Something startling was uncovered on Wall Street.
And it could mark the beginning of history’s greatest ever wealth transfer…up to $131.77trillion of paper currency hurtling towards gold.
I’m not telling you this as investment advice.
You make up your own mind. But I get unending flack from my pals who swear by the S&P500…the Dow…Property…Bonds…Anything right now that’s in a blatant bubble.
Yes, I’m a gold bug.
But it’s an obsession that’s been paying me a tidy return these past couple of years. And when I saw the research uncovered by fellow gold-lover Mike Maloney, I was even more convinced that gold is set to go higher. Perhaps much higher.
As revealed in this short video…
…In a survey of 6,500 hedge fund managers, only 132 held any gold in their portfolios.
What’s more, 97 of those relied on computers to place their trades. In other words:
Only 35 – of 6500 funds – are holding gold as a protection against economic crisis. That leaves a LOT of money outside of gold. More, in fact, than America’s entire annual GDP.
Quite simply: there is not enough gold for everyone.
There’s not even close to enough gold.
Add up all of the combined wealth in those funds. It amounts to some $131.77trillion. Meanwhile, there is only $1trillion of gold on the market. Now, here’s where it gets even more interesting.
Imagine if all of those funds moved just 2% of their holdings onto gold. (2% is the minimum amount for a fund’s investment to be considered relevant.) This would trigger a $2.6trillion crash landing onto gold. More than double the amount available.
And this is a very conservative scenario.
Suppose they followed common wisdom, and raised their gold to 10%. You would see the market totally and utterly swamped.
Demand for gold would be 13X higher than what’s available. And you have to ask yourself:
In a scenario like this, would YOU be willing to sell?
It gets even more crazy. Because while gold typically rises after a crisis, it is (at the time of writing) up over 20% on the year. If gold can rise 20% in a supposed expansion, think what could happen in a downturn.
Think what could happen when the big money starts to really move.
Anyway, rant over. That’s my thesis for buying gold. If it’s useful to you, I’m glad. If not, it’s no problem.
If you follow me and lose money, it’s all on you.
But I thought I’d share my reasons for buying gold.
I still get people laugh at me, you see. They can’t believe I’d do anything so stupid.