China Is Killing The Dollar

By Alasdair Macleod – Re-Blogged From GoldMoney

In the wake of the Fed’s promise of 23 March to print money without limit in order to rescue the covid-stricken US economy, China changed its policy of importing industrial materials to a more aggressive stance. In examining the rationale behind this move, this article concludes that while there are sound geopolitical reasons behind it the monetary effect will be to drive down the dollar’s purchasing power, and that this is already happening. More recently, a veiled threat has emerged that China could dump all her US Treasury and agency bonds if the relationship with America deteriorates further. This appears to be a cover for China to reduce her dollar exposure more aggressively. The consequences are a primal threat to the Fed’s policy of escalating monetary policy while maintaining the dollar’s status in the foreign exchanges.

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China Unloads Dollars As Gold Price Tests Support

By Stefan Gleason – Re-Blogged From Gold Eagle

Since posting new record highs in early August, the gold market has consolidated above $1,900/oz support.

A close below the $1,900 level would carry bearish implications for the near term.

Alternatively, a move back above $2,000/oz would likely be followed through to the upside with a rally to fresh highs. Silver, in turn, could be expected to run to new multi-year highs above $30/oz.

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The New Red Peril Represents a Golden Opportunity

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Gold – A Perfect Storm For 2019

By Alasdair Macleod – Re-Blogged From GoldMoney

This article is an overview of the principal factors likely to drive the gold price in 2019. It looks at the global factors that have developed in 2018 for both gold and the dollar, how geopolitics are likely to evolve, the economic outlook and how it is worsened for the dollar by President Trump’s tariff war against China, the availability and likely demand for bullion, and the technical position in paper markets. Taken together, the outlook is bullish for gold.

2018 reprise

For gold bulls, 2018 was disappointing. From 11 December 2017, when gold made a significant bottom against the dollar at $1243, it has ended virtually unchanged today, after being 4.2% up. Gold had to struggle against a rising dollar, whose trade-weighted index rose a net 3.7% over the same period, and as much as 9.4% from its mid-February low.

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A Trade War Truce Won’t Fix China

By Michael Pento – Re-Blogged From Pento Porfolios

The Main Stream Financial Media would love to have investors believe that the recent problems in the global equity market are all about a trade war with China. Therefore, everything can be made right just because Trump shook hands with Xi Jinping at the G-20 meeting in Argentina. But the truth is, China’s problems are structural in nature–resulting from a centrally-planned economy that goads its citizenry into pre-fabricated urban areas in order to manufacture a pre-determined rate of growth. Nevertheless, what the Chinese government has actually accomplished is to produce a dystopia; one that was erected upon the largest percentage increase in debt the world has ever witnessed.

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What Can Kill A Useless Currency

By Keith Weiner – Re-Blogged From Gold Eagle

There is a popular notion, at least among American libertarians and gold bugs. The idea is that people will one day “get woke”, and suddenly realize that the dollar is bad / unbacked / fiat / unsound / Ponzi / other countries don’t like it / <insert favorite bugaboo here>. When they do, they will repudiate it. That is, sell all their dollars to buy consumer goods (i.e. hyperinflation), gold, and/or whatever other currency.

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The Biggest Of Big Pictures

By Alasdair Macleod – Re-Blogged From Gold Eagle

I have had a request from Mrs Macleod to write down in simple terms what on earth is going on in the world, and why is it that I think gold is so important in this context. She-who-must-be-obeyed does not fully share my interest in the subject. An explanation of the big picture is also likely to be useful to many of my readers and their spouses, who do not share an enduring interest in geopolitics either.

That is the purpose of this article. It can be bewildering when a casual observer tries to follow global events, something made more difficult by editorial policies at news outlets, and the commentary from most analysts, who are, frankly, ill-informed. Accordingly, this article addresses the topic that dominates our future. The most important players in the great game of geopolitics are America and China. But before launching into an update, I shall lay down the disciplines required for an informed analysis.

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Dollar/Yuan and Treasuries/Gold

   By Bob Shapiro

The relationship between currencies on the FOREX market has a lot to do with the trade balances between countries. If a country consistently runs a trade surplus against a second country, most likely its currency will rise. Certainly, there are other factors, mainly bearing on how they affect expectations of future trade.

For many years, China has run a trade surplus with the US. Of course, as China exports goods containing components from other of its trading partners, the China/US trade balance likely is overstated. But, China still has a surplus.

Image result for image china

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The Yuan-Oil Future And Gold Price

By Alasdair Macleod – Re-Blogged From http://www.Gold-Eagle.com

Regular readers of Goldmoney’s research will be aware that we were among the first to alert western financial markets that China would introduce a new oil futures contract priced in yuan, months before it was officially admitted that the plans for the contract were being finalised and a date for trading was being planned.

