Bank Specialist

Global Financial Markets:

gold

Gold is a highly sought-after precious metal, having been used as money, as a store of value, standard for monetary exchange, in coinage and in jewelry since the beginning of recorded history. The metal occurs as nuggets or grains in rocks, underground “veins” and in alluvial deposits. It is one of the coinage metals. Gold is dense, soft, shiny and the most malleable and ductile substance known.

Pure gold is too soft for ordinary use and is typically hardened by alloying with copper or other base metals. The gold content of gold alloys is measured in carats (k), pure gold being designated as 24k.

Gold Bar

The most traditional way of investing in gold is by buying bullion gold bars. In some countries, like Argentina, Austria, Liechtenstein and Switzerland, these can easily be bought or sold “over the counter” of the major banks. Alternatively, there are bullion dealers which provide the same service.

gold bar

Bars are available in various sizes, for example in Europe these would typically be in 12.5kg or 1kg bars (1kg = 32.15072 Troy ounces), although many other weights exist.

Gold Coins

Gold coins intended for circulation from 1526 into the 1930s were typically a standard 22k alloy called crown gold, for hardness. Modern collector/investment bullion coins (which do not require good mechanical wear properties) are typically 24k, although the American Gold Eagle and British gold sovereign continue to be made at 22k, on historical tradition.

american gold eagle

The American Gold Eagle is an official gold bullion coin of the United States. Authorized under the Gold Bullion Coin Act of 1985, it was first released by the United States Mint in 1986. Offered in 1/10 oz, 1/4 oz, 1/2 oz, and 1 oz denominations, these coins are guaranteed to contain the stated amount of actual gold weight in troy ounces.

The market value of the coins is generally about equal to the market value of their gold content, not their face value. (As of January 2008 the $5, $10, $25, and $50 coins by face value are worth and sell for about $110, $225, $450, and $900 USD respectively. Their actual selling prices vary daily based on the current spot price of gold.) The American Gold Eagle may be used to fund one government sanctioned Individual Retirement Account.

By law, the gold must come from sources in America, with an additional alloy of silver and copper to produce a more wear-resistant coin of .9167 (22 karat, which had long been the crown gold English standard for gold coins). It is authorized by the United States Congress and is backed by the United States Mint for weight and content.

canadian gold maple leaf

The Canadian Gold Maple Leaf coin contains the highest purity gold of any popular bullion coin, at 99.999% (.99999 fine).

Several other 99.99% pure gold coins are currently available, including Australia’s Gold Kangaroos (first appearing in 1986 as the Australian Gold Nugget, with the kangaroo theme appearing in 1989), the several coins of the Australian Lunar Calendar series, and the Austrian Philharmonic.

In 2006, the U.S. Mint began production of the American Buffalo gold bullion coin also at 99.99% purity.

currency exchange

currency converter

global currency

World (global) currency refers to a currency in which the vast majority of international transactions take place and which serves as the world’s primary reserve currency.

Since the mid-20th century, the de facto world currency has been the United States dollar. It is estimated that somewhere between 40 and 60 percent of international financial transactions are denominated in dollars. For decades the dollar has also been the world’s principal reserve currency; in 1996, the dollar accounted for approximately two-thirds of the world’s foreign exchange reserves.

global currency eu

Since 1999, the dollar’s dominance has begun to be eroded by the euro, which represents a larger size economy, and has the prospect of more countries adopting the euro as their national currency while the eurozone continues to expand. As of today the euro surpassed the dollar in the combined value of cash in circulation. The value of euro notes in circulation has risen to more than €610 billion, equivalent to US$900 billion at the exchange rates at the time.

money

Money is anything that is generally accepted as payment for goods and services and repayment of debts. The main uses of money are as a medium of exchange, a unit of account, and a store of value.

When we think of money we usually think of coins and banknotes (paper money). Coins are produced by stamping metal in a factory called a mint. Banknotes are financial securities issued by a bank.

Types of money as financial currency:

* cash money (coins and banknotes)
* check and money order (paper instruction to pay)
* giro (funds transfer, direct deposit)
* direct debit (pre-authorized debit)
* standing order (automatic funds transfer)
* ATM card or debit card (cashless direct payment at a store or merchant)
* SWIFT: International account to account transfer.

In economics, money supply, or money stock, is the total amount of money available in an economy at a particular point in time.

US money supply

History records show that the first modern bank was founded in Genoa, Italy in 1406. The name of the first bank was Banco di San Giorgio (Bank of St. George). The bank’s headquarters were at the Palazzo San Giorgio, which was built in the 13th century.

The name bank derives from the Italian word banco “desk/bench”, and the word traces its origins back to the Ancient Roman Empire, where moneylenders would be set up on a long bench called a bancu, from which the word bank is derived.

banking

Banking is the business of keeping money for savings and checking accounts, or for borrowing, lending, issuing loans and credit etc. A bank is a financial institution which primary activity is to act as a payment agent for customers.

Banking law is based on a contractual relationship between the bank and the customer. The definition of bank is given above, and the definition of customer is any person for whom the bank agrees to conduct an account.

The law implies rights and obligations into this relationship as follows:

1. The bank account balance is the financial position between the bank and the customer, when the account is in credit, the bank owes the balance to the customer, when the account is overdrawn, the customer owes the balance to the bank.

2. The bank engages to pay the customer’s checks up to the amount standing to the credit of the customer’s account, plus any agreed overdraft limit.

3. The bank may not pay from the customer’s account without a mandate from the customer, e.g. a check drawn by the customer.

4. The bank engages to promptly collect the checks deposited to the customer’s account as the customer’s agent, and to credit the proceeds to the customer’s account.

5. The bank has a right to combine the customer’s accounts, since each account is just an aspect of the same credit relationship.

6. The bank has a lien on checks deposited to the customer’s account, to the extent that the customer is indebted to the bank.

7. The bank must not disclose the details of the transactions going through the customer’s account unless the customer consents, there is a public duty to disclose, the bank’s interests require it, or under compulsion of law.

8. The bank must not close a customer’s account without reasonable notice to the customer, because checks are outstanding in the ordinary course of business for several days.

These implied contractual terms may be modified by express agreement between the customer and the bank. The statutes and regulations in force in the jurisdiction may also modify the above terms and/or create new rights, obligations or limitations relevant to the bank-customer relationship.