Paper gold isn’t backed by real gold. They make up as much paper gold as they need to get the price where they want it. If they have to pay out, they sell more paper to raise funds and drop the price before paying out. It’s a pyramid scheme.
Years ago paper metal had an option to be redeemable for metal. Most just took the cash because it’s way easier to move digital currency. But apparently London was having problems when people tried to get their gold.
The Commodities Exchange (Comex) doesn't trade silver or gold. It trades contracts for silver and gold (and other commodities). These "contracts" are the paper referred to in the term "paper gold". If you take control of a contract, the contract will have a date and price on it. If you're holding the contract on that date it should mean you're buying the commodity for that price--except most contracts holders don't actually take delivery, they roll it over to the next contract period or take the cash equivalent. So even though they can't inflate the supply of gold, they can inflate the supply of contracts thereby bringing down the price. The vulnerability, of course, is if the paper price gets too low then too many will take delivery and wipe out the inventory of the real commodity (because there are more contracts than the underlying commodity they are supposed to represent) and Comex would default. And then...financial apocalypse.
How do they use paper gold to bring price down? Sell it to each other?
Sell it at a loss, and try to buy back later at a reduced price. Doesn't work very good when entire continents buy the dip.
Paper gold isn’t backed by real gold. They make up as much paper gold as they need to get the price where they want it. If they have to pay out, they sell more paper to raise funds and drop the price before paying out. It’s a pyramid scheme.
Years ago paper metal had an option to be redeemable for metal. Most just took the cash because it’s way easier to move digital currency. But apparently London was having problems when people tried to get their gold.
Same criminality…
They make up as much p̶a̶p̶e̶r̶ ̶g̶o̶l̶d̶ paper ballots as they need to get the p̶r̶i̶c̶e̶ vote where they want it.
The Commodities Exchange (Comex) doesn't trade silver or gold. It trades contracts for silver and gold (and other commodities). These "contracts" are the paper referred to in the term "paper gold". If you take control of a contract, the contract will have a date and price on it. If you're holding the contract on that date it should mean you're buying the commodity for that price--except most contracts holders don't actually take delivery, they roll it over to the next contract period or take the cash equivalent. So even though they can't inflate the supply of gold, they can inflate the supply of contracts thereby bringing down the price. The vulnerability, of course, is if the paper price gets too low then too many will take delivery and wipe out the inventory of the real commodity (because there are more contracts than the underlying commodity they are supposed to represent) and Comex would default. And then...financial apocalypse.