As he noted yesterday, Keith McCullough has been buying gold since November. A subscriber asked if there was a specific reason why he is buying physical gold, in addition to paper gold, and whether it had to do with counterparty risk.
“I’ve always been long physical gold,” explains McCullough in this clip from The Macro Show. “I’m not going to tell you where I keep it. And I bought a bunch of physical gold when it was at $1,803.”
“What I wanted was something on the board that would just reflect what I’m doing,” McCullough adds. “So, I found an ETF that said ‘Physical Gold’ on it. I wanted to differentiate between paper gold and physical gold, because you should.”
“Take a bar of gold to somebody who’s in the business of buying and selling gold, and you’ll get a good price from them,” McCullough explains. “Now, take some of the CLOs backstopping Arbor Realty’s bullshit and try to sell those. Say, ‘Hey, I got all this CLO crap in my hands. JP Morgan, can you take that out of my hands?’ That’s going to go at a big discount.”