Top Ten Reasons to Love Digital Gold

Here are my top ten reasons to love digital gold.

10. Digital gold is hated by the banking cartel, who fear anything that is not fiat money. Bankers live by scamming everyone else with fractional reserve fraud, deposit insurance fraud, and fiat money inflation.

09. Digital gold is a good store of value. Money in a bank account isn't, and lately, money in the stock market has been very poor by comparison. See my performance analysis of silver and gold at http://indomitus.net/goldperf.html

08. Digital gold is money. Several billion dollars worth of digital gold changed hands in 2004. We think about three to five billion. See our report at http://indomitus.net/2004status.html for details. In 2005, we think about ten to fifteen billion. Increasingly private, digital gold currency companies don't all release complete figures on spend data.

07. Digital gold is worldwide. You can name a country, I can name people there who use digital gold, or find them on various directories quickly. Give me a hard one, and I may have to use three or four degrees of contact to reach someone who knows someone there.

06. Digital gold is a new way to work with an ancient tool. For about the last eight thousand years, as archaelogists account for time, people have been using gold and silver. For the last ten years, thanks to Doug Jackson and others, gold has been available in digital warehouse receipt form. The gold is stored in London, Zurich, Dubai, or Perth. Audits are available to validate the gold is where it should be. Digital gold receipts are generated and move around the world at the speed of the Internet.

05. Digital gold enhances your privacy. Online gold currencies have servers which store data in Indiana, Florida, Switzerland, Singapore, the Channel Isle of Jersey, New Zealand, Hong Kong, and elsewhere. Depending on where you are, your privacy is enhanced by having data about your transactions stored where you aren't. Privacy is like a warm blanket. It keeps out cold oppressive cruelty. Like a blanket, it may be penetrated, or ripped away, so privacy is not your only defense.

04. Digital gold is free from government price fixing schemes. The free market sets the price of gold worldwide. If you contract in dollars, euros, or pounds, you are allowing a government's monetary, fiscal, foreign, and trade policies to set the value of that currency. The value of the contract should reflect a free market standard for value, such as gold or silver. Relying upon government for drainage services in New Orleans, for effective military intelligence in Baghdad, or for currency valuation policies has proven, over the years, to be a poor choice. People in the Weimar Republic of Germany in 1923, in Yugoslavia in 1994, and in other places at various times have suffered from enormous hyperinflation - as much as five quadrillion percent per year. Don't let that happen to you.

03. Digital gold is useful. Tens of thousands of merchants in dozens of countries accept digital gold and silver for purchases. You may be able to find a proxy service to accept your digital gold at shops where it isn't accepted directly.

02. Digital gold payments are immediate. Have you ever sent a bank wire for $200,000 across the ocean, only to find that the receiving bank had set the availability date to next week? Digital gold transfers are immediate. So, you can rely upon them. When bankers let you down, look to digital gold. Not only is it faster, the people who use it are among the most considerate, thoughtful, and honest people in the world. (Yes, there are fraudsters who use digital gold, but only a tiny fraction of the numbers of fraudsters who use national currencies.)

01. Digital gold payments are irrevocable. When your online store gets paid in digital gold, it takes a court order to reverse the payment. Reversals do happen, but they are handled by due process of law, not by the whimsy of some credit card company. If you've ever challenged a credit card payment reversal because someone got valuable products and services from you and then decided not to ever pay for them, you know how important this feature would be.

Here's a note about a group "list" writing project.
http://www.problogger.net/archives/2006/08/14/lists-group-writing-project/

Regards,

Jim
Vertoro

What is Free Market Money?

"What we need now is a Free Money Movement comparable to the Free Trade Movement of the 19th century, demonstrating not merely the harm caused by acute inflation...but the deeper effects of producing periods of stagnation that are indeed inherent in the present monetary arrangements. I still believe that, so long as the management of money is in the hands of government, the gold standard, with all its imperfections, is the only tolerably safe system but it is better to take money completely out of the control of government. The only way to save civilization will be to deprive governments of the power over the supply of money."
- Friedrich August von Hayek, The Denationalization of Money, 1976

For thousands of years, men have organized governments. In the earliest years, the government was a sort of religion or priesthood which not only told people to obey but told them that disobedience was heresy. Priests of the great Temple of the Pyramid in ancient Egypt were responsible for the surveys of all the lands along the Nile River. These surveys were the basis for taxes collected from as early as 3,500 BC.

