While some experts say gold is now a bubble, a slew of prominent investors and analysts disagree.
That list includes HSBC Holdings, Goldman Sachs and Barclays Capital. Count hedge fund heavies John Paul Tudor Jones, John Paulson and David Einhorn in that camp, too.
Even hedge fund legend George Soros, who recently called gold “the ultimate asset bubble,” doubled his holding in the SPDR Gold Trust exchange-traded fund last quarter.
A recent survey of 22 gold analysts by Bloomberg shows that 15 expect the precious metal to exceed last year’s record high of $1,226 in 2010. The median forecast is for a 17 percent gain to $1,300 an ounce. Gold recently traded at about $1,123 an ounce.
Jones’ firm Tudor Investment Corp. boosted its position in Newmont Mining, the largest U.S. gold producer, by almost 300 percent last quarter.
Gold is “just an asset that, like everything else in life, has its time and place. And now is that time,” Jones wrote last year in a letter to clients obtained by Bloomberg.
The bubble talk doesn’t worry Charles Morris, manager of the HSBC Absolute Return Fund, which has 11 percent of its assets in gold.
“A bubble is good,” he told Bloomberg. Morris says the precious metal may hit $5,000 in five years.
Dave Skarica, editor of Newsmax’ Gold Stock Adviser newsletter, agrees. We’re 10 years into a 15-20 year bull market — that’s usually how long they last,” he told Moneynews.
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