In 2007, value investor David Einhorn wrote a fascinating book titled “Fooling Some of the People All of the Time: A Long, Short Story”, which is about how companies over the course of the business cycle begin using accounting tricks and the indifference of stock investors as long as stock prices are rising. This “accounting cycle” is intimately connected to the business cycle. In boom times, businesses can easily get away with creative (though, in many cases, perfectly legal)

We were again disappointed. Last week, investors did not hear what they were hoping for from Mario Draghi, the ECB chief, that is, when, how and at what rate the central bank will gradually put an end to its policy of quantitative easing. “Come back in October, and then you will find out”, was Draghi´s message to a gathering of reporters and to millions of investors and traders around the world who were glued to their screens.

Although in this case the old maxim “better late than

Exchange traded funds (ETFs) are hot. Everybody is buying. The mantra of passive investing has created a billion-dollar industry for these “trackers.” And gold is not staying behind. One of the world´s largest ETFs is the SPDR Gold Shares Fund (GLD), a gold-backed ETF, which is supposed to track the gold price. And the GLD ETF is perhaps among the world´s “safest” ETFs, but let us not get started on junk bond index ETFs. ETFs suffer from deep structural flaws whenever there arises a shortage of liquidity. Today we will walk through the case of the largest physical gold backed ETF in the world.