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Omaha Steve

(99,069 posts)
Mon Apr 15, 2013, 09:48 PM Apr 2013

Hedge Fund Billionaires John Paulson And David Einhorn Lost $640M In Gold Market Collapse

Source: Forbes

The gold bloodbath that hit the market over the past two trading sessions has definitely caused a dent in the portfolio of billionaire hedge fund managers. John Paulson and David Einhorn suffered combined losses of more than $640 million since Friday, according to their latest SEC filings, with the bulk concentrated in the former’s massive position in the SPDR Gold ETF. Einhorn’s Greenlight took a big hit on its holdings of the gold miners ETF.

An implosion that appears to have started in the gold market last Friday spread throughout the commodities complex on Monday, with everything from crude oil to soybeans falling. Physical gold lost more than $200 per ounce, sliding nearly 15% over the past two trading sessions.
Violent And Panicky Gold Selling Collapse Bullion And Commodity Markets Agustino Fontevecchia Agustino Fontevecchia Forbes Staff
The Gold Bloodbath Nathan Vardi Nathan Vardi Forbes Staff
The 40 Highest-Earning Hedge Fund Managers And Traders Nathan Vardi Nathan Vardi Forbes Staff

Players in the gold market got hurt, and among those are some of the world’s most high-profile investors. John Paulson, of the eponymous hedge fund with approximately $20 billion under management, took a big hit. Just with his positions in gold miners Paulson lost more than $171 million over the past two trading sessions, if his latest disclosed holdings remained unchanged. Add an additional $430 million in losses from his 21.8 million stake in the SPDR Gold Trust, and total paper losses climb to $601 million.

Among his individual gold equity positions, Paulson took the biggest hits in AngloGold Ashanti, Freeport McMoran (which has exposure to several other metals including copper and silver), and Novagold. Paulson & Co. is AngloGold’s largest shareholder, with more than 7% of the shares, and lost $93 million on that stake. Novagold, where the hedge fund titan owns 11.36% of shares outstanding, delivered losses worth $13.3 million, while Freeport McMoran’s losses added to $31.7 million.

FULL STORY AT LINK.


Read more: http://www.forbes.com/sites/afontevecchia/2013/04/15/hedge-fund-billionaires-john-paulson-and-david-einhorn-lost-640m-in-gold-bloodbath/





John Paulson took a big hit on his gold holdings
42 replies = new reply since forum marked as read
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Hedge Fund Billionaires John Paulson And David Einhorn Lost $640M In Gold Market Collapse (Original Post) Omaha Steve Apr 2013 OP
I wanna see the headline where these hedge fund guys CAUSED the run-up benld74 Apr 2013 #1
I wonder what Glen Beck is going to do!! Lobo27 Apr 2013 #2
I wonder how we are gonna end up paying them back for the money they "lost" mucifer Apr 2013 #3
You can bet that as "job creators" they will be made whole for their loses - somehow -- n/t mazzarro Apr 2013 #28
My first thought. nt valerief Apr 2013 #29
Yup. Same thing I was thinking! FiveGoodMen Apr 2013 #35
heh heh heh..snicker..snicker dixiegrrrrl Apr 2013 #4
Couldn't happen to a "nicer" guy. reteachinwi Apr 2013 #5
Good. Paulson pretty much ruined my previous employer Common Sense Party Apr 2013 #6
The Gold Collapse Is Personally Costing Ron Paul A Fortune yortsed snacilbuper Apr 2013 #7
Wow, that made my day. Gold standard people really irk me. joshcryer Apr 2013 #26
not worthless waddirum Apr 2013 #36
Only 10% of gold is used in industry. joshcryer Apr 2013 #38
Gold could be used for a wide variety of uses Art_from_Ark Apr 2013 #41
Gov't/Fed 'bailout' pending... /sarcasm eom Purveyor Apr 2013 #8
well it's a start olddots Apr 2013 #9
So they won't be paying any taxes for a few years... bluedigger Apr 2013 #10
Good. I hope he winds up losing everything and has to take a job as a kestrel91316 Apr 2013 #11
+1000 wordpix Apr 2013 #32
Can't say I feel sorry for these hedge fund thieves. Initech Apr 2013 #12
Wah-wah-wah-waaaaaaaaaaaaaaaaaaaaaaaaaaaahhhhh!!!! Crowman1979 Apr 2013 #13
Future breakthroughs in nanotechnology ThoughtCriminal Apr 2013 #19
My heart beats purple piss for both of them. Occulus Apr 2013 #14
And didn't even notice. MrSlayer Apr 2013 #15
Keep going down, gold. Punish the anti-american basement dwellers. nt onehandle Apr 2013 #16
You realize (or maybe you don't) that lots of ordinary Americans own gold Art_from_Ark Apr 2013 #24
ordinary Americans should consider the environmental damage of gold mining wordpix Apr 2013 #33
Most of the gold in the physical market was mined long ago. Art_from_Ark Apr 2013 #39
: ) MoreGOPoop Apr 2013 #17
Let them sink! Dawson Leery Apr 2013 #18
I'd bet it's still worth more than they paid William Seger Apr 2013 #20
If one holds physical gold, that would be true Art_from_Ark Apr 2013 #23
How are ETFs different? (n/t) William Seger Apr 2013 #27
One way that ETFs are different is that they can be margined (leveraged) Art_from_Ark Apr 2013 #31
Oh, the humanity - I just can't take any more! hatrack Apr 2013 #21
Hilarious! SoapBox Apr 2013 #22
Smart investors know that it's a good time to buy right now MrScorpio Apr 2013 #25
This is why I always sell when down 7%. cbdo2007 Apr 2013 #30
Warms my heart! City Lights Apr 2013 #34
awww tax time, just in time to not have to claim all those capital gains and pay the bitty tax Sunlei Apr 2013 #37
Seriously, who the hell *couldn't* see a collapse in gold prices coming from a mile away? Bucky Apr 2013 #40
So the United States Mint was "betting against America"? Art_from_Ark Apr 2013 #42

