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The “Bond King”: Buy Gold, Not Bonds

Posted By admin On September 10, 2012 @ 1:18 am In Money Watch | Comments Disabled

Washington’s Blog [1]
Sept 10, 2012

Bill Gross – the world’s pre-eminent bond fund manager, nicknamed the “Bond King” – is the boss at Pimco, the world’s largest bond fund, with $1.8 trillion dollars under management.

Gross told Bloomberg:

[There's] a diminished or dying cult of both bonds and stocks from the standpoint of a belief that they can return 10% ….

Gold can’t be reproduced.  It could certainly be taken out of the ground in an increasing rate but there’s a limiting amount of gold.

And there has been an unlimited amount of paper money over the past 20 to 30 years and now – in this period of central bank expansion where it’s QE1 or QE2, or whether it’s the LTROs of the ECB or this potential new program … then central banks are at their leisure to basically print money.

Gold is a fixed commodity that has a considerable store of value that paper money has not….

When a central bank starts writing checks and printing money in the trillions of dollars, it’s best to have something tangible that can’t be reproduced, such as gold.


Gold … is a better investment than a bond or a stock, which probably will  only return a 3 to 4 percent return over the next 5 to 10 years.


Gross doesn’t believe that gold is a crowded trade at this point.

See this for background [2].

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URL to article: http://www.prisonplanet.com/the-%e2%80%9cbond-king%e2%80%9d-buy-gold-not-bonds.html

URLs in this post:

[1] Washington’s Blog: http://www.washingtonsblog.com/2012/09/the-bond-king-buy-gold-not-bonds.html

[2] See this for background: http://www.washingtonsblog.com/2010/12/is-gold-or-fiat-currency-in-a-bubble.html

[3] Should We Be Alarmed That The Biggest Bond Fund In The World Has Dumped All Of Their U.S. Treasury Bonds?: http://www.prisonplanet.com/should-we-be-alarmed-that-the-biggest-bond-fund-in-the-world-has-dumped-all-of-their-u-s-treasury-bonds.html

[4] Gold Tumbles As IMF Reaffirms Plan To Sell 191.3 Metric Tons Of Gold Over Time in Phased “On-Market” Gold Sales: http://www.prisonplanet.com/gold-tumbles-as-imf-reaffirms-plan-to-sell-191-3-metric-tons-of-gold-over-time-in-phased-on-market-gold-sales.html

[5] Roubini: Reduced Selling of Gold by Central Banks Should Support Gold Prices: http://www.prisonplanet.com/roubini-reduced-selling-of-gold-by-central-banks-should-support-gold-prices.html

[6] Three U.S. Banks Collapse as Bond Street Holdings Acquires Another Lender: http://www.prisonplanet.com/three-u-s-banks-collapse-as-bond-street-holdings-acquires-another-lender.html

[7] Central Banks Buy the Most Gold Since 1964: http://www.prisonplanet.com/central-banks-buy-the-most-gold-since-1964.html

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