> You mean, the underwriter is a money issuer, and the
> Lucrative Mint is a tool which permits the money
> issuer to generate digital coins based on underlying
> value.  Does the Mint provide for any audit function?
> Or does the underwriter issue as many digital coins
> as he pleases, regardless of how much underlying
> value he has laying about?

Three questions. First, yes. Second, yes. Third, that depends.

As you know, auditing and trust are serious and related matters. More on
that when you bring it up again below.


> > clients should be able to interpret, store, and exchange
> > DBIs from multiple independent bearer instrument issuers
> > (like a wallet that can store and spend e-gold and
> > e-bullion and e-cows too).
> 
> The e-gold system offers gold and silver.  It uses the
> troy ounce as its underlying unit of account, but one
> can convert to many decimal places of accuracy to get
> to grams.  e-Bullion also offers gold and silver. The
> GoldMoney system offers only gold.  I'm curious about
> the e-cow system as it relates to your interchange.
> 
> Clearly, a gram of gold is equal to a gram of gold.

It depends on whether you're comparing physical objects or claims on
supposedly physical objects, and that's a major reason why Lucrative
Series hold some related information about each coin Series, including
issuer name, policy, expiration date, series issue start date, series
issue stop date, issuer API URL, unit, amount, asset, description, and
of course the cryptographic information necessary for clients to create
digital proto-coins.

The ability exists, and I encourage it, to separately and distinctly
specify a digital coin that represents a gram of GoldMoney gold, or
e-gold, or e-bullion gold, or gold in Patrick's desk drawer, or gold in
a Swiss vault, or gold that might come to pass, etc., as well as who is
making this representation. Each digital coin is thus essentially two
claims: a claim by the coin holder on some asset held by the
underwriter, and a claim by the underwriter that it truly holds the
asset.


> Similarly, an ounce of gold is equal to an ounce of
> gold, if those ounces are both ounces troy.  (The
> same is true if both are ounces avoirdupois, but
> there is a discrepancy if one is troy and the other
> is avoirdupois.)  I'm not confident of the rate of
> exchange between gold and cows.

The cow example is intended to demonstrate that Lucrative DBIs are
flexible enough to represent most common types of assets, if not all.
Cows (or heads of cattle), pigs, etc. are obviously not all equal, but
the Series policy can indicate certain minimal standards, including
delivery time and place, condition of cows, etc. There's no technical
reason why Lucrative DBIs could not represent shares of stock, bonds,
commodities, futures, annuities, and so on. Lucrative mints could also
issue instruments representing non-traditional "assets" including
email-tickets, game tokens, brownie points, and so on.


> > Software agents can manage your portfolio in real-time,
> > always in direct possession of your assets, maximizing
> > your returns to your exact specifications.
> 
> If you have such a software agent to demo, please
> specify the URL.  Otherwise, you might wish to change
> the word "can" into "may." 

"may".

> 
> > It may even be possible that widespread use of digital
> > bearer currencies can reverse the adage and make "good
> > currencies drive bad ones out of circulation."
> 
> That's not the adage, and the adage has a name. It
> is known as Gresham's law.  Properly stated, it says:

Thanks for keeping me honest. I am hopeful that free-market money can
drive fiat money out of circulation. I'll leave it at that.


> > statistics and auditing service.
> 
> To perform actual audits requires more than just
> software.  Without actually auditing the gold
> or other assets in inventory, an underwriter
> could mint money using a fractional reserve
> scheme, hoping never to encounter the need to
> simultaneously redeem all money in circulation.

This is true. I cannot claim that the Lucrative software can audit
physical objects. What I claim is that the software as provided keeps
careful track of nearly every event that occurs at the mint. This
information is distributed to various software consumers that may do
everything from spill it out on a console to store it in a database and
compile statistics.

Yes, a particular vendor might alter the code to make it do something
different, or might alter the output to make the mint look busier or
whatever. There is no way that I know of around the real-world fact that
businesses must establish a reputation for trustworthiness and
reliability. The software is only meant to help with that task.

One could argue that e-gold's "examiner" also doesn't compare data
operations to physical objects. But it seems to make people feel good.


> > " How do I unbail the gold?  Is gold involved?")
> > this is up to the mint operator(s).
> 
> You mean the underwriters?

I guess some terminology is in order. One reason I may seem to be
confusing various terms is that the models for a digital cash venture
seem to vary (I have a post about this on the lucrative-l list, which is
available in the mailing list archives on
http://lucrative.thirdhost.com/).

> 
> > Patrick
> 
> I gather you aren't Patrick Verbeek of AnyGoldNow,
> nor are you Patrick Chkoreff of fexl.  Do you have
> another name?

        Sure, lots. My daughter calls me "Daddy". My wife calls me
various terms of endearment, usually "Honey". My mother calls me
"Patrick", my father "Number One" (I gather this is from a pre-star trek
detective movie series), my sister calls me "Paaa-trick", and to the
federales I am "Patrick McCuller". I have other handles but I'm sure
your time is too valuable to sit through them ALL.


Patrick of LFCGate



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