gunDriller
12th December 2011, 06:15 AM
/ Facepalm
"Consider things thought of as "unlevered" such as physical gold. Of course the problem is that gold is bought and sold using leverage every day on the futures market, at various leverage ratios from 2:1 for those investing in ETFs on margin to 10:1 or so for those using futures. Remove all that leverage and the price could easily collapse by 90% in nominal terms!"
http://market-ticker.org/akcs-www?post=198985
not a word about paper gold.
it's odd to see somebody so smart on some issues - and so stupid on others.
reminds me of some engineers i've worked with.
"Consider things thought of as "unlevered" such as physical gold. Of course the problem is that gold is bought and sold using leverage every day on the futures market, at various leverage ratios from 2:1 for those investing in ETFs on margin to 10:1 or so for those using futures. Remove all that leverage and the price could easily collapse by 90% in nominal terms!"
http://market-ticker.org/akcs-www?post=198985
not a word about paper gold.
it's odd to see somebody so smart on some issues - and so stupid on others.
reminds me of some engineers i've worked with.