Is China Preparing A Gold-Backed Yuan: Beijing Greenlights Purchases Of Billions In Bullion | |
BullionDude
(OP) User ID: 80028000 United States 04/16/2021 11:19 AM Report Abusive Post Report Copyright Violation | With all its gold, by monetising it China could kill off the dollar tomorrow. Undoubtedly, this financially nuclear option has become a backdrop to her strategy in the ongoing trade and financial war against America. But the idea that by using this undoubted power over the dollar China gains a simple victory if through her actions the dollar is destroyed understates a more complex situation. It is not in China’s interest on many levels, not least because of her ownership of dollars is about $3.4 trillion, of which only $1.5 trillion is invested in Treasuries, agency, corporate and short-term debt in the US. The balance is actively used in loan finance to China’s commodity suppliers, those involved with the belt and road initiatives and other states with which China desires to gain influence. Destroy the dollar and China’s heft around the world is destroyed as well, because only a small proportion of China’s loan-influence is in renminbi. In that sense, if the dollar collapses America gains a geopolitical benefit over China, her means of international influence being crippled. The Chinese leadership will be acutely aware of the consequences of the dollar’s demise and therefore will do nothing to encourage it. Indeed, if the dollar begins its collapse in the foreign exchanges, we could find China increasingly calling out the Fed on its inflationary policies. But then the Fed’s problem is and will continue to be an inability to stop its addiction to unlimited inflationism. Unfortunately, a banking crisis is embedded in the script, which will have fundamental effects on all fiat currencies, some more than others. And since international banking is overwhelmingly a dollar affair, after a short pause the consequences are bound to weigh heavily upon it as the reserve currency. This credit cycle unwind is a Category 5 compared with 2008—09’s Category 2 or 3. It is only after such a cataclysm that China will have no alternative to abandoning all attempts to support the dollar and its means of buying overseas influence. China will then need to secure its own currency. It will require a return to gold backing — the nuclear option so far avoided. While the cost will be writing off trillions of dollars and its means of securing overseas influence, there will be a monetary vacuum to fill. And compensation will be found in an increase in the value of China’s declared and undeclared bullion stocks, as well as the enrichment of its gold-holding people. |
Anonymous Coward User ID: 78400477 Netherlands 04/16/2021 11:20 AM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 78400477 Netherlands 04/16/2021 11:22 AM Report Abusive Post Report Copyright Violation | |
Hard Eight
User ID: 75863275 United States 04/16/2021 05:40 PM Report Abusive Post Report Copyright Violation | China opens its borders to billions of dollars of gold imports [link to www.mining.com (secure)] Texas has yet to learn submission to any oppression, come from what source it may. Sam Houston "The beauty of the Second Amendment is that it will not be needed until they try to take it." Thomas Jefferson If you don't read the newspaper you are uninformed, if you do read the newspaper you are misinformed. -- Mark Twain Giving money and power to government is like giving whiskey and keys to teenage boys. -- P.J. O'Rourke, Civil Libertarian |
BullionDude
(OP) User ID: 80028000 United States 04/16/2021 09:42 PM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 80117563 United States 04/16/2021 10:10 PM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 76760905 United States 04/16/2021 10:37 PM Report Abusive Post Report Copyright Violation | The problem is debt, that has entirely distorted the economy because it was used mostly for speculation. That's why the markets are at all time highs, it goes with the record bond bubble. Their currency may be successful but a lot of their economy has been leveraged. I assume when the payment is finally due the CCP will take it out on the citizenry, happens most of the time. We have to let all this leverage collapse, liquidate it in bankruptcy then allow prices to find equilibrium with demand and each other. |
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User ID: 80230070 United Kingdom 04/16/2021 10:42 PM Report Abusive Post Report Copyright Violation | |
BullionDude
(OP) User ID: 80028000 United States 04/16/2021 11:52 PM Report Abusive Post Report Copyright Violation | |
Anonymous Coward User ID: 76838783 Australia 04/17/2021 07:10 AM Report Abusive Post Report Copyright Violation | I hope China continues to fuck over the Central banks. Its funny watching the Gheews squirm. Quoting: Anonymous Coward 78400477 Squirming with delight... considering they own China. I guess you just can’t figure that one out. But while you are scratching your head at shit too hard to fathom... (((They))) are literally making trillions out of the whole process. |
Anonymous Coward User ID: 33122469 Australia 04/17/2021 07:19 AM Report Abusive Post Report Copyright Violation | |
BullionDude
(OP) User ID: 80028000 United States 04/17/2021 04:31 PM Report Abusive Post Report Copyright Violation | |