There’s a band playing in the plaza downstairs today, and Anna couldn’t move her feet when she saw the drum set. When the band was done, the drummer invited her to the stage and let her play with the drums. I snapped a picture with my blackberry. Anna loves musical instruments. She now claims that she wants an oboe when she grows up. I am just glad that it’s not a trumpet or drum set that she wants.
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Since the recruiting season is just around the corner, I thought I’d share one random question I came across when I was going through OCI. Can’t remember whether I heard or read it somewhere, or I was actually asked the question during an interview. Anyhow, the question is this: why would people ever want to invest in the stock of gold mining companies when they can directly invest in gold, the product of these companies? I think the unstated logic behind the question is this: Presumably the price of gold is positively correlated with the price of the stock of gold mining companies, and as some may argue, gold has intrinsic value as a hard currency, whereas the stock certificate does not. So why doesn’t every investor in gold mining companies just buy gold instead if they think gold is going up in price?
I think I have an answer. But this may well be one of those open-ended questions for which there is no “correct” answer, or multiple “correct” answers. What do you think the answer should be? Comments are, as usual, welcome.