/biz/ - Business & Finance

Time for an IQ test

>the same tired talking point for the brazillianth time

>>54735968
Two words. COUNTERPARTY RISK. If you're invested in a paper contract for hypothetical ownership of precious metals, you're hoping and praying that whoever issues the contract is able to make good on their promise.
Physical precious metals are the only asset in the world that hold NO COUNTERPARTY RISK
YOU ARE LITERALLY PICREL

For the lurkers: A low spot price and high premiums indicate that demand is in the PHYSICAL market. Think of these as valves or floodgates that direct where the product flows. As long as the premiums are high relative to the spot price, the metal will flow out of the vaults and into the retail bullion dealers and ultimately private individual's safes. If you don't believe the price is manipulated, the will lead to an equilibrium with spot rising and premiums falling. If you do believe in the manipulation, which has been proven in court on multiple occasions, this drain will lead to the end of said manipulation and chart go hockey stick.
In either case, high premiums are extremely bullish.

>>54695439
>Maybe on paper, but not on physical product.
hmmmm... very wise

friendly reminder to hyperfixate on the spot price and judge all premiums to be unfair chicanery that have nothing to do with real world supply and demand

>LE SPOT PRICE OH EM GEE