The ReLOVElution Will Be Vended

Now comes a Financial Times story sure to warm the cockles of even the coldest libertarian heart. German businessman Thomas Geissler is setting up a line of vending machines that dispense gold:

"German investors have always preferred to hold a lot of personal wealth in gold, for historical reasons," said Thomas Geissler, the owner of the company. "They have twice lost everything."…  

"There has definitely been more interest because of the financial crisis," Mr Geissler said.  

"Gold is a good thing to have in your pocket in uncertain times."

Sounds like at least one Kraut smells what Ron Paul is cookin'. Geissler plans to install 500 of these machines throughout Europe. Different amounts of gold will be available—the FT mentions a 1-gram wafer and a 10-gram bar—but, for now, all amounts come with a hefty mark-up. So don't get too excited:

When the Financial Times bought the cheapest product it was dispensed in an oblong metal box labelled "My Golden Treasure", with a certificate of authenticity signed by Mr Geissler but no receipt and the wrong change. Mr Geissler said he hoped to have a more advanced machine later this month.

Gold prices from the machines - about 30 per cent higher than market prices for the cheapest product - will be updated every few minutes.

If you're willing to pay that much to escape the evils of fiat currency (and the idea of gold-for-cash transactions without receipts doesn't bother you), then get thee to a vending machine!

(Link via the estimable and unlinkable Jared Walczak, who notes in an e-mail that "this obviously falls somewhat short of the libertarian dream of installing heroin vending machines in schools.")

Comments

[Jonas]

Somebody just used the expression "warm the cockles" in the comments on another post... I've never even heard this expression before, now I've seen it twice in one day. What gives?

[Terry]

Let's start a drive to buy one for the Reason headquarters in Washington DC.
I'll start.
My donation, twenty bucks.
Next.

[Liz]

I'll donate my services to get one for the office
[phone]

[jtuf]

Gold prices from the machines - about 30 per cent higher than market prices for the cheapest product - will be updated every few minutes.

So, buying from the vending machine makes economic sense if it saves you an hour on the transaction time and hourly inflation is up to 30%. Sadly, there are plenty of historical examples when hourly inflation was over 30%. I haven't checked the latest figures, but Zimbabwe might be at that point.

[Astro]

Isn't 'warm the cockles' an archaic expression?

Kind of like the DEROGATORY name 'Kraut'? I don't think I've heard that term since 'Hogan's Heroes' or maybe that 'Fawlty Towers' episode.

/Don't mention the war.

[monkey on juice]

"I haven't checked the latest figures, but Zimbabwe might be at that point."

Don't worry, we'll get there soon enough. I think this administration took lessons at the Robert Mugabe School of Economics.

[Robert Enders]

If you're one of those types who insist on keeping the actual gold on your person, then this might be for you. Owning gold that's in a vault in another state justs makes it that easier for your assets to be seized.

[The Angry Optimist]

nah, man, even Zimbabwe is "only" at 100% per day. And that's not even the highest in history (although it is the second-highest). Post-war Hungary had an inflation rate almost double Zimbabwe's. Holy Diver.

[ashaw]

I thought the bid-ask spreads from legit dealers were bad enough, what a joke. Robbery of the clueless.

[Billy!]

How exactly is this dude "smelling what Ron Paul is cooking"? He's selling the gold. SELLING. He's dropping his silly yellow rocks on a public dumb enough to buy.

"Gold is so awesome I invite you to buy all mine!"

[ChrisH]

This is the first step. Next, we'll put in the herion vending machines that accept gold.

As for putting them in the schools...

Political Novice: You're libertarian? Aren't you the ones that believe in heroin vending machines in public schools?
Libertarian [with contempt]: What do you mean, "public" schools?!!

[ChrisH]

Post-war Hungary had an inflation rate almost double Zimbabwe's

Did they have to do that with actual printing presses, or did they manage it with bookeeping entries somehow? 'Cause printing money that fast (even just to add zeroes!) is an impressive feat of production, just put to a completely counter-productive use.

