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An open letter to Jessica Cross, managing director of Virtual Metals
By Mark S. Wallace
Monday, May 3, 2004
Unfortunately I cannot attend the May 13-14 conference of
the American Institute for Economic Research in Great
Barrington, Mass., about resuming a gold standard, as
reported in GATA dispatch 2122:
http://groups.yahoo.com/group/gata/message/2122
But there are many more reasons now than there were
even 10 years ago why a gold standard is feasible.(We
gold advocates always knew that it was desirable, but
feasibility was another question.)
GoldMoney.com shows the way of the future.Holding cash
balances as gold grams transferable over the Internet with
a few clicks of a mouse solves the issue of having to send
gold coins through the mail.
The potential of this system cannot be overstated.It holds
the promise of moving away completely from fraudulent paper
money (which, as history shows, will always revert to its
intrinsic value, zero) and moving into an environment where
all money is gold. All credit card transactions could be
settled by the transfer of gold grams.
A traditional cause for concern is whether gold is actually
in the gold warehouse.But owing to advances in civilization,
I think we have reached the stage where we can generally
trust major financial institutions such as banks, stock
brokerage companies, and life insurance companies not to
steal our money outright.In other words, though I generally
try to keep my bank balances to a minimum, it is because
I fear bank failure and a waffling on the FDIC guarantee; I
don't worry that the bank is going to steal my money.
For this reason, if a major bank decided to allow customers
to keep balances in gold grams and to make such balances
transferable by checks or Internet transfers, I think I would
trust it to have the gold in its vaults if that was the deal
up-front. (There might be a two-tier system, in which some
customers would allow banks to loan out their gold in
exchange for interest, whereas other customers would elect
to have all their gold stored in the vault, with none being
loaned and the customer paying the bank storage and
processing fees.)
The existing political structure can be expected to resist
any shift to a gold-based financial system as described
above, because it will make the welfare state impossible to
maintain. The welfare state depends upon the government's
ability to defraud people by printing money or, worse,
gunning the economy through a reckless credit expansion.
The Federal Reserve has opted for the latter course since
1982, and it will soon lead to a devastating crash and
depression.
--------------------------
Mark S. Wallace is a tax attorney in LosAngeles and a
member of Stutman, Treister & Glatt Professional Corp.
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RECOMMENDED INTERNET SITES
FOR DAILY MONITORING OF GOLD
AND PRECIOUS METALS
NEWS AND ANALYSIS
Free sites:
http://www.cbs.marketwatch.com
http://www.capitalupdates.com/
http://www.silver-investor.com
http://www.thebulliondesk.com/
http://www.goldismoney.info/index.html
http://www.minersmanual.com/minernews.html
http://www.a1-guide-to-gold-investments.com/euro-vs-dollar.html
http://www.investmentrarities.com
http://www.kuik.com/KH/KH.html
(Korelin Business Report -- audio)
http://www.plata.com.mx/plata/home.htm
(In Spanish)
http://www.plata.com.mx/plata/plata/english.htm
(In English)
Subscription site:
http://www.lemetropolecafe.com/
Eagle Ranch discussion site:
http://os2eagle.net/checksum.htm
Ted Butler silver commentary archive:
http://www.investmentrarities.com/
----------------------------------------------------
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WHO HAVE SUPPORTED GATA
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Michael Kosares, Proprietor
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Metalguys@aol.com
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15018 North Tatum Blvd.
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http://www.swissamerica.com
Dr. Fred I. Goldstein, Senior Broker
1-800-BUY-COIN
FiGoldstein@swissamerica.com
----------------------------------------------------
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