SerpApi.Org
Billionaire investor John Paulson declared that gold (XAUUSD:CUR), (GLD) is in the early stages of a long-term bull market, reinforcing his conviction in precious metals by announcing he will become co-chair of NovaGold (NG) following a newly announced merger.
Shares of NovaGold (NG) rose 11.65% on Wednesday’s afternoon trade.
In an interview with CNBC, Paulson—who became a household name after betting against mortgage debt during the housing bubble—explained why he continues to press his long-held gold thesis.
"Gold is becoming the most sought-after reserve currency in the world, replacing fiat currencies," Paulson said. "As people lose faith in paper currencies, gold (GLD) as an alternative will continue to grow."
The precious metal is also going for its best two-day rally since the start of the second quarter, up 9%.
While gold (GLD), (XAUUSD:CUR) has pulled back roughly a thousand dollars from its highs this year, Paulson noted the metal remains up more than 20% over the past year.
He pointed to sustained demand from both central banks and the private sector as evidence that the upward trend will continue.
When asked about alternative ways to express a bearish view on the dollar (DXY), Paulson emphasized that early-stage gold stocks represent the best opportunity.
Paulson broke down the compelling math behind his NovaGold (NG) investment: the company possesses 40 million ounces of gold in measured and indicated resources and reserves.
"At the market cap of $4.2B, you're buying gold in the ground at only $119 per ounce," he explained. "You only paid less than 3% of the gold price."
Gold and Gold Miner ETFs: (GLD), (IAU), (SGOL), (OUNZ), (BAR), (GDX), (GDXJ), (NUGT), (RING), and (DUST).
