(Kitco News) – Billionaire investor David Einhorn, president and founder of Greenlight Capital, says the Federal Reserve has been unable to control inflation and will maintain restrictive monetary policy for longer than expected. They are betting money because they are forced to do so.
“I think inflation is accelerating again. I think there are a lot of signs of that,” Einhorn said Wednesday at the annual Thorn Investment Conference in New York.
The well-known investor said in an interview with CNBC that the Fed is unlikely to be able to cut interest rates three times this year in an environment of high inflation. He added that the central bank may not cut rates at all this year.
This month, gold rose to an all-time high above $2,300 an ounce on expectations for a new easing cycle in June. But Einhorn doesn’t foresee a potential long-awaited Federal Reserve policy change to derail gold’s rally.
Greenlight Capital has invested in SPRD GoldShares (NYSE:GLD), the world’s largest gold-backed exchange-traded fund, as a hedge against a potential recession as the Federal Reserve maintains aggressive monetary policy. ) is busy acquiring.
“We own much more gold than GLD. We also own physical bullion, so gold is a very large position for us,” Einhorn said. Ta. “If there is a problem with the country’s overall monetary and fiscal policy, and both policies are institutionally too lax, I think ultimately budget deficits will become a serious problem. And this is where not-so-good things happen. I think it’s a way to avoid risk.”
At the end of the fourth quarter, Greenlight Capital held approximately $74 million worth of GLD, according to SEC regulatory filings. The fund’s GLD holdings account for 3.6% of its total portfolio.
The hedge fund manages approximately $2 billion in assets.
Mr. Einhorn is a long-time gold investor and owns a large amount of physical bullion.
Each year, this one-day conference brings together Wall Street’s top fund managers to raise money to support research programs for treatment and cures for childhood cancer.
The conference is in memory of Wall Street trader Ira Thorne, who died at age 29 after a battle with cancer, and conference organizers say they have raised more than $50 million since 1995. .
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