Why FOFOA? Who is FOFOA?

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Steve Netwriter
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Here are some clues Smiling

Quote:
And then, on January 30, 1997, the daily volume of paper gold sales on the London Bullion Market Association (LBMA) IS LEAKED through an article in The London Financial Times (FT). Posted by "The Red Baron":

Quote:
For 8 months following this strange event, the chat room at Kitco (the ONLY gold chat room at the time) buzzed with intrigue about the meaning of this revelation. Then out of nowhere, someone started posting under the name ANOTHER, offering a plausible explanation for everything that had been happening in plain sight. But the real kicker was ANOTHER's call -->PREDICTION<-- of the END of the dollar as the global reserve currency! Back in October '97, this call was COMPLETELY UNPRECEDENTED!

It became apparent to those who followed ANOTHER that he was closely tied to the monetary faction that opposed the massive inflation of dollars and paper gold. It became clear that he was somehow associated with the ECB and/or the BIS. It also became clear that he had been writing through an intermediary, an American friend, in order to ensure his anonymity. This friend came to be known as "Friend of ANOTHER", or FOA for short.

http://fofoa.blogspot.com/2009/08/call-of-century.html

Can you guess? Smiling

Some posts:
http://www.goldforum.com/forum/search.php?searchid=5035

====================

I have a forum dedicated to ANOTHER, FOA and FOFOA:

http://neuralnetwriter.cylo42.com/forum/91

where you will find many answers.

Your friendly host. You can email me here: climategate.scandal at gmail.com

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rabble babel
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Can you guess?

I know this is an old thread Steve-but what are we guessing?
Is it "who is FOFOA?"
Or (since its so old), "what does FOFOA stand for?"('cos everyone knows now,eh?)
Or something else?
I note no-one had any guesses yet.....
Having read FOFOA "for eva'" the question of his identity increasingly intrigues me especially after the recent comment by Bron Suchechi implying that FOFOA might be close to the WGC.

Quote:
Unless of course you are close to the WGC, but then that would be revealing a bit too much? Smiling

http://goldchat.blogspot.com/2011/02/further-discussions-with-fofoa-on-g...

How could a would be burger flipper ........

http://fofoa.blogspot.com/2010/06/day-2-early-poll-indications.html

Quote:
Here's the poll question:

Is my time more valuable here sharing my Thoughts, or flipping burgers to protect my savings?

A) Here

B) McDonald's

be so erudite-the man is obviously a scholar/thinker of some note(well he presents as a man,doesn't he?)

While I am asking questions why is there a reference to the BBC in the header of this website?

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

Steve Netwriter
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Hi rabble babel I've long

Hi rabble babel Smiling
I've long held the view that identity of writers is unimportant. It's what they have to say that matters. So this thread was very much only about why "FOFOA", and not about the person behind the name.
I expect that many who first come across the name will wonder what it stands for. I'm not SURE it's ever been stated, but I assume, as I implied above, that it is an extension of the idea of Friend Of Another, as in Friend Of...FOA.

As to identity, or other facts, I don't think you can draw any reliable conclusions from someone's ability to write and think well. There are many taxi drivers who surprise at their abilities.

As to the BBC link, I put that there at the height of the Climategate saga to gain maximum search engine notice. It's still a reminder (if you read the thread), of how the mainstream media, with the BBC as a very good example, covered it, and IMO serves as good evidence that the media cannot be trusted to report in an unbiased uncensored way. So serves a purpose for more than just climate related matters.

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d2thdr
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FOFOA

I believe FOFOA is a giant in the exact sense 'Another' meant it.

I wonder if about 300 odd years from now, will there be a autobiography released in posterity. It would go unnoticed, I think, as Humans are quite fickle creatures. I think I will make a note in my will asking my future generations to read a bit of A/FOA/FOFOFA to be eligible for the claim on the gold they might inherit.

Freegold- only way to protest against the growing tide of conformity.

rabble babel
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Hey D2,what sense...?

Sounds like you have a similiar respect for the ideas/philosophy; Thumbs up but could you please clarify/elaborate on what you think another meant by 'Giant'.
I find it incongruous that a Shocked "burger flipper" would be in conversation with european royalty,'small giants' and have such a detailed knowledge of markets.The fact that the essays have an improbably small number of typos is also indicative of something.....
Mr Netwriter,Sir, Smiling the identity of such a talented individual who is having such a profound influence on economics could be of relevance if they were not one individual-but a team.
Some vested interest on FOFOAS part(larger than the metal stash he has owned up to) could also have relevance.......
FOFOA sounds as though he only "plays cricket",but. Thinking Big

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

Capt Goodvibes
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Another meant Giant as one of

Another meant Giant as one of huge wealth, ie. billions.

Your conjectures about the identity and attributes of FOFOA are way off the mark there RB, but I'll let him put you right, should he choose to. Thumbs up

I can't see that it makes any substantive difference: a sound idea is a sound idea, no matter the source. FOFOA does not claim to be the originator, just the guy with the intellect (and the time) capable of giving it the cut 'n' polish it deserves and us less well endowed require.

d2thdr
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Giant?

Another meant 'Giant' who might be worth billions of dollars. Yes.

I also read on his blog -

Quote:
I remember when FOA and Aristotle had similar conversations. So let's pretend we've eliminated fractional reserve banking yet we still have gold loans.

If he remembers this conversation- he knows FOA. That is my opinion anyway. His mission is to make small giants out of the common man. I do feel RPG can not be implemented without the support of these small giants.

Or he could be Morpheus.

Freegold- only way to protest against the growing tide of conformity.

Capt Goodvibes
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Quote: he knows FOA. I know
Quote:
he knows FOA.

