I thought England was a gold bankrupt?

[The Lone Gunman]

The perfect example of a fiat currency:



31/05/1997 ZWD$100 = £5.40
31/05/2006 ZWD$100 = £0.000529

They just issued a 100,000 dollar bill due to 1000% inflation. The 50,000 wouldnt buy a loaf of bread.
The new bill is officialy worth 1 US Dollar but only 34 cents on the black market.

[simondolan]

Not really, almost all currency in circulation today is Fiat anyway. That is it is accepted by tradition or convention at it's face value for what it is, under the direction of some authority with the power to impose penalties, and without backing from any kind of fixed asset.

Yep - worrying isn't it!

Apparently there is £48bn in actual circulation - no idea how much is held in bank accounts. Once you offset current levels of debt probably about £6.73

[Joe Black]

Fiat currencies

Not really, almost all currency in circulation today is Fiat anyway. That is it is accepted by tradition or convention at it's face value for what it is, under the direction of some authority with the power to impose penalties, and without backing from any kind of fixed asset.

The perfect example of a fiat currency:



31/05/1997 ZWD$100 = £5.40
31/05/2006 ZWD$100 = £0.000529

[wendigo100]

The problem is that 400 tonnes of gold is only worth about £4.5bn.

Not much when you consider the amount of cash that is in circulation and which the gold is supposed to underwrite.

How much cash is in circulation? (By that I assume you mean readies, not money in "current accounts".)

[DaveB]

The problem is that 400 tonnes of gold is only worth about £4.5bn.

Not much when you consider the amount of cash that is in circulation and which the gold is supposed to underwrite.

Not really, almost all currency in circulation today is Fiat anyway. That is it is accepted by tradition or convention at it's face value for what it is, under the direction of some authority with the power to impose penalties, and without backing from any kind of fixed asset.

[simondolan]

Gold

The problem is that 400 tonnes of gold is only worth about £4.5bn.

Not much when you consider the amount of cash that is in circulation and which the gold is supposed to underwrite.

[Mailman]

Just because it's held in the Bank of England doesn't mean that it all belongs to the Government.

hth.

Thats not what the article is saying, quite clearly its owned by the gooberment.

The bank says it has 400 tonnes of UK government gold stored

Mailman

[Churchill]

Just because it's held in the Bank of England doesn't mean that it all belongs to the Government.

hth.

[Mailman]

Maybe he bought at the height of the price of gold?

Mailman

[stackpole]

http://news.bbc.co.uk/2/hi/uk_news/magazine/4987016.st

400 tons of the stuff held in the Bank of England???

Anywho, on a related matter...anyone been to the Bank of England museum? I thought it was actually quite a good museum...not a bad way to spend 30 minutes anyway

Mailman

Don't tell Gordon. Next gold price slump and he'll announce that he'll sell it, which will drive the price down a bit further, then he'll sell it.

[Xenophon]

This link works

The 'm' was missing from the end.

[Mailman]

http://news.bbc.co.uk/2/hi/uk_news/magazine/4987016.stm

400 tons of the stuff held in the Bank of England???

Anywho, on a related matter...anyone been to the Bank of England museum? I thought it was actually quite a good museum...not a bad way to spend 30 minutes anyway

Mailman