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This could be a simple sweet article to write. I think it is likely slightly shocking and very informative. I have known this and explained it to select people but why haven't I written about it? Because as a currency trader it skirts around trade secrets that are my bread and butter. It is quite counter intuitive giving people the opportunity to think that I am self motivated to tell you this. The fact is I did write about this from another angle. But here goes, the logic should stand on it's own.

People should and do buy the best deal when buying currency. Yay everyone! keep that up.

Beyond that who should you buy from? There are often, these days without exception, more than one offer at the best price. The answer for many people is buy the first one that they come across. If you are rushed, that is fine, accomodating you has been my bread and butter and joy and honor. It is hard to expect thoughtful in depth action out of people who simply buy currency and I don't mean to insult anyone by saying this.

Imagine if you will a person who doesn't have time to think that they could sell gold and get more USD for their money but still has enough time to research who they buy from. There should be plenty of people and businesses that you recognize from which to buy and then there is CBO with tons of cash and the offical seal of Congress.

My answer is obviously buy from me right? I could make a case for that since I sell the gold competitivly and CBO does not. More telling though is when faced with the option of just CBO and some foreign enemy trader. I pick for your best option as a buyer the foreign enemy trader over CBO when offering the same price. In the short term this would be a windfall for the enemy trader. in the long term selling and selling gold to satisfy demand will bring the price of gold down to near the peg. continuing this practice may double or tripple his volume but cut his profits as the gap erodes.

CBO will suffer a short term drop in the amount of gold it collects. It will however collect at the same rate because once all the competitor's currency is bought we have no choice but CBO. The rate that the CBO collects is dependant on very few factors. Tax rate is one and lately we have seen the price of gold change affect the rate of collection of gold. This affects both the amount of currency that is required to do business and the amount of taxes collected as wages denominated in USD fall. This is however Independant of who you prioritize as your first choice in your currency needs.

This would be great news for people who buy currency which is pretty much soley composed of allies. This would be bad news for the sellers who are composed of allies and foes. You can say that this might save half of the arbitrage costs to the eUSA. There is a lot of guessing here but I am going to say 25 gold a day. If you are worried about poor CBO missing out I guarantee some of the extra spills into the government.

This conversation may be leaving you wondering why CBO doesn't post gold if as I claim, it comes right back. It may leave you wondering why CBO doesn't take some other action. Feel free to wonder about that some more. Wonder about that as you buy currency while you are at it.