I know different, but you are entitled to your opinions.
He remembers because he has spent thousands of hours reading the archives, since finding USAGold in 2008. He simply had few obstacles in understanding their perspective, and was able to use inductive logic to make connections to contemporary events and extrapolate these into the future.
I've already narrowed the field for you by 50% Eye-wink , but I won't be commenting further. I just wanted to put you straight on your thoughts above.

rabble babel
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Dammit Goodvibes,you are so obscure sometimes

but I like it..... Smiling
If FOFOA was a 'Giant' in the sense that he has billions why does he say he has unexpected expenses and 'needs to flip burgers'.That's disingenuous.
If he has got billions then he does have an interest in the outcome.....
I agree the ideas apparently stand on their own merit.
But I keep thinking of the ol'tinfoil standard 'problem,reaction,solution'angle.
He has spent thousands of hours on the archives and a good many more writing his own essays(how many complain about the length of his dissertations?).I love the way you say

Quote:
he simply had few obstacles

-what's simple about his subject,eh?And how simple to pierce 'recieved wisdom'?(-well thats a misnomer in this case,ain' it?)
He 'must' be educated(some cab driving Giant Smiling ) independently wealthy or sponsored to turn out such beautiful work and keep up to date with developments-or a team.But CGV insists I am way off base-implying some personal knowledge not disclosed to all in the collected works.CGV and FOFOA have a lot in common......prolific and philanthropic Shrug Shoulders
But FOFOA does detest tin(even silver really Smiling )
So who is Neo?

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

Capt Goodvibes
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everyONE
Quote:
So who is Neo?

We all are. Thumbs up

Quote:
-what's simple about his subject,eh?And how simple to pierce 'recieved wisdom'?

Perspective yields simplicity. Thinking Big

d2thdr
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CGV might be correct

FOFOA did not know FOA. However, may be he does now.

He is a client of Europac - Peter Schiff's company.

He read A/FOA in 2008, for the very first time.

He is a big fan of Antal Fekete. ( Though I wonder what he thinks about Gold Basis).

Now that I am re reading all his posts, there would be more insights about this person. Whoever, he/she is - I salute you and thank you for taking time to do what you do.

Freegold- only way to protest against the growing tide of conformity.

owen
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Flipping burgers can be an

Flipping burgers can be an expression, simply meaning to pass the time - no more no less.

Onto the more interesting slant that this has - that of the human condition, and trust. We are trained that we must trust the speaker first, before we trust the message, or the content. Evidently that is not true, because it matter not whom the speaker as, as long as we pay attention to the message, and apply the usual rigour to it.

By getting you to focus on the speaker, and not the message, many of the critical faculties that should be applied are not, and allow bad messages to be accepted, and thats how we've ended up in this very, very fine mess Stanley. We trust the speaker, so what they say has to be right.. right.?

This is precisely the slight of hand that has been exploited to drive the world onto the rocks.

No I have no claim to know FoFoA, but like the contributions, I like the message and am not bothered if its a single person, or a team. Its a damned fine job, and needs to be kept up - and I look forward to the next contributions (assuming that account isn't quietly closed, and the door click softly as he walks away...), so my response to why FoFoA is simple, its the message stupid.

Owen

Auckland... Where the heck is that..?

d2thdr
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zerohedge
Quote:
by uno
on Tue, 03/08/2011 - 19:41
#1031548

Yesterday I was talking with my co-worker, sits across from me. Very intelligent, tutors calculus and advanced math on the side. I was explaining the thoughts of 'Another' from Kitco's board years ago, I had just re-read them. He could not understand anyone valuing gold as a currency. I explained silver's use in medical and electrical applications, still did not get it as a currency.

Long long way to go before the sheeple gets on the buying spree. Still some more time left to buy the precious.

Freegold- only way to protest against the growing tide of conformity.

Perry
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Choke, Sputter, Wheeze, Cough, Gasp

Hard to eat gold bars.
Silver's the same.

d2thdr
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eating...
Perry wrote:
Hard to eat gold bars.
Silver's the same.

The best thing about eating gold is pooping gold. Don't eat ETF GLD paper though, it's boring and painful to poop out.

Freegold- only way to protest against the growing tide of conformity.

Perry
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Does That Add . . .

. . . a whole new dimension to the expression:
shit a brick.
Shocked

If so, I would not want to further along:
my blood's worth bottling
using that same vein of reasoning.

rabble babel
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Perry you is da' man

You really are mining(on topic x 3) that vein aren't you? Happy horizontal clapping

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

Perry
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Vane-ity, all is vane-ity.

Vane-ity, all is vane-ity. The harsh reality is that
of the two people starving on the proverbial
desert island, the one with the food will outlive
the one with the gold bar. Unless the one with
the gold bar also has a functioning gun.

Lemon Thrower (not verified)
Another seems to me to have a

Another seems to me to have a middle-eastern world view based on his phraseology and other indicators.

I read on a different site speculation that Another = James Turk, and that is plausible. Turk spent a lot of time in the middle east. His published bio is a bit thin though, so its difficult to confirm or deny.

FOA seems to me to be a European insider. definitely has a pro-Europe anti-U.S. perspective. He seems to have influenced FOFOA the most although i believe FOA to have less meaningful insights than FOA. I think FOA and FOFOA have a bias in favor of the Euro as if it is superior to the dollar. At best, its the same thing. I think all paper fiat may fail, but i don't see the Euro surviving and the dollar failing like they seem to.

d2thdr
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euro v usd
Lemon Thrower wrote:
I think FOA and FOFOA have a bias in favor of the Euro as if it is superior to the dollar. At best, its the same thing. I think all paper fiat may fail, but i don't see the Euro surviving and the dollar failing like they seem to.

Euro is not superior to dollar. Neither is it superior to any fiat. However, there are things that makes Euro superior to dollar viz. Gold marked to market and not under the control of a single country. Euro also being young has not lost its credibility, while USD has.

Freegold- only way to protest against the growing tide of conformity.

