Dear Craig (Spencer), >JP, I think SD's theory amounts to saying that if the e-gold is >in some special accounts then it doesn't count as "being in >circulation".
I have a related theory to SnowDog's theory. There is one e-gold Bullion Special Purpose Trust. It holds a bunch of gold in allocated storage in Zurich, London, and Dubai (listed in reverse alphabetical just for fun) and none in Geneva that I'm aware of. (I don't know where JP got Geneva, but Swiss is Swiss.;-) I think we all agree that there is such a trust, Reid has done us the favor of pointing out where to read all about the trust, and the Examiner pages say that the gold bullion held in Zurich, London, and Dubai, is held by the trust. So far, so good. Now, we have two categories of gold assets: those gold assets that back the e-metal in circulation (e-gold's gold product as opposed to e-gold's silver also called e-silver), and those gold assets that are assets of e-gold, Ltd. Why are these gold assets all held by the Special Purpose Trust? Because it is a pain in the ass to get allocated storage in the first place. Getting two allocated storage accounts at all three locations would be a nightmare. Further to this point, if e-gold, Ltd., can allocate the gold it holds by internal memoranda, so that the people running the show know whether the gold they hold is for covering their liabilities like they have promised to do, or is an asset of e-gold, Ltd., itself that is not covering e-metal in circulation, then they don't need more than one allocated storage account with each vault. They also don't need to move bars of gold around, which is good, because that is another cost. Avoiding costs and living like monks, eating sawdust and drinking recycled water, the e-gold system is designed to be a low cost system. Now, JP says, the balance sheet should balance the assets on the left against the liabilities on the right. I say, and SnowDog says, no, assets = liabilities plus equity. A balance sheet that does not show owners' equity is incomplete. The e-metal balance sheet is incomplete. Further to this point, the "e-metal balance sheet" shown at http://e-gold.com/examiner.html is telling us the assets of gold held by the e-gold Bullion Special Purpose Trust. For whom is that gold held? That gold is held by the Special Purpose Trust for e-gold., Ltd. Okay, then whose liabilities are shown across the way on that e-metal balance sheet? Those are the liabilities of e-gold, Ltd. What, then, does it mean "e-metal in circulation (liabilities)"? It means that so much e-gold gold, silver, platinum, and palladium is in circulation as liabilities to e-gold, Ltd. What about the e-gold that e-gold, Ltd., has been paid by me and y'all? That e-gold is an asset of e-gold, Ltd. Therefore it is not under the heading "liabilities." Is it still e-metal? Yes, I think so. Is it still in circulation? I don't know. How much of it is there? In grams: 19105.9 grams. In ounces: 614.27 In dollars, at $326.50 per ounce: $200559.155 What happens if e-gold, Ltd, spends some of its e-gold to, say, OmniPay, and OmniPay writes a check to pay for some cost that e-gold, Ltd., has to pay? Why, then OmniPay has the e-gold in OmniPay's account, and that e-gold is back in circulation. OmniPay turns around and sells it on the open market to get dollars or other fiat money. As soon as the e-gold leaves the account of e-gold, Ltd., it is back in circulation - and is now a liability to e-gold, Ltd., that must be "backed" by gold. What happens if e-gold, Ltd., comes to the end of another month and assesses storage fees on all and sundry? A bunch of e-gold, approximately one twelfth of one percent, goes out of "circulation" as a liability to e-gold, Ltd., and becomes e-gold held as an asset. Almost immediately, if automation is in place, some of that goes back into OmniPay to pay the bills of e-gold, Ltd., that are known (such as monthly fees at JP Morgan Chase in London, for example). Why is JP May fussing over $200K of gold held in the allocated storage accounts of the Special Purpose Trust? Because he rocks. (!) <grin> For whom is the Examiner page? I think it was built for the benefit of and to the preferences of e-gold, Ltd., and its owners/operators. They want a page where they can go to see how much gold they have, and where it is, and they want a page where they can see how much of that is their gold and how much is in circulation among all the other cool people out there who have e-gold accounts. What else could this gold that is "too much" represent? I have no other theories to advance. I think the theory I have advanced covers the existing facts. What about the silver, platinum, and palladium that is "too much"? Same deal. Why are all the different metals "out of balance"? Because e-gold, Ltd., collects fees from users of e-gold silver (e-silver) in e-gold silver (e-silver), and fees from users of platinum in e-platinum, and fees from users of e-palladium in palladium. So, if e-gold, Ltd., were not willing to accept fees in its own e-metals, that would be shocking. But, as it is and does accept such payment in e-metal form, it has to have more assets of metal in the Special Purpose Trust than it has liabilities to cover the e-metal accounts of users other than itself. Are we violating the Copernican Principle by supposing that there are special accounts in the e-gold system which have non-liability status? I don't think so. I think it is obvious that there have to be accounts which have special status: e-gold, Ltd., is not rich, but it does have assets. Some of those assets are e-metal. Is the horse dead yet? Regards, Jim http://cambist.net/ --- You are currently subscribed to e-gold-list as: archive@jab.org To unsubscribe send a blank email to [EMAIL PROTECTED] Use e-gold's Secure Randomized Keyboard (SRK) when accessing your e-gold account(s) via the web and shopping cart interfaces to help thwart keystroke loggers and common viruses.
