Re: Inflation, deflation, gold and currencies
Posted: Sun Jan 01, 2012 7:18 pm
Very interesting!
US Dollar as the Sole, Global Reserve Currency to End!
Of considerably more importance is the impact on global foreign exchanges and the role of the U.S. dollar as the world's sole global reserve currency. For more than two years now Gold, Silver Forecaster have been predicting that the day would come when Chinese exporters/importers would offer and bid prices for goods in the Chinese Yuan. Well it has arrived, albeit confined to Asian trade at the moment.
As of now, $350 billion in global trade will disappear, replaced by Yuan/Yen trade. Where will these dollars go? Over time they will be sold off and head home through a falling exchange rate. That's why we'll see the Yuan appreciate, but only initially, as the Chinese ensure that demand is met by foreign sales of Yuan for non-U.S. currencies.
As time passes the process of the internationalization of the Yuan will primarily be at the expense of the dollar. At some point in this process, the rise of the Yuan and the fall of the dollar from its throne will become visible on foreign exchanges and in the financial picture inside the U.S.A. and Europe. At best, we'll see the Yuan join the world's current leading currencies in global trade, but rising in the future to potentially the prime global, reserve currency at worst.
But this process could take more than five years or less if the Chinese government pushes it hard.
The consequential pressures on the global currency system, which presently is dependent on the U.S. dollar for its credibility, will undermine the entire global monetary system. When control of the monetary system was entirely in the hands of the developed world, both sides of the Atlantic, gold could be side-lined. But with this new Chinese empire, the new currency bloc has divergent interests from the developed world.
The developed world is seeing the beginning of its loss of control over gold!
Asia, as well as emerging nations worldwide, have seen the importance of gold in their reserves and continue to press for an increase in their holdings - almost preparing for the day when global cooperation is reduced by trade wars, protectionism and the like. The spectre of a world split into two financial and trading parts is now in front of us. While this is still in the future, it's a visible probability. In such a financial climate, consistent with its history, gold being independent of national obligations and links must return to the system in one form or another. But how?
http://www.marketoracle.co.uk/Article32339.html
US Dollar as the Sole, Global Reserve Currency to End!
Of considerably more importance is the impact on global foreign exchanges and the role of the U.S. dollar as the world's sole global reserve currency. For more than two years now Gold, Silver Forecaster have been predicting that the day would come when Chinese exporters/importers would offer and bid prices for goods in the Chinese Yuan. Well it has arrived, albeit confined to Asian trade at the moment.
As of now, $350 billion in global trade will disappear, replaced by Yuan/Yen trade. Where will these dollars go? Over time they will be sold off and head home through a falling exchange rate. That's why we'll see the Yuan appreciate, but only initially, as the Chinese ensure that demand is met by foreign sales of Yuan for non-U.S. currencies.
As time passes the process of the internationalization of the Yuan will primarily be at the expense of the dollar. At some point in this process, the rise of the Yuan and the fall of the dollar from its throne will become visible on foreign exchanges and in the financial picture inside the U.S.A. and Europe. At best, we'll see the Yuan join the world's current leading currencies in global trade, but rising in the future to potentially the prime global, reserve currency at worst.
But this process could take more than five years or less if the Chinese government pushes it hard.
The consequential pressures on the global currency system, which presently is dependent on the U.S. dollar for its credibility, will undermine the entire global monetary system. When control of the monetary system was entirely in the hands of the developed world, both sides of the Atlantic, gold could be side-lined. But with this new Chinese empire, the new currency bloc has divergent interests from the developed world.
The developed world is seeing the beginning of its loss of control over gold!
Asia, as well as emerging nations worldwide, have seen the importance of gold in their reserves and continue to press for an increase in their holdings - almost preparing for the day when global cooperation is reduced by trade wars, protectionism and the like. The spectre of a world split into two financial and trading parts is now in front of us. While this is still in the future, it's a visible probability. In such a financial climate, consistent with its history, gold being independent of national obligations and links must return to the system in one form or another. But how?
http://www.marketoracle.co.uk/Article32339.html
