You're optimistic about the economy but at the same time long on gold. How come?
Wien: I view gold as an insurance policy. Just as you buy insurance on your home and you don't hope it burns down, so you buy gold as a policy against your financial portfolio. The reason is that there's a debasing of all paper currencies, not just the yen and the euro but the dollar as well because we are running unprecedented budget deficits. So I [buy] gold as an insurance policy, not because of inflation or geopolitical risk.
You are looking for higher rates. I presume higher real rates. How does the public recover their 401(k) damage, given higher real rates?
Well, the market is doing pretty well so far this year.
Excuse me, Mr. Wien—the market's doing pretty well? We're up 70% [in] 13 months.
I know. I'm just saying that from Jan. 1 the market has done pretty well. I think the S&P 500 can reach 1300 in the first half of this year. I think interest rates are going to be higher ... [and] Treasury rates will be a headwind for the market. But remember these Treasury rates compared to any [other] recovery cycle are very favorable. Usually at this point in the cycle a ten-year Treasury would be yielding 7% or more. If you look back to the recovery from '73-'74, or from '80-'82, we had much higher rates and the economy was able to recover.