An Organic Roll into Shares

I haven't yet received any concrete offer to buy shares for my son in my family's business, and I'm probably not getting any such offer before the fall. This has given me some time to think about the best way to go about this business, and I've come to the conclusion that I should avoid acting too eagerly too soon. All I need to begin with is for my son to have a handful of shares in order for him to start accumulating shares over time.

My experience with the family business is that good offers come every now and again. Someone gets in trouble and has to sell, and family members with savings come in to pick up shares at a good price. It's a predictable pattern that I expect to continue, so there's no rush.

Another aspect of this is the sale of gold required to raise cash to buy the shares. My initial thought was to sell my gold back to the bank where I bought it. But that's not a very appealing option. I didn't buy the gold just to make some money off of it. I bought it just as much in order to get away from the current banking system. My idea was to trade it with friends and family as an alternative to the current financial system where banks always get a cut of the action.

This has prompted me to check with friends and family if there's any interest in buying some of my gold at spot price, which is several percentage points cheaper than buying gold at the bank, but also a little above the price that banks are willing to pay for it.

As it turns out, I have some offers to buy. Here too, there's no definite commitment, but the interest is genuine. I'm sure I'll be able to sell some gold through my personal network, and since I only need a few shares in the family business in order to give my son a foothold, I see no reason to sell additional gold through the bank.

This approach comes with some noteworthy advantages.

• My son will only buy as many shares in the family company as my network of friends and family can sustain.
• We're therefore likely to be able to buy back gold from family and friends should they themselves need cash at some future point.
• The gold is never returned to the bank, which means that it cannot be used in price suppression schemes.
• Friends and family will learn through experience what it's like to own gold, and may themselves set up personal networks.
• My overall vision of a parallel economy based on networks of friends and family becomes reality.

I expect this to move slowly to begin with, but once friends and family discover how much better gold performs than other types of savings, the demand will likely go up. My son will be able to sell some gold whenever there's a good offer to buy shares in the family company. When friends and family want to sell some gold themselves, we're likely to be modest buyers. But the total network will be large enough to absorb more. Sellers are likely to get their offers absorbed without having to go to the bank.

This will have the overall effect of producing an extended network that can act in ways reminiscent of how business was done in the olden days. With gold always retaining purchasing power, there's no rush to invest in alternatives. Only when a really good offer comes along is there any need to transact. This slows down the pace of things. It puts us in a position to wait and see. We sleep better at night, because our investments are organic rather than debt funded.

Sovereign

By Heritage Auctions for image, Mary Gillick for coin - Newman Numismatic Portal, Public Domain, Link