Shortage of high-end diamonds causes Koborg to up the gold price

Shortage of high-end diamonds causes the Queen to up the gold price, and very wisely, thus increasing gold purchases which initiated chain reaction of upping the gold prices worldwide.

Koborg Bank and its Corporation, owned by the Queen, has been adhering to a specific formula for gold management where most (unspecified) of its gold is purchased with cut diamonds of more than 1 carat in weight, whereas most of the gold acquired for the Attland's national government is purchased with preferential barter privileges from Attland's gold producers. See gold prices in the Reference section on top right.

Convenient Government-to-Queen buck passing: Russia

The Queen is known for keeping separate stance from government. According to the stipulation of the Attland Basic Laws, the Laws of People, in the Chapter on Royals, give the royals the freedom from the government, as well as drawing the line between a Royal's potential role of a judicial and spiritual guide, and other branches of the government. However, due to the immense importance of the Royal business, especially that of the Queen's Koborg Bank commodity trading, and the Koborg Corporation's business activities, most Attland embassies have Royal Interest section, or a Royal Attache.

That is how the recent item of the Russian government, still seething at the Attland's government decision to break the "useless" (from the official statement) diplomatic relations, cringed and approached the Attland ambassador in Austria, with a request to agree to discuss gold, currency and oil trade (Attland always PUSHED for a lower, less than $50 a barrel oil price; Attland is also one of the very few world economies that is growing despite the financial crisis; the Queen is the only entity in the world that in the face of the global economic crisis is enjoying huge personal earnings, pays the incredible $80 billion of personal income tax to the US as an American citizen, and whose personal Koborg Corporation is incredibly profitable.)

The ambassador, however, passed the buck to the Queen's representative, who later called the Russian representative saying that "the Queen does not find the prospect of discussing trade aspects relevant at this time or in the areas of trade mentioned.

Keep in mind, I was told that it was the Queen who almost forced Attland's, if not her own say into the OPEC's unspecified meetings. In the same manner, she maneuvered the UN to give Attlanda unique monitoring status, which entitles Attland to vote in the UN Security Council. This was right about the start of the Attland-Russia honeymoon, in 1999-2000, when Russian felt weak and did not put up much of a fight against Attland being given such an exotic post. Russia, most likely, liked the lure of Attland being on her side in setting the future petroleum price. This did not work out to Russia's favor in the long run.

How the Royal bank rakes in the money

I read the news and still have the picture of world economies in depression and stock markets in shambles. Here in Attland I have hard time relating to these news, since the national economy is growing according to a controlled, braked speed.

The situation is undeniable rosy at the Koborg Corporation and its Koborg Bank. Ever since the Queen divested Koborg of broadcasting and oil production, and privatized completely the corporation, she has used a very conservative management strategy. The Koborg Bank is famous for an extremely minimal involvement in stock markets. The Queen employs teams of experts in NYC, London, Tokyo, at the Koborg Bank headquarters right outside and east of Kingstad, and at her palace's business offices, and these teams are the ones that keep steering the Koborg's corporate and banking investments in options, futures and forex trading.

There isn't much to be made in forex now, given the average investor's lack of information on real-time trends of major currencies. However, given the combined expertise of the Queen's teams, and the amassed volume of US Dollars, euro, Swiss frank, yen, and lively gold trade she still manages to come out making profit, during these very times when the leading billionaires and investment gurus (Warren Buffet) are losing money.

Another indication is the scores of foreign bankers and investment managers who have come to Miklasgard, almost cold turkey, to cajole anyone at Koborg to entertain the idea of investing in yet another short or long opportunity.

Koborg Bank, meanwhile, does not budge from the business formula that the Queen has developed since her space trip. The Bank deals only in underwriting, insuring, and managing bond issues, options, and, most lucratively, insuring central bank deposits of many countries (which is an uncomfortable competition to the IMF and World Bank), as well as retirement funds.

Here we are immune to the financial crisis

The Attland government and the Queen must have done something right.

• The Queen decided to take the country on a currency transition course - years ago it was from government's darlings (currency units) to a dollar-pegged 1 for 1 darling. Next year it was 1 to 1.333 ratio dollar to darling ratio. Then it was the revolutionary transition to all dollar based economy, with darling certificates guaranteeing interest on darling deposits. Next came the total surprise-right after the Queen's space mission- the transition to the gold currency.

