--- "CCS" <[EMAIL PROTECTED]>
>It is a good thing that an understanding of money (or >derivative markets) is not
>necessary for trading >e-gold.
Seems I have offended you, for that I apologize.
>> The government does have something that it can >>redeam the IOUs
>> for. They redeam it for more IOUs which are >>valuable because I
>> can go to my neighborhood grocery store and buy food >>to eat.
>That is not redemption.
>> In the world of money, "Redeam" and "Trade" have the >>same meaning.
>No, they are not. Redeem means to fulfill the >contract (in the
>promissory note).
Excuse me, I did not mean the dictionary definition, I meant that they could both have
equal effects.
>> Consider this example, you have an ounce of e-gold >>in your
>> account. Can you redeam it?
>Yes. The current redemption pledge for e-gold is that >1 ounce of
>it is good for 1/400 of delivery of a 400 ounce bar. >If they will
>keep that pledge then you can redeem an ounce of >e-gold.
>> No, but you can trade it to GoldFinger Coin for an >>ounce of
>>physical metal.
>And the only reason GoldFinger will continue to do >that is the
>expectation that the redemption pledge will be >honored. If it
>ever appears that that pledge will not be honored no >one will
>trade anything for an ounce of e-gold any longer.
I doubt that GoldFinger is saving up the gold so he can redeem a 400oz bar. Infact I
sincerely hope that he is not doing this. GoldFinger probably sells the e-gold that
he gets in exchange for the Physical Gold. Every time that somebody redeems(using
dictionary definition here) any form of currency they are hurting their economy. They
are decreasing the amount of money in circulation and causing lower demand levels and
deflation.
Money is a medium of exchange, it does not matter what its backed by or what it can be
redeemed for just as long as it can be traded for something.
Khurram Khan
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