Why I am buying gold and Citigroup

Reasons to buy gold:

- supply is extremely limited
- the printing of money from central banks around the world is generating inflation, and it will increase going forward
- Faber foresees the second half of 2010 when gold price will boom
- Faber stated that gold price wouldn't drop below the $1,000 an ounce mark ever again. A renowned investor that he is, Faber feels that it is the right time to buy gold at these current levels, rather than dumping gold (Prechter disagrees, and thinks that gold will retreat to US$680)
- Renowned investor George Soros has just added 4 million shares of gold at an average price of US$108

Therefore, I will be buying gold, but with a very long-term investment horizon in mind (5 years or more).

Reasons to buy Citigroup:

- the US will recover from the financial crisis
- it offers extremely limited downside risks (current price of US$3+ is a steal)
- Renowned investors Soros (bought 95 m shares) and John Paulson (bought 200 m shares) recently. In 2007, they made tons of money shorting US financials. Now they have turned long.

It is obvious I have to follow the smart money. But this will have to be from a very long term perspective too.