Steve Netwriter
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Welcome Lemon Thrower

Welcome Lemon Thrower Smiling
Always good to see new members posting Thumbs up

Your friendly host. You can email me here: climategate.scandal at gmail.com

I recommend buying gold and silver from BullionVault

Lemon Thrower (not verified)
Quote: Euro is not superior
Quote:
Euro is not superior to dollar. Neither is it superior to any fiat. However, there are things that makes Euro superior to dollar viz. Gold marked to market and not under the control of a single country. Euro also being young has not lost its credibility, while USD has.

I agree that the Euro is not superior to the dollar but FOFOA thinks the Euro will survive and be the mechanism for Freegold. Its at that point that i disagree with him.

marking gold to market is nothing but an accounting trick - the Fed could do that with the dollar tomorrow.

my view is that the Euro was envisioned as an offset to the dollar, and it has been a phenomenal success. It was not designed to replace the dollar but to coexist with the dollar.

I don't beleive the dollar will fail before the Euro. The dollar is the most used currency and so everyone has a vested interest in its success and continued usage. it also has a strong military behind it. the euro does not have these advantages.

Even if the Euro outlasts the dollar, the moment the dollar fails the Euro has basically become the dollar. marking gold to market in dollars has some value when you are the no. 2 currency, but once you become the no. 1 currency all this does is advertise that you are debasing your currency. this is why the Fed does not mark its gold to market. to understand how there is no advantage to doing so, consider this. if you assume there is an advantage, then the Fed rationally ought to mark its gold in dollars up to the current value. further, the Fed would then have an incentive to print as many dollars as possible, because the value of its gold would then rise in dollars. obviously doing this accomplishes nothing besides making dollars worth even less, and this illustrates that the assumption is wrong.

ultimately, government paper is merely currency, and currency is a money substitute--not money. gold is money. printing more paper or changing the accounting does not increase the amount of money.

Capt Goodvibes
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LT wrote: doing this
LT wrote:
doing this accomplishes nothing besides making dollars worth even less

Au contraire; it establishes the value of the gold reserve, and by floating that reserve it reveals this value to be much higher than previously accepted, as well as being a mechanism which will keep this value stored in the physical gold reserve protected moving forward.

You say stability in the monetary system is nothing?

The establishment of an objective reference point such as this is not in the interests of the US, because the true value of the dollar would be revealed; a much bigger hit than this revaluation would serve to other currencies.

Objectivity in the monetary system has no value to you?

The issue is nothing to do with Euro vs Dollar, and everything to do with an equitable system for all users.

The advantage of the Euro is that it is designed to be compatible with an equitable emergent system. The dollar does not have this flexibility. If US reserves were MTM, the system would have to price in all US dollars. There's a lot of them out there. The US cannot afford this, credibility-wise (or any other-wise).

Usage demand for the USD would fall off a cliff. It will anyway, but the US hardy want to hasten it.

If the US did MTM, they would simultaneously make the Euro far stronger than the USD by extension: ie. the gold reserve to outstanding currency ratio.
USD is old and very bloated, and it is only due to credibility inflation that this incredible bloat is not currently priced in. MTM US gold reserves destroys this advantage, and the jig is up.

Lemon Thrower (not verified)
my point is that when you are

my point is that when you are the lead dog, which the dollar is now, floating the price of gold accomplishes nothing because it just indicates that the dollar as a reference point is anything but stable.

if you are no. 2, like the euro is now, there is some relative benefit to marking to market but this benefit vanishes once you become the lead dog and even before then it exists only if you are diluting your currency relatively less than the lead dog.

d2thdr
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occams razor
Lemon Thrower wrote:
Quote:
Euro is not superior to dollar. Neither is it superior to any fiat. However, there are things that makes Euro superior to dollar viz. Gold marked to market and not under the control of a single country. Euro also being young has not lost its credibility, while USD has.

I agree that the Euro is not superior to the dollar but FOFOA thinks the Euro will survive and be the mechanism for Freegold. Its at that point that i disagree with him.

marking gold to market is nothing but an accounting trick - the Fed could do that with the dollar tomorrow.

my view is that the Euro was envisioned as an offset to the dollar, and it has been a phenomenal success. It was not designed to replace the dollar but to coexist with the dollar.

I don't beleive the dollar will fail before the Euro. The dollar is the most used currency and so everyone has a vested interest in its success and continued usage. it also has a strong military behind it. the euro does not have these advantages.

Even if the Euro outlasts the dollar, the moment the dollar fails the Euro has basically become the dollar. marking gold to market in dollars has some value when you are the no. 2 currency, but once you become the no. 1 currency all this does is advertise that you are debasing your currency. this is why the Fed does not mark its gold to market. to understand how there is no advantage to doing so, consider this. if you assume there is an advantage, then the Fed rationally ought to mark its gold in dollars up to the current value. further, the Fed would then have an incentive to print as many dollars as possible, because the value of its gold would then rise in dollars. obviously doing this accomplishes nothing besides making dollars worth even less, and this illustrates that the assumption is wrong.

ultimately, government paper is merely currency, and currency is a money substitute--not money. gold is money. printing more paper or changing the accounting does not increase the amount of money.

You make too many assumptions. Occam's Razor needs to be applied. You need to re read A/FOA/FOFOA.

CGV has answered it better than I.

Another point is you are saying Euro to be No 1. Wrong. Gold will be No 1. Everything else will be fiat. Among those fiat, Asian fiat will be backed by labour, middle eastern fiat will be backed by oil, Russian fiat by energy, Euro will be backed by nothing particular except credibility.

Freegold- only way to protest against the growing tide of conformity.

Capt Goodvibes
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d2thdr wrote: ...you are
d2thdr wrote:
...you are saying Euro to be No 1. Wrong. Gold will be No 1. Everything else will be fiat.

I thought that too... what is assumption Euro want to be lead dog based upon?

All fiat will be subservient to gold, which is as it should be in a free society.

Gold ain't going up. Or down. Or anywhere else. These are illusions created by fluctuations in confidence, and the manipulations thereof, of fiat currencies (particularly the USD), and the misguided use of these as the denominator of wealth.

