So are the mega-wealthy creating another asset bubble, or do they know something that the peasants who invest in stocks, bonds and real estate don’t?
The world’s wealthiest people have responded to economic worries by buying gold by the bar — and sometimes by the ton — and by moving assets out of the financial system, bankers catering to the very rich said on Monday.
Fears of a double-dip downturn have boosted the appetite for physical bullion as well as for mining company shares and exchange-traded funds, UBS executive Josef Stadler told the Reuters Global Private Banking Summit.
“They don’t only buy ETFs or futures; they buy physical gold,” said Stadler, who runs the Swiss bank’s services for clients with assets of at least $50 million to invest.
UBS is recommending top-tier clients hold 7-10 percent of their assets in precious metals like gold, which is on course for its tenth consecutive yearly gain and traded at around $1,314.50 an ounce on Monday, near the record level reached last week.
“We had a clear example of a couple buying over a ton of gold … and carrying it to another place,” Stadler said. At today’s prices, that shipment would be worth about $42 million…
[continues at Reuters]