[Inivsible Finger]

Sounds like at least one Kraut smells what Ron Paul is cookin'.

In the current American mind of mush, that makes Ron Paul a Nazi.

[Tricky Prickears]

Now, you can own a "pet rock" made entirely of 24 carat gold!

[kc]

".....but no receipt and the wrong change."

So much for German engineering....

[brotherben]

I didn't rtfa. Did it mention theft deterrance of the machines?

[Jared]

Billy!: That is, of course, the conundrum of all the Liberty Dollar salesmen one used to see from time to time. You'd be a fool to hold on to fiat paper money when you could have inflation-free Liberty Dollars (for, of course, a 20-30% surcharge above commodity value) intones the salesman -- as he eagerly accepts your Federal Reserve Notes in exchange.

Double coincidence of wants indeed.

[The Angry Optimist]

is there some reason that a sect of libertarians call them "FRNs" instead of "dollars"? Are these not equivalent concepts?

[Tulpa]

The dollar originally denoted a certain amount of gold, while the reserve note was merely a promise that that amount of gold could be obtained by redeeming the note.

Now, of course, the distinction has disappeared (though with so much of our currency being exchanged electronically, a new distinction may have been created).

[EJM]

I haven't checked the latest figures, but Zimbabwe might be at that point.

FWIW, consumer prices have been falling a bit over the past few months; granted, it's largely the result of the government abandoning the Zimbabwean dollar.

[Tulpa]

That is, of course, the conundrum of all the Liberty Dollar salesmen one used to see from time to time. You'd be a fool to hold on to fiat paper money when you could have inflation-free Liberty Dollars (for, of course, a 20-30% surcharge above commodity value) intones the salesman -- as he eagerly accepts your Federal Reserve Notes in exchange.

That's not contradictory at all. The Liberty Dollar sellers want money to spend right now (for which FRNs are better than gold), while the buyers want a store of value just in case inflation explodes in the future (for which gold is better than FRNs). The markup over current commodity prices will be insignificant compared to the savings if hyperinflation actually happens.

This isn't really any more counterintuitive than any other buying and selling that's done in the marketplace, however much some want us to think it is.

[The Angry Optimist]

Tulpa - but the sales pitch is that inflation is going to happen, like, tomorrow, so you do have to wonder how much the salesman behind the gold believes that.

[Dribbles]

"Somebody just used the expression "warm the cockles" in the comments on another post... I've never even heard this expression before, now I've seen it twice in one day. What gives?"

Cockles are replacing Twitter. The act of using the Cockle application is called cocking. Or if you're getting Bill Flanigen's cockles you would say "Bill Flanigen just cocked me again.

It's all the rage on MSNBC now.

[Dribbles]

"Tulpa - but the sales pitch is that inflation is going to happen, like, tomorrow, so you do have to wonder how much the salesman behind the gold believes that."

This just confirms a suspicion I have held for weeks now -- That RC is gonna get burned when the gold bubble bursts.

[Tulpa]

TAO,

OK, that would be overselling the point. But I guess I was responding to folks who question why someone who thinks inflation is coming in the future would be selling gold. It's no different from a guy who's going boating on rough water next month selling lifejackets.

[Chris]

You want to stay fit because you want to have good health. To make this possible, you also eat healthy food to supply the energy that your body needs and to be able to carry out every activity that you have to do everyday. To maximize the advantages of your work out, it is highly encouraged that you give importance to the kind of food that you eat before and after your physical activities.

[phalkor]

I'll have you know that I have written "it warms the cockles" in at least three posts on reason. Two of which were by my shizoaffective imaginary friend, rascal.

[Kroneborge]

Actual physical possession is always more expense that the spot price (although 30% is high).

I know for silver, it's normally a buck when you buy, then another buck when you sell. So that's close to 10% each way.

[Dribbles]

"my shizoaffective imaginary friend, rascal."

So how is it that you are able to cum in your own mouth? Are you really that limber, or just a good aim?

