Gold or Farms?

Gold hits $1,800; but what about farmland?

August 10, 2011, 12:40 PM

Nothing can seem to get in front of this gold freight train. The December contract gc1u, the most active, just hit an intraday record of $1,801 an ounce and recently traded up $44.40, or 2.6%, to $1,787.60 an ounce on the Comex division of the New York Mercantile Exchange. But Jon Nadler, an often bearish gold analyst for Kitco Metals Inc. North America, points out in his morning commentary that some of the so-called “smart money” has moved out of gold.. and into farmland? Read Nadler’s past commentary.

“Amid the chaos and the noise, someone (George Soros) is quietly buying ‘stuff’ you can actually use and which has value way beyond currencies or metals; yep, farmland.” He points to a Bloomberg News story out Wednesday about  investors, including a former bond fund manager, jumping into farm ownership, where returns have averaged 16% annually from Jan. 2008. A fund operated by Soros, whose funds shed gold holdings earlier this year, has also gone into farms. Read more on Soros’s move out of gold.

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