c2, what is wrong with this picture? unless of course a whole lot of somebodies are manipulating price of the precious political metal, naturally ;0)
just in in-tray,
player 1
It occurs to me that this offer is too good to be true, would only apply to central banks and their buddies but if not:
Why not borrow some gold, say great heaps of it, secured by same, stored in nice safe location (say buried under the Colorado foothills for example), at negative interest rates, and just hang out for the term of the loan?
When complete, return to sender, pocket risk free rate.
Clearly, too good to be true... so where is the falsehood?
1. The rate?
2. The coupon (available only to select membership group, say, if you are a fed correspondent bullion bank)?
Seems like a complete no brainier to me, however I have at least half a brain, so might not qualify.
player 2
why would one do it, it being that "if lending gold gets you a negative return, why would you do it" ?
obviously to earn more negative returns as diversification from anything that might gain, of course.
any more trick questions from you (edit: player 3)?
:0)
player 3
well, my trick question as you called it, was meant to imply that if a CB actually lends out gold at a negative lease rate, i.e. actually pays the borrrower to borrow the gold, then it would to my mind constitute prima facie evidence of an intent to manipulate the market. the argument that gold must be lent out to generate a return would definitely lack credibility under the circumstances.
|
