Another Billionaire Goes “All In” on the Barbarous Relic

Crispin Odey

Now another billionaire investor is putting a lot of money into gold-based investments, and explained why in a recent management letter to his institutional clients.

Here’s the report from Zero Hedge and The Dollar Vigilante:

“Billionaire Crispin Odey recently released a management letter to his hedge fund clients praising gold and explaining gold products constituted the next, great investment wave.

“Odey has now taken a significant position in Kinross Gold Corporation, purchasing 15.5 million shares of the Canadian gold-mining company, valued at $75.7 million on June 30. But it is his recent management letter where he speaks about gold historically that should get your attention:

In a world where $13 trillion of bonds are negative yielding, where $4 trillion of investments are in ETF’s, is it wise that only $1.5 trillion of savings are invested to protect investors against a change in the weather?’

If we are at the limits of QE and financial repression, central banks, in the developed world, are at least doing a very good job at printing money. Every chance is taken to push some money printing through. 

Carney was quick to take advantage of Brexit to keep up with his fellow central bankers. And this is where gold comes in. Gold was the original currency. It came out of distrust of governments and was chosen because it could not be manufactured at will. 

“‘Today there are around 300,000 tons of gold extant and each year around 2,700 tons are mined, or less than 1% of the stock of gold. 

“… Today, world GNP stands at $75 trillion and world money supply stands at around $85 trillion – some ten times its level at the start of the millennium.” 

A lot more paper fiat currency is being produced than physical gold. Odey is betting that eventually the “price” of gold against paper money will be revalued a lot higher.

We agree with Mr. Odey’s premise as it’s Economics 101: The supply of paper fiat currency is going a lot higher, while the supply of physical gold will remain relatively constant.

What do you think about Crispin Odey’s “all in” bet on gold and gold-related investments?

Share your thoughts in the comments section below.