Gold may have lost some of its glitter of late, but Uri Landesman, president of hedge fund Platinum Management, sees no major reason for concern.
Landesman's firm is "long-term precious metal bulls." Despite the metals getting ahead of themselves he "believes we're in a super cycle in commodities" that will take gold as well as industrial metals much higher over time.
Speaking of time, that's what he thinks will be needed to repair some of the damage to silver in the recently popped trading mania. "All the precious metals got extended," he says, adding that "the easy money in silver has been made." That said, Landesman is a believer in the widespread theory that gold and silver trade roughly in tandem, over the haul (a time at the end of which we all shuffle off this mortal coil -- not a tradable event).
The less-than-emphatic gold bug's enthusiasm is based less on a "religious" conviction and more of a relative value compared to currency. When questioned as to the logic of storing one's wealth in a metal, precious or not, as a way to stockpile against global unrest, Landesman notes that "going to gold as a safe haven here makes more sense than, say, going to the yen."
Currency being a relative play, Landesman is also mildly positive on the dollar, if only due to his skepticism on both the yen and the euro.
Away from commodities and into equities, he is in the camp that says this is the year of M&A. Corporate balance sheets are strong, and boards are looking to put cash to work. Landesman says that research and product development was largely ignored during the financial crisis, leaving companies with hollow pipelines. Where to look? Computer software and biotech, he says. Despite the rally in those sectors, along with every other sector over the last two years, the fund manager thinks corporate boards will be willing to pay a premium to buy growth where organic expansion wasn't sown.
Which companies in particular? The cagey money man is playing his cards close to the vest. He says you can make blanket bets on the field, or, he notes with a wry expression, "do some of the work on some of the names."
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