now you might think that gold would be a perfect collateral for repos, but currently: it’s too volatile - price may drop > 10% on systemic risks there is no lender of last resort (you can’t print gold or have swap lines for it 😀)

Illya Gerasymchuk 2025-07-03 17:49

most of debt is issued for re-financing of existing debt, not for new debt repo markets are the backbone of that. and since they’re collateralized loans - there is a huge demand for collateral/safe assets