Claude, Thank you for your comments.
> > > The Euro has already 15% of its reserve in gold. > > What does that mean? > Well I meant that the ECB at 15% of its foreign reserves in gold. But what does that mean? What are foreign reserves? Since it is not redemable in anything what good are these "reserves"? If someone said I won't promise to give you anything for your car but I've got a lot of money would you give them your keys? This is crazy! Such reserves are utterly meaningless. > > > Although the Euro is not convertible to gold, it gives some > > > sort of stability and solidity to the currency. > > > Of what use is that? It sounds like OSGold. > > Well at least it raise the confidence of Europeans and foreign > central banks (like China) who are considering the Euro as a > component of their reserves. Perhaps it does. But why? What are they thinking? To certain people it might "raise their confidence" if each bill were smeared with chicken blood and sprinkled with powdered rhino horn. But that would still be irrational. > > > The issue here is what arguments the ECB can use when it comes to > > > the table with the USA to decide on the equilibrium of the USD and > > > the Euro as world reserves currencies. Gold is one argument. > > > > You seem to think that the usage and/or relative value will be > > determined by political fiat. > > Well. Yes. Why do you think that the US and Europe are having a > series og major meetings starting next july. I have NO idea altho I am sure they are up to no good. But they can't, per se, set exchange rates or force usage without eliminating all human freedom. And, altho I am sure they would like to do that, I don't think they are going to be able to do so in the next few years. > Europe wants's to share the benefit of having a reserve currency. No doubt. It is a license to steal. But it's not "use as a reserve" that is so enviable but enjoying a worldwide circulation. By floating worldwide non-Americans are fooled into giving REAL value to the printers of greenbacks in exchange for NOTHING. ***Maybe I've got it!*** The US can continue to get away with floating its fiat currency worldwide as long as there is no realistic alternative. If the Euro became a realistic alternative then people would have a choice and that would end the whole house of cards. However, the competition would not only end the "benefits" of the US dollar's worldwide float it would also prevent the Euro from gaining those benefits. Perhaps, realizing this, they are scheming to establish a cartel which divides up the loot. Perhaps it is not exchange rates or usage they aim to fix but to establish an OPEC of money. This would require them to coordinate their issue in a joint way so that there is NO competition between the Dollar and the Euro. > > As long as people have any choice that will not be the case; > > both will be determined by market > > forces. > > I agree. But it is a political decision that will lead these > forces. WHat if the ECB decides to make the Euro convertible? > WHat if they increase to 40% and start selling more USD reserves. In the sense of a political decision determining governance and supply you may be right. But a political decision cannot arbitrarily determine to outcome of the market independent of all other facts without coercively eliminating the market first. Best, CCS ------------------------------------------------------- - Virtual Phonecards - Instant Pin by Email - - Large Selection - Great Rates - - http://speedypin.com/phonecard/start.mhtml?af=743 - ------------------------------------------------------- *************************************************** * Craig Spencer * * [EMAIL PROTECTED] * *************************************************** --- 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.
