China is intensifying their internationalization of the Renminbi/Yuan. A few days ago, they announced a huge deal with Brazil. In the news today, a deal with Australia in the works:
http://gata.org/node/12407
http://gata.org/node/12407
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A currency deal enabling the Australian dollar to be converted directly into Chinese yuan, slashing costs for thousands of businesses, is set to be the centrepiece of [Prime Minister] Julia Gillard's mission to China next weekend.
Australia would become the third country, after the United States and Japan, to secure such an arrangement from China, which is Australia's top trading partner, with exports and imports totalling $120 billion last financial year.
At present, companies doing business with China must pay the added cost of converting their Australian dollars into U.S. dollars or yen and then into yuan.
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The only real takeaway I get from all this is - better to be safe than sorry. Don't put wealth at risk. Physical metals in the hand are better than electronic zeros and ones in a bank's computer.
While I agree with you in general, yet that there is not necessarily true. It is actually quite easy, for the value of your land to be transferred to the government, to enjoy benefits of: property tax, anyone?ANY hard asset, PMs, land, food, etc. is better than electrons floating around in a bank. You may not be able to sell them for what you paid for them, BUT THEY NEVER GO TO ZERO. And they are a hell of a lot harder to confiscate.
It is extremely important for people around the world to understand that if history has taught us one thing, it is that central planning has never, ever succeeded. This group of central planners will fail as well. They are designed to fail and they know it. They are simply there to buy time before a new world currency is put in place.
... the persistent and growing news about "bail-ins" across the Eurozone, New Zealand and now Canada, it's apparent that there is something else going on. ...
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This is the policy that the central banks are following. Check out the list of central banks consulted on the formulation of this – last page. The Fed is represented, so it should not have come as a surprise to Mr B. or was it the tilt of the cards that provoked the “angry” reaction?
Underlining is mine in the below quote.
Recommendation 10
National authorities should adopt crisis management and resolution strategies that reduce moral hazard by minimising public expenditures. Losses should be allocated among shareholders and other creditors, where possible; and private sector resolutions rather than public ownership should be facilitated.
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China is intensifying their internationalization of the Renminbi/Yuan. A few days ago, they announced a huge deal with Brazil. In the news today, a deal with Australia in the works:
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... According to China Daily, as reported by Reuters, "France intends to set up a currency swap line with China to make Paris a major offshore yuan trading hub in Europe, competing against London." As a reminder the BOE and the PBOC announced a currency swap line back in February, in effect linking up the CNY to the GBP. Now it is the EUR's turn. ...
Japan will be reminded of its pledge not to drive down the yen when Group of 20 finance chiefs meet this week for the first time since the world’s third- largest economy intensified its campaign to defeat deflation.
As G-20 finance ministers and central bankers prepare to convene this week in Washington, the U.S. Treasury is saying it will press Japan to refrain from competitive devaluation and European governments are urging it not to become too reliant on fiscal and monetary stimulus.
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Japanese policy makers have already launched their defense against criticism that they are driving down the yen. Mitsuhiro Furusawa, the vice-finance minister for international affairs, said in an April 12 interview that Japanese monetary policy is “clearly aimed at getting Japan out of deflation” and that officials will “properly explain” their position in Washington.
In another sign officials want to head off attacks, Bank of Japan Governor Haruhiko Kuroda last week indicated limits to easing by saying April 10 that the central bank has taken all “necessary” and “possible” measures.
Such arguments may be enough to offset criticism especially given economies from the U.S. to U.K. have carried out similar quantitative easing programs. Federal Reserve Chairman Ben S. Bernanke said in London on March 25 that low interest rates in advanced nations benefit the world economy without creating a disruptive diversion of trade through weaker currencies.
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The Australian central bank plans to invest about 5 per cent of its foreign reserves in Chinese government bonds, in the latest move to build closer economic ties between the two countries.
