David Einhorn, hedge fund manager of Greenlight Capital, said he's increasing his exposure to gold, and has bought African Barrick Gold (LON:ABG) shares, primarily because they're lower priced than other miners.
Einhorn recently said at an investment meeting of Greenlight Capital, that 'We tend to think of gold as a currency, I think there's going to be a lot of inflation."
Citing the sovereign debt crisis in Greece, and by extension, the overall European Union, Einhorn added that Greece could be the initial signal that the "sovereign debt bubble" is bursting, and it could easily expand to the United States.
One problem Einhorn recognizes correctly, is the difficulty in finding out the real conditions of American banks, which he says in many cases are nowhere near capitalized enough.
That was pointed out recently in an article in the Wall Street Journal, which noted that even the usual practices of hiding the real numbers before a quarterly report seems to have prolificated with some of the major banks in the country, making it even harder to know they're real level of health.
All the more reason to invest in gold and gold miners.
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