[thew83]

is there some reason that a sect of libertarians call them "FRNs" instead of "dollars"? Are these not equivalent concepts?

I've taken to calling "dollars" "arbitrary units."

[Mike Laursen]

Gold vending machines are good, I guess, as long as my gold ingots don't get snagged on a bag of Twizzlers.

[Mad Max]

In Japan, the vending-machine beer comes in golden cans.

(That's the cleanest Japanese-vending-machine joke I could think of)

[Brandybuck]

I can drive a half hour down the street and get gold at far far less than a 30% markup. Or some (reputable) online stores at less than that.

These vending machines are like the Liberty Dollars of Germany. When told was $750 an ouce they were selling one ounce coins for $1000.

[Sean W. Malone]

I might also note that Liberty Dollars were intended to be a competing currency but were subsequently demolished by the fuzz.

[mark]

is there some reason that a sect of libertarians call them "FRNs" instead of "dollars"? Are these not equivalent concepts?

I think it helps initiate non-libertarians to the tyranny of the Fed. A "dollar" has the feeling of a store of value, as it should. But when you remember that it's more of a promise or a contract, a note signed by the Treasury Secretary, you begin to question the nature of that contract, and whether the terms of that contract are worth it, or should be re-negotiated.

[jtuf]

Billy! | June 19, 2009, 1:00pm | #

How exactly is this dude "smelling what Ron Paul is cooking"? He's selling the gold. SELLING. He's dropping his silly yellow rocks on a public dumb enough to buy.

"Gold is so awesome I invite you to buy all mine!"

Umm, that's kind of the concept behind all sales. I assume he buys the gold at one price and then sells it for a higher price to make a profit. He thinks the money he gets from selling the gold is more valuable than the gold he gives up. The customer thinks the gold is more valuable than the money paid for it. They can both be correct, because value is subjective. Hence, the baker sells bread that he says is good, the candlestick maker sells candles that he says are good, ect.

[REYNOLDS REVOLUTION]

PEOPLE ! Are you not paying attention to what is going on in the world economically ???
Gold will double up in price next year and just to cover 10% of the world's debt gold would rise to $10,000 per ounce !!! But I'll be happy with doubling up my money so I can buy MORE gold within this GOLD BOOM in the next twelve months ! OBAMA's and other world leaders' efforts to keep the currency strong is just a pipe dream in the long run; for we've gone beyond the point of NO RETURN folks; and if DAILY REPORTS of job losses, (which are indicative of the economies slowing down to a halt)is not convincing enough for some of you, then consider the instability in the world due to the insanity that's coming from North Korea, Iran, and ESPECIALLY from the President of The United States; who is crazy enough to "TIGHTEN" up lending policies while "STRENGTHENING" the Federal Reserve, ( America's Central Bank, but nevertheless a PRIVATE entity that is rubber-stamped by Congress to do business on behalf of the US ) who's "Fed" (Bernanke)has already hinted at changing ALL of the world's currencies to a single monetary BOW YOUR KNEES BEFORE the "Fed" or face annihilation type of one world government, that we've all heard about for some time now, but are about to be smacked in the jaw with very soon now !

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[Farma]

Amazing to find out this interesting idea, a vending machine for gold?? In this period where there is so much uncertainty, gold is obviously one of great choice to choose as safe haven.

[Joc]

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[Robusta]

Amazing to find out this interesting idea, a vending machine for gold?? In this period where there is so much uncertainty, gold is obviously one of great choice to choose as safe haven.

[Jamine]

Amazing to find out this interesting idea, a vending machine for gold?? In this period where there is so much uncertainty, gold is obviously one of great choice to choose as safe haven.

[Jamine]

Just to add further, it is still good to invest on multiple baskets instead of purely on one item such as gold. that will help to spread our risk

[Jamine]

Just to add further, it is still good to invest on multiple baskets instead of purely on one item such as gold. that will help to spread our risk

[Jamine]

Just to add further, it is still good to invest on multiple baskets instead of purely on one item such as gold. that will help to spread our risk