"This decision to invest in China is an important one. It reflects the broader economic relationship between China and Australia and our increasing financial ties", Philip Lowe, deputy governor of the Reserve Bank of Australia, said in a speech on Wednesday in Shanghai. "It provides greater diversification of our investments and will help with our understanding of the Chinese financial markets."
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Australia will join a small but growing band of central banks that have looked to China to diversify their foreign reserves.
Chile, Japan, and Malaysia all hold renminbi assets, often in the form of offshore bonds -- known as "dim sum" bonds -- while Nigeria's central bank holds around 10 per cent of its reserves in the Chinese currency.
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NATO member Turkey signed up on Friday to became a "dialogue partner" of a security bloc dominated by China and Russia, and declared that its destiny is in Asia.
"This is really a historic day for us," Turkish Foreign Minister Ahmet Davutoglu said in Kazakhstan's commercial capital Almaty after signing a memorandum of understanding with Shanghai Cooperation Organisation Secretary General Dmitry Mezentsev.
"Now, with this choice, Turkey is declaring that our destiny is the same as the destiny of the Shanghai Cooperation Organisation (SCO) countries."
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I had the opportunity yesterday to speak with one of the western world’s most courageous and astute women, Karen Hudes, Former Senior Council to the World Bank—now turned whistle-blower.
It was a powerful conversation, as Karen spent 20 years with the World Bank as an attorney and economist, before being “let-go” after reporting internal fraud and corruption.
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... Karen noted, as, “All of the countries of the world are going to allow precious metals to serve as currency, and this will be an underpinning for paper currency, [as] we’ll have both systems at the same time. This is my guess, as I mentioned—I am an economist.”
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China Names Yuan Convertibility Plan as Goal This Year
China signaled it will propose plans this year to allow freer flows of its currency in and out of the nation as part of measures to loosen control over the yuan and interest rates.
The plan on yuan capital-account convertibility will also include a way to let individuals make overseas investments, the State Council said in a statement yesterday after a meeting led by Premier Li Keqiang on the focus of economic reforms in 2013. ...
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The Chinese currency will be fully convertible within five years, while a third of China’s trade will be settled in yuan by 2015, HSBC Holdings Plc forecast in a March report.
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Karen is echoing what Robert Zoellick said back in November 2010 (see entry in the OP of this thread).
Former senior legal counsel at the World Bank turned whistleblower Karen Hudes talks about the corruption inside the World Bank and her personal saga to find out about it. She says a worldwide currency war is certain and NATO in jeopardy, if the wrongdoing isn’t finally addressed.
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Hi PMBug
I think what is really needed is precious metals as currency to circulate at the same time as the paper money, and that would put a little discipline in the issuers of the paper money as their currency starts to devalue when they can't keep their balance of payments deficits under control.
What prompted the Committee on Governance to jettison Robert Zoellick was his corruption in promoting corrupt people and covering up corruption. I didn't even know his sordid attachment to the losing "Bancor" proposal.
I hope this clarifies my position.
Best,
Karen
> To: <Karen Hudes>
> Date: Wed, 8 May 2013 12:37:55 +0000
> From: <PMBug>
> Subject: Lars Schall interview; follow up ? re: Zoellick
>
> Hi Karen,
>
> I read your recent interviews with Tekoa Da Silva and Lars Schall. I'm a bit confused on one point and would appreciate some clarification.
>
> You mentioned in the Tekoa Da Silva interview that you forsaw a move to use precious metals to underpin paper currency. Isn't this essentially the same thing that Robert Zoellick was advocating back in November 2010?
>
> You also mentioned in the Lars Schall interview that, "It was because of Robert Zoellick’s corruption that the World Bank’s Committee on Governance refused a second term to Robert Zoellick". Would you mind elaborating a bit on what corruption you are referring to here and why it prompted the committee to send him out the door? Did it have any relationship to his advocating for the gold underpinning of a "Bancor" (so to speak)?
