I would call this already a war between the US and China.
The US government is creating unprecedented amounts of debt, that can ‘never be paid back’, according to Ron Paul. Of course he is correct.
The Fed monetized 80% of government debt last year, according to PIMCO’s Bill Gross. The Fed created that money out of thin air. ‘Quantitative easing’ sounds so economic, but it is nothing more than just ‘printing money’, which devalues the dollar, which in turn devalues China’s investment!
The US started the war by devaluing China’s assets, but China has already won the war. If China would officially press the ‘sell’ button on their US government debt holdings and their foreign exchange holdings in the US dollar, the USS Titanic would sink immediately.
Of course that victory would come at a great prize and so China is buying time to diversify itself out of the US dollar, that will be soon as good as bad toilet paper.
China will have to buy a lot more gold, silver and other commodities.
In essence the US government has sold out America and is now completely bankrupting and destroying it.
BEIJING (Reuters) – China will be prudent in adding gold to its official reserves, wary that any move to buy the precious metal would only serve to drive its price higher, the country’s top foreign exchange manager said on Tuesday.
Yi Gang, head of the State Administration of Foreign Exchange, said that while gold was “not a bad asset,” it would never become a big part of China’s overall investment portfolio.
“The international gold market is very limited. If I purchase gold on a massive scale, it will definitely push up global gold prices,” Yi said at a news conference on the sidelines of China’s annual parliament.
“So, as for suggestions from many friends that we should increase gold holdings, we will give prudent consideration to this, according to market conditions.”
Gold fell $3 in the hour after Yi spoke, later paring losses to reach $1,122 per ounce, as many market participants had already discounted the chances of a sudden gold spree by China.
Many investors have wondered whether China might buy 191.3 tonnes of gold being offered for sale by the International Monetary Fund, after India bought 200 tonnes in November.
“We have been saying that whilst it’s clearly the case that it’s sensible for China to buy some gold, we think it’s more likely they’ll be doing it quietly in the open market as opposed to taking a large chunk of the IMF gold,” David Barclay, commodities analyst at Standard Chartered.
State media have reported the country is unlikely to do so, partly for fear of fuelling market speculation, and Barclay said he thought it was largely a question of price.
“If we have gold correct down below $1,000 then I think it’s more likely, given that they’ve said prices below $1,000 are more reasonable and also it would be lower than the $1,045 level that India bought at. There is that rivalry between the two countries.”
“CHINA WON’T IGNITE THE MARKET”
The Chinese government wowed the gold market last year by revealing it had increased its holdings of the metal to 1,054 tonnes from 600 tonnes in 2003. Buying the IMF gold might cause prices to spike, Barclay said.
“Prices haven’t really corrected that much despite the drop in the euro, and we’ve seen investor positioning turn a bit more positive. It wouldn’t take much, if China did come out, to really ignite the market, and I don’t think that’s something they want to do.”
China’s $2.4 trillion in foreign currency reserves and its relatively small gold holdings have fueled speculation the country is continuing to buy, although officials have insisted that any increases have come from domestically produced gold and the international price is too high.
“It is, in fact, impossible for gold to become a major investment channel for China’s foreign exchange reserves. We have 1,000 tonnes now, and even if I double that holding, according to current prices, that would be about $30 billion,” Yi said. “It would just increase the level of gold (in China’s reserves) to about 2 percent from the current 1 percent.”
Yi also said that, from a long-term investment perspective, gold was not the best play.
“Gold prices in recent years have risen very nicely, but if we look at the price over the last 30 years, gold prices moved in great swings,” he said. “So as an investment, its yield is not very good from a 30-year point of view.”
China is vying with India to be the world’s top consumer of gold. It is already the top producer, with output of 313.98 tonnes last year, up by almost 50 percent in five years.
In January, China produced 21.81 tonnes, a rise of 8.1 percent from a year earlier, according to the Ministry of Industry and Information.
