Comment by lxgr
1 day ago
Is gold really sufficiently fungible to enable daily bidirectional sizable flows across the Atlantic, but not fungible enough to allow somebody to net these flows out and save at least one way of the airfare?
1 day ago
Is gold really sufficiently fungible to enable daily bidirectional sizable flows across the Atlantic, but not fungible enough to allow somebody to net these flows out and save at least one way of the airfare?
Yes. Gold is fungible only within the same custodian.
Many people buy (normally small) gold bars only to discover that they can't sell them back by the same price.
That is the spread which the gold dealers have to make a profit. But bullion is bullion anywhere you turn and no matter to who you sell. No gold dealer will turn down investment grade gold.
Coordination cost maybe. If you're transferring A -> B and C <- D, but A and C or B and D don't know each other or even dislike each other, it's going to be hard to even get them to talk about the fungibility of the actual bars. And I bet airfare is the cheapest part after all the security and paychecks of people arranging the transaction.