George Soros seems to think the economy is collapsing or else he is being heavy handed with his hedging. Soros increased his short position dramatically (perhaps even alarmingly) raising his bearish position by 605%. He increased his put position from 1.6 million to 11.9 million shares. Some could explain this away by saying that, like many institutional investors, he is increasing his short position as a hedge, but many people haven’t seen hedges like that since going to Versailles Palace as tourists.
Yes, he did increase his stakes in Facebook and Apple, but he also bought a lot of shares in gold miners, more than doubling his position in Market Vectors Gold Miners ETF from 1.16 million shares to 2.05 million in just one quarter. There is nothing wrong with investing in gold, but such a sudden and dramatic increase gold investment is usually a sign of bearishness or even outright paranoia about the economy and geopolitical situation that can drive people to also stock up on canned food and bottled water, buy guns and hide in bunkers.
George Soros is clearly bearish on the economy with his huge number of puts, but is the sky really falling?