Wealth is simply the stock of value.
Unencumbered physical gold is the natural and equitable store of this value, and as such wealth is measured by weight in gold.
Fiat currency is the flow of value, the income and expenses.
If one accrues a surplus in fiat, it would be best stored in gold, as the stock of this value, aka wealth.

Lemon Thrower (not verified)
I dont think the Euro is

I dont think the Euro is going to be no. 1, FOFOA does and probably FOA.

I disagree with him/them there.

I havent' read FOFOA in a few months because i figured out he was going in the wrong direction. I understand he's changed his tune and now says that gold will actually circulate rather than fiat.

agree with you CGV that ultimately phys au is what will store value.

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Quote: gold will actually
Quote:
gold will actually circulate rather than fiat.

Absolutely not.

The underlying premise of Freegold is that the medium of exchange and the store of value cannot be the same thing. Circulating gold coinage as a medium of exchange is a barbarous relic.

I've never observed FOFOA change his tune about anything; his position has been completely consistent since his first post. Other people's interpretation of his writing has been a different story; if you are not dealing in first hand information (as you insinuate) then this is likely the source of your misunderstanding.

Quote:
I dont think the Euro is going to be no. 1, FOFOA does

No, your limited understanding of what you think FOFOA says in this regard leads you to this erroneous conclusion. There is no "#1" under Freegold- there is no need. A different paradigm has different parameters, and different requirements, and a reserve currency is not one of them in the future as it is now.

d2thdr
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divisibility
Capt Goodvibes wrote:
Quote:
gold will actually circulate rather than fiat.

Absolutely not.

The underlying premise of Freegold is that the medium of exchange and the store of value cannot be the same thing. Circulating gold coinage as a medium of exchange is a barbarous relic.

I've never observed FOFOA change his tune about anything; his position has been completely consistent since his first post. Other people's interpretation of his writing has been a different story; if you are not dealing in first hand information (as you insinuate) then this is likely the source of your misunderstanding.

Quote:
I dont think the Euro is going to be no. 1, FOFOA does

No, your limited understanding of what you think FOFOA says in this regard leads you to this erroneous conclusion. There is no "#1" under Freegold- there is no need. A different paradigm has different parameters, and different requirements, and a reserve currency is not one of them in the future as it is now.

Dancing Banana CGV hits a homer. CGV hits a Sixer. Happy vertical clapping

Ok I will humour you and say gold will circulate. I do not know in what context you say this exactly. However, this is my opinion (which counts for nothing really!!) on circulation of gold.

I asked a question to FOFOA.

Background- he said in one of his posts -( also Ender mentioned this in one of his comments and possibly Aragorn III also alluded to this)- Indian women will be like the new rich movers and shakers on account of the amount of gold they own.

I ask him will there be enough gold available for these women to acquire more? What if there is a scarcity of gold.

FOFOA used only one term to answer this - 'DIVISIBILITY'.

Go figure.

Freegold- only way to protest against the growing tide of conformity.

d2thdr
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narrative fallacy
Lemon Thrower wrote:
I think all paper fiat may fail, but i don't see the Euro surviving and the dollar failing like they seem to.

Also there is a narrative fallacy in your argument.

Euro is not in crisis. Eurozone is in crisis.

USD and USA are both critical.

Freegold- only way to protest against the growing tide of conformity.

Lemon Thrower (not verified)
fofoa has said the euro will

fofoa has said the euro will survive but the dollar will not. i refer to that as euro becoming no. 1. i guess he never addresses yuan but he does expect euro to survive. so i think its fair to characterize his commetns as Euro will become no. 1.

for a long time, he has said gold will be the store of value and not circulate, and that somehow Gresham's law will be suspended and people will circulate paper. but he's changed his tune because recently in his comments - he talks about fractional gold such as gram bars circulating.

i think the remonetization of gold in some form is inevitable, and I credit FOFOA for bringing this to so many people's attention. But i don't think the vehicle will be the Euro. Even if it is the Euro initially, once the dollar fails or loses supremacy people will convert their Euro to physical.

finally, the euro is backed by nothing but the goods and services of the euro zone. the eurozone may have less problems than the US economy, but the Euro has more problems. the eurozone as a political institution is breaking apart. will germany subsidize greece, portugal, ireland, and spain? or jettison those countries?

ultimately the Euro is a piece of paper just like the dollar. Neither are a warehouse receipt for gold. I don't understand why the Euro will be accepted in lieu of gold.

d2thdr
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Hall of Fame
Lemon Thrower wrote:

FOA seems to me to be a European insider. definitely has a pro-Europe anti-U.S. perspective.

NO he is American. He admitted this in his posting.

Quote:
Our stance is and always has been that the world will be using paper digital currencies for the rest of our lifetime. I for one, have never heard any official voice his stance that we will move back into a gold standard. Their (Euroland) direction has always been to keep a reserve currency system and strengthen it with a free physical gold market trading in the background. In none of our meetings have we heard where a fear was expressed that the governments will lose control of digital currencies and give it (that control) back to gold. That is simply not going to happen, no matter how severe a down turn the loss of the American dollar system creates. Believe it.

This has been the fundamental thrust of this news. The dollar system is failing as we move into another stronger (relative to fiat currencies) money system. I support, use and promote the new Euro simply because it is and will create the next trend for the future. Not because it's a gold currency of extra hard value. This (Euro) future will see us all using digital currencies, for better or worse. Therefore, by logical extension if I must use a reserve currency of account, I move into one that has the best strategic ability to survive and denominate my assets. In addition, it's creators are restructuring the gold market to the physical bullion holders advantage. This is the only reason I "Walk In The Footsteps Of Giants". They created this bullion path and the world will follow in due time. Therefore, my position of Euro assets and physical gold. Mostly (because I am American), I lean to gold for this transition.

You must read the HoF.

This post will put all your doubts at rest.

