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23

The main likely reasons why barter is not more common are: The inconvenience of having to find another party who both offers what you want and wants what you offer. Even if such a party can be found, the possible complexity of negotiating a "fair" transaction (eg I'll do your electrical job if you'll clean my windows monthly for the next 3 months). I don'...

22

It's not clear what level of answer you're looking for, so here is a much more basic answer. There are indeed many exchanges with many different prices. However, if you have noticed that you could make money by exchanging your BTC for USD, exchanging the USD for SEK, and then exchanging the SEK for slightly more BTC than you started with - then someone else ...

19

International currency markets are highly liquid, with near-instant transfer of knowledge between trading centres. This means that any arbitrage opportunities tend to get resolved within seconds. To put it simply, the thing you tried to do, of trading two currencies via a third, is something that lots of real-world currency traders, and their automatic ...

17

In the countries that I am familiar with (such as Canada), using barter to avoid taxes is definitely illegal. You are required to report the dollar value of the exchange as revenue. It is treated as an implicit trade of cash along with the trade of goods. Since I am not going to give tax advice to random strangers on the internet, please consult the tax laws ...

8

Economic analysis always requires making some assumptions at some point. The assumptions that you make should try to fit reality the best that they can. Regarding your specific situation, there is a term in economics that might be helpful in describing what's going on: "Market Segmentation." This is a topic that is often studied in the asset ...

4

The same reason why money became popular in the first place: bartering doesn't scale well. Even if you're able to evade taxes by bartering, the inconvenience makes it difficult to take advantage of this on a large scale. It's only really feasible for casual transactions among family and acquaintenances, not real businesses. When you do barter with these ...

4

Not really an answer, but too long for comment. The $P$ in your $$y(u,v)^*= \frac{v-P(y^*)}{P'(y^*)} +u$$ expression from the insider's problem and the $P$ in the expression $$\min_{P(\cdot)} \cdots$$ from the market maker's problem should not be the same. That is not the definition of rational expectation equilibrium in this context. The insider ...

3

Within finance, there is interest in attempting to replicate the positions of strongly performing funds. So your basic premise has some merit. However, most funds attempt to obscure what they are doing to foil copycats. However, what you describe has risks. The investors you are copying may lose money themselves. In particular, there is no reason that ...

3

You cannot obtain that information with the data provided. You would need periodic samples throughout the day.

3

Consider an economy where there are $N$ goods and assets. How do you purchase a good? If $n \cdot (n-1)$ forms of exchange are possible because all $n$ goods can be all other $n-1$ goods then this is a barter economy. If there is only a single good that can be exchanged for all other goods then only $n-1$ forms of exchange are possible then this is a ...

2

It doesn't save money. Keep in mind that revenue taxes are calculated after deduction of expenses. So if I sell something for 50€, and buy something for 50€, the total earnings of my company have not changed, so neither have my taxes. At the same time, the rules for what a company can claim as business expenses might be wildly different between them, but ...

2

It would not prevent speculation driven bubble like GME but it would arguably prevent the situations such as Robin Hood being forced to restrict trading. This is because when you buy stock your transaction is actually not processed immediately but takes few days to clear (usually 2 days see here). This creates a problem because by law brokers like Robin ...

2

I believe "Auctions of Homogeneous Goods: A Case for Pay-as-Bid" by Pycia and Woodward answers your questions theoretically. This is quite recent and their results are striking. They also briefly discuss some empirical insights. The pay-as-bid (or discriminatory) auction is a prominent format for selling homogenous goods such as treasury ...

1

What were these excess permits of carbon emissions? Is it the amount of permits that are still up for sale (or to be distributed for free); and hence, aren't used? Page 92 of the ETS handbook states that since 2009, because of the economic crisis of 2008, a higher than expected imports of international carbon credits and a large uptake of renewables led to a ...

1

A quote would be on an exchange, and currency involved is whatever is specified on the exchange. There may be multiple exchanges - with different prices. (Price deviations between markets for financial assets are normally small, but that depends on the exchanges being liquid.) Data providers translate those quotes to other currencies based on the appropriate ...

1

Any part of you question about futures is above my pay grade since I know diddly about them. What I do know is that ignoring frictional costs, options and futures are a zero sum game. Winners win and losers lose, eg. a transfer of wealth. Your mentioned stocks in your question and in a comment you defined a leveraged pool as pools that people put their ...

1

Warning I am currently editing this answer, as I feel like I might have come to incorrect conclusions. (Maybe I didn't, but I am putting this warning in place in case I did). I hope to update this answer with more information soon. Answer It appears that a futures market is a zero-sum game. Futures markets the sum of all the long positions must be equal ...

1

I would use A = (low + high)/2. I am not aware of this being a common technical indicator. In regard to common practices "VWAP" refers to any algorithm that calculates a volume weighted average price. I have seen a few references that define simple VWAP = volume x (low + high + close)/3. https://www.investopedia.com/ask/answers/031115/what-common-...

1

There are experts in distressed debt. They buy the debt at a deep discount to face value, with the belief that the salvage value is greater than what they paid. To do this successfully, knowledge of how bankruptcy works is required. Different types of debt have different priorities in bankruptcy. In most cases, bonds are deeply subordinated, and so often ...

1

This is because for the price comparison it is not relevant what the exchange rate is now but what it will be at the time of delivery. The difference between these corresponds to different expectations of what the USD-Yuan exchange rate will be in the future. For example consider oil supplier that is incorporated in the US and eventially needs to convert ...

1

I guess the main reason why you could not find an answer is that economists do not know, see, for instance this chapter of "Electricity Markets." The auction theorist Peter Cramton has a few papers on this.

1

If you have an estimate of the probabilities of each scenario, say with probability $p\in[0,1]$ the loan is repaid (assuming no other scenario exists), then you can calculate the expected value of making the loan of size $L$: In scenario 1, payoff is $-L+(1+0.05)L=0.05L$ (giving out $L$ and getting back the principal plus interest) In scenario 2, payoff is ...

1

I think it really depends on your what you mean by the words "trading", "bartering" and "monetary exchange". E.g. the sentence "I will trade my apple for your orange" describes a barter, yet it uses the word trade. "Let us trade places" also does not involve any money. If you google "monetary exchange took place" you will find several sentences that merely ...

1

What you're describing doesn't work on the open market, where any arbitrage opportunity is scooped up within milliseconds by thousands of trading algorithms. That's because currency markets are perhaps the most liquid market of all markets - primarily traded using derivatives anyway, and able to reconcile nearly instantly. Supply and demand are not very ...

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