Can Governments Fix a Market Price?

The Silver Market was recently found to be rigged. Can Governments Fix a Market Price?

[box type=”info”]HISTORIC EVENT: LBMA SILVER FIX BREAKS, JANUARY 28TH — Silver Markets in Disarray After Benchmark Price FIXED AT $13.58, FAR BELOW REAL WORLD Trades, Spot Price[/box]

No, they cannot. Consider the fact that all currency pegs have ultimately failed. Governments can subsidize one side or the other, but this doesn’t change the market price because all value is subjective. A good example is the Swiss Central Bank’s recent attempt to fix the price of the Swiss Franc to the Euro. People continued to buy Swiss Francs against Euros until the Swiss Central Bank was overwhelmed. People acted based on their subjective determination of value. The peg subsidized buyers of Swiss Francs. It did not change the market price. It provided a subsidized price.

Government interventionist policies always distort prices. This creates opportunities for profit. Keep in mind that governments aren’t able to change market prices because all value is subjective. This is a fundamental economic law. Governments cannot repeal economic law any more than they can repeal the law of gravity. However, they can create subsidized prices, and, if you have positioned yourself properly, they can subsidize your speculation net profit. You can accomplish this using the Fixed System. For more information on using the Fixed System click here for a free white paper. And yes it is true: 10K can be leveraged and pyramided to 5.5m in less than a year.

by Arthur Fixed

[box type=”info” style=”rounded” border=”full”]Commentary from Arthur Fixed the author of the Art of Speculation during Civil War – Sun Tzu Meets Jesse Livermore is a private manuscript copyrighted 2012 by Art Fixed.[/box]