(Or, SO GOLD IS A VERY RATIONAL INVESTMENT)
The tweet heard ’round the world makes those who claim GOLD is an irrational investment appear to be the true FOOLS. In 140 characters, one man’s opinion added $40 BILLION to the equity value of a corporation. This is insanity and makes the idea of a rational capital market structure very suspect. The number of outstanding shares of Apple Inc. is 908 MILLION, thus a rally of $45 puts on more than $40 billion dollars of equity. This makes the recent rally in GOLD a very rational rebuttal. One man did the work of what thousands of sell side analysts failed to do. (And they wonder why the retail investors have been sidelined). The HFTs are pissed because they didn’t get the news two seconds early. The efficient market hypothesis may be correct during a certain amount of time, but in today’s algo-driven market and tweetable investments it is difficult to refer to any market as rational in the traditional sense. Warren B., you got a lot of explaining to do. But until then, don’t denounce GOLD as a haven in the times of monetary insanity. Oh well, back to the tapering!