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Gold/Mining/Energy : Gold Price Monitor -- Ignore unavailable to you. Want to Upgrade?

To: The Vet who wrote (53070)	5/21/2000 10:55:00 PM
From: Enigma	Read Replies (2) \| Respond to of 116762

Yes that may be true of certain instruments - but you can take a Bank of Nova Scotia Gold Certificate and present it at the gold window and get physical gold at any time.

To: The Vet who wrote (53070)	5/21/2000 11:13:00 PM
From: d:oug	Read Replies (2) \| Respond to of 116762

Warning, on topic but a long BaBBle from me. So treat it like fly paper. The Vet, I agree with all you have said and I would like to add a few comments to certain parts. <<...the majority of the gold certificates and derivatives really have no basis.>> Here I need help. Is the term paper gold that knowned as a gold certificates ? Also, I think a gold certificates is something more of a one to one, as in it's face value has a number to represent a quanity of gold in weight rather than a dollar value. That e-gold site that lets people buy and sell products and services with each person using their physical gold reserve as direct payment. I believe silver and other precious metals are allowed. Understanding of the term derivatives I can only guess at, as the math or grammer usage can be described quite straight forward, as in grammer examples of words can be obtained, and in math one can obtain any textbook and find the same type of instructions for development and usage examples. But as a market or trading tool I will guess that a derivative is really like a formula or procedure or rules and regulations of the type that tries to create an end result from a set of knowned current facts that are not real as in time, but more of a type of guess or probability of being true. Seems that these derivatives are just a bunch of events that traders use among each other like a hot potatoe passing among each other, and everyone hopes to obtain a piece as a return bthru selling or buying into it. This unlike that paper gold, derivatives has a cause and result element that changes with time, rather than a cause and effect quality like those strict rules of mathematics, these market derivatives are governed by the laws that govern peoples needs and desires in the area of trying to out smart the other guy, as in a game of chance never knowing what will happen next, unlike math where what happens can be predicted, these derivates have human qualities derived from folks trying to be the winner, where each winner requires a loser. No service or product generated thru market derivative, only a flow of risk between winners and losers. That may be the reason why paper gold lends itself to this derivative "game", since nothing of value is generated thru derivatives, as it only represents paper movement of wealth or value as in a bookkeeping manner, then actual delivery or actual consumption can hide the fact that wealth or value does not really exist, but as you stated: <<...same as counterfeit dollar bills - they are as good as real bills for the purpose of settlement of accounts until they are discovered as fakes.>> But I may add to the follow... <<... the last holder is faced with the loss. As far as any intermediate holders are concerned they have suffered no loss.>> that yes, intermediates holders in this exchange of derivatives are uneffected once they pass on to the next person, but the economy outside this loop feels the effect as false indicators, as in there being a bigger physical supply of gold than really is, just like the phony paper bills gives the impression of a larger real money supply. But I'm sure the Secret Service might say that the amount of counterfeit bills in circulation is under 10%, the amount of counterfeit gold may be over 90% if GATA is correct. <<...it is the original issuer who has ultimately made the gain and unless the fake bill (read unbacked gold certificate) is ever presented for redemption and discovered to be fake then in theory it can circulate forever...>> Yes, and unlike law enforcement already on the case for counterfeit paper bills or products or services, we have to depend on people like those of GATA Bill Murphy, Chairman Gold Anti-Trust Action Committee gata.org and those who put forth expert opinion at the Le Metropole Cafe to help others understand that the facts given out by the government and controlled news media like CNBC are false. dougak