About 280 BC, a Hellenistic Egyptian named Aristarchus of Samos set out to measure the circumference of the Earth. He already knew that the Earth was a sphere, that it orbited the Sun, that the Moon orbited the Earth as a satellite, that all three bodies were spherical, and that the Sun was much, much further away than the Moon. He learned of the famous well at Cyene, Egypt which is situated exactly on the Tropic of Cancer. The Sun shines directly down into the well on the equinoxes, casting no shadow. Aristarchus knew that at Alexandria, Egypt, much further north where he lived, there was a shadow cast by the Sun on the equinox. So, he took a six foot pole and measured the shadow it cast on the equinox. With a little trigonometry, he could relate the distance from Alexandria to Cyene to the circumference of the Earth. All he needed to know was the distance between the two cities. Since both cities are on the Nile, he turned to the tax records of the Temple of the Pyramid. Adding up the north-South distances for each property between the two cities, Aristarchus came up with a fairly close figure. He then calculated the circumference of the Earth. His figure was too high by 10%.

But his math was correct. Astronomers and archaeologists pondered the matter for many years. Why was his result off, if his math was right? In the late Nineteenth Century, British and French teams performed surveys of the Nile River valley. Subsequently, these surveys were compared to the tax records for the Temple of the Pyramid. It turns out that the priests cheated. They recorded each property as 10% larger in its east to West dimension and 10% larger in its north to South dimension. In this manner, they were able to collect 21% more taxes from everyone.

This story serves to illustrate the fact that government has always been corrupt. It has always been a temptation for those in power to use their power to gain more for themselves and their families, even though doing so is a betrayal of the trust placed in them.

Given the importance of money in every single conceivable transaction, why trust the creation of money to those in government? Indeed, how can economics ever be secure from tyranny if the issue power of money is trusted to those least capable of upholding the public trust? It is this essential issue which Hayek wrote about in his brilliant book The Denationalisation of Money in 1976.

That same year, gold was legalized. President Ford, presumably seeking campaign contributions from wealthy gold bugs, signed an executive order which reversed the decree of President Roosevelt. Once again, Americans were free to own gold coins, gold bullion, and write contracts in terms of gold. The stage was set for the development of free market money.

In 1996, Doug Jackson founded e-gold. In 1998, Bernard von NotHaus founded the Liberty Dollar. Since then, several other companies have been organized including GoldMoney, e-Bullion, 1MDC, Loom Gold, Pecunix, and the Phoenix Dollar. These private companies issue money which is redeemable for gold or silver.

Monetary competition has staggering consequences. It is so significant that many governments through the ages have forbidden it. "Uttering money" is illegal in many places, as is refusing the "coin of the realm." Legal tender laws make it difficult to compete against the government currency. As we saw in Chapter 9, these laws have been used to the detriment of shopkeepers and consumers.

It is a curious thing that the USA has no legal tender law. Or, rather, its legal tender law consists of authorization for the text "This note is legal tender for all debts public and private" to be placed on the Federal Reserve Notes. There is no punishment for refusing to accept Federal Reserve Note money. So, in the sense that a legal tender law punishes those who won't accept the national currency as legal tender, as acceptable for payment, there is no such law in the USA. In other words, if you want to accept credit cards and turn away cash, you are free to do so. If you want to accept gold and silver coins only, you are free to do so. If you want to take e-gold and refuse American dollars, you can do so without fear of prosecution.

Why is free market money so vital? E.C. Riegel wrote in June 1947 that, "it has not dawned upon society that the political monetary system that prevails in every nation is fundamentally socialistic. To point the finger at conscious socialists is self-deceiving, for it implies that others are not socialists. The finger should be pointed as well at the professing individualists who accept the socialization of the monetary system and are naive enough to believe that we can have a free enterprise system in spite of it (Escape from Inflation, 1979)."

He also wrote, in April 1952, in a letter to Ludwig von Mises, "The economy functions by means of verbal and written contracts, and under a monetary system, these contracts are all expressed in terms of the monetary unit. Hence the meaning of the monetary unit is the meaning of the contract. With the state's power to change the meaning of the monetary unit, it holds complete perversive power over the economy. To admit this all pervasive intervention while objecting to collateral ones is to swallow a whale while gagging at minnows (Ibid.)."

Plunder is the abusive practice of taking without compensation. It has many forms. None is more pernicious, none is more evil, than the plunder of bad money. Inflation is theft. When debased coin or counterfeit money is forced into the market, the worst sort of scum are stealing from everyone.

The ability to trade freely is an essential element of individual liberty. Restrictions on trade inevitably lead to restrictions in other areas. Fiat money, money which has value as "legal tender" only by decree or government order, is the very worst form of restriction on trade and commerce. It necessarily distorts markets, destabilizes prices, and destroys value. Productive people who are able to work for a living, to create and prosper, are deliberately hampered by the policies of fiat money, fractional reserve banking, redistribution of wealth, and intervention in the market.

The adoption of a free market money policy sets the economy free. Free market money helps people live free and prosper. The greater prosperity of every individual is best provided for by free market money.

Free market money lacks nothing that you would desire in monetary policy. It is the best possible money at the best possible price.