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Warren Buffet Goes all in with Gold?

serfserf Member Posts: 9,217 ✭✭✭✭
in General Discussion
He was forever against the stuff but now he dumps most of all of the banks and airline stocks and...
                                   serf
       Berkshire took a new stake (20.9 million shares) in Barrick Gold, a holding that was valued at about $564 million at the end of that period.



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Comments

  • hobo9650hobo9650 Member Posts: 2,759 ✭✭✭
    Gold could be the only winner when the election takes place.  Might be major rioting and shooting with the economy taking a dump many times worse than the virus hit.
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  • victorj19victorj19 Member Posts: 3,642 ✭✭✭
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.
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  • victorj19victorj19 Member Posts: 3,642 ✭✭✭
    He didn't buy gold itself.
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  • BobJudyBobJudy Member Posts: 6,677 ✭✭✭✭
    edited August 2020
    victorj19 said:
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.
    Don't say that! It spoils the panic narrative. I suppose he should have left the funds money in stocks that were tanking because of the pandemic. As soon as this covid crap is over I bet they will be the first to take advantage of low price bank and airline stocks. The value of the stock bought amounts to less than 1% of the funds assets so "going all in" may be a bit of an exaggeration. Bob
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  • William81William81 Member Posts: 25,514 ✭✭✭✭
    Serf......Like any investor, one looks at what will hopefully bring a decent return..  That is all that happened here.....with Gold prices being up where they are, there will be a push to produce more...

    Seems like a decent idea....and if you are worth billions, you can take a chance now and then....
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  • serfserf Member Posts: 9,217 ✭✭✭✭
    victorj19 said:
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.

    BobJudy said:
    victorj19 said:
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.
    Don't say that! It spoils the panic narrative. I suppose he should have left the funds money in stocks that were tanking because of the pandemic. As soon as this covid crap is over I bet they will be the first to take advantage of low price bank and airline stocks. The value of the stock bought amounts to less than 1% of the funds assets so "going all in" may be a bit of an exaggeration. Bob

          He could have bought paper gold, but he was too smart to trust the thieves on Wall Street. Gold has been money for one reason for over an millennium  because the source is finite and not infinite like paper money fiat bonds they call Federal Reserve notes.
                                                          serf


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  • BobJudyBobJudy Member Posts: 6,677 ✭✭✭✭
    serf said:
    victorj19 said:
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.

    BobJudy said:
    victorj19 said:
    He bought shares in a company that happens to mine gold.  I assume he sees value in the company and looks to make money on it.
    Don't say that! It spoils the panic narrative. I suppose he should have left the funds money in stocks that were tanking because of the pandemic. As soon as this covid crap is over I bet they will be the first to take advantage of low price bank and airline stocks. The value of the stock bought amounts to less than 1% of the funds assets so "going all in" may be a bit of an exaggeration. Bob

          He could have bought paper gold, but he was too smart to trust the thieves on Wall Street. Gold has been money for one reason for over an millennium  because the source is finite and not infinite like paper money fiat bonds they call Federal Reserve notes.
                                                          serf


    He bought "paper" from a NYSE listed company (Wall Street) so I am not sure where your comment is coming from. If the companies profits and stock price go up then his fund will make money in dollars as I don't believe they pay dividends in metal. On the surface to us poor people this looks like a major investment but it is just a miniscule portion of the funds worth so just another days work for them. Bob
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  • serfserf Member Posts: 9,217 ✭✭✭✭

     It's the price fixing on the Comex I was writing about. He bought into a gold mine with proven deposits by geologists not paper certificates with promises it's there. The devil is always in the details,go ask any lawyer he will tell you not to put the cart in front of the horse. B)

                                          serf. 
        https://www.rmegold.com/resources/investing-in-comex-what-investors-need-to-know-2/

    COMEX doesn’t supply gold, but is crucial to the gold delivery process.

    As stated before, less than 1% of trades actually go to delivery. When it does occur, the contract holder needs to notify the clearinghouse and the COMEX that he or she intends to possess the gold commodity. In this arrangement, a short seller that lacks the deliverable gold must liquidate his position by the last trading day.

    When an investor requests to take delivery, he or she will be given COMEX deliverable bars, which are produced by approved refiners at the high standards set by COMEX.



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  • BobJudyBobJudy Member Posts: 6,677 ✭✭✭✭
    You miss the point. The fund could have taken physical possession of that much gold. Instead he bought stock in a gold mining company for dollars in hopes of the value, in dollars, increasing. The fund has bought no gold - just paper representing a very small, by wall street standards, stake in Barrick. This is no different than buying oil stocks when you see an increase in the demand for their production. When or if the value of the stock rises the profit will be in dollars and not gold. Once again, the value of the trade seems unbelievably huge to normal people but is in reality pretty tiny compared to the actual assets of both Berkshire and Barrick. Bob

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