China has already made its aim to establish the renminbi as a global currency, possibly even replacing the American dollar as the world’s reserve currency. Recent moves to ramp up the gradual liberalization of the renminbi, which is currently allowed to trade only within a narrow trading band, and other actions suggest that China may be preparing for a major push to establish its currency as a major global reserve currency.
Traditionally speaking, the American dollar has acted as this reserve currency. The dollar is the most widely used currency in the world, and most commodities, such as oil, are priced in dollars. Many countries keep huge dollar reserves on hand to facilitate trade. China, for example, is believed to have some 3.2 trillion dollars worth of reserves. Even the tiny city-state Singapore has over 250 billion dollars in reserves. Continue reading
When, not if, the U.S. Dollar loses reserve currency status, that will not only be a major turning point in the history of our country, but a major turning point in the history of the world. Something on this scale has never happened in world history. China and Russia are positioning themselves to be the next world superpowers after hitting America with one clenched fist. The only wildcard in the deck is Germany, which runs Europe, the largest economy in the world.
China and Russia are not the “buddies” of the United States. The truth is that they are both ruthless competitors of the United States and leaders from both nations have been calling for a new global currency for years.
They don’t like that the United States has a built-in advantage of having the reserve currency of the world, and over the past several years both countries have been busy making international agreements that seek to chip away at that advantage.
Just the other day, China and Germany agreed to start conducting an increasing amount of trade with each other in their own currencies.
You would think that a major currency agreement between the 2nd and 4th largest economies on the face of the planet would make headlines all over the United States.
Instead, the silence in the U.S. media was deafening.
However, the truth is that both Russia and China have been making deals like this all over the globe in recent years. I detailed 11 more major agreements like the one that China and Germany just made in this article: “11 International Agreements That Are Nails In The Coffin Of The Petrodollar“.
In that article I listed a few of the things that will likely happen when the petrodollar dies….
-Oil will cost a lot more.
-Everything will cost a lot more.
-There will be a lot less foreign demand for U.S. government debt.
-Interest rates on U.S. government debt will rise.
-Interest rates on just about everything in the U.S. economy will rise.
So enjoy going to “the dollar store” while you can.
It will turn into the “five and ten dollar store” soon enough.
Okay, so if you are China and Russia and you are working hard to undermine the dollar, how do you get prepared for the fiat currency crisis that your hard work will eventually create?
You guessed it. You hoard gold and other precious metals.
And that is exactly what China and Russia has been doing.
A recent MarketWatch article detailed the massive hoarding of gold that Russia has been doing.
Just because the economy is relatively stable right now does not mean that it is always going to be that way.
If we keep debasing our currency like this, at some point the rest of the world is going to decide that China and Russia have been right all along and that we need a new global reserve currency.
That day is coming. It might not come tomorrow or next week or next month but it is definitely coming.
Once the U.S. dollar loses reserve currency status, that will be a major turning point in the history of our country. We will never fully recover from that, and we will never get back to the same level of prosperity that we are enjoying today.
So enjoy spending those dollars while you can. The party is almost over.
Full article: China And Russia Are Ruthlessly Cutting The Legs Out From Under The U.S. Dollar (The Economic Collapse)
Ironically, in another article several days ago, it was mentioned (See “China Recasts Gold Bars” heading) that China was recasting larger gold bars into smaller ones. A possible motive for this being a new globally dominant currency that will end the USD’s rein. The validity of this remains to be seen, however, the world is one crisis away from a collapse. This is likely economic warfare
Not impressed by the headline? Consider the following: China has acquired more gold in the last six months than there is in all of Portugal, one of the EU’s largest holders of the precious metal.
Does that sound a bit more impressive?
“While the highly ‘sophisticated’ traders that make up the gold market continue to buy or sell the precious metal based on whether the Fed will or will not do the NEW QE [Quantitative Easing] tomorrow … China continues to do one thing. Buy,” writers at Zero Hedge report.
And they’re not kidding. China is on a mission:
“[I]nstead of purchasing US paper, Beijing continues to buy non-US gold, in the form of 68 tons in imports from Hong Kong in the month of June. The year to date total (6 months)? 383 tons,” the Hedge reports.
“In other words, in half a year China, whose official total tally is still a massively underrepresented 1054 tons, has imported more gold than the official gold reserves of Portugal, Venezuela, Saudi Arabia, the UK, and so on, and whose YTD [Year to Date] imports alone make it the 14th largest holder of gold in the world,” the report adds.
“[T]he moment the PBOC [People's Bank of China] does announce its official updated gold stash, a gold price in the mid-$1000 range will be a long gone memory,” Hedge adds ominously.
Let’s do a quick recap, shall we?
1. Has China been selling off its stake in U.S. Treasurys? Yes.
2. Has China been importing hundreds of tons of gold? Yes.
If China’s actions are any indication of what lies ahead, is it safe to assume things are going to get really interesting, really fast?
Full article: Hoarders: China Has Imported 383 Tons of Gold in the Last 6 Months (The Blaze)