Risk is a function of market participants having a perception of lower risks while governments increase their intervention of market prices.–Chicago Slim
One Sign of Increasing Risk: GOFO
The lack of liquidity in the leasing market for gold has pushed the gold forward rates (“GOFO”) into negative territory, meaning that gold for forward delivery is trading at a discount to the physical spot market price–a rare situation that has only occurred a few times in the past twenty years–the last time in Nov. 2008 when a scramble for physical spurred a sharp rally in the dollar price of gold.
This week the GOFO rate did something it has only done a handful of times in its long history–it went negative out to three months which means somebody was willing to pay to have gold instead of dollars right now.
I don’t know what the future will bring, but I do know risks are rising. Values are out there, but with more uncertainty attached. Experience has taught me to deal with excruciating pressure such as whether to buy the yellow Lamborgini
or the red Ferrari.
I am thinking of putting in a fur-lined sink or is that too much? How about I finally do something for the boy scouts. I’ll hire a bus to New York City for a visit here:
Back Twenty-Four Years Ago in Chicago
But I remember the best day of my life 24-years ago back when I was a young pit trader on the Chicago Open Board (Mid-Am Exchange) doing this,
when–within 24-hours--I went broke, my fiancé nixed our wedding day, and my suicide attempt failed. Oh, and the Cubs lost again.
Never would adversity teach so much to an arrogant, ignorant, selfish, and insane twenty-two year old. To be continued………………
Have a Great Weekend!
PS: Three-minute kindergarten course on investing. It is never too late to get started.