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<p>[QUOTE="Rono, post: 1051695, member: 6492"]Howdy,</p><p> </p><p>Recall a year or so back when there were supply shortages all over and you couldnt' find bullion anywhere without paying some enormous premiums? It was a classic case of Econ 101 with demand/supply curves. Remember what happens when there is a price that's fixed, say by the gov't? Supply disappears. Happen with gas under Nixon. </p><p> </p><p>I posit that because the paper price of bullion was being kept artificially lower than what the 'market' felt it should be, dealers all of a sudden 'ran out of stock'. If you think the price should be 10 and the market says 8 - are you going to be selling?</p><p> </p><p>Same thing is happening right now with interest rates. The price of money (interest rate) is so low as set by the Fed OMC, banks are not willing to loan money at this point. Hell, 30 year fixed mortgages are under 5% but do many get written at this rate? I think not.</p><p> </p><p>oh well,</p><p> </p><p>rono[/QUOTE]</p><p><br /></p>
[QUOTE="Rono, post: 1051695, member: 6492"]Howdy, Recall a year or so back when there were supply shortages all over and you couldnt' find bullion anywhere without paying some enormous premiums? It was a classic case of Econ 101 with demand/supply curves. Remember what happens when there is a price that's fixed, say by the gov't? Supply disappears. Happen with gas under Nixon. I posit that because the paper price of bullion was being kept artificially lower than what the 'market' felt it should be, dealers all of a sudden 'ran out of stock'. If you think the price should be 10 and the market says 8 - are you going to be selling? Same thing is happening right now with interest rates. The price of money (interest rate) is so low as set by the Fed OMC, banks are not willing to loan money at this point. Hell, 30 year fixed mortgages are under 5% but do many get written at this rate? I think not. oh well, rono[/QUOTE]
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