[Toddsterpatriot]

From an institution that is usually not in the possesion of the underlying good.

So the buyer makes $2 when the underlying goes from $10 to $12 and the seller loses $2.

[Rummenigge]

Ummm no ?! There’s usually a leverage and a spread - isn’t there ?

By selling back and forth the banks ‘earn’ a lot of money.

So the buyer makes maybe 2$ times 4 minus 20% spread.... and because the buyer (as the seller) is most probably an institution that doesn’t work with it’s own capital it’s minus some more percent for interests.

It’s not the 2 dollar back and forth - it’s the interests on captial - the spreads - and all that.

There’s so much capital in these markets that doesn’t really produce a benefit. It’s like the housing bubble - so much economy around a guy that cannot pay for his house. It’s excessively printed money at work.

Watch it collaps as gold goes to 2k$