Again this is just my mind thinking aimlessly. Could someone with some bullion please try the following experiment:

Go to your local safeway, utility outlet, gas station, and see what dollar value comes up when they scan your waffer of gold? All I'm saying is that we do not have the basic infrastructure to handle physical gold. Yes, as inflation increases you will be able to trade gold for devalued currency(which you will get a lot more of) but it is still only paper in the end.  Thats what I am trying to get my head around. Eventually we have to rely on the government to cash out. Thats how they get  us. Even in hyperinflation( in our lifetime Yugoslavia when it was around had a 5 Billion dollar note, everyone in the country was a millionaire) they cash in old currency for new, revalue it and away you go. As the USA did in this past century they can even peg the price of gold to a fixed rate to prevent destabilization.

So, yes, gold is good. But where I get a little lost is an exit strategy. When gold goes through the roof and SGR follows most of us will sell our shares. Where does the money go? Well after the 3 day waiting period we get to pick it up from either a bank or a brokerage house. Today I deal with CIBC, so assuming they are still open I will have X number of digits that I can play with. Even today you cannot withdrawl large sums of cash without advance warning to the bank. Try it, go withdraw $25,000 cash tomorrow and see if it can be done.  So, you call the bank and give them a heads up that you want to remove $50,000 from your account in a few days. They counter by saying, I'm sorry sir but the government will only allow you to remove $1000.00 per week or what ever so there isn't a run on the bank. Now what? Your money is sitting in your account devalueing in front of your eyes.

Some billionaire guy named Richard Rainwater subscribes to a similiar scenario. He still has faith in currencies though with the Canadian dollar being high on his list(Avoid countries short on resources and long on people, buy canadian sell Japanese) . Thinks Americans are "in the kind of trouble people shouldn't find themselves in". Likes oil,gas and copper but thinks the really big play will be in agricultural products. This article was printed Dec 26/05  by the way in a special issue of FORTUNE magazine, Investors guide 2006.

Cheers