Gold Is Hot, Cryptocurrency's Not, According To These Two Experts

With inflation on the rise and gold at $1,700 an ounce, now is a good time to invest in gold, billionaire hedge fund manager John Paulson proclaimed — and Mark Mobius, founder of Mobius Capital Partners, strongly agrees.


gold coins with Latin writing

Today John Paulson is bullish on gold and bearish on cryptocurrencies, as he said during a recent "Bloomberg Wealth with David Rubenstein" interview.

Paulson went on to say that gold, now priced at about $1,700 an ounce, is a good investment.

"When it comes to one's investment portfolio today, 10% of it should be in gold, and it should be physical gold," concurs Mark Mobius, in a Bloomberg article. Mobius is a long-time investor, having worked 30-plus years at Franklin Templeton Investments and having founded Mobius Capital Partners.

"It is going to be very, very good to have physical gold that you can access immediately without the danger of the government confiscating all the gold," Mobius was quoted as saying.

So why do Paulson and Mobius both strongly support this shift to gold? It's because gold performs well during periods of high inflation, and we are in one. The best indicator of this, Paulson said, is the money supply, which was up about 25% last year.

Further, he believes that given the expanding money supply, we are in for worse inflation than predicted, higher than the 2% the Federal Reserve is targeting, he said.

"I think we have inflation coming well in excess of what the current expectations are," he told Rubenstein.

Paulson explained that as inflation rises, investors move their money out of cash and fixed income and into gold. However, the amount of money being moved exceeds the quantity of investable gold, thereby causing a supply-demand imbalance. This inequity thereby causes gold to rise.

If you're looking for another reason to embrace his recommendation for gold, Mobius noted the negative outlook for currencies worldwide.

"Currency devaluation globally is going to be quite significant next year given the incredible amount of money supply that has been printed" — and given the global governmental spend on fighting the COVID-19 pandemic, Mobius added.

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Disclosure: The article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of ...

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Bindi Dhaduk 3 days ago Member's comment

Gold is for my grandpa.  The next generation is really interested in crypto.