HALL OF FAME

Freegold- only way to protest against the growing tide of conformity.

rabble babel
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LT

Sorry,in the nicest possible way,of course-but I agree with CGV

Quote:
No, your limited understanding of what you think FOFOA says in this regard leads you to this erroneous conclusion.

If you look at the latest one or two FOFOA comments sections you will see quite a lot of discussion about people dragging the conversation back to the 'same old, same old'.I dont want to stereotype you but you sound like a 'noob'.Ya just gotta keep reading the work till you get it-if you can't get it from FOFOA you ain't gonna get it.
Do you understand that the Euro is backed by a routinely revalued gold hoard(at market) and that the dollar is fixed relative to its gold at US$43 an oz.(or thereabouts)?Isn't that where the Euro gets its strength?When the price of gold goes up so does the asset side of the Euros balance sheet.If gold went to $50k per oz. the assets of the Euro would explode upward-NOTHING would happen to the US balance sheet.
CGV said

Quote:
The advantage of the Euro is that it is designed to be compatible with an equitable emergent system. The dollar does not have this flexibility. If US reserves were MTM, the system would have to price in all US dollars. There's a lot of them out there. The US cannot afford this, credibility-wise (or any other-wise).

Freegold is a new asset class-not 'money'(I think? Roll Eyes )
FOFOA is way too deep for me so I offer this as a simpleton,but not a noob......... Smiling
D2,how do you 'know' that American comment isn't a curve ball-does he use English or US grammar or spellings?

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

owen
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RR, Thats the touch of genius

RR,

Thats the touch of genius behind the euro - the key part will be in the longer term that they can keep the liabilities side below market fluctuation. The Germans are very keen to ensure that this is the case, and rightly so.

Owen

Auckland... Where the heck is that..?

Capt Goodvibes
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rabble babel wrote: Freegold
rabble babel wrote:
Freegold is a new asset class-not 'money'

RB hits his own 6. Happy horizontal clapping

Freegold is unencumbered physical gold as the wealth reserve asset outside the monetary system.

From its position outside the monetary system, as a simple physical asset, gold denominates everything inside the monetary system in terms of value, because accrued value is all that this asset is, all it does. This is its function. The function of gold. The ONLY function of gold.

Actually, it is not even a new asset class - it is the return of an old one, as I posted here recently. This (old) asset class was compromised when it became encumbered by increasingly synthetic forms of gold derivatives which traded at par with the real thing, a situation which continues to this day.

d2thdr mentioned divisibility:

...the remainder of this comment is lengthy and currently unfinished, so I will hopefully post it tomorrow. Thumbs up

Lemon Thrower (not verified)
Euro
Capt Goodvibes wrote:
rabble babel wrote:
Freegold is a new asset class-not 'money'

RB hits his own 6. Happy horizontal clapping

Freegold is unencumbered physical gold as the wealth reserve asset outside the monetary system.

From its position outside the monetary system, as a simple physical asset, gold denominates everything inside the monetary system in terms of value, because accrued value is all that this asset is, all it does. This is its function. The function of gold. The ONLY function of gold.

Actually, it is not even a new asset class - it is the return of an old one, as I posted here recently. This (old) asset class was compromised when it became encumbered by increasingly synthetic forms of gold derivatives which traded at par with the real thing, a situation which continues to this day.

d2thdr mentioned divisibility:

...the remainder of this comment is lengthy and currently unfinished, so I will hopefully post it tomorrow. Thumbs up

i agree with this except to the extent you suggest gold is not money. gold is money and everything else except for silver is a money substitute.

i have been reading Fofoa for about a year, read everything he wrote, Another, and Foa wrote at least once and read big parts of teh HOF. am not anti-fofoa, just pointing out I don't subscribe to his entire vision of the future and that he says a lot of things Another never said.

anyway, i'll be trading my euros for physical gold if it comes to that, just like i'm trading my FRN's for physical.

the value of the euro is the value of the goods and services created in the eurozone and the ability and willingness of the eurozone govts to repay its debts.

marking the gold held by the euro countries to market doesn't create more ounces. nor does it transfer that gold to the ECB from the constituent countries. nor does it make the germans any more likely to pay on Greed bonds.

if the dollar fails and the euro becomes the primary world reserve currency, marking the gold to "market" denominated in euro is just another way to keep track of the increase of the number of indirect paper claims to eurozone country gold. call me a noob, call me dense, but i just don't get how the euro is going to suspend Gresham's law. In several hundred pages or thousands of pages of writing i do not recall either Another, FOA, or FOFOA explaining this. If you ask the question of FOFOA, if you question his utopian future, he gets offended.

I do however fully agree with Another's main points about the value of oil and gold and their role.

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Ah, the old money, commodity

Ah, the old money, commodity chestnut.

Gold can be both. Simultaneously.

It could be monetised (infact it is already in many countries, they have just 'ignored' it, but its visible in the special taxation exemptions for Gold as it is supposed to be liable for seignorage a currency minting tax).

So is Gold currency.? NO. definitely not, it is traded and treated as a commodity class, with shipments by weight and volume - and any insurance should be marked to market value.

Yes it does have circulation, but that is for delivery of trade, not as a payment in lieu, except under exceptional circumstances - although more on that later.

Because of its position as an inert scarce commodity it 'holds' its value against currency, and is in effect a little nugget bank. Yes it can be sold for any currency you like, but the same is said of iron ore, and coal. The monetary confusion arises because it used to be in widespread circulation. In those circumstances a Gold standard would need to in place too - for the correct currency conversion, and, for folks to understand what 'value' that coin in thier pocket has.

In this regard, I defer to Fekete's weight based valuation, if Gold is to be monetised otherwise there is incentive to clip and strip the coinage whilst still retaining a nominal value. Weight in this case is the absolute.

It would still in effect be a global alternative currency - running in parallel to the other currencies, and because of the effectiveness of Gold as a store, it would carry commensurate dangers of theft.

