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Commodities Briefing - Categorized | Bullion/Gold, Regulatory, Trading more

Why Indians love it when government makes gold expensive

Posted on 26 September 2013

Government of India makes gold more expensive by hiking duties four times in 20 months, hoping this will deter citizens of India from holding more gold. But not only does gold remain attractive for Indians, expectations of a high price regime have increased its attractiveness.
This is not a perverse outcome. It’s more a case of wrong official logic. Economics 101 says high prices dampen demand for a product or a service. But Investing 101 says expectations that an asset class will get pricier can increase demand for that asset. Gold is an asset class………………………………………..Full Article: Source


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VRS - who has written 34624 posts on Opalesque Commodities Briefing.


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