benld74

(9,888 posts)
1. I wanna see the headline where these hedge fund guys CAUSED the run-up
Mon Apr 15, 2013, 09:52 PM
Apr 2013

in the gold market and the SEC NAILS them but good.

I know its a fairy tale but I can dream,,,,,,

Lobo27

(753 posts)
2. I wonder what Glen Beck is going to do!!
Mon Apr 15, 2013, 09:53 PM
Apr 2013

He got thousands of people to buy gold, and I'm sure he profited somehow.

 

reteachinwi

(579 posts)
5. Couldn't happen to a "nicer" guy.
Mon Apr 15, 2013, 09:57 PM
Apr 2013

On the heels of the SEC director's statement that hedge-fund manager John Paulson would not be charged with any wrongdoing for the 2007 deal it made with Goldman Sachs — in which the firm agreed to allow the hedge-fund manager to structure a bond both parties knew would fail, but neglected to mention that to the investors it sold it to — Paulson and Company has issued a statement.

It can pretty much be summed up as "Goldman's clients aren't our problem."

As the SEC said at its press conference, Paulson is not the subject of this complaint, made no misrepresentations and is not the subject of any charges.

http://nymag.com/daily/intelligencer/2010/04/paulson_and_company_responds_t.html

joshcryer

(62,265 posts)
26. Wow, that made my day. Gold standard people really irk me.
Tue Apr 16, 2013, 04:41 AM
Apr 2013

It'll probably go back up though because the world loves that almost worthless metal (contact points and jewelry = mostly worthless).

waddirum

(976 posts)
36. not worthless
Tue Apr 16, 2013, 09:32 PM
Apr 2013

Gold is also used for dental crowns, electronics, aerospace, and many other uses.

A small amount of gold is used in almost every sophisticated electronic device. This includes: cell phones, calculators, personal digital assistants, global positioning system units and other small electronic devices. Most large electronic appliances such as television sets also contain gold.


http://geology.com/minerals/gold/uses-of-gold.shtml

joshcryer

(62,265 posts)
38. Only 10% of gold is used in industry.
Tue Apr 16, 2013, 11:40 PM
Apr 2013

And that includes gold used in jewelry. The lions share of the worlds gold is hanging around the neck of Indian people. As a useful element its uses are few and far between. The amount of gold used in electronic devices is minuscule in comparison to the amount of gold available.

Art_from_Ark

(27,247 posts)
41. Gold could be used for a wide variety of uses
Fri Apr 19, 2013, 02:24 AM
Apr 2013

but its high price precludes its widespread use for most of its potential applications.