Now to the Euro - in many ways mark to market only allows the reserve to be correctly valued at a given time. This in turn removes the opportunity for balance sheet overhangs like the one in the US where QE has like the UK devalued the currency and Gold is showing significant rises. So it stops the pollies 'bankrupting themselves' so easily - one of the fastest ways for congress out of a corner right now is to revalue thier reserves, but as they no longer have any (speculation), and what they are holding is owned by foreign nations (Germany for example) they cannot perform the audit. that means they cannot revalue and return the US balance sheet to more orderly values of debt to asset held.

They are trapped literally between a rock and a hard place.

That corner doesnt exist for the Euro - with a large sword hanging of the direct relation of devaluation being directly visible in pricing.

Have fun

Owen

Auckland... Where the heck is that..?

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LT, how about you give your

LT, how about you give your definition of money. This statement:

LT wrote:
gold is money and everything else except for silver is a money substitute.

is meaningless without it. A meaningful exchange of views is not possible without an objective and recognized reference point. A mutually agreed definition of money would be a good start, or we are just tilting at windmills.

LF wrote:
[of FOFOA]: I don't subscribe to his entire vision of the future and that he says a lot of things Another never said.

I don't subscribe to it myself; I understand the implications of the perspective Another described, and I see what appears to be the same, or very similar, view FOFOA describes. Neither FOFOA nor I are asking anyone to subscribe to any vision. If FOFOA posits any faulty logic from my perspective, I will be the first to speak up.

Thinking for oneself is a necessity only a fool would discard.

I understand how many people cannot see any possibilities for a brighter future; I have thought that way myself in the past, but I now find that view was one of logic influenced by unnecessary incumbent beliefs (ie. lots of assumptions made about things I had never closely examined but had simply taken as self-evident on the basis the majority of others did too) that did not stand up to close examination. These were discarded through a careful and ruthless process of self examination, through thinking for myself, leaving my perspective broadened by the resulting absence of baggage. Not a total absence, I'm sure, but a lot less than previous. This is not possible when one is prepared to let others think for them, and merely accept the results.

FOFOA's carefully presented logic has made sense to me only because I am thinking for myself.

I am very open to you influencing my thinking on these matters, but to do so you will need to impartially present your case, to allow it to be examined.

You have only thus far made vague complaints about how you don't agree with various statements while giving every indication you do not understand them. If you are asking someone to convince you of something, you could extend the courtesy of attempting to convince them (or at least stating your own case) of yours.

The commitment of one's thoughts to text is a most productive tool in the examination of one's understanding. All sorts of unexpected morsels present themselves.
I look forward to your presentation.

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I note that my words above

I note that my words above (comment #34) including the imbedded link have been quoted back at me, and yet no one has followed the link since I posted it. Does anyone actually read the comments, or just skim through looking for things that support their existing views?

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Ofcourse we do..
Capt Goodvibes wrote:
I note that my words above (comment #34) including the imbedded link have been quoted back at me, and yet no one has followed the link since I posted it. Does anyone actually read the comments, or just skim through looking for things that support their existing views?

I do read it. I have read your blog numerous times.

Freegold- only way to protest against the growing tide of conformity.

rabble babel
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To LT

Hey mate-once again I agree with CGV-if we are going to discuss this lets have some precision.

Quote:
i agree with this except to the extent you suggest gold is not money. gold is money and everything else except for silver is a money substitute.

I said "FREEgold is a new asset class-not money". Freegold(properly speaking) is a concept-not a thing,not actual gold,Au atoms
....you maybe correct

Quote:
gold is money and everything else except for silver is a money substitute.

But that ain't wot I said now,is it?

All you towers of Babel;you better wake up and speak up and earn your place on the team and if you don't know please and thank you, well, you better learn;because the Queens English was good enough for Jesus Christ and its good enough for me-Don McGlashan

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This is interesting, and

This is interesting, and Lemon_Thrower, welcome to the fray.

These questions are needed and necessary. At the moment we have a strong understanding of a construct, and only by throwing questions at the construct can we develop and understanding of its universality, or not.

Captain, thanks for the link, in my old role, I was completely unable to 'see' anything that had #blog in it thanks to the firewall - I will be taking a close look at your site soon enough Eye-wink

Have fun

Owen

Auckland... Where the heck is that..?

Lemon Thrower (not verified)
I define money similar to the

I define money similar to the ancient Greek Aristotle.

* Durable: Money must stand the test of time and the elements. It must not fade, corrode, or change through time;
* Portable: Good money needs to hold a high amount of 'worth' relative to its weight and size;
* Divisible: Money should be relatively easy to separate and re-combine without affecting its fundamental characteristics. An extension of this idea is that the item should be "fungible", defined as "being freely exchangeable or replaceable, in whole or in part, for another of like nature or kind."
* Intrinsically Valuable: This value of money should be independent of any other object and contained in the money itself, starting with rarity.

so gold is money. fiat - whether formally backed by gold like the pre-33 dollar or informally like the euro - is currency, which means a money substitute. its more convenient but ultimately not good money because it has no intrinsic value. the proof of its inferiority is to watch Gresham's law in action.

that is a good segue to my problems with FOFOA as contrasted with Another. I think FOFOA has gone far beyond what Another ever said, and i view FOA as a cheerleader for the Euro (whether you believe he is European or not).

What I can't come to grips with is why some of you agree with FOFOA that the Euro will be accepted good as gold. In my view, the current state of the Euro is inferior to the pre-Nixon dollar. It has as much gold as the US did then, but no promise to pay it. As Doug Casey says, the dollar is now an I owe you nothing, and the Euro is worse because its a Who owes you nothing. People are trading fiat for metal now. Once the dollar fails, as FOFOA envisions, the trust in paper will be shattered imho.

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Quote: why some of you agree
Quote:
why some of you agree with FOFOA that the Euro will be accepted good as gold.

It will be in the same position as the dollar was when the dollar took over from the pound as reserve currency. The euro's gold underwriting prevents

Money is a 'process' - the exchange of currency for an asset is monetisation of that asset. It is an intangible.