(Additional reporting by Langi Chiang and Tom Miles)
(Editing by Clarence Fernandez)
Zhou Xin and Simon Rabinovitch
Tue Mar 9, 2010 3:08am EST
More on gold:
– Marc Faber: It’s Dead Simple, The Supply Of Dollars Will Grow Way Faster Than The Supply Of Gold
– German TV Channel Finds 500 Gram Tungsten Bar At W.C.Heraeus Gold Foundry With Bank Origin
– China to Purchase 191.3 Tons of IMF’s Gold
– Famous Investor Marc Faber: ‘Buy Farmland And Gold’ – ‘Prepare For a Dirty War’
– George Soros not only doubled his gold investment, but also bought call options
– George Soros More Than Doubled Gold ETF Stake in 4th Quarter
– Fake Gold Bars in Fort Knox! What’s Next? The IMF sold Gold plated tungsten bars to India ?!
The elite puppet US government and the Fed are destroying America:
– Obama Administration Using Accounting Gimmicks That Would Make Enron ‘Blush,’ Says Republican Lawmaker
– Bizarre? Now this is bizarre! Audit the Fed banksters NOW!
– US Senator Judd Gregg Warns of ‘Financial Meltdown’ Risk
– Rep. Ron Paul Grills Ben Bernanke on Saddam Hussein, Watergate and the Fed
– US Unveils Plans For New $1 Billion High-Security Embassy In London — The Most Expensive It Has Ever Built
– FDIC Report: ‘We Were Broke And Getting Broker’
– US: Millions of Unemployed Face Years Without Jobs
– US: Wealth Disparities Approaching 1920s Levels
– Judge Napolitano and Angela Keaton on Freedom Watch: Obama’s Bush Foreign Policy
– Rep. Ron Paul At CPAC 2010: ‘We Are On The Brink Of A Financial Cataclysmic Event.’
– Obama Signs Law Raising Public Debt Limit from $12.4 Trillion to $14.3 Trillion
– Societe Generale Chief Strategist Albert Edwards: Theft! Were the US & UK central banks complicit in robbing the middle classes?
– How to invest for a global-debt-bomb explosion; Prepare for an apocalyptic anarchy (Market Watch)
– Marc Faber on CNBC: All Governments Will Default On Their Debt, Including The US
– Cynthia McKinney at Munich Germany NATO Peace Rally: ‘My Country Has Been Hijacked By A Criminal Cabal’
– Report: 1 in 5 US Homeowners Underwater; Foreclosures at Record High
– President Obama’s Pledge Never to Raise Taxes on Anyone Making Less Than $250,000 a Year
– Rep. Alan Grayson: ‘20 Percent Of Our Accumulated Wealth Over The Course Of 2 Centuries Gone in 18 months!’
– Paul Craig Roberts: It Is Now Official: The U.S. Is A Police State
– Prof. Russell Roberts Testifies Before House Committee: ‘I Want My Country Back!’
– Director of National Intelligence Says US May Kill Americans Abroad
– President Obama Ups Pakistan Drone Strikes in Assassination Campaign
– The New Vision of the Obama Administration: War Without End
– Pentagon’s New Record Black Budget Tops $56 Billion
– Rep. Ron Paul on Obama seeking to assassinate ‘US citizens’ he labels as terrorist
– White House to Paint Grim Fiscal Picture: Another Record Budget Deficit
– US: GDP Mirage – The Last Hurrah
– Controller: Pennsylvania Capital Should Weigh Bankruptcy
– Marc Faber: Obama Makes Bush Look Like a Genius
– Obamanomics: Why Did the ‘Stimulus’ Fail to Help the US Economy?
– Paul Craig Roberts: How Wall Street Destroyed Health Care – Greed, Be Thou My God
– Ron Paul: US Foreign Policy is Bankrupting America
– Rep. Ron Paul: State of the Republic Address – ‘Dangerous Times Indeed.’
– America’s Impending Master Class Dictatorship! (MUST-READ!)
– The CFR Controls American News/Media
– Senate Proposes Increasing US Debt Limit to $14.3 Trillion: “If Congress does not enact this legislation, and soon, then the Treasury would default on its debt for the first time in history,” said Senate Finance Committee Chairman Max Baucus
– US: Unfunded Benefits Dig States’ $3 Trillion Hole
– Illinois enters a state of insolvency: ‘We’re close to de facto bankruptcy, if not de jure bankruptcy.’
– The No.1 Trend Forecaster Gerald Celente: Financial Mafia Controlling US and Wall Street
– Peter Schiff: The Lunacy of US Government Programs
– Former Dean of Harvard College Harry R. Lewis: Larry Summers, Robert Rubin: Will The Harvard Shadow Elite Bankrupt The University And The Country?