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Prof. Steve Keen says that current stock rally is very dangerous and on the edge, but he thinks that the Market will not crash immediately
http://finance.yahoo.com/blogs/dail...-debt-fueled-bubble-steve-keen-121950839.html
Sent from my Nexus 7 using Tapatalk 2
Well Steve keen is one of, or rather THE one economist, who accounts for the debt levels and banking system in his economic models. Surprisingly, they seem to work. He had been ousted from the univ of Sydney a while ago, or rather, had been 'reduced', as part of the cost cutting there. Imagine, the only economic theorist on the feeding planet that passes the smell test of common sense, gets 'reduced'
Sent from my V1277 using Tapatalk 2
There was a Reuters story yesterday by William Schomberg, “G7 Finance Chiefs to Discuss Bank Reform Push.” Very few people picked up on this but it seems strange that all the sudden a meeting is called to discuss what elements of bank reform. Are they going to try to persuade Germany to get behind the EU push for a banking union and if so why the hurry before the September German elections? The idea of a banking union with resolution authority is sure to be a lightening rod for all the German angst about the bailouts of the peripheral nations. The Reuters piece notes that some G-7 officials are upset that the U.K. called the meeting so soon after the recent IMF talks in Washington. One official said, “I am really annoyed I’ve got to give up my weekend for this.”
This leads me to believe that there must be a simmering problem coming to the boil. ...
... I will continually stress that the main political battle may be the Bundesbank versus the EU. The German central bank is the bastion of “hard money” and is fighting hard about the German polity surrendering monetary and financial rectitude to the French and other profligate countries. ...
... The battle lines are being drawn and it appears that the BUNDESBANK is hellbent on reasserting its authority. This will not be a side-show but the main conflict.
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The U.S dollar is shrinking as a percentage of the world's currency supply, raising concerns that the greenback is about to see its long run as the world's premier denomination come to an end.
When compared to its peers, the dollar has drifted to a 15-year low, according to the International Monetary Fund, indicating that more countries are willing to use other currencies to do business.
While the American currency still reigns supreme -- it constitutes $3.72 trillion, or 62 percent, of the $6 trillion in allocated foreign exchange holdings by the world's central banks -- the Japanese yen, Swiss franc and what the IMF classifies as "other currencies" such as the Chinese yuan are gaining.
"Generally speaking, it is not believed by the vast majority that the American dollar will be overthrown," Dick Bove, vice president of equity research at Rafferty Capital Markets, said in a note. "But it will be, and this defrocking may occur in as short a period as five to 10 years."
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Quietly exiting
The smart money has been shifting out of US dollars and into real assets for some time. Look at Abu Dhabi buying half of Dubal yesterday (click here). These asset prices also fall in a depression but real assets have intrinsic value. But what will function as money after the paper currencies of the world have been trashed?
Last week the 1999 Nobel Prize winning economist Robert Mundell was in Amman talking about the concept of a new global currency with special drawing rights backed by major currencies and administered by the global central bank, the International Monetary Fund.
He said: ‘The US dollar is now not backed by gold, but only by trust. And since most commodities and major goods such as oil and gas, major metals are exchanged based on the US dollar, it was quite logical that the US government had to increase its power through inflationary measures that made the US dollar less stable.
‘The new system should not be based on any single currency. It should rather allow the introduction of Sprecial Drawing Rights which are assets issued by the IMF, to make the world financial market much more stable,’ he said noting that the SDR should have a value based on the dollar, euro, yuan and yen.
SDR and gold
Professor Mundell is also an advisor to the Chinese government whose central bank has expressed its interest in SDRs backed by gold reserves as well as paper currencies. Ultimately SDRs will have to be backed by gold to win the trust of the world after a catastrophe caused by paper money.
Sadly we have to go through that catastrophe first. But investors ought to realize that for the limited and rather fixed supply of gold available in the world to perform this function it would have to be revalued to a much higher price than it has at present. Herein lies the real top of the bull market for gold.
