The unofficial China gold holdings number since 2009 based on our internal calculations: about 2500 tons higher, which would make it the world’s second largest official gold holder below the US and surpassing Germany, and rising at 100 tons per month.
- 9 Signs That China Is Making A Move Against The U.S. Dollar (Economic Collapse, Oct 17, 2013):
On the global financial stage, China is playing chess while the U.S. is playing checkers, and the Chinese are now accelerating their long-term plan to dethrone the U.S. dollar. You see, the truth is that China does not plan to allow the U.S. financial system to dominate the world indefinitely. Right now, China is the number one exporter on the globe and China will have the largest economy on the planet at some point in the coming years. The Chinese would like to see global currency usage reflect this shift in global economic power. At the moment, most global trade is conducted in U.S. dollars and more than 60 percent of all global foreign exchange reserves are held in U.S. dollars. This gives the United States an enormous built-in advantage, but thanks to decades of incredibly bad decisions this advantage is starting to erode. And due to the recent political instability in Washington D.C., the Chinese sense vulnerability. China has begun to publicly mock the level of U.S. debt, Chinese officials have publicly threatened to stop buying any more U.S. debt, the Chinese have started to aggressively make currency swap agreements with other major global powers, and China has been accumulating unprecedented amounts of gold. All of these moves are setting up the moment in the future when China will completely pull the rug out from under the U.S. dollar.
- Jim Rogers Blasts “This Is Going To End Badly… And The Rest Of The World Knows It” (ZeroHedge, Oct 15, 2013):
The only thing exceptional about the USA is “its the largest debtor nation in the history of the world” is how Jim Rogers begins this brief interview with RT and he doesnt back away from the rhetoric. The sad truth, he notes, is that the US “has been kicking the can down the road for years…” how do you think we got so much debt, he chides. “Every year that goes by we go deeper and deeper into debt,” adding, rather ominously, that it “will be solved one way or another.” They will kick the can once more; then next week, we will be told that the problem is fixed and compromise is here. However, Rogers warns, eventually the market is going to turn away; “this is going to end badly… and the rest of the world knows it.”
For some clarifying thought before an onslaught of headline hockey in US equity markets, Rogers comments are a must view to comprehend the game we are playing…
YouTube Added: 15.10.2013
Flashback: Continue reading »
- How Much Longer Will the Dollar be the Reserve Currency? (Ludwig von Mises Institute, Oct 12, 2013):
We use the term “reserve currency” when referring to the common use of the dollar by other countries when settling their international trade accounts. For example, if Canada buys goods from China, it may pay China in US dollars rather than Canadian dollars, and vice versa. However, the foundation from which the term originated no longer exists, and today the dollar is called a “reserve currency” simply because foreign countries hold it in great quantity to facilitate trade.
The first reserve currency was the British pound sterling. Because the pound was “good as gold,” many countries found it more convenient to hold pounds rather than gold itself during the age of the gold standard. The world’s great trading nations settled their trade in gold, but they might hold pounds rather than gold, with the confidence that the Bank of England would hand over the gold at a fixed exchange rate upon presentment. Toward the end of World War II the US dollar was given this status by international treaty following the Bretton Woods Agreement. The International Monetary Fund (IMF) was formed with the express purpose of monitoring the Federal Reserve’s commitment to Bretton Woods by ensuring that the Fed did not inflate the dollar and stood ready to exchange dollars for gold at $35 per ounce. Thusly, countries had confidence that their dollars held for trading purposes were as “good as gold,” as had been the Pound Sterling at one time.
- China’s Official Press Agency Calls For New Reserve Currency, And New World Order (ZeroHedge, Oct 13, 2013):
We assume it is a coincidence that on the day in which we demonstrate China’s relentless appetite for gold, driven by what we and many others believe is the country’s desire to have a call option on a gold-backed reserve currency when the time comes, just posted in China’s official press agency, Xinhua, is an op-ed by writer Liu Chang in which he decries the “US fiscal failure which warrants a de-Americanized world” and flatly states that the world should consider a new reserve currency “that is to be created to replace the dominant U.S. dollar, so that the international community could permanently stay away from the spillover of the intensifying domestic political turmoil in the United States.”
- America’s default on its debt is inevitable (Washington Post, by Jim Grant, Oct 11, 2013):
How wrong he is.
The U.S. government defaulted after the Revolutionary War, and it defaulted at intervals thereafter. Moreover, on the authority of the chairman of the Federal Reserve Board, the government means to keep right on shirking, dodging or trimming, if not legally defaulting.
Default means to not pay as promised, and politics may interrupt the timely service of the government’s debts. The consequences of such a disruption could — as everyone knows by now — set Wall Street on its ear. But after the various branches of government resume talking and investors have collected themselves, the Treasury will have no trouble finding the necessary billions with which to pay its bills. The Federal Reserve can materialize the scrip on a computer screen.
