Thursday, February 20, 2014
China and the real Golden Rule
This stuff interests me. Note that "Price Discovery" means the process of figuring out what a thing is worth. London and New York print pieces of paper, call them silver or gold, and manipulate the price with these documents. Neither financial center has anywhere near enough metal to cover these pieces of paper.
China only acknowleges ownership of 1,000 metric tons of gold. The real number is almost certainly over 4,000 metric tons.
Eventually, people are going to get a rude reminder about the real Golden Rule.
"The guy with the gold makes the rules."