Aristotle didnt have a definition for 'currency' because there was a global currency of 'gold' in circulation - some minted, some not and a large selection of local 'dross' from which emerged the currencies

In contemporary society, the divisible part is the tricky bit - cliping, remilling and scraping are all techniques that can now be done quick as a flash with a laser. Take a thou of a coin, unformly (including the scratches) and likely as not, you'll only lose a little of the crispness of the minting, and only need to handle 1000 coins to 'gain' enough gold for a coin of your own...

Thats the reason that Gold could never return to currency use - and hence it lives best as an asset class.

In many texts the swap of gold for goods was termed barter.

Have fun

Owen

Auckland... Where the heck is that..?

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owen wrote: It will be in the

I agree with owen's comment, but would add this:

owen wrote:
It will be in the same position as the dollar was when the dollar took over from the pound as reserve currency.

The only notable difference being it (Euro) will not be expected to perform as a store of value by the savers, with physical gold reasserting itself in this role.

The irony here is that gold becoming the objective reference point in the store of value role will make the Euro (and other currencies) much more stable and therefore dependable as store of value vehicles. They will have a bit of a credibility issue on this front however. Perception is everything. Smiling

owen wrote:
Money is a 'process' - the exchange of currency for an asset is monetisation of that asset. It is an intangible.

This is my position too. I have posted as such in an essay titled "Gold is not Money" , which was titled as such not to make a definitive claim, but to spur the reader (if there are any Smiling Cross Fingers ) to think about their definition of money. FOFOA has a series of three posts titled "Gold is Money" (highly recommended reading BTW) in which the title serves the same purpose. The two are not at odds with each other at all; it all depends upon the definition the individual gives the term "money".

The beginning of "Gold is not Money":

I wrote:
These three functions:

1. store of value
2. medium of exchange
3. unit of account

collectively form the abstract concept we refer to as "money".

All three functions are separate mental processes to which we ascribe different mediums, depending upon circumstance. Money is not one or another of these things, nor anything else. Money is the sum total of these three functions. Period.

From FOFOA's Gold is Money - Part 1:

FOFOA wrote:
Gold is Money

This is the dogma among most in our crowd, is it not? Gold is money! Who on earth can dispute this (practically) divine statement? Well, I'm not here to stir up trouble, so I will leave this one alone for the moment. But I hope we can all agree on at least one thing for the moment. How about this one?... "Gold is a form of wealth!" Hopefully we can at least agree on this statement as we proceed. Gold is a form of wealth.

Lemon Thrower (not verified)
Here is how I perceive

Here is how I perceive things, which seems to be a little different from how I understand most of you to perceive things:

First, to me, it was critical that after WWI the dollar was still convertible into gold. Then, it was still good as gold.

The Euro today may have more gold behind it, depending on who printed your Euro (compare Germany to Portugal) but that does not mean its convertible or even relevant (Italy).

Second, to me, there is a big difference between Another on the one hand and FOA and FOFOA on the other. Another understood the value of gold to giants. He understood that gold was the solution, and implicitly that central banks were the problem. FOA in contrast believes that the ECB is the solution, and FOFOA until recently was more like FOA than Another.

Third, FOFOA seems to be changing his tune and is beginning to express doubts that any fiat will survive. In this way, he is moving towards Another and away from FOA (and most posters on this thread besides me):

fofoa:

Here's an interesting Freegold story. Hat tip Fauvi and my apologies because this has been sitting in my email spam folder for nine days. The article is dated Mar. 9, the day Fauvi sent it to me. But I guess it went to spam because the email was mostly in German.

Remember from Indicium that FOA wrote, "1 gram coins will be the norm; being the size of our one ounce now, but with alloys." At other times he also wrote about how gold is divisible to ANY size necessary. Well here we have three Swiss politicians proposing a constitutional amendment to make a new set of official Swiss gold francs down to the smallest size of.... wait for it.... 0.1 grams of gold!

And from the wording of the initiative it sounds like they would be meant to float in value with the price of gold, without a fiat face value. I get this from the use of the term "fixed gold content" and the later reference to the value of the coin relating to the "cost" of its gold.

It also appears to be a vessel designed to absorb "hot money inflows" directing them away from, and to prevent the unwanted appreciation of the fiat Swiss franc: "an attractive alternative to the Swiss franc as a safe haven?"

For reference, 0.1 gram of gold today would be $4.57 at spot. A Freegold valuation of such a coin would be in the ballpark of $175. Furthermore, the references to safe haven use and the attractiveness of Switzerland as a financial center tell me that the intended purpose is as a store of value more so than as a transactional currency. Also, they want it to be commercially (privately) minted and distributed through commercial banks, yet licensed, monitored and the gold content guaranteed by the Swiss government.

And as logic can reveal to even the most hard-headed among us, a monetary store of value need not have denominations as low as a five dollar bill; for those with only $5 are not in need of a monetary store of value! (I remember opening my first savings account. I recall the minimum starting balance was $100. And that was a long time ago!)

So I suppose one could be forgiven for running wild with theories as to the agenda behind the official proposition of what would surely be an overly-expensive minting at today's gold prices. Our 1/10th ounce coins (the size of a dime) are 3.1 grams. So if this coin were that same size it would need a special mix of one part gold, 30 parts something else. Of course this would be much more economically meaningful at $55,000 per ounce, $1,768 per gram, $176.80 per 0.1 gram (which is about what a 3.1 gram 1/10th ounce Eagle costs today)!

Translated by Google:

On Wednesday, the politicians came with a new campaign to the public. They call for the creation of a Swiss gold franc. The goal: New Swiss gold coin with a fixed gold content is strictly controlled licensing and tax-exempt issue to allow according to the wishes of the founders and small savers to invest their assets in gold and thereby safeguard against inflation. The whole thing is in the form of a constitutional amendment be enacted.

The press release also states that upon the gold franc also "an attractive alternative to the Swiss franc as a safe haven created, making the franc's appreciation should be held as a result of currency turmoil in international borders."

