dow is above its 14,000 peak; gold is below $1,600\/oz.<\/p>\n

I’ll come back to this in a minute. First…<\/p>\n

Even a seasoned traveler can make remarkably dumb mistakes. That’s
\nwhy we are writing to you from Baltimore rather than from Beijing. For
\nthe second time in a single week, we got to Dulles International Airport
\nyesterday and discovered that we lacked the proper visa for travel to
\nChina. We had forgotten that you need a visa at all.<\/p>\n

You don’t always go where you intend to go, but you always end up where you ought to be. Why ought we be in Baltimore<\/strong><\/a>? We don’t know. But here we are.<\/p>\n

Getting Out of Gold<\/h3>\n

Even seasoned investors make mistakes too. And now they seem to be
\nselling gold. Yes, dear reader, our favorite metal is taking a beating.
\nGold has dropped below $1,600\/oz to trade at $1,594\/oz at writing. The
\nbest investors are said to be abandoning their yellow metal for more
\n“productive” positions. From Bloomberg:<\/p>\n

Billionaire investors George Soros and
\nLouis Moore Bacon cut their stakes in exchange-traded products backed by
\ngold last quarter as futures dropped the most in more than eight years.
\nJohn Paulson maintained his holding.<\/em><\/p>\n

The fourth-quarter decisions by Soros
\nand Bacon may bolster speculation that gold’s 12-year bull run is coming
\nto an end as economic data from the U.S. to China show signs of
\nrecovery, curbing haven demand.<\/em><\/p>\n

Soros Fund Management LLC reduced its
\ninvestment in the SPDR Gold Trust, the biggest fund backed by the metal,
\nby 55% to 600,000 shares as of Dec. 31 from three months earlier, a
\nU.S. Securities and Exchange Commission filing showed yesterday. Bacon’s
\nMoore Capital Management LP sold its entire stake in the SPDR fund and
\nlowered holdings in the Sprott Physical Gold Trust. Paulson & Co.,
\nthe largest investor in SPDR, kept its stake at 21.8 million shares.<\/em><\/p>\n

And under the headline “Gold Sinks Through $1,600 on Recovery Hopes,” the Financial Times<\/em> adds:<\/p>\n

Gold<\/strong><\/a> prices tumbled… for the first time in six months as investors turned to other assets amid hopes of an economic recovery.<\/em><\/p>\n

Recovery? The U.S., eurozone and Japanese economies are all
\n(according to the most recent quarterly results) shrinking, not growing.
\nWhat kind of a recovery is this?<\/p>\n

Nevertheless, mainstream opinion believes this is no time to cower in
\nthe safety of cash… or gold. Take chances. Buy stocks! Look at
\nBuffett. He’s teamed up with a Brazilian tycoon; they’re paying $28
\nbillion for a ketchup company.<\/p>\n

Dumb and Lifeless<\/h3>\n

Well, what do you think? Are they right?<\/p>\n

Why would you ever want to hold gold, anyway? It is dumb and
\nlifeless. It issues no upbeat press releases. It never “beats analysts’
\nestimates.” It doesn’t come out with a slick new handheld device… or
\nannounce a major acquisition.<\/p>\n

None of the good news you hope to get from an investment ever comes
\nfrom gold. No matter how much you own, it doesn’t seem to care about
\nyou; it makes no effort whatever to increase shareholder value.<\/p>\n

Instead, it just sits there… like an old umbrella next to the front
\ndoor, only useful when it rains. War? Gold goes up. Market crash? Gold
\ngoes up.

You must see this now or risk losing out…<\/strong><\/a><\/p>\n

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