Greenspan, the Fed, and gold

http://www.economicpolicyjournal.com/2010/09/alan-greenspan-hedge-against-federal.html

The multi-billion dollar hedge fund run by John Paulson has a huge position in gold. Zero Hedge reprints a portion of a Paulson letter sent to investors. In that letter, Paulson explains who is advising them to buy so much gold :

Lastly, and perhaps most important, from a monetary policy perspective in developing an ability to forecast the timing and future price of gold we believe we have an unparalleled team. Former Federal Reserve Chairman Alan Greenspan has been extremely helpful to us in understanding the relationship between the monetary base, the money supply, inflation and gold prices.

John Paulson's hedge funds made $20 billion in profits betting against the subprime mortgage industry in 2008. He went long gold in 2009. His recent bets on an economic recovery have soured, but his bets on gold and gold-related equities have continued to outperform.