Shanghai Gold Exchange International Board Another Blow To US Dollar

Courtesy of Koos Jansen @ In Gold We Trust:

As we can see power shifting from West to East on a daily basis at the current time of writing, in the fourth quarter of this year the Shanghai Gold Exchange (SGE) will launch an international board in the Shanghai Free Trade Zone (FTZ) for investors worldwide to trade gold spot contracts denominated in renminbi. The purpose being is becoming not only the world’s primary physical gold market but also increase pricing power and internationalize the renminbi.

Shortlist of recent developments regarding the rising powers in the East:

  • Russia’s central bank bought 28 metric tonnes of gold in April
  • Russia set up a Euarsian Economic union with Belarus and Kazakhstan
  • Russia dumps record amounts of US treasuries
  • Russia closes an energy deal with China worth $400 billion (amongst 40 other business contracts)
  • Putin says Russia and China need to secure their gold and currency reserves
  • China openly calls for de-Americanization of the world
  • China, Russia, Iran and 21 other countries bolster cooperation to promote peace, security and stability in Asia
  • China is buying assets all over the globe and investing in infrastructure in Africa and West Asia
  • China is importing unprecedented amounts of physical gold

The SGE international board will be another blow to the US dollar hegemony, as more people around the world will hold renminbi, use the renminbi for trading gold and China wil have more power in pricing gold, though the international board’s pricing power can only be wholly exploited when the renminbi is fully convertible.

A Provisional Introduction To The Shanghai Gold Exchange International Board

Currently I don’t have any official documentation on the launch of the SGE international board, but by reading media (one, two, three, four) and from a source in the mainland, this is what I understand of it at this point: China’s central bank, the Peoples Bank Of China, has given approval to the SGE to set up a subsidiary company called the Shanghai International Gold Trading Center to operate the international board. The SGE is currently working on member recruiting, including commercial banks, gold producing companies and investment funds. Allegedly HSBC, ANZ, Standard Bank, Standard Chartered and Bank of Nova Scotia are to take part in the global trading platform. Continue reading

The World Is Screaming For A New Financial System

Courtesy of Simon Black @ Sovereign Man

One of the key lessons we can take away from history is that the global financial system changes… frequently.

In ancient times, Roman coins were used across the region by Romans and non-Romans alike who engaged in trade and commerce.

Given how destructively successive Roman governments debased their coins, however, the reserve burden eventually fell to the Byzantine Empire, whose gold solidus coin became the dominant currency in world trade.

Over the centuries, this standard changed several more times. The Venetians, Florentines, Spanish, French, British, etc. each issued the world’s dominant currency at one point or another.

But the fundamentals of those currencies changed. Governments engaged in wanton debasement, mismanaged their economies, and accumulated massive debt levels. And eventually the world shifted to new currencies.

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Since the end of World War II, the US dollar has been the dominant currency in the world.

And even though Richard Nixon ended the dollar’s convertability to gold and unilaterally abandoned the US government’s obligations under the Bretton Woods system back in 1971, the world has still clung to the dollar for the past 43-years.

But this is changing rapidly.

The Chinese, which have their own economic issues to deal with, are starting to dump Treasuries in record numbers. Continue reading

The Big Reset, Part 1

Courtesy of @KoosJansen & Ingoldwetrust:

The sole reason why I became interested in gold is because of the book “Overleef De Kredietcrisis” (How To Survive The Credit Crisis), written by Willem Middelkoop – the Dutch equivalent of Jim Rickards – in 2009. This book opened my eyes and interest for economics and I didn’t stop reading and writing about it ever since.

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Middelkoop had written four books in Dutch when he decided to switch to English, his latest book has just been relesed: The Big Reset. This book is about the War on Gold and the plans behind the scenes to create a new gold-backed world reserve currency. I had the privilege to do a Q&A with Middelkoop about his latest book. The Q&A will be published on this website in two parts. Continue reading

China’s Gold Hoarding Continues: Over 2,200 Tons Imported In Two Years

It’s game, set and…..courtesy of The Hedge:

Paper gold in the developed world may trade based on the whims of marginal momentum chasers, and of course, the daytrading mood of the BIS gold and FX trading desk, but when it comes to physical gold and China’s appetite for it, one word explains it best: unstoppable.

