Monday, May 16, 2011

Soros and his back ache: no more!

Soros Fund Management was one of the top-10 holders of the GLD Gold ETF.
Today's 13F reveals that... not anymore. He reduced, right? No. No? He got rid of it.

From around 4.7m shares to 50k shares. From around ~ USD 700 million to USD 7m.
So a 99% cut to his exposure. That was before March 31th.

My reading?

These guys are getting more bearish. Believing the money-printing bonanza is over until at least the economy, and consequently the markets, forces them to turn their machines on again.
Without deflation in sight the Fed Misfits won't be able to wave the lettuce-green dollar bills at the hot ladies in Monaco. And Soros, who couldn't take the pain, called his babe:

Soros: "Darling.. my back hurts... is it the markets or my age coming?"

Wife: "Honey, from these headlines in the paper.. what do you think?"

Soros: "You're right. The past few data points in the US, Trichet hiking in Europe and Mr. King saying he won't hike in the UK... It seems that the fiat-money issue will be, in the near-term, put to the side. Perhaps risky assets will get a bit of a beating soon and the USD will come out stronger. Maybe I'll cut my short-USD bets in Gold and other assets and wait for Bernanke and his lads to come to the rescue again. But can I still get that massage after I'm done with my ETF exposure in precious metals? And a cup of tea, please."

Wife: "Absolutely, sweetie. I'll be right back."

(phone rings at Druckenmiller's office)

*Disclaimer: charts and data are presented as I receive/see them. Sources are usually not checked for validation and my own calculations are of 'back of the envelope'-type. I am aware that some math that I do myself might be wrong and/or misleading to some extent. In financial markets the rate of change of economic data is often more important than the actual level and the perception of 'what is priced in' is more important than 'what is actually going to happen'. This is actually the way people pick entry and exit points. So... yes, sometimes you might say 'This guy is an idiot, this is way wrong!' with a high conviction, being right. Not to worry. Markets are made of expectations and the clash of conviction between its participants. Portfolio managers know that being an idiot is sometimes profitable and being smart is often a bad choice. It is all reality, sometimes good, sometimes bad. By the way: corrections to my analysis and intelligent debate is welcome. theintriguedtrader AT gmail do com

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