"Gold is the most malleable of all metals; a single gram can be beaten into a sheet of 1 square meter, or an ounce into 300 square feet. Gold leaf can be beaten thin enough to become transparent. The transmitted light appears greenish blue, because gold strongly reflects yellow and red.[20] Such semi-transparent sheets also strongly reflect infrared light, making them useful as infrared (radiant heat) shields in visors of heat-resistant suits, and in sun-visors for spacesuits.[21]

"Gold readily creates alloys with many other metals. These alloys can be produced to modify the hardness and other metallurgical properties, to control melting point or to create exotic colors (see below).[22] Gold is a good conductor of heat and electricity and reflects infrared radiation strongly. Chemically, it is unaffected by air, moisture and most corrosive reagents, and is therefore well suited for use in coins and jewelry and as a protective coating on other, more reactive metals. However, it is not chemically inert. Gold is almost insoluble, but can be dissolved in aqua regia."

http://en.wikipedia.org/wiki/Gold

 

kestrel91316

(51,666 posts)
11. Good. I hope he winds up losing everything and has to take a job as a
Mon Apr 15, 2013, 10:03 PM
Apr 2013

Walmart greeter for minimum wage.

ThoughtCriminal

(14,010 posts)
19. Future breakthroughs in nanotechnology
Mon Apr 15, 2013, 10:48 PM
Apr 2013

may some day allow us to create a violin almost small enough, but I do not think we will ever be able to assemble structures on a sub-atomic scale.

 

MrSlayer

(22,143 posts)
15. And didn't even notice.
Mon Apr 15, 2013, 10:11 PM
Apr 2013

It's like having twenty bucks and losing fifty cents while pitching quarters. It's annoying but it doesn't really hurt.

Art_from_Ark

(27,247 posts)
24. You realize (or maybe you don't) that lots of ordinary Americans own gold
Tue Apr 16, 2013, 12:52 AM
Apr 2013

Not "basement dwellers", not ultra-right-wingers, but ordinary Americans.

I have no idea why you think it is "anti-American" to own it, especially considering that gold products are an important source of income for the US Mint.

wordpix

(18,652 posts)
33. ordinary Americans should consider the environmental damage of gold mining
Tue Apr 16, 2013, 10:45 AM
Apr 2013

totally destroys rivers and tributaries, land where it's mined

Art_from_Ark

(27,247 posts)
39. Most of the gold in the physical market was mined long ago.
Wed Apr 17, 2013, 01:52 AM
Apr 2013

I will agree, however, that gold mining can be a dirty business. A lot of big gold miners have gotten into trouble in South America and elsewhere for their environmentally unsound practices. And local artisan miners also tend to use environmentally damaging methods. But then again, that can pertain to mining for any metal or mineral, including the metals in everything around us. In fact, it may have been a dirtier process to get those rare earths for your computer/cell phone/other technogadget because the ores for those rare earth metals, such as monazite, usually also contain radioactive minerals that have to be treated or disposed of in some way, and they are usually strip mined to boot.

William Seger

(10,742 posts)
20. I'd bet it's still worth more than they paid
Mon Apr 15, 2013, 11:18 PM
Apr 2013

You haven't really "lost" anything unless you actually sell for less than you paid.

Art_from_Ark

(27,247 posts)
23. If one holds physical gold, that would be true
Tue Apr 16, 2013, 12:49 AM
Apr 2013

Physical gold that is owned outright can be held indefinitely.

ETFs are a different story.

cbdo2007

(9,213 posts)
30. This is why I always sell when down 7%.
Tue Apr 16, 2013, 09:43 AM
Apr 2013

It's one of my golden trading rules and has saved me many, many thousands of dollars.

Bucky

(53,795 posts)
40. Seriously, who the hell *couldn't* see a collapse in gold prices coming from a mile away?
Wed Apr 17, 2013, 03:46 AM
Apr 2013

Confidence artists, stoking baseless Obamaphobia, have been hyping so much gold for so long to the rubes, the price had to be inflated. Buying gold was basically betting against America. Guess what, ya dumbasses? America always wins... and this time: you lose!

Art_from_Ark

(27,247 posts)
42. So the United States Mint was "betting against America"?
Fri Apr 19, 2013, 02:29 AM
Apr 2013

Because the United States Mint sells a lot of gold coins to Joe Public.

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