Billionaire John Paulson Explains Why Buy Gold Bullion

About 18 months ago, hedge fund billionaire John Paulson laid out his ongoing thesis for why he sees the potential to lever up bullish gold derivative bets with the potential to pay off 25-50 fold at some point in this decade, the 2020s.

Here is a brief clip from the video we made then entitled, "John Paulson 25-50x Gold Bet Potential Payout," which we will link here.

We'll get back to what hedge fund billionaire John Paulson said about gold published in an interview this week.

But first, the US government's underreports Consumer Price Inflation data came in this week higher than expectations at 6.4% or at a rate of fiat US dollar devaluation that will see the dollar halve in purchasing power in just over 11 years. More on that in a minute.

Here you can see consensus guesses regarding this week's data inflation mostly missed to the downside.

A large contributor to the persistent rise in the CPI has been the lagging shelter index data which, while mostly being a guess at what homeowners think they can rent their homes for, is now its largest increase in over 33 years.

Regarding John Paulson's mentioning about how fixed income was about to be slaughtered, the FDIC's latest quarterly banking profile with data through Q3 of last year, 2022.

Not only is the FDIC "Problem Bank List" growing rapidly, but it's also for real reasons like losing nearly -$1.5 trillion in unrealized losses on investment securities through three-fourths of last year. Dwarfing unrealized losses taken by banks during the 2008 global financial crisis era.

Moving on to what Billionaire John Paulson stated in an interview published this week about owning Gold Bullion over fiat US Dollars with a 3, 5, and 10-year outlook and timespan.

Slightly down weeks in trading for both monetary precious metals.

The spot silver price is likely to close this week at around a $21.75 oz bid, while the spot gold price pushes to close at $1,850 per troy ounce ask price.

The spot gold-silver ratio traded flat for the week, likely again to close again at 84.

As both gold and silver move down in price consolidations towards their respective 200-day moving averages, here is a long term view of where each respective metal sits in relation to their important 200-day moving averages.

Gold's 200-day moving average sits currently just over $1,777 oz, and of late, spot gold has been an inverse trade relative to fiat US dollar strength or relative weakness versus other major competing fiat currencies.

Silver's 200-day moving average is likely to end this week around $21 oz. 

Generally speaking, in a secular bullion bull market, buying bullion positions when spot prices retrace back toward their 200-day moving average is best for lower dollar cost averaging. Perhaps one of those times is now again here for long-term bullion buyers.

In a continued strange industry news item, the supposed US commodities regulator, the CFTC, has delayed publishing its weekly Commitment of Traders Report for now, three weeks running. Reuters reported the following earlier this week regarding missing CoT Report data.

Of course, if you already own a prudent position in physical gold and silver bullion, you're likely not too concerned with exactly when the next CFTC Cot Report will be published.

You likely rest soundly knowing you have harder monies which will likely outperform the fiat US dollar and other debasing fiat currencies over the next 3, 5, and even 10 years of time.

That is all for this week's SD Bullion Market Report.

As always, to you out there, take great care of yourselves and those you love.

← Previous Next →
James Anderson
James Anderson
Senior Market Analyst & Content

A bullion buyer years before the 2008 Global Financial Crisis, James Anderson is a grounded precious metals researcher, content creator, and physical investment grade bullion professional. He has authored several Gold & Silver Guides and has been featured on the History Channel, Zero Hedge, Gold-Eagle, Silver Seek, Value Walk and many more. You can pick up Jame's most recent, comprehensive 200+ Page book here at SD Bullion.

Given that repressed commodity values are now near 100-year low level valuations versus large US stocks, James remains convinced investors and savers should buy and maintain a prudent physical bullion position now, before more unfunded promises debase away in the coming decades...