Contra Media: George Soros hasn’t been Selling Gold, He’s Buying Mines and Redeeming Physical Gold

Mainstream media likes to promote the supposed bear market in gold by attributing to actions of celebrity investors like George Soros. 

From yesterday’s Bloomberg:

Soros Fund Management LLC lowered its investment in the SPDR Gold Trust, the biggest bullion ETP, by 12 percent to 530,900 shares as of March 31, compared with three months earlier, a Securities and Exchange Commission filing showed May 15.

Paul Craig Roberts, former Assistant Secretary of the US Treasury and former associate editor of the Wall Street Journal, writing at the lewrockwell.com unearths what George Soros’ real position is (bold mine)

You know that gold bear market that the financial press keeps touting? The one George Soros keeps proclaiming? Well, it is not there. The gold bear market is disinformation that is helping elites acquire the gold.

Certainly, Soros himself doesn’t believe it, as the 13-F release issued by the Securities and Exchange Commission on May 15 proves. George Soros has significantly increased his gold holding by purchasing $25.2 million of call options on the GDXJ Junior Gold Miners Index.

In addition the Soros Fund maintains a $32 million stake in individual mines; added 1.1 million shares of GDX (a gold miners ETF) to its holdings which now stand at 2,666,000 shares valued at $70,400,000; has 1,100,000 shares in GDXJ valued at $11,506,000; and 530,000 shares in the GLD gold fund valued at $69,467,000. [values as of May 17]

The 13-F release shows the Soros Fund with $239,200,000 in gold investments. If this is bearish sentiment, what would it take to be bullish?

The misinformation that Soros had sold his gold holdings came from misinterpreting the reason Soros’ holdings in the GLD gold trust declined. Soros did not sell the shares; he redeemed the paper claims for physical gold. Watching the gold ETFs, such as GLD, being looted by banksters, Soros cashed in some of his own paper gold for the real stuff.

The giveaway that Soros is extremely bullish on gold comes not only from his extensive holdings, but also from his $25.2 million call option on junior gold stocks. This is a highly leveraged bet on the weakest gold mines. With high production costs and falling gold price from constant short selling in the paper market, Soros’ bet makes no sense unless he thinks gold is heading up as the short raids concentrate gold in elite possession.

Well isn’t this poop and scoop or the spreading disiformation in order to force prices down and enable unscrupulous practitioners to profit?

Media has been deceptive, while it may be true that Mr. Soros may have reduced ETF holdings, they didn’t say that this was not a result of selling but from paper redemption to physical gold. Mr. Soros has shifted from paper gold and joined the physical real gold markets

And it is important to note that in watching what he does rather than what he says (demonstrated preference), Mr. Soros has been buying up the depressed mining sector both from derivatives (call option) ETFs (GDX) and from direct share ownership.

Media can be so toxic.