Home > Banking, Investing > Gold

Gold

February 10th, 2009 Sphere: Related Content

I’d like to say that today’s market response to the Tim Geithner press conference was a surprise, but I can’t.  I’d also like to say that I say it coming, but I can’t.

Geithner revealed few details about what will essentially become federal bailout round two.  The biggest detail he did reveal however was that it was going to cost another $1.5 trillion, spending $500 billion to recapitalize banks and the other trillion to support consumer and business lending.

His words didn’t even make it from his lips to the microphone and the market took a plunge.

I watched gold (GLD: chart, web, Y!) skyrocket while nearly everything else went directly to red.  Didn’t even turn pink first.

So I picked up some GLD at $90 under the notion that inflation will surely rise with the influx of all this money, and equities will suffer accordingly.

To take a page out of the Winston playbook, I’m going long on gold as a hedge against my equities.

If only I could get crude to follow in its golden commodities footsteps.

Sphere: Related Content

Goto comments Leave a comment

Banking, Investing , , , ,

  1. Winston
    February 11th, 2009 at 10:09 | #1
    Reply | Quote

    I think this is a good play, Grant. However I should preface that I am ‘talking my position’. I’m long GLD from 88 (apprx $880 spot) with the idea that inflation will be upon us at some , but more for the reason that I believe more and more global banks and economies will turn to gold as a reserve, a shift away from paper assets, i.e. US Dollar and US debt. I don’t consider myself a doomsdayer, I think the global economy will be fine down the road, but I think that road is a long one….

    BTW, the only trade idea I see working right now is storing crude….so if anyone has crude tankers sitting around in the Gulf give me a call, Grant has my contact info :)

  1. No trackbacks yet.