Pet Rocks Again

Mr. Laurent,

Thank you for your insightful article recently.

https://www.bloomberg.com/opinion/articles/2019-08-09/bitcoin-and-gold-are-monuments-to-irrationality

I hope we can warn the central banks before it is too late!

It does seem quite foolish of the BIS to classify gold as a Basel III Tier 1 Asset.  After all, it earns no interest.  It also seems quite foolish of China and Russia to accumulate such massive amounts of gold this year as years past.  Think of the storage fees and armed guards!   Also, how foolish of Dalio, Drunkenmiller, and others.   They invest in such an unstable asset.   Your comment, “gold prices too depend on human psychology and herd-like investment behavior,”  must be communicated to our world leaders as it could be a national security issue.  What if central banks ran with the herd, and worse!  lost their psychology?   Fortunately, I think a good majority of the reasonable ordinary and prudent citizenry will be protected and get the message before central banks will.  Your article should help inform the public.   After all, it makes much more sense to deposit funds in assets with negative interest rates, than a freely traded volatile pet rock that earns no interest.  Pet rocks are also commingled on financial statements with foreign exchange futures contracts, so there is no question what’s what. 

 Thanks for helping to protect our unsuspecting private investors from human psychology manipulation.  It’s the right thing to do.

 

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