After rising to a gross 131 tons imported from Hong Kong alone in August, which was the second highest ever monthly import tally, September saw a modest decline to “only” 116 tons: “only” because it is still 67% more than the amount imported a year earlier.

The total gross imports since September 2011 is now a whopping 2232 tons. Why September? Because that is when we posted: “Wikileaks Discloses The Reason(s) Behind China’s Shadow Gold Buying Spree.” The chart below confirms precisely said reason.

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Continue reading

China’s Wake-Up Call from Washington

While the US government plans towards the next election, China is planning for the next 100 years and the plan…it’s golden. Courtesy of Steven Roach @ Project Syndicate

Yes, the United States dodged another bullet with a last-minute deal on the debt ceiling. But, with 90 days left to bridge the ideological and partisan divide before another crisis erupts, the fuse on America’s debt bomb is getting shorter and shorter. As a dysfunctional US government peers into the abyss, China – America’s largest foreign creditor – has much at stake.

It began so innocently. As recently as 2000, China owned only about $60 billion in US Treasuries, or roughly 2% of the outstanding US debt of $3.3 trillion held by the public. But then both countries upped the ante on America’s fiscal profligacy. US debt exploded to nearly $12 trillion ($16.7 trillion if intragovernmental holdings are included). And China’s share of America’s publicly-held debt overhang increased more than five-fold, to nearly 11% ($1.3 trillion) by July 2013. Along with roughly $700 billion in Chinese holdings of US agency debt (Fannie Mae and Freddie Mac), China’s total $2 trillion exposure to US government and quasi-government securities is massive by any standard.

China’s seemingly open-ended purchases of US government debt are at the heart of a web of codependency that binds the two economies. China does not buy Treasuries out of benevolence, or because it looks to America as a shining example of wealth and prosperity. It certainly is not attracted by the return and seemingly riskless security of US government paper – both of which are much in play in an era of zero interest rates and mounting concerns about default. Nor is sympathy at work; China does not buy Treasuries because it wants to temper the pain of America’s fiscal brinkmanship. Continue reading

9 Signs That China Is Making A Move Against The U.S. Dollar

Courtesy of The Economic Collapse blog:

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 andmore 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. Continue reading

9 Mind-Blowing Facts About Money

Money and banking are seen as dark arts, extremely difficult to comprehend and understand but I’ll let you into a little secret, its all a charade. Modern money is fiat currency, currency backed by nothing and intrinsically worthless, created by the click of a button and used to subjugate the population.

History, facts and logic stand on my side, money is not a mystery but a fraudulent concept imposed on us, the people. Gold, silver, commodities and land are assets, fiat currency is not money or an asset, its a medium of exchange. When you realise this, that you have been lied to, the world has been lied to, you can protect your friends and family.

Courtesy of the Washingtons Blog:

China Invented Every Form of Money

China:

  • Invented every single major form of currency, including paper money and fiat currency not backed by any tangible commodities
  • Seized gold six centuries before Franklin Roosevelt, in order to prop up its fiat currency and prevent runaway inflation

Debt Forgiveness Is The Basis of Modern Civilization

Religions were founded on the concept of debt forgiveness.

For example, Matthew 6:12 says:

And forgive us our debts, as we forgive our debtors.

Periodic times of debt forgiveness – or debt “jubilees” – were a basic part of the early Jewish and Christian religions, as well as Babylonian culture.

David Graeber, author of “Debt: The First 5,000 Years” told Democracy Now:

If you look at the history of world religions, of social movements what you find is for much of world history what is sacred is not debt, but the ability to make debt disappear to forgive it and that’s where concepts of redemption originally come from. Continue reading