Billionaire investor and ‘bond king’ Bill Gross thinks the top may be in
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Bill Gross told Business Insider that gold acts more like a meme stock than a safe asset.
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The precious metal, which has been rising this year, suffered its worst single-day decline in the last 12 years on Tuesday.
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Billionaire “Bond King” said it “exhibits the characteristics of meme and momentum stocks.”
Gold is trading more like a trending stock on Reddit than a haven for investors, and gold may have peaked after its rally on Reddit. record surgeBillionaire investor Bill Gross told Business Insider:
Yellow metal dropped to 6.3% It experienced its worst decline in the last 12 years on Tuesday. The decline coincided with an even steeper 8.7% decline in spot silver prices.
These moves suggest investors are taking profits after gold and silver’s record-breaking gains this year, perhaps acting on Gross’ latest warning.
After warning investors to “wait a bit” if they want to buy gold in a post on X on Friday, he said:Bond KingGold “exhibits characteristics of meme and momentum stocks,” he told Business Insider in an email.
Gross, who co-founded PIMCO and raised its flagship Total Return Fund to $270 billion in nearly three decades, said the price of gold rose partly because of hype and speculation, making it more volatile and vulnerable to a sudden and sharp decline.
Gross told Business Insider that gold is still “sensitive to short-term interest rates.” The tendency for prices to rise when borrowing costs fall.
This is because falling rates make gold more attractive to investors than cash and bonds as yields fall. Low rates can also accelerate inflation, making gold a more attractive hedge against rising prices and signaling economic distress, fueling demand for gold as a safe investment.
Gold rose this year too because central banks historically purchasing large quantities Gross said this was due to “policy uncertainty.” Trade wars, military conflicts and political disagreements have increased doubts about the outlook for markets and the global economy.
Gross told Business Insider that gold will likely “hold up better than stocks” in the coming weeks, adding that a disappointing earnings season could rein in the bull market. But he said it could happen price pullback After two months of strong trading, it creates “perhaps a better time to buy.”
The master investor said that “momentum, politics and perhaps interest rates will be the dominant factors” in gold’s rise price trajectory.
