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Still, gold has been a great bet for the past 1-, 3-, 5- and 10-year periods...and almost everything in between. Gold's stellar performance has attracted interest from some of the most successful hedge fund managers, including John Paulson, whose firm counts AngloGold, Kinross Gold and the SPDR Gold ETF (GLD) among its top 15 equity holdings.
In addition to Paulson, whose gold fund was up 33.6% this year as of November 30, according to Reuters, Greenlight's David Einhorn and Passport Capital's John Burbank are also notable gold bulls.
As was the case with housing, none of these hedge fund managers have traditionally been gold investors, but they've quickly educated themselves. And Zuckerman notes Einhorn and Burbank are holding and storing the metal itself vs. betting on gold equities or ETFs.
"They don't actually think gold is going thru the roof because inflation is right around the bend next week...but they're worried down the road," Zuckerman says. "We've flooded the system with money...and the only way to protect yourself is through gold."
Housing Bulls, Unite
Among the recent crop of hedge fund stars, Pershing Square Capital's Bill Ackman is notably absent from the parade of gold bulls. But he and Paulson do share a bullishness on another asset class: Housing.
Paulson, who recently bought a two-bedroom condo in NYC for a reported $2.85 million, has been quoted saying: "If you don't own a home buy one. If you own one home, buy another one, and if you own two homes buy a third."
Ackman, meanwhile, recently gave a presentation entitled "How to Make a Fortune," which lays out his bullish case on housing, as shown here.
Betting on gold and housing in tandem makes sense if you think the dollar is going lower and inflation is going to rise, as "hard assets" do well in that environment. Of course, if the dollar collapses, as many gold bugs like Peter Schiff predict, that won't be good for the economy or the housing market.
Notably, Ackman's bet on housing is predicated at least in part on his generally bullish outlook for the economy and America, which may explain why he's not jumping on the gold bandwagon.
Aaron Task is the host of Tech Ticker. You can follow him on Twitter at @atask or email him at altask@yahoo.com
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