Posts tagged john paulson

John Paulson’s investing philosophy is based on making sector bets according to his interpretation of the macroeconomic picture. The strategy paid off well when he made $3.7 billion in 2007 shorting the subprime mortgage market and another $5 billion in 2010 primarily by betting on gold. Times have been less spectacular since then, with his funds losing 36% in 2011 by being too early in financials and returning 1% in 2012.

In the fourth quarter, Paulson adjusted his sector strategy. He eased more out of financials and consumer cyclical stocks, and made increases to his real estate and energy holdings, according to GuruFocus’ sector weightings.

To read more about his strategy click here:

http://www.forbes.com/sites/gurufocus/2013/02/22/hedge-fund-giant-john-paulson-reduces-financials-puts-money-in-other-sectors/

Hedge fund biggie John Paulson, the world’s foremost gold bug, added to his precious metal hoard during the second quarter.

Gold now accounts for 44 percent of his entire stock portfolio.

The biggest increase was the additional 4.5 million shares of SPDR Gold Trust, a gold exchange-traded fund. 

The firm reported a $3 billion decline in the value of its stock portfolio, to $12 billion for June 30, down from $15 billion on March 31, in the quarterly statements with the Securities and Exchange Commission that were filed yesterday.

SPDR Gold now accounts for $3.39 billion of Paulson’s entire portfolio, or 28 percent. The exchange-traded fund lost about 4 percent during the quarter.

Source:NYpost

BILL FLECKENSTEIN: This Is How The 40-Year Paper Money Experiment Will End

“Eventually the bond markets will say, ‘Oh my God,’ and instead of paying governments to let them lend them the money, like you now see with negative short-rates in various countries around the world, the bond market will say, ‘Hey, you are going to cheat us. We know you are going to cheat us, now we want you to compensate us for that.’  And the bond market or the currency market or a combination of the two will take the printing press away. That’s how it will end. That will be the end of the 40 year experiment with all paper money.”

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ALBERT EDWARDS: The US Is In Recession, Corporate Profits Will Collapse, Stocks Will Tank

“While the consensus continues to expect growth of around 2.5% this year, the economy has entered a recession with GDP declining by as much as 2%.This would cause a sharp drop in income of companies, up 30% to 40%. Company margins (based on operating results) are now at their historical highs. Profit warnings should therefore be multiplied throughout the season for publications that summer that has just begun. Excluding financials, profits of U.S. companies have already begun to decline in the second quarter (-0.3% expected according to the consensus, Ed). And it is only the beginning!”

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PAUL KRUGMAN: The Government Has To Do More Deficit Spending To Avoid A Full-On Depression

“Somebody has to spend more than their income, and, for the time being, that has to be the government,” says Krugman. ”My thinking has evolved … If you haven’t updated your views in the face of new experiences, you’re not doing your job.”

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JOE LAVORGNA: This Is Why I Just Slashed My GDP Forecast

CNBC

“One substantive difference between this year and last is the household sector. As we have highlighted over the past month, consumer finances continue to improve. This makes us longer-term more constructive on the economy. Both household buying power and household liquid assets to liabilities are rising, and household debt to income continues to decline.”

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JEFF SAUT: Europe Can’t Be Fixed Until It Addresses Its Systemic Problem

“The systemic problem being, you cannot have a unified currency without a unified fiscal policy and they never had that.  So you’ve had this complete misallocation of capital that left the Greece’s of the world totally uncompetitive with the Germany’s.  I don’t know if you can fix that.”

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RICHARD RUSSELL: ‘Ben Bernanke Is No Jesus’

“Like the great tide of the ocean, the primary trend of the stock market functions in its own way, this despite the desires of man.  The Bible tells us of the instance when Jesus commanded the ocean to become quiet and the waves to die down.  The ocean reacted exactly as Jesus commanded.  All well and good, but it is well to remember that Ben S. Bernanke is no Jesus.”

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JOHN PAULSON: Something’s Gotta Give In The European Debt Crisis

“Like the passage of the Greek bailout plan in March, the plans’ impact on the markets will prove temporary and short-lived. These plans do not solve the productivity gap among euro-zone countries, current account deficits, government deficits, unemployment, and capital outflows.”

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JOSEPH STIGLITZ: America Has Now Seen ‘Almost Half A Century Of Stagnation’

Vanity Fair

“We used to look at America as the land of opportunity…In fact, mobility [and] opportunity in the U.S. today is lower than it is in any of the advanced economies. So this notion of America as a land of opportunity has vanished.”

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LAKSHMAN ACHUTHAN: The US Is In Recession Already

“What we said back in December was that we thought the most likely start date for the recession would be in Q1, and if not then, by the middle of 2012. I’m here to reaffirm that. In other words, I think we’re in recession already. As I said back there, it’s very rare that you know you’re going into recession when you’re going into recession. It often takes some big hit on the top of the head. In the last recession it took Lehman to wake people up. In the recession before it took 9/11.”

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ED YARDENI: The Outlook For US Jobs Is Not As Bad As You Think

Ed Yardeni

Bloomberg Television

“Among the positive indicators were June’s employment indexes included in the national and regional business surveys. Both the manufacturing and non-manufacturing employment indexes were relatively strong at 56.6 and 52.3, respectively. The average employment index of the regional surveys conducted in several Federal Reserve districts also remained relatively high.”

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NOURIEL ROUBINI: Next Year Could Be A Global Perfect Storm—Much Worse Than 2008

flickr/World Economic Forum

“So, it’s the perfect storm! You could have a collapse of the Eurozone, a U.S. double-dip, hard-landing of China, hard-landing of emerging markets, and a war in the Middle East. Next year could be a global perfect storm.”

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JOHN HUSSMAN: The Recession Is Here

“Recall that the NBER often looks for “a well-defined peak or trough in real sales or industrial production” to help determine the specific peak or trough date of an expansion or recession. From that standpoint, the sharp and abrupt decline we’re seeing in new orders is a short-leading precursor of output.”

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Source: BusinessInsider