Things were very different when America owed the kind of dollars that couldn’t just be whistled into existence. By 1790, the new republic was in arrears on $11,710,000 in foreign debt. These were obligations payable in gold and silver. Alexander Hamilton, the first secretary of the Treasury, duly paid them. In doing so, he cured a default. Continue reading »
Tags: Barack Obama, Ben Bernanke, Bonds, Debt, Dollar, Fed, Federal Reserve, Franklin Delano Roosevelt, Global News, Gold, Government, Jim Grant, Obama administration, Politics, Quantitative Easing, Silver, U.S.
- Peter Schiff Warns Yellen’s Nomination Means Any QE Taper Expectations Are “Delusional” (ZeroHedge, Oct 9, 2013):
Submitted by Peter Schiff via Euro Pacific Capital,
Now that Janet Yellen has been named to lead the Federal Reserve the global financial markets should factor out any possibility that the Fed will diminish their Quantitative easing program anytime during her tenure. In fact, financial forecasts should assume that not only is a taper off the table, but that the QE program is now more likely to be perpetuated and expanded.
Unlike her predecessors, Janet Yellen has never had a youthful dalliance with hawkish monetary ideas. Before taking charge of the Fed both Alan Greenspan, and to a lesser extent Ben Bernanke, had advocated for the benefits of a strong currency and low inflation and had warned of the dangers of overly accommodative policy and unnecessary stimulus. (Both largely abandoned these ideals once they took the reins of power, but their urge to stimulate may have been restrained by a vestigial bias against the excesses of Keynesianism). Janet Yellen, who has been on the liberal/dovish end of the monetary spectrum for her entire professional career, has no such baggage. As a result, we can expect her to never waver in her belief that stimulus is the answer to every economic question. Continue reading »
Tags: Alan Greenspan, Barack Obama, Ben Bernanke, Bonds, Debt, Dollar, Fed, Federal Reserve, Global News, Government, Janet Yellen, Keynesianism, Obama administration, Peter Schiff, Politics, Quantitative Easing, U.S.
- Ron Paul Redux: “The End Of Dollar Hegemony” (ZeroHedge, Oct 9, 2013):
In a little-known 2006 speech (in the US, though widely known around the world), entitled “The End of Dollar Hegemony,” Ron Paul discusses the breakdown of the Bretton Woods system – which most people know about – and the de-facto system that replaced it – which most people do not know about. As Casey Research’s Nick Giambruno notes it is a must listen with the most important part of the speech where Paul discusses the petrodollar system, a primary factor in maintaining the dollar’s role as the world’s premier currency after the breakdown of Bretton Woods.
The End of Dollar Hegemony Part 1
The End of Dollar Hegemony Part 2
The End of Dollar Hegemony Part 3
The speech is an absolute must-listen…
The most important part of the speech is where Paul discusses the petrodollar system, a primary factor in maintaining the dollar’s role as the world’s premier currency after the breakdown of Bretton Woods.
“It all ended on August 15, 1971, when Nixon closed the gold window and refused to pay out any of our remaining 280 million ounces of gold. In essence, we declared our insolvency and everyone recognized some other monetary system had to be devised in order to bring stability to the markets.
Amazingly, a new system was devised which allowed the US to operate the printing presses for the world reserve currency with no restraints placed on it—not even a pretense of gold convertibility, none whatsoever! Though the new policy was even more deeply flawed, it nevertheless opened the door for dollar hegemony to spread. Continue reading »
- Debt ceiling: Obama issues fresh warning to Republicans as stalemate drags on (Guardian, Oct 9, 2013):
President shoots down new suggestions among Republicans that US could prioritise payments to avoid lasting damage
Barack Obama has warned of immediate damage to US creditworthiness if Congress fails to raise the debt ceiling – even if the Treasury can find funds to avoid triggering a technical default in the bond market.
With billions of dollars of payments to social security, recipients and lenders competing for possible attention if such a crisis were to occur, the president shot down new suggestions among Republicans that the administration could prioritise payments to avoid lasting damage.
- USA: Uncle Sam is Dead (ToTheTick on Oct 8, 2013):
Isn’t it wonderful how the US believes (whether that be the citizens or the politicians) that the state will never default on its debt repayments? It’s the unfailing belief that your country will pull through and anyone that says otherwise is always either shouted down or told to go elsewhere. It’s all well and good having the belief that you will come out tops. But, the times of the US being at the top of the roost are well and truly over today. We should be playing the funeral march as Obama leaves office for all the debt that has been piled onto the country rather than the Star Spangled tune. The Stars just aren’t that spangled anymore, are they? Unprecedented debt, a budget that isn’t going to get passed, two sides that are playing a stand-off, a country that is held hostage, a debt rating that will be reduced and the Chinese and the Japanese that are now pointing the reprimanding finger.
When the US defaulted on their payments for their mortgages, they got called into the banks and had their houses repossessed back at the start of the financial crises. They were living on credit then and they still are. Obama should get the first plane to Tokyo and then fly on to Beijing. He will be needing to sign a few papers before he hands over the Good Old US of A to the Asians. Uncle Sam is dying a slow and painful death. A death by debt that has shot through the roof of the White House.
Uncle Sam is dead!