The relationship between physical buying and paper contracts
by C.G. BHARGAV
A friend of mine once said that he is going on a holiday to unwind. I asked him what exactly he meant by the word unwind.
Then he drew my attention to the old mechanical watches and how they have to be wound up. What will happen when it is fully wound he asked. Well, the spring will be in full tension I said.
Well, you see in our day to day life also we become fully tensed at times. So we go on a holiday to unwind that is to release the tension.
The silver market in the absence of a paper market will tend to become fully wound very soon. And then there could well be chaos.
So, since man has to have silver as long as he is in the planet the tension in physical market has to be eased by the paper market.
But greed being what it is other factors could upset the apple cart.
There is a saying in Tamil language that too much of nectar will become poisonous.
Yes, everyone should have some silver. But let them not hunt (pun not intended) for it!