Gold Goes Mainstream

From our friends at: Thundering-Heard

Gross: Stock and bond managers today must be alchemists: turn lead into gold. NOT likely. Too much lead (bubbled assets).

–Tweet from Bill Gross, Founder of PIMCO, which manages $1.8 trillion

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“Do you own gold?” “Oh yeah. I do…There’s no sensible reason not to have some.”

–Ray Dalio to the Council on Foreign Relations

This is being written to put the precious metals market in a larger context for those people who still see the world proceeding much as it has proceeded in the past, a world without the large financial and supply chain disruptions that we foresee.

Strong multi-year upmoves in the price of any asset, aka a secular bull market in that asset, go through three stages:

1. The speculative, early-proponent phase during which the mainstream investment community ignores or derides the potential of that asset.
2. The mainstream phase, where the mainstream decides that exposure to that asset is a good idea for just about everyone.
3. The mania phase, where just about everyone feels that they must own that asset and will tell you so when you meet them by chance in the supermarket.   LINK...

#1 Reason To Own Gold, Ray Dalio

Gold is primarily an alternative to fiat currency and a storehold of wealth.  The main advantage that gold has over other currencies is that it can’t be printed.  While we have just gone through a period in which the degree of monetary stimulation has ebbed, the ongoing deleveraging means that developed economic will remain highly reliably on continued stimulation for years.  By the end of the quarter, central banks were starting to shift back toward renewed stimulation.

Read more: http://pragcap.com/ray-dalio-on-the-primary-reason-to-own-gold#ixzz26IK10jdr
LINK...
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Ray Dalio is one of the most successful asset managers in the industry, and as seen in this video, he's an obvious "insider" at the CFR.   BK