Several news agencies recently reported the roll out of a new machine in Abu Dhabi that dispenses gold in a variety of forms, ranging from coins to 10g bars. This begs the question: is this a vending machine or an ATM?
The machine, which is linked electronically to match the price of gold on international markets, will offer a “nice souvenir for guests to take home,” according to Thomas Geissler, whose company Ex Oriente Lux developed the machine.
On the surface, this dispensary would seem akin to other souvenir vending or even candy bar machines, but the fact that it provides a platform for cash to be exchanged for gold at the customer’s convenience must be viewed with an eye to the recent explosion of the price of gold and a rising demand for gold as a store of value.
Why Gold is Viewed as an Alternative to Cash Currencies
While commonly ignored by the public, the Bretton Woods II agreement of the 1970’s uncoupled gold from the world’s reserve currency, the USD, resulting in a decades long flood of paper currency. This onslaught of paper and electronic money, designed to dilute the value of America’s foreign debt obligations, and the credit systems that have grown up around this model, have led to massive expansion of the dollar supply and consequent devaluation in the purchasing power of the dollar as well as other currencies around the world.