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To: long-gone who wrote (27855)2/7/1999 11:04:00 AM
From: John Hunt  Read Replies (2) | Respond to of 116837
 
Re Gold & Silver Leasing Formula

Hi Richard,

I have been playing around with this on a spreadsheet so that I can enter the data and watch it for the next few days.

I think the brackets should be off the formula

Gold carry profit rate = TB(t) - [LR(t) - I ]

Should read

Gold carry profit rate = TB(t) - LR(t) - I

(This agrees with his numerical example)

If you assume a rising inflation rate over the next 12 months for I, that is rising rates for 1, 3, 6, 12 months, it also becomes much less profitable. IMHO, the inflation trend will become more and more our friend.

Obviously, it is not longer attractive to carry silver.

< g >

John