Legendary billionaire investor sends bold message on gold | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Gold has enjoyed a record-setting run, but legendary hedge fund manager David Einhorn believes the story is much bigger.

As per reporting from Business Insider, the Greenlight Capital founder feels that gold could effectively replace U.S. Treasurys as the world’s primary reserve asset, or move so far that the proximity becomes virtually impossible to brush off.

Clearly, that could be a tectonic shift to say the least.

Einhorn lays out the argument that central banks aren’t treating gold as a dusty diversification tool and have been increasing their holdings at a healthy pace.

That sentiment is similar to comments made by another big-name fund manager, Ray Dalio, who said recently in Davos that,

Moreover, Bank of America’s Michael Hartnett said in a piece I wrote that, given the stock market’s volatility, capital is moving toward gold and other dollar reflation trades.

However, Einhorn’s call carries far broader implications, particularly around long-term credibility.

David Einhorn says gold is increasingly replacing U.S. Treasurys as the world’s preferred reserve asset

Photo by Bloomberg on Getty Images

Wall Street’s latest gold price targets are eye-popping

Gold spot (XAU/USD): $4,969/oz (Feb. 13, 2026). JPMorgan: $6,300/oz by end-2026 (+26.8% vs spot).
Wells Fargo Investment Institute: $6,100–$6,300/oz end-2026 (+22.8% to +26.8%).

Deutsche Bank: $6,000/oz in 2026 (+20.7%).

Goldman Sachs: $5,400/oz end-2026 (+8.7%).

Bank of America: $5,000/oz 2026 forecast (+0.6%).

UBS: $6,200/oz target (Mar/Jun/Sep 2026), with $5,900/oz seen by end-2026 (+24.8% / +18.7%).
Sources: Reuters, Investing, Barrons.

Einhorn’s gold call is really a bet against “trust”

Einhorn’s argument is that gold is effectively evolving into the go-to asset central banks want when they aren’t comfortable holding someone else’s paper.

More Gold:

He feels that reserve managers are now effectively weighing gold against U.S. debt, not against oil or other assets, which is a matter of trust.

China is at the heart of that story.

So, Einhorn sees Beijing’s move as more of a strategy to weaken the dollar’s dominance in developing alternative trade and reserve systems.

Moreover, Einhorn believes there are two accelerants in play at this time.

Firstly, changes in trade policies make dollar-linked assets much less predictable.

Secondly, there’s the U.S. debt/deficit trajectory for investors to contend with.

Einhorn believes that, with such lofty deficits, the government will eventually be compelled to take steps that hurt people who hold government debt.

That entails printing more money, issuing more debt, or switching roles in subtle ways. Gold isn’t dependent on the government, which makes it the best insurance hedge.

Einhorn built his legend on numbers and nerve

David Einhorn is what I would call a performance-first investing legend, and the numbers underscore that point.

He launched his popular hedge fund Greenlight Capital back in 1996 with just $900,000.

Fast forward almost 30 years, and Greenlight’s partnerships have posted a jaw-dropping 3,117% cumulative return and nearly 12.9% annualized net. Over the same period, the S&P 500 returned around 10% annualized.

That level of sustained outperformance over a 30-year period is incredible, to say the least.

Moreover, Einhorn has solidified his reputation on high-conviction calls and hasn’t been shy in thinking out loud.

Front and center was his prescient call ahead of the financial crisis.

In 2007 and 2008, Einhorn questioned Lehman Brothers’ leverage and lofty asset valuations, arguing that its financials weren’t reflective of the bank’s economic reality. Months later, Lehman collapsed in September 2008, becoming the biggest bankruptcy in U.S. history.

In terms of numbers, Greenlight’s latest 13F showed a whopping $2.05 billion in reported equity positions, with the fund posting a+9.0% net return in 2025.

That said, Einhorn just said that Greenlight will be closing up to new capital on July 1, 2026.

Central banks are quietly rewriting the reserve playbook

Central banks are now scooping up gold in size, and they’ve been doing that for years.

The World Gold Council said that the official-sector buyers loaded up on a massive 863 tonnes in 2025.

The upward trend has been consistent over the past couple of years, with additions of 1,082 tonnes in 2022 (the highest on record) and 1,037 tonnes in 2023, the second-highest ever. That’s three consecutive years of structurally elevated purchases.

Moreover, the sentiment is shifting as well.

In a WGC survey from last June, 76% of reserve managers held the view that gold will potentially make up a significantly higher share of reserves five years from now.

It comes amid an intense debate over gold versus U.S. dollar–denominated debt.

China’s Treasury holdings have fallen to $683 billion, and the country has been a net seller for months.

Although I covered in a recent piece that institutions like the IMF have broadly brushed off these concerns, it still reinforces the diversification narrative.

At the same time, Treasurys haven’t dazzled either.

A broad Treasury ETF (iShares GOVT) delivered just a +3.6% average annual return over the past three years.

Mind you, that period also covers a bruising -12.69% in 2022, followed by a mostly modest rebound: +4.21% in 2023, +0.68% in 2024, and +6.15% in 2025.

Gold vs. silver: Here’s the scoreboard across every timeframe

30 days: Gold +6.66% vs. Silver -17.94%.
6 months: Gold +47.60% vs. Silver +99.39%.
1 year: Gold +70.84% vs. Silver +135.93%.
5 years: Gold +170.89% vs. Silver +174.88%.
20 years: Gold +808.35% vs. Silver +720.55%. Source: Goldprice.org.