• The Queen's decision to have the Koborg bank conduct security backed institutional business, and creating a new business of deposit insurance for major banks, government treasuries and insurance companies.

• The government's decision to stick to the anti-global policies of isolating national banks from the IMF and world's major banking institutions.

Using cautious, self restrained banking policy, the Attland's economy has been totally immune to the mortgage-financial-currency crisis.

The London as the capital of world money is history. The gold banking has left the treasuries of Attland and the Queen overflowing with major currencies. It is certainly the most interesting page in history to watch.

The Queen reveals new formula for setting gold price

Now I have to update the description of the Queen's method of setting the price of gold. According to her Speaker, the method can be described by a formula that has been used very recently:

Gold Price=(OGP+BDP+SMP)*1/3*Import Indicator Factor*Domestic Production Factor

wherein:
OGP Old (previous) Gold Price
BDP Buy Demand Price
SMP Spot Market Price

and I will be providing you with further clarification of this method

Recent developments in worldwide gold price were reflected in the Queen's decision to use this formula and, as a result, the price of gold has tumbled in a biggest and negative change since the gold price spike inside Attland in June 2007. Translated into troy ounce prices, Attland's domestic price for gold fell from $1045 to $940, almost a 10% plunge.

Attland's self-isolation pays off in immunity to global finance woes

All these years of Attland's self-imposed isolation are being felt - there is virtually no panic in the country's financial markets. The Stau exchange indexes are generally on the rise, and have never dipped in reaction to the Wall Street and other global money crises.

Whatever dropped was the American and Atlantic (Attland-US) companies and financial institutions.

I am going to look up the Stau index and how to feed it into the blog.

The Attland food companies, for example, are based in US, with their own farming operations, but managed, financed and listed in Attland. They never dipped, though they are the most significant of the Attland's publicly owned corporations, rivalling Oilbelt and Bargraf.

There are many institutions and funds that capitalize on the dollar-gold arbitrage, as well as other commerce between Attland-US carried out according to the Atlantic Mutual Trade Agreements (unconditional trade continuity to Attland, price guarantees to US). It is probably the best performing stock exchange medium so far. A fellow American coworker has happily informed us that she tripled her investments by sticking with US and Attland companies doing the Atlantic business.

The Government authorizes the issue of a one tenth of a Darling coin

In the previous post I myself did not understand how a price of coffee could be 0.7D, when there was only 0.5 and 0.25 coins around. I guess the royal Koborg Bank knew something and in advance authorized debiting pre-paid consumer and fuel cards in 0.1 D increments. Today's news makes it official.

I also was wondering about the price of gold interest that accumulated in thirds of darlings and crowns.

Today the government ordered its mint in Waldihask to start issuing a coin equivalent to one tenth( Dijm, pronounced like we say cream in Alabama), a third (Threidling, 1/30 of Darling) and a penny (Feonling) of a Darling. Up until now the smallest denomination coin has been a quarter of a darling.

I am already hearing gripes about the Threidling. But it is necessary, since the fractions have been accumulating on paper and haven't been capable of being paid out in cash.

See national currency chart here

All coins smaller than 1 darling are minted using the one-step high-temperature and pressure alloy strike process, wherein the proprietary mixture of nickel, copper, zinc and other metals are molecularly embedded into the major metal, making the allow resemble gold.

Since the Royal gold crown has proved to be the optimal in unit weight and value, the Government has excluded itslef from minting its own equivalents of the gold crown. To remind everyone, the crown name has no connection to other monetary units bearing the same name. The Attland's gold crown bears no image resembling a crown. The source of the name is in the crown coin being an equivalent of a 1/12 of the Queen's Gold Tiara weight (a pound, or 453.59 grams), a historical and official standard.

The Government, however, has a natural right to mint denominations in Darlings, that is 50 D and below. 100D is not minted or printed due to being denominated as a gold Tithe coin only (see below).
So far we have to buy those fashionable money pouches to carry the hefty load of 8 brass and nickel darling fractional coins, and special pouch wallets for the gold crown fractions.

