Two years ago, Texas University shocked the gold community by taking delivery of $1 billion in physical gold from the COMEX, under the guidance of Texan hedge fund titan Kyle Bass.
Bloomberg reports this morning that the University’s Endowment fund has just liquidated $375 million of its physical gold position over the past 3 months, and will plow the proceeds…back into the PAPER GOLD FUTURES MARKET (along with general equities).
Nothing like identifying a coming trend and getting out of Dodge in time…just to come running back and jump into the fire when the game actually starts heating up!
Somehow we suspect that Mr. Bass was not consulted on the University’s latest financial decision…
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As Bloomberg reports:
The University of Texas Investment Management Co., the third-largest U.S. academic endowment, sold $375 million in gold bars from holdings of about $1.4 billion and reinvested the proceeds in gold futures and equities.
In the three months that ended Feb. 28, the Austin, Texas- based fund bought $75 million in gold futures, $225 million in developed-market equities and $75 million in emerging-market equity futures, Bruce Zimmerman, the chief executive officer, said yesterday in a telephone interview.
The fund, which manages $29.2 billion, started taking delivery of gold through futures starting in 2008 as a hedge against inflation, Zimmerman said. While fund managers and directors remain concerned global consumer prices may increase, the fund wanted to increase investments in equities, he said.
At least the fund sold their bullion holdings prior to the last month’s take-down in gold:
The fund hasn’t bought or sold gold since February, he said. Its gold holdings are now valued at about $1.1 billion, while its cost basis is $967 million, he said.
We are sure our bullion banking friends were more than happy to get their hands on $375 million of Texas’ PHYSICAL gold and immediately re-hypothecated it into several $billion in “gold”.