Great explanation, misterbigg. One of the best high-level explanations I've seen about Ripple, and this is after spending hours at the Ripple booth this past weekend hearing from David Schwartz directly about how things worked.

Your comment about the . bidirectional order books clears up why OpenCoin thinks XRP will be so valuable; because it's the only non-IOU (real XRPs are sent), the only non-gateway-issued currency, it would become the default reserve currency in this ecosystem, just like the US dollar is in the world today.