Tuesday, October 26, 2010

Gold- and Silver-denominated Bank Accounts

THIS is what we're talking about, when we say that if Georgia (or any State) passes the Constitutional Tender Act, the banking business would BOOM here, as people from other States rush to open gold- and silver-denominated bank accounts:
The thing that I have seen on the ground, though, is a disproportionate amount of mainlanders in the shops and banks buying physical gold for storage here in Hong Kong.

In Asia, it’s common to use a measurement for gold called a Tael, which is roughly 1.215 troy ounces. They sell locally minted products at 990 fineness at very low premiums: at one of the banks I visited, the premium was only 5 HKD (less than a buck) plus 1% above spot.

9999 fineness (Maple Leaf coins and the like) sell for a bit more, but not much.

This morning I saw mainlanders scooping up these deals like it was the day after Thanksgiving in Wal Mart. They don’t take the gold back to China, they leave it here at a number of banks or facilities. Secure storage is in such high demand, in fact, that there is a 5-year waiting list for larger boxes.

Banks in Hong Kong have responded with some innovative products - they offer deposit accounts that are denominated in gold (taels), and on top of this they also offer a line of credit for up to 70% of the bullion on deposit.
This isn't rocket science, folks. Banks will continue to fail under the current system (Georgia leads the way) - it's time to dump the fiat paper money, and embrace real money that holds real value: Gold and Silver, the only Constitutional Tender allowed to States.

Sunday, October 17, 2010

Clean Money

From the Colorado Tenth Amendment Center...

The United States Constitution declares, in Article I, Section 10,
“No State shall… make any Thing but gold and silver Coin a Tender in Payment of Debts.”
State-Level Constitutional Tender laws seek to nullify federal legal tender laws in the state by authorizing payment in gold and silver or a paper note backed 100% by gold or silver.

The concept of Honest Money is lost on most US citizens, thanks in part to a complete and utter lack of discussion in public schools and universities, but certainly not lost on the elite financial organizations who vehemently oppose such reform. When Nixon decoupled the dollar from its traditional gold backing and replaced it with fiat debt (private Federal Reserve notes) in 1971 because we could no longer cover our bets with gold, he substituted the last vestige of real value (our dollar) with a promissory note (debt) representing nothing more than the willingness and ability of US citizens to shoulder the artificially created debt burden via taxes.

The current private US Federal Reserve, the third central bank in our history, creates money from nothing but the unacceptable privilege to do so, making an arbitrarily agreed upon bookkeeping entry and thus creating an imaginary value which it then extends to their private member banks to trickle down to Main Street, or tells the Treasury they have a like amount of credit to either print money or issue Treasury bills with nothing to back it but an elaborate accounting and taxing scheme which can be viewed as a tenuous financial house of cards.


Friday, October 1, 2010

ATMs That Sell Gold Bars Are Coming Soon to America

By: Reuters
Original Link: http://www.cnbc.com/id/39381947

A German firm that installs and manages gold vending machines aims to introduce them into the United States this year as it expands rapidly to take advantage of demand for bullion in times of economic uncertainty.

Thomas Geissler, creator of the Gold to Go brand and chief executive of Ex Oriente Lux, told Reuters on the sidelines of the London Bullion Market Association conference that the company aims to issue a "couple of hundred" machines next year.

Gold to Go launched its first ATM in Abu Dhabi's Emirates Palace hotel in May. They are now operating in luxury hotels in Abu Dhabi, Bergamo and Madrid as well as around Germany.

"This year we will issue around 35 machines, and for next year we are looking for bigger numbers," Geissler said on Monday, standing in front of one of the ATMS, which was coloured and shaped like a giant gold ingot close to 2 metres tall.

The machines, which update the gold price every 10 minutes to match international markets, take cash or credit cards and dispense small bars—including 1 gram, 5 gram, 10 gram and 1 ounce units—as well as coins such as South African Krugerrands, Australian Kangaroos and the Canadian Maple Leaf.

The company's plans include expansion into the United States this year, first in Florida and then in Las Vegas, Geissler said.

As for major gold consumers India and China, that will have to wait for next year, he said. "We have large interest in these countries," he said. "This is the task for next year."

Gold's rally this year has come largely as a product of investor unease over the economy.

This nervousness has been reflected in high sales of coins and bars from national mints, particularly last year as the world emerged from recession and this year as concerns have persisted about the risks to recovery.

With the gold price near record highs, there is a danger that demand from people on the street for gold products could tail off, however.

"Whether gold drops to $500 or goes to $2,000, we are living from small spreads, and we give people the best price they can get on a minute basis in the machine, so we're pretty fine with any price," Geissler said.

Gold to Go, which obtains the gold bars from refiners in Germany and Switzerland, first tested the machines in 2009.

Spot gold was quoted at $1,297.95 an ounce at 1235 GMT on Monday, up by over 18 percent this year and by over 80 percent since the unfolding of the credit crisis in late 2008.