Danny, Did you know that when stocks of share were first introduced, they were redeemable at base/face value? Similar to a partnership where one party wants out, shares could be returned to the company and sold at the base value which was determined through the actual sale value of the company's assets divided by the number of shares outstanding. Coicidentially that is why we use the term of shares outstanding ;o)
Patrick, I agree that gold in a vault is dead capital and of little use to most of us. However, as I pointed out in my post, the reason for my pondering was how such a precedent often leads to the loss of the value base of money. THE FOLLOWING IS NOT ABOUT DGC, JUST A THOUGHT GAME OF SORTS Let's assume for the moment that there is 1,000 ounzes of gold in storage at gold-currency.dom and that an online casino goldslots.dom beginns to issue shares that are sold for gold-currency.dom units at 1 ounze per share. 1,000 shares are sold, goldslots.dom outexchanges the 1,000 ounzes to pay some new software it bought. People now hold 1,000oz worth of shares, there are 1,000oz in circulation, do you see where I'm heading here? In theory the number of ounzes in circulation has just doubled. People hold their shares believing that they are 'good as gold', but in order to trade all shares one would need to control all 1,000oz in circulation. If goldslots.dom decided to issue another 500 shares and there are takers for it, suddely there would be more shares in circulation than ounzes available to buy them all. All the while there are people who own 1,500 shares, each 'worth' an ounze but only 1,000 ounzes to trade them. Hence the inherent value of the shares even if it did not rise at all, would still be inflationary. And that is where one of the problems are when an exchange allows only one currency to be used for trade. The inherent problem would be removed, if people could swap 'bearer' shares for anything they want, of course. But hey, that means we just created an infaltionary fiat currency that started out as having a gold base and suddenly there is more paper than gold... Cheers, Robert. budget & privacy website hosting http://www.cyberica.net start a profitable online business http://www.cyberfrontier.biz budget domain registrations http://www.u2planet.com --- You are currently subscribed to e-gold-list as: [EMAIL PROTECTED] 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.
