Monday, November 23, 2009

Scarcity of gold bears

I am slightly bearish on gold, and am constantly looking for less lukewarm sellers.

Eddy Elfenbein notes that Roubini is a gold bear, and Schiff is a super bull.

I think that the "smart money" is:
  1. seeing dollar devaluation and projecting significant future inflation in dollar denominated assets
  2. finding gold to be the best pitstop to exchange dollars
  3. hoping that gold does not crash as fast as inflation explodes
It feels too risky for me to jump on the bandwagon. Plus, I just found out today that some gold ETFs are taxed as collectibles (28% long term cap gains) vs. 15% on financial assets.

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