3 ms·
But then they bought it again. They had 129 tons of gold, and now they still have 129 tons of gold. Where does the realised gains come from?
by mort96 7mo ago
But then they bought it again. They had 129 tons of gold, and now they still have 129 tons of gold. Where does the realised gains come from?
- emanueleo 7mo agoThey "realized" it just for a short time.
- fakedang 7mo agoThe variation in gold prices in the time they carried out this exchange process.
- littlestymaar 7mo agoSo they had 129 tons of gold, and now they have 129 tons of gold and 11 billions of euros? Sounds like a good deal if so. Edit: wtf is going on with you for downvoting a question…
- 6031769 7mo agoWelcome to the wonderful world of commodities trading.
- sixhobbits 7mo agoThey had gold worth X to the market but X minus 11 billion on paper. So when France accounted for its gold in euro terms they would say they have X minus 11 billion Euros worth of gold. Now they still have the same amount of gold but they "realized" a gain of 11 billion. They don't have that much cash left after the repurchase but now they say they have X Euros worth of gold which is 11 billion more than before. So no they didn't make a profit from this as gold is higher on both sides of the Atlantic than last time they did their accounting updates.
- littlestymaar 7mo ago> worth X to the market but X minus 11 billion on paper. Why was it worth “X minus 11 billions”?
- sixhobbits 7mo agoProbably based on the price they paid for it or when they last did some kind of asset accounting to calculate the Euro value of all assets held
- direwolf20 7mo agoFrom paper shenanigans. Don't expect accounting spreadsheets to perfectly mirror real life. Most of the financial economy is kayfabe.
- AnimalMuppet 7mo agoLet's say I bought a 100-ounce gold bar in 1965, when gold was $35/oz, for a total price of $3500. Let's say I sold it today at $4700/oz, for a total price of $470,000. That gives me a gain of $466,500. And let's say that I regret it. I decide that I really want to hold some gold, so I take the $470,000 and buy another 100-ounce gold bar. The situation was that I had a gold bar worth $470,000 with a taxable basis of $3500. Now the situation is that I have a gold bar worth $470,000 with a taxable basis of $470,000, and I owe the IRS taxes on $466,500 of capital gains. TL;DR: Selling and re-buying the same asset gives you the accumulated gains, and resets the price basis.