The Gold Rush, pound success & our recommendations for today

19 jul 2019

Ray Dalio is the founder of the world's biggest hedge fund firm, Bridgewater Associates, which manages $160 billion. An American
businessman with an estimated net worth of $16.9 billion. He recently has published a quite interesting essay on his LinkedIn account. Ray
Dalio thinks the current era of low interest rates and quantitative easing might be coming to an end, paradigm that could see escalating
conflict between capitalists and socialists is simple - gold. “I believe that it would be both risk-reducing and return-enhancing to
consider adding gold to one’s portfolio,” the billionaire founder of investment management firm Bridgewater Associates said in a 6,000-word
essay posted on LinkedIn.

The logic of his thinking is approximate as follows. The debt market is becoming less and less investment attractive due to the low
profitability caused by the ultra-soft monetary policy of the leading central banks. As a result, it is quite logical to assume that they
want to redirect their capital from the debt markets to others. But the problem of many countries is that they freeze to debt markets
forming the Ponzi, which is based on the constant debt refinancing. If investors stop lending money the currencies and stock markets will be
among the victims.

The stock market bubble will burst under such conditions, therefore, it is necessary to seek alternatives. According to Dalio, gold is
ideal for investing - this will, on the one hand, reduce risks, and on the other, increase profitability.

Yesterday turned out to be quite successful for the pound buyers. The reason for the growth was unexpectedly good UK retail sales outcome:
+ 1.0% m / m, with the forecast of -0.3% m / m. As well as comments from the main representative of the European Union at the Brexit
negotiations, Michel Barnier, who said that the EU is open to negotiations about the Irish border status. Our position on the pound
today is unchanged - we are looking for points for its purchases.


Our other trading recommendations: we continue to look for opportunities to sell the dollar, oil and the Russian ruble. Gold has
definitely climbed high so today we will sell it.


As for Friday, your attention should be paid to Canadian Retail Sales, as well as The Michigan Consumer Sentiment Index .