The commodity hedge funds are simply collapsing. This is one reason why you will also see the low in gold unfold. With all the ranting, screaming, claims of hyperinflation, threats of investigations, and prognostications that the dollar will end, not only has gold declined, but the appetite for investing in commodities in general.
Clive Capital, who was once the largest Commodity hedge fund, announced it was winding down and returning $1 billion to investors after two years of losses. Being bullish on commodities (including gold) has not paid off in the last two years. Numerous hedge funds are closing. This has included Arbalet, Bluegold, Centaurus, and Fortress. Clive Capital wrote in their announcement to clients:
“We perceive there to be limited suitable opportunities at this point in the economic-demand and the commodity-supply cycles to enable us to utilise our directional, long volatility approach to generate the strong returns of the past.”
This is reflecting the collapse in liquidity and the general deflationary side of this implosion within the world economy. As the G20 continues to hunt money now on a global scale, they will force more and more capital into hiding and the economic contraction to become far worse the more they tax and seek to make illegal anyone with money outside their own country. They are lawyers – not economists or market traders. They only see their own side – power. They do not comprehend what they are doing to the world economy and how they are destroying the future for the next generation reflected in the more than 60% unemployment among the youth.
