Paulson has been stung by the mine unrest at AngloGold (NYSE:AU) in South Africa. His positions in gold bullion have been relatively flat.
Paulson has been bullish on gold over the last few years.
“I view gold as currency, I was not interested in it as currency until quantitative easing,” said Paulson in 2010. Paulson also explained why any talk of gold being a bubble is preposterous right now. Paulson’s key point is that gold ownership is incredibly low.
For example, it is estimated that pension fund holdings of gold are between 0.15% and 0.5%. In the past, pension fund holdings were close to 5%. In other words, how can gold be a bubble if it is such a small percentage of the financial asset landscape?