Paulson thinks the U.S. economic recovery will be led by the housing market recovery. To him, we have seen a strong recovery in the market thus far and it is likely to continue. The number of houses out in the market is at an all-time low – a 10-year low to be exact – and drives the appeal in buying houses right now. It also places a stress on building efforts, emphasizing the need to build more new homes.
Paulson is seeing a positive turnaround in the U.S. energy market. In particular, he sees petrochemicals and energy-related stocks benefiting.
Paulson sees the world of credit cards, auto loans and mortgages picking up. While he believes of its improvement, he is less bullish in credit.
Paulson continues to feel good about gold, however, he thinks it will take at least three to five years to play out. This is still evident in his portfolio, seeing that Anglogold Ashanti Ltd. (AU) and SPDR Gold Trust ETF (GLD) remains his top two holdings.
He said ever since he got into gold in the Spring of 2009, it has returned about 80 percent.
Source: CNBC’s Squawk Box, http://www.cnbc.com/id/100400853