Lord Jacob Rothschild recently bet approximately 200 million dollars that the euro will go down. Billionaire hedge fund manager John Paulson made somewhere around 20 billion dollars betting against the U.S. housing market during the last financial crisis, and now he has made huge bets that the euro will go down and that the price of gold will go up. George Soros, chairman of Soros Fund Management, has put approximately 130 million more dollars into gold last quarter.
If a massive financial disaster occurs, two things are likely to happen: the euro will plummet like a rock and the price of gold soar. With the European economy is becoming more unstable with each passing day, investors all over the globe are looking for safe places to put their money. The mainstream media keeps telling us that everything is going to be okay, but the global elite are sending us a much different message by their actions.
You know the euro is in deep water when a icon of the banking industry, Lord Jacob Rothschild, takes $200 million bet against it.
Banks, companies and investors are preparing themselves for a collapse of the euro. Cross-border bank lending is falling, asset managers are shunning Europe and money is flowing into German real estate and bonds. The euro remains stable against the dollar because America has debt problems too. But unlike the euro, the dollar’s structure isn’t in doubt.
There was also news last week in an SEC filing that both George Soros and John Paulson had increased their investment in SPDR Gold Trust, the world’s largest publicly traded physical gold exchange traded fund (ETF). Mr Soros upped his stake in the ETF to 884,400 shares from 319,550 and Mr Paulson bought 4.53m shares, bringing his stake to 21.3m. At the current price of about $156 a share, these are new investments of about $88m of Mr Soros’ cash and more than $700m from Mr Paulson’s funds. These are significant positions.
Within the gold market, there is unconfirmed speculation that China plans to buy up to at least 5,000 to 6,000 metric tons of gold and that it will start to buy during this year, according to Kevin Kerr, president of Kerr Trading International. If China buys this much gold, that would exceed annual, global production of gold, he said. “We do not have enough gold for China to buy that much, and it will take China time to purchase this amount of gold.
Whether you turn your attention to Greece, Spain, Italy, Portugal or even Ireland; it is getting worse. Nowhere on the Continent are things improving and even in France and Germany the financial strains are beginning to show. It is not a question of Euro-bear or Euro-bull; it is just the numbers as they come rolling out month after month.
Governments and big banks all over the world have been rapidly preparing for the coming financial collapse. 77 percent of all Americans live paycheck to paycheck at least some of the time. If another major economic crisis comes along, many of those people are going to be totally wiped out.
The U.S. economy is basically on life support. Look at the velocity of money. In an economy that is growing and healthy, money tends to circulate very, very quickly. But when an economy is sick, money tends to circulate very slowly. And that is exactly what is happening right now. The velocity of money is currently at the lowest level in modern U.S. history.
This is exactly what happened back in the 1930s. The velocity of money absolutely plummeted. When people are scared, credit is tight and times are hard, money does not exchange hands as rapidly.
This is just the beginning.
