Carolina Mandl

NEW YORK (Reuters), David Einhorn, manager of Greenlight Capital’s hedge funds said Thursday that the Federal Reserve was pretending to be able to control inflation. He also stated that it is possible for the gold price to climb in this current climate of rising prices.

The question is “Whether there is enough gold to support the currency reserves.” Einhorn stated that the answer to this question is for gold’s price to rise, possibly even higher. Einhorn spoke at the Sohn Investment Conference which takes place virtually. Einhorn believes that gold will be a critical asset for portfolios since he was a child.

The fund of Einhorn is now up 20% this year due to investment in gold and macro trades.

According to the investor, the Fed has limited tools for controlling inflation due to the U.S. debt. The country’s national debt increases when interest rates rise.

The Fed is lying,” he stated, not in fighting inflation. He suggested that it might choose to back the Treasury. Wait until the Fed is forced into supporting the Treasury with an inflationary surge. It’s good to keep some gold in case that happens. This is what my grandpa Ben taught us.”

He also said that the U.S. had earlier sanctioned Russian Central Bank Reserves and may now allow some other countries to decide whether they want to sell their dollars-reserves.