The Federal Constitution is supplemented as follows:

Continued?

March 18, 2011 3:58 PM

Article 99, paragraph 2 (new) (existing paragraphs 2 - 4 are paragraphs 3 - 5)

"The federal government creates an official Swiss gold francs with a set of coins, each with fixed amount of gold. It regulates the licensing of legitimate tax-free to its publishing institutions. "

The rationale for the initiative reads as follows:

1. At today's gold price of approximately CHF 45'000 .- per kilogram, it is difficult unduly small savers to invest their assets in gold and step by step in order to protect against feared devaluation. This one comes as close as discrimination grievance must be eliminated by an official Swiss gold francs is created with a set of coins that are affordable for everyone. A coin with 0.1 grams of gold content would now be about CHF 4.50, those with 1 gram of gold around CHF 45 - cost.

2. In times of international currency turmoil, the Swiss franc is often a safe haven, not infrequently resulting in a marked appreciation of the franc results with the known competitive impediments, particularly for export trade and tourism. As soon as Switzerland creates an official gold francs, this gold francs offers an attractive currency to escape - which is difficult to be managed price rises in the Swiss franc in check.

3. If the federal government awards licenses for the issuance of Swiss gold francs in Swiss banks alone will increase the attractiveness of Switzerland's financial center significantly. The Swiss gold francs has to do with the held in gold reserves of the National Bank nothing. The issue of Swiss gold francs to the chartered banks obtain the required for its production of gold on the open market - to the extent that there is demand from customers.

4. The federal government is responsible for monitoring as part of the licensing of the gold franc issue legitimate banks, the gold content of the gold franc coins is strictly followed to ensure that the federal government can guarantee the gold content of the official gold franc coins.

Here is one article in German. This is the announcement on the website of one of the three politicians. And this Google search gives you a whole string of articles with the "translate this page" option.

Sincerely,
FOFOA

March 18, 2011 4:01 PM

I think FOFOA has begun to recognize like me that it does not matter if the ECB marks its gold to market if it does not stand ready to deliver that gold in fully convertible fashion, let alone explain WHO stands behind its notes. So Gresham's law will result in people swapping fiat Euro for physical gold.

owen
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Hi LT. Disagree almost

Hi LT.

Disagree almost completely.

The next phase for converitble currency will be digital.

Coin and note is in the UK becoming history - 80% of transactions involve electronic means, and you cant have an electron or two of Gold. Add in that a wheelbarrow of electons will fit comfortably on the point of a pin, and you have FIATs resurrection king.

That leaves Gold as an asset that can be used to effectively store wealth.

If you look at the rise of the pound, the indicators that drove investment into the bank of England was the amount of gold held vs the debt of the UK - a novel situation that enabled the Elizabethans to eventually rule the world. That is the path that the Euro has ahead of it, and the mark to market avoids the negligence of an international asset. It isnt about paying in Gold - that happens only when there is no other means of payment acceptable (much akin to the ICI fertiliser deals in the 60's with Russia) because you have exceeded your credit worthiness.

Lets throw in that countries would need a gold reserve and a gold mint allocation and you quickly see a scenario that is numismatically impossible.

Now silver, maybe. Or copper but it would have to be a single commodity with a single weight exchange rate. It is extremely unlikely to be Gold outside of the 'decorative' minting that the gold swiss franc, the gold soveriegn, the maple leaf and so on are. There simply isnt enough gold for normal circulatory requirements, even at the hundredth of a gramme level.

My thoughts.

Owen

Auckland... Where the heck is that..?

Lemon Thrower (not verified)
owen - do you mean electronic

owen - do you mean electronic like the euro or dollar are largely today or like goldmoney is? To me the difference is critical.

i get your point about debt. if you look at Europe, the Northern Protestant countries had a huge headstart on Catholic Southern Europe.

so on one level a money system that continues to faciliate debt might be optimal.

however, if the dollar collapses you could see a return to metal, and you are already starting to see trickles of this. fundamentally i don't see any advantage to the Euro over the dollar so if one collapses they both will.

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LT, The point about the very

LT,

The point about the very small fractional gold coins is that they are preparing for the value of gold to soar, and thus much smaller weights will be required to act as store of value for the average saver than are currently the norm.

This has absolutely nothing to do with gold as physical currency in circulation. Purely store of value.

Your one ounce coins will be family heirlooms in the future, in that no normal person will ever be able to amass enough surplus value in one lifetime to afford an entire ounce.

Value is measured in weight in gold. The benchmark.

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I note no definition of money

LT,
I note no definition of money has been agreed upon. I believe Owen and I are in broad agreement, based upon our remarks above, that money is a conceptual device incorporating three distinct functions, as in the diagram:

A medium, a store, and a unit, allowing for exchange, value, and account, respectively.

I have posted my extended comment mentioned above in a new thread (link here), but it is still pertinent to this conversation. I presume you have read it.

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Captain, Exactly. We will

Captain,

Exactly.

We will have an electronic 'means of exchange' in a currency that is the unit of account, and we can choose how to store those units.

The underwriting of a person or nations account by the stored units of account, ensures that you cant spend more than you have - that is the critical part of the Gold equation. This critical part is missing from many of the current FIAT currencies

Gold has moved almost exclusively from a medium of exchange forever - the digital currency machinery means new currencies can be created in an instant, and an entire nation can be switched overnight. This means that in future the death of a FIAT currency will be alot less of a drama. It also means that consolidation in the currency market is almost inevitable, as nations converge on single means of exchange.

This is also why 'alternative' currencies will also not take off as expected by Bernard Lietaer - as we already have a panopoly of alternative mediums of exchange available - we as consumers dont have consolidated access to them just yet, but that will come, and will come quickly.

Owen

PS Gold is now almost exclusively used as a 'last resort' means of payment when you can no longer gain any underwriting of your currency, and need to pay your national debts...

Auckland... Where the heck is that..?

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