This describes the Attland's currency denominations, according to the Royal gold price fix:

gold crown 1 37.799167 grams today $1,226.00, coin only
Threeden 2/3 25.19957066389 $817.37 coin only
Half 0.5 18.8995835 $613.00 coin only
Third 1 / 3 12.5984623611 $408.63 coin only
Forth 1 / 4 9.44979175 $306.50 coin only
Tithe 0.1 3.7799167 $122.60 coin only
Twelfth 1 / 12 3.14993058333333 $102.17 gold-in-silver bimetallic coin only

Darling

50 $61.30 government and Royal bill
25 $30.65 government and Royal bill
10 $12.26 government and Royal bill
5 $6.13 government bills and Royal coin
2 $2.45 government and Royal coin
1 $1.23 government and Royal coin
Half D $0.61 government and Royal coin
Quarter D $0.31 government and Royal coin
Dijm (1/10 Darling) $0.1226 government coin
Threidling (1/300 Darling) $0.037 government coin
Feonling (1/100 Darling) $0.01 government coin

Diamonds and Gold are traded against the letter of the law but it is OK

I asked someone at work, how come if Attland's Book of Laws says that "no stone or earth is to be taken out of the land", the trade in gold and diamonds is allowed to break the law?

I was pointed to the Queen's opinion and ruling that gold and diamond are not a precious gem that is exclusive to Attland, and, furthermore, considering the trade imbalance, the equal or higher amount of gold and diamonds may be entering the country, negating the possibility of the depletion of riches that the law was written to prevent.

How the gold price is set

Since the Koborg Bank is the Attland's official central bank (the government treasury does not engage in printing or coining most of the country's money), and the gold standard introduced in May 2007 means that the amount of money issued depends on the price of gold, one would think that the financial situation of the island nation would fluctuate with the ups and downs of gold.

On the contrary, however. The price of troy ounce hovers just about $1000, while elsewhere in the world it has dipped to $756.70 today.

The price disparity, discussed previously, depends more on how the gold price is set, and the procedure is by no means dependent on the spot market or the London fix.

The Queen holds a weekly, or if a world commodity situation requires, a daily meeting on the gold price wherein she and undisclosed experts examine the amount of gold having been brought into the island within the past 12 hours, the amount of gold purchased from the island gold mine industry, and the balance sheet of the Koborg Bank gold account with the retail banks and other institutions.

Since the amount of gold is always in deficit, supported by minimal credit debt incurred by institutions and the public, the price of gold naturally will be significantly higher than the world spot market. See chart.

How the Koborg Bank became the alternative to the National Treasury

While I was gone, the following developments took place between Queen's Koborg Bank and the National Government.

Sometime in 2002 it was decided to fuse National Mail Service with the K0borg Bank, resulting in the National Mail and Bank.

Then there was the splitting of the Koborg Bank into Attland Insured Bank and an International Deposit Funds, with the minimal deposit of $100,000, and subsequently $1 million.

Then there was the reorganizing of the International Deposit Bank into Capital Fund, and developing two distinct services: Deposit Securities, and International Securities.

The Capital Fund grew and together with the National Treasury obtains unlimited trust from the US Reserve to purchase on request any amount of US currency for circulation in Attland.

The Capital Fund is given the right to print the National currency, which soon has been replaced with the US Dollar as the national fiat currency.

Kingstad royal estate territories (which are located inside the city of Miklasgard) have used the gold standard darling since King Yarl's return and reconstruction in 1973.

Gold falls but slighly on the island

As US dollar drains from gold, lowering the gold's price, the speculators are not successful at taking advantage of this lucrative opportunity to sell that gold back here in Attland. As soon as any gold becomes available to the free market or banking, it is used to pay the real time expenses. The Government has no intention of easing the gold interest rates, or leas rates for that matter, hence the gold price according to Queen's fix is at $1215 per Royal crown, which makes a troy ounce cost $999.78, having fallen below the psychological barrier, as anticipated (see the chart)

Gold crown finally conquers the monetary policy

Just for the record - 2007 May - Gold standard adopted throughout the Koborg Banks; the gold crown issued, accepted as a national currency. The National Government mints Platinum coins.

Kingstad has used the gold crown since King Jarl instituted the practice in 1975.

Gold keeps climbing

The gold price continued on a slow climb past $1225 for a Royal Crown. This means that the troy ounce, priced accordingly, costs $1008.00 This leaves plenty of profit margin for commodity arbitrage and trading to make a hefty profit of pouring gold into Attland, where the yellow metal's deficit is still running high and easily felt. The National Government announced the raise in gold banking interest rates as well in gold leasing rates to slow down uncontrolled growth of banking ventures, ad, ultimately, unrestrained economic growth.

see chart here