8/12/2019 5The Real Gold Man at Goldman Sachs He Called Gold Crash Right - ET Dt. 19-04-13

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The Real Gold Man at Goldman Sachs: He Called Gold Crash Right ET dt. 19-04-1

WHITNEY MCFERRON & NICHOLAS LARKIN

Goldman Sachss Jeffrey Currie got ahead of golds biggest collapse since 1980 last weekbecause he saw two signals most others missed !rices that had risen for 1" straight years asin#estors sought a ha#en asset failed to rally amid turmoil in Cyprus Gold holdings in e$changetraded funds tumbled at a time when interest rates remained low Currie% the banks &'(year(oldglobal commodities research head with a !h) in economics from the *ni#ersity of Chicago%issued his sell recommendation on +pril 10% before gold fell 1,- in a two(session plunge thatended on +pril 1.% the biggest decline in ,, years /organ Stanley and ank of +mericafollowed Goldman% and the slump wiped out almost 1 billion of hedge fund manager John!aulsons personal wealth 2ou had a whole group of obser#ations that should ha#e created asubstantial rally in gold prices% but they didnt% Currie said by telephone from 3ew 2ork 4hefact that gold did not rally on Cyprus amid the bad *S data that occurred in that time periodcreated the con#iction we needed

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Gold rose 1- in the week after /arch 1' when Cyprus announced an unprecedented le#y onbank deposits% before erasing gains the following two weeks 4he countrys finance minister saidon +pril 1& it may sell gold reser#es to get international aid% helping e$tend a slump this weekafter the metal fell into a bear market +pril 1" ullion capped a record annual run last year asnations pledged more stimulus to bolster economic growth Currie% who manages a team of 11research analysts% first cut the banks outlook for gold prices in )ecember% and then again in5ebruary% before recommending a short position on +pril 10 4he banks 1"(month forecast is forprices to reach 1%,90 an ounce 4he target for the end of "01& is 1%"60 and prices may dropbelow 1%"00 temporarily% he said

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Golds price drop hasnt changed billionaire !aulsons intermediate to long(term outlook on theprecious metal% said John 7eade% partner and global strategist at !aulson Co in 3ew 2ork in astatement on +pril 1.ond buying by go#ernments will increase demand for gold e#en as thecommodity is going through one of its periodic adustments Curries correct goldrecommendation came as he celebrated his 16th year at Goldman Sachs on +pril 1. :e oinedthe bank after earning his doctorate from the *ni#ersity of Chicago in 199'% and became amanaging director in "00" and partner in "008 :e mo#ed to the 3ew 2ork office last year from;ondon% where he worked since "00, and ser#ed as

8/12/2019 5The Real Gold Man at Goldman Sachs He Called Gold Crash Right - ET Dt. 19-04-13

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look at a chart% gold was trending downward consistently% so this was less of a contrarian callthan ones we#e made in the past >hile futures a#eraged a record 1%'61 last year% prices werealready in a fi#e(month slump through 5ebruary that was the worst since 1996 and a monthbefore Goldman Sachs ad#ised selling the metal Gold is now "8- below its September "011record 3ot all of Curries recommended trades are winners 4he bet on higher copper prices that

was recommended on /arch 1 has lost about &98 a tonne% according to an +pril 1' report fromthe bank

Glo)al Mar(et

Currie% who li#es in 5airfield% Connecticut% said he tra#els 1," days out of the year /embers ofhis research team are based in 3ew 2ork% ;ondon% Singapore% :ong @ong and Sydney *nlikee?uities which are by definition regional% commodities are truly a global market% Currie said4hats one reason why =m on the road so much% because of that =ts predominantly corporateplayers in the market% so =m not going to places like oston or Aurich >ere going to placeslike ;agos and Johannesburg% as opposed to where the in#estors are loomberg

Jeffrey Currie, Global Coo!i"ie# Re#ear$% Hea!, Gol!a Sa$%#