When you own gold, it’s money that you own. Everything else circulating around here is currency – you don’t really own it. The cash you have in your pocket is Federal Reserve Notes [meaning you possess a liability of the Federal Reserve and your spending power is exposed to counterparty risk]. The money you have in your checking account is a liability of the bank where that money is deposited. But when you own physical gold, it’s money that you own. Your are not dependent on someone else’s ability to make good on that money when you want to spend it. – James Turk on The Daily Coin
The U.S. populace has been methodically trained over the last 100 years, since the erection of the Federal Reserve, to believe that Federal Reserve Notes – otherwise known as U.S. dollars – represents a wealth asset. But it’s just the opposite: it’s a liability of the Federal Reserve backed by the “promise” of the U.S. Government. How much value do you place in that “promise?”
Even more insidious is the notion that “money” in a checking account belongs to the person who made the deposit. In fact, your money sitting in any bank account is no longer in your ownership. You have ownership of an unsecured liability issued to you by the bank. The bank takes your money and “hypothecates” it – or lends it out. If the bank loses that money, it may be protected from any legal costs thanks to D&O insurance, but it might not be able honour to its liability to you. This is because if enough loan counterparties defaulted and the bank is insolvent, you will never receive the full value of the bank’s debt obligation. Welcome to the new world of bail-ins.
But gold in your possession does not have that problem. Rory Hall of The Daily Coin interviewed James Turk about a new type of non-bank banking service called Bitgold. He discusses the unmitigated advantages of using Bitgold vs. a traditional bank account.
I have moved U.S.Government electronic monopoly money from my checking account into my Bitgold account every day this week, including today. I don’t have the funds required to buy a 1oz. bullion coin everyday, but BitGold allows me to accumulate .9995% gold grams. This is bona fide allocated gold. I look at this manipulated take-down of the gold price as a gift from the Fed because it enables me to purchase more Bitgold gold every day the dollar price of gold declines. When the dollar price of gold moves back up, my Bitgold account will increase in value. That does not happen with dollars sitting in a checking account. They just sit there like a Pet Rock, earning no interest. If the bank becomes insolvent, the Pet Rock has no value to me.
I want to make it clear that I’m not an affiliate or associated with Bitgold and do not get any ad revenues from Bitgold for the display link at the top (although I’m sure I could if I requested it). I just really believe in the service and I think anyone can benefit from moving their digital bank credits out of the global Central Banking system and in to Bitgold. I receive a 2% “bonus” if someone uses the links on this site to sign-up for Bitgold and everyone who opens a new account that is funded receives a 5% bonus.
If you own gold, you have money – If you don’t own gold, you have a problem