pull down to refresh

2 sats \ 4 replies \ @SwapMarket 19h \ on: How has gold been neutered by ETFs? Has it? econ
Paper gold can be borrowed at a prime broker and sold short. This further enables markets in futures and options. Greater financial liquidity means that the price is less of a function of physical supply/demand.
write
preview
0 sats \ 3 replies \ @kepford OP 19h
Yeah, I understand that. That isn't necessarily neutering right? I would argue that the invention of telecommunications did more to affect gold than ETFs.
reply
2 sats \ 2 replies \ @SwapMarket 19h
Derivatives make price manipulation way easier than physical commodities due to leverage and speed of settlement. Not only ETFs, but all structured products. Telecom and IT progress surely was/is a huge driver of financial markets.
reply
0 sats \ 1 reply \ @kepford OP 19h
Funny thing is that all central banks still hold gold. Still. So do nation states. Gold isn't as practical as it once was but this is due mostly to technological advances.
reply
0 sats \ 0 replies \ @SwapMarket 19h
because they don't trust IOUs
reply