I think some people are missing something as regards the gold bars, the weight thereof. These gold bars are similar to security on a loan. While they do sometimes bail new ones in (or out), this is not their main intention. If you put these gold bars in a vault in London and the bank states that they are there, this is all that need be done to give them their value. They could be blocks of cheese but the markets would still treat them the same while that fact was unknown. Like most national currencies, their market value comes from their perceived value. Provided most people in the world agrees that the US Treasury isn't insolvent, most people will be quite happy to trade their greenbacks for goods, services and other currencies. If in fact it turns out the US treasury has no assets or ability to raise income to meet those liabilities, it is no different to what would happen if Wired.com found out that E-gold's gold bars were actually chocolate bars in gold foil. Provided no-one knows it is an article of faith between the people using the currency. Similarly to dividends on shares. There are often several decimal points which are simply ignored by all but the most dedicated bean- counters. I'm sure many other financial transactions are similar in nature. There's a very good fantasy novel, I think it was Secret of the Sixth Magic, where a kingdom's most valuable currency is some sort of platinum coin with a magic enchantment to make it glow (or something similar). When something goes wrong and all these currencies lose their enchantment, the merchants (who are the only ones rich enough to hold many of them) are in a panic, until the hero comes up with a solution. They make a record of who has how many of them, then throw them down a very deep well. They still fulfill exactly the same function, the merchants still trade with one another and everyone else on the assumption that they are transferring ownership of the coins even though they can't be physically gotten at. They simply change hands on paper, the same way as the modern banking (and to a lesser extent GBCs) operate. Visit my website daily http://leviathan.weblogs.com New Books at Discount Prices --- Send the right message --- + Today freemail + Get your free, private email address at http://www.today.com.au --- You are currently subscribed to e-gold-list as: archive@jab.org To unsubscribe send a blank email to [EMAIL PROTECTED] Did you know that the new e-gold Secure Random Keypad can help you to protect your passphrase from both keystroke & mouse- click "sniffing" trojan viri? You can find out more about computer security at: http://www.cert.org/tech_tips/home_networks.html