And this is how gold will end up back at the heart of the global currency system again.
https://mobile.twitter.com/JamesGRickards/status/342473197674979328Left unsaid in #Mundell's forecast of #IMF gold-backed world money is that non-deflationary price of gold is $7000/oz
Right on Benjamen!
GovCo thinks we're all fooled out here in Wonderland, and believe the numbers to be true and representative of a heal;thy and growing economy. In actual fact, the economy is grinding to a halt as employers dump all their full timers in favor of even more part timers. This is beyond nauseating for me to watch. Next on the play list, the three day work week, within which we'll all get our "fair share" of 24 work hours at some shitty minimum wage nowhere job.
... Gold has been leased out, and we do know this (takes place) because it’s been admitted to by the major central banks. The Fed has admitted it, the European Central Bank has admitted it, the Bank of England has admitted it. They’ve all admitted that they engage in wholesale leasing of gold to the market.
In practice how that (leasing) works is the Fed would contact their agent, typically JP Morgan, sometimes Goldman Sachs, and they would say, ‘OK, the gold price needs to be capped, so here is 20, 30, 40, 50 tons (of gold) that we’re going to lease out to you as our agent. But in theory we can call it back.’
That’s a great theory, but in reality it’s nonsense because once JP Morgan and Goldman Sachs get the gold they sell it into the market. So these bullion banks then become net-short gold. And the Fed says, ‘Well, we still have a contract where in theory we can claim the gold. So we’re going to report that we still own it in the official documents.’
But in reality the gold has been sold into the market. That gold winds up in places like Beijing. But before it gets to Beijing it frequently goes through Hong Kong. And when it goes to Hong Kong, it goes to our refiner, the same people we use. And by the way, Eric, we may own some of the gold that Germany thinks that they own. But Germany will never see that gold because it’s safely stored in my account (and) for our investors at the Hong Kong International Airport.
Regarding that gold, which could have had the symbol of the Bundesbank on it when it arrived in Hong Kong, a leading refiner, one of the biggest in the world that deals with the People’s Bank of China (PBOC), certified that, ‘Yes, we’ve got gold available that we can deliver. We’ve melted it down, we’ve tested it. It may have had the Bundesbank symbol on it when it arrived, but now it’s melted down .9999 (fine) gold.’
That’s how it works in practice. So the Fed gold, that Americans think is theirs, is gone. The gold that the Germans have been told they will get back in 7 years, they’ll never get back because it doesn’t exist anymore (at the Fed). I own it. The People’s Bank of China owns it. The Reserve Bank of India owns it. The central bank of Russia owns it. But the people of Germany (and America) don’t own it.
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A) How does the FED "unwind" it's position and sell off the roughly two TRILLION dollars worth of treasuries without causing rates to rocket up? Keep in mind, the value of a long term bond goes down as market interest rates rise.
B) How does the U.S. government refiance it's existing debt as it comes due over the next 5 years (let alone borrow more)?
Reference:
http://www.321gold.com/editorials/pento/pento071113.html
http://www.321gold.com/editorials/holmes/holmes071013.html
Data shows that the ordinary retail public – Mom and Pop – are back on Wall Street, and how! According to the Investment Company Institute, the Great American Public has poured $92 billion into the stock market via stock mutual funds since the start of the year.
To put that in context, in the first seven months of last year – when the market was much lower – they withdrew $180 billion. The last time the investing public jumped into the Wall Street pool with both feet like this was in 2007. And they are investing even more this time around. In the first seven months of 2007 they invested $85 billion into stock funds.
...you might want to ask yourself, how many more years you need to keep it in your IRA, Fusor, before withdrawing it without penalties? You might consider, if it is plausible that the whole circus will be still on the road, at that date. It might be better to take a hit today, and recoup at least part of your life savings, rather than counting on the whole thing NOT collapsing, if the required time frame is say 10 years or so.(...)A bunch of it is IRA money, and the tax hit I'd get taking it all out to the bank of mattress would be stunning, so I've not done that at this point - but I AM thinking about it.
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