I had to look fungible up. In my parlance, you say a bit fungible When the blonde walks by, "say. man, she looks a bit fungible. What you really mean is "hey that babe is "way fungible". So it's the same thing. It is surprising in this commodity oriented commercial world, that you cannot make babes fungible in this sense like they do time on condominiums, and hours of labour etc... Babes of course have their own system whereby they ransom favours to the money maven male by testing his adaptibility to the fungibility of their personal largesse.
Cute? Hell, I am absolutely beautiful. Thousands of females pay me not to walk down their streets because they cannot stand the heartbreak. They throw themselves at me so frequently that I employ a secretary to take names and addresses as I pass by, as I get writer's cramp on an average walk-about. At a George Clooney autograph signing I attended recently, the women were asking me "George who"? I wouldn't say cute, no.
Lease rates of gold are set so the rumour goes to make the loaning and subsequent sale of gold attractive in order to set the price of gold artificially low. That is the rumour.
If a lease rate is low it attracts people to borrow gold, sell it, and buy gold forward at a higher price than today's. The delivery of this gold at a higher price to cover the sale, requires that the gold buyer/seller actually use an instrument or option put to cover his differential.
Of course the buyer/seller who leased the gold can sell his gold forward too, offsetting the higher price he paid. But still he is out the interest if he breaks even. So the interest being low allows less of a coverage by option instruments. If gold is falling in price, it allows the seller/buyer to short gold, or "put" it, and thus win in the shorting game to offset his forward buy.
Low lease rates of gold allow the middleman to borrow gold, sell it and buy T-Bills to pay the interest and make money. This has the tendency to be good money for the bank, and support currencies.
If lease rates are high, this cylce is interrupted and gold sales forward will decline. If gold sales forward are declining the banks may drop lease rates to get money from their normally non money-earning gold deposits. It is a double-edged sword, as the Swiss know. More paper fuels inflation and eventually you break even earning interest selling gold.
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