“Once again, all roads lead to gold”
By jturbin | October 9, 2012 3:21 AM EST
Despite the fact that several of the world’s most respected investment managers have recently laid out their bullish outlooks for gold, the yellow metal remains a very under-owned asset class around the world.
Bill Fleckenstein – a former fund manager who has been correctly bullish on gold for the large majority of the past decade – discussed this phenomenon in his latest weekly column for MSN Money.
“So, once again, all roads lead to gold to protect one’s cash from debasement,” Fleckenstein wrote, ”which is still not a mainstream idea despite the number of smart people who think investors need to own it.”
“I mean, when was the last time you heard Jim Rogers, Marc Faber, Bill Gross, Felix Zulauf, Jim Grant, Stan Druckenmiller, Fred Hickey, David Einhorn, Kyle Bass and Ray Dalio all say the same thing?” Fleckenstein pointed out. “If they all agreed that people should own a specific stock, the order imbalance would be so large that the exchange wouldn’t be able to open trading in it for a week!”
As further evidence of just how few people in the investment community across the globe own gold, last month Fleckenstein noted that “To put how early we are in the gold accumulation phase into perspective, last week I also saw a clip of Frank Holmes, the chief investment officer at U.S. Global Investors, noting that the value of the SPDR Gold Shares (GLD) ETF, at around $75 billion, is roughly equivalent to the amount of market capitalization that Facebook (FB) has lost as it plunged from its opening high to its recent low.”
He went on to say that “For some reason, thinking about this potentially overhyped ‘New Economy’concept losing the entire value of GLD really struck a note with me.”