– Experts: Dollar Crisis Looms if US Doesn’t Curb Debt
– Marc Faber on Coming Sovereign Debt Crisis: Next Countries to Default are the US, Japan and the ‘PIIGS’
– Fitch: US Must Cut Spending To Save AAA Rating; US December Deficit Nearly Doubles
– The Coming Sovereign Debt Crisis
– US slides deeper into depression as Wall Street revels
– PIMCO’S Bill Gross: ‘Let’s Get Fisical’ (… or why the US will not make it.)
– Barack Obama’s Health Care Lies And Reversals
– US sheds 85,000 jobs in December; Record 40% Of Unemployed Without Job For 27+ Weeks
– Peter Schiff on Fast Money: ‘America is broke’; ‘The Fed created a currency crisis’; ‘Dollar to collapse 50-70% or more’
– US: Public Pensions Face $2 Trillion Deficit
– U.S. Avoids Technical Default By Three Days
– As an American, I refuse to buy mandatory health insurance … that supports Big Pharma
– The US Government Is Preparing For Collapse: Your Legal Right To Redeem Your Money Market Account Has Been Denied
– Prof. Dr. David Michael Green: Now I’m Really Getting Pissed Off … With Obama
– US Treasuries Post Worst Performance Among Sovereign Markets In 2009
– US losses will top $400 billion on Fannie Mae and Freddie Mac
– US: More Ammo For The Treasury Bazooka
– US government wants farmers to use coal waste on fields
– The No.1 Trend Forecaster Gerald Celente: The Terror And The Crash of 2010
– We’re Screwed! Hyperinflation like in the Weimar Republic; Great Depression worse than in the 1930s
– US Congress: Banksters Get $4 Trillion Gift From Barney Frank
Traitor in chief:
– Treason: Obama gives INTERPOL immunity from the Constitution (Amending Executive Order 12425)
– Peter Schiff on Obamacare, Freddie Mac & Fannie Mae: The Nightmare Before Christmas
– Obama administration backs Fannie Mae and Freddie Mac no matter how big their losses may be
– Rep. Dennis Kucinich: US War Presidents ignore Congress and Constitution
– Obamacare: Big payoffs to senators on health bill stoke public anger
– US: Trillions Of Troubles Ahead
– Chinese central banker Zhu Min: ‘The world does not have so much money to buy more US Treasuries.’
– Obamacare: Change Nobody Believes In
– Obama’s surge comes at a cost: At least $57,077.60 per minute
– US National Debt Tops Debt Limit
Hypocrite in Chief (Funny):
– President Obama: Another Busy Day in The Oval Office!
– Fascism in America: By Political Definition The US Is Now Fascist, Not A Constitutional Republic
– John Williams of Shadowstats: Prepare For The Hyperinflationary Great Depression
Liar in Chief (NOT funny!!!):
– Barack Obama Lies 7 Times In Under 2 Minutes!!!!!
– Robert Fisk, The Independent’s award-winning Middle East correspondent: Obama is a Disaster, Worse than Bush
– Rep. Dennis Kucinich: ‘These Wars Are Corrupting The Heart Of Our Nation!’
– Famous Investor Jim Rogers: Incompetence In Washington, Abolish The Fed And The Treasury
– Rep. Dennis Kucinich: The Truth About Afghanistan
– Obama’s Big Sellout (Rolling Stone Magazine)
– Obama administration to lift debt ceiling by $1.8 trillion
– Climategate: President Obama’s rule by EPA decree is a coup d’etat against Congress, made in Britain
– Obama administration tells Pakistan: Tackle Taliban or we will
– MSNBC Rachel Maddow: War President Obama
– Ron Paul: ‘Obama is Actually Preparing Us For Perpetual War’
– Afghanistan Surge to Cost At Least $40 Billion, That Is $1.333.333 For One US Soldier Per Year
– Rep. Brad Sherman: Geithner rejects $1 trillion limit on bailout power (Section 1204 is unlimited in dollar amount!)
Liar in Chief (Over 300 soldiers died in 2009 because of this lie!!!):
– Obama: ‘I will promise you this, that if we have not gotten our troops out by the time I am President, it is the first thing I will do. I will get our troops home. We will bring an end to this war. You can take that to the bank.’