Danny

I do agree that most accounts have a small balance, but that holds true
for the amount of money many people have in their wallets, does it not?
People appear to be treating e-gold as money, something they use to buy
things with - which is what we promote it for in Asia, by the way - not as
an investment. One of the answers I am sure I would be getting if I asked
my clients why they don't exchange more than they need and keep some in
their accounts is that people treat e-gold in the same way they treat a
foreign currency. One gets some in order to spend abroad, but it's useless
elsewhere.

The many small earners who joined various paid email reading programs etc.
and who are outexchanging their monthly earnings would be further
testamony to that.
Further, as more and more e-gold accounts are being opened from Asia, $10
- $50 is actually a serious balance in countries where people earn $50 -
$250 a month.
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Sidd,
I don't think you got me right. When talking about trust, I mean that
people are beginning to show the same trust for e-gold that they show for
fiat. People believe that if they have e-gold in their account they can go
to websites and buy goods and services for it. This has little to nothing
to do with trusting e-gold Ltd. or trusting that the gold is really there.
Quite frankly, in an active mercantile environment the only one who gives
a darn if there is any gold there is the one who holds it at the end of
the day. Everyone else used it and spent it in exchange for goods and
services.
As other currencies are used less actively and as the number of sites
accepting them as payment is smaller, those other currencies *must* show
that there is gold there, while e-gold doesn't need to, because nobody
really wants the gold; they want goods and services.
Why else would more and more people use evocash - which had been
questioned as a viable alternative from the onset, and which we still do
not accept as payment for our services? It is because people believe that
they can buy goods and services with it.
I think it was Danny who said a while ago that in the end, money is what
people are willing to accept as payment for goods and services.
And if a currency is not flowing then with people not offering goods and
services in exchange for it, what good is it then? If I want gold as an
investment I pick up the phone and have some bars shipped over from
Indonesia or go to a gold trader - who will charge me the daily London,
New York or Tokyo fix without surcharge, by the way.

Frank,
I agree that completely free negates the costs, but I suggested that the
currency operators should team up to offer the service. While thy may have
costs to store the physical gold, they have none to exchange it.
I have also used open2exchange for the first time yesterday, but the
problem with that is that I do not only pay 2% but also spend a few
minutes doing the exchange.
The scenario I based my post on is the one active merchants are in. We
have dual accounting in two offices, consolidate the books daily and move
funds around between accounts once or twice a month. The last thing we are
looking for is to start exchanging $4.00 of GoldMoney and $12.95 of
Pecunix and $2.99 of e-bullion into e-gold everyday. Having 16 active bank
and DGC accounts is consuming more than enough time.
Hence my suggestion that the currency operators should give merchants a
way to have it done automatically - on their own sites, right away when a
client makes a spend.
Of course, e-gold and everyone else charges a spend fee, which is fine. So
me saying that I want to receive $11 of e-gold when my client spends $11
of pecunix is inaccurate of course. What I meant was the automatic
exchanging bit at no surcharge or additional deduction.
I am aware of the fact that all currency operators would take my
suggestion personal. It is after all as if I had said that their kid was
ugly, as it were. But I really don't mean it that way. I sincerely think
that my suggestion is showing the way to more and more people accepting
and using all types of DGC.

While the free-market advocates embrace each new IG currency as more
competition, good for consumers, I think that we are dividing our strength
rather than making a concentrated effort. In other words, rather than
doing our best to have more people use IG in general, each operator wants
them use his currency in particular. Why did the world economy first begin
to base international trade on the US dollar? Because it makes economic
sense and made things easy. Why is everyone right now thinking "but the
common denominator of IG is gold"? Because it is. Why then doesn't it work
the same way the dollar does? Because most merchants quote in dollars, not
in grams, because that is what their customers expect from them.

In essence I am suggesting to measure other currencies in terms of e-gold.
But, because some IG have lower spend and lower storage fees, customers
would actually migrate from e-gold to the cheaper currencies - IF there
was a way to spend any IG currency for any other IG currency directly at
the point of sale.

It's so simple it hurts that operators prefer to be guided by their
emotional attachments to their 'babies' rather than by economic common
sense. Hence, we focus on e-gold. Unemotionally. As business should be.

Cheers,
Robert.

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