Trading in the new Shanghai oil future commenced last Monday, and on the first three days trading there were 151,804 contracts traded with a turnover value of 65bn yuan. It is the first futures contract listed on China’s mainland available to overseas users, putting them on the same footing as domestic investors. There are 15 benchmark contracts for different delivery dates between September next and March 2019.

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They Did It…

By Mike Savage – Re-Blogged From http://www.Gold-Eagle.com

After many starts and stops over the past few years, the Chinese oil exchange launched on March 26, 2018 as I have been reporting for the past few weeks. This is a big deal. It appears to be a direct competitor to the US dollar in, right now, just oil but it could expand to many other materials- particularly in Eastern Europe and Asia where their one belt one road initiative is taking place. (the largest infrastructure plan the world has ever seen being overseen by China)

Basically, oil is now trading in Shanghai for Yuan rather than the US dollar. In addition, anyone who doesn’t want to hold Yuan can trade the Yuan for gold in either Shanghai or Hong Kong.

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Trade Wars

By Alasdair Macleod – Re-Blogged From http://www.Silver-Phoenix500.com

An overt trade war has commenced. President Trump has fired the starting gun, setting in motion an election promise, part of his Make America Great Again undertaking. It is a blow squarely aimed against China, costing China some trade perhaps, but basically a loser’s last roll of the dice.

The back story appears to be far deeper than some relatively minor tariffs on steel and aluminium would suggest. It comes after a prolonged period of shadow-boxing between America in the blue corner and Russia and China in the red. To pursue the boxing analogy, China and Russia have been soaking up America’s punches on the basis America would simply tire herself out. It has been a replay of Muhammed Ali’s dope-on-a-rope strategy in the rumble-in-the-jungle, with America cast as George Foreman.

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Bad ‘Karma’ Brings Bad Consequences

By Hugo Salinas Price – Re-Blogged From http://www.Silver-Phoenix500.com

There is a lot of commentary going around the world, regarding Trump’s initiation of a “Trade War” to rebuild America’s industries. Trump thinks that tariffs will do the trick, and stop the rest of the world from taking unfair advantage of the US by selling their goods to the US in exchange for lots of US dollars. According to Trump, this nefarious behavior on the part of the rest of the world is causing a h-u-u-u-ge Trade Deficit, sending hundreds of billions of dollars out of the country. Trump’s view is that this is just plain “unfair”.

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China Wants the World’s Reserve Currency

By Michael Pento – Re-Blogged From PentoPort

In the aftermath of WWII the American economy was that shining city on a hill. After saving mankind from the Nazi’s, America had the only intact manufacturing base and was the repository for most of the world’s gold. Those circumstances propelled the US dollar to world’s reserve currency status. And for the past seventy years, this status has been the cornerstone for America’s power base and hegemony around the globe.

But the 1960’s ushered in a time of great fiscal mismanagement. President Johnson’s dual wars on poverty and Vietnam led to worldwide distrust about the greenback’s purchasing power in relationship to gold. This eventually led to Nixon’s baneful decision to close the gold window, which untethered the exchange between gold and the dollar.

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Gold Worm On The Yuan Hook

By Hugo Salinas Price – Re-Blogged From http://www.Gold-Eagle.com

Once again, I turn over in my mind the Chinese plan regarding their imported oil, which consists in convincing their oil suppliers to accept yuan in payment (and thus re-directing their sales outside the orbit of the US dollar) with an additional sweetener in case the oil exporters do not wish to hold assets denominated in yuan: the sweetener consists in offering to exchange the yuan received by the oil exporters, for gold purchased on the world markets – and not out of Chinese reserves.

Again, I mention that for the first time in 46 years – ever since that fateful date, August 15th, 1971, when Nixon took the US “off gold” – gold is once again mentioned as part of a commercial deal – and one of great importance.

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How China Moves The World To A Gold Standard!

By Bill Holter – Re-Blogged From http://www.Gold-Eagle.com

We have watched for years as China grew in strength economically, financially and militarily. They have pre-positioned themselves by making trade deals, setting up credit facilities and even an alternative clearing system to the West’s “SWIFT”. We also know China has been gobbling up global mine supply of gold for going on 10 years now. As I’ve written in the past, just using the back of a napkin, it can be surmised they now have hoarded 20,000 tons or more compared to the “supposed” 8,133 tons held by the US.

It is clear China has meticulously readied themselves to take the role of world leadership from the U.S. but do they really want the responsibility AND burden of issuing the reserve currency? This has always been the question and the answer from logical thinkers is “no”. No, because we (and of course China) have seen the result of the “burdens” that comes along with the privilege of issuing the reserve currency. I must confess, I too did not believe China would desire or even accept the responsibility of reserve currency status. I now believe this thought is mistaken! I will explain shortly.

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In Praise Of The Whistleblowers

By Charles Thorngren – Re-Blogged From http://www.Gold-Eagle.com

Whistleblowers run a two-pronged battle – on the one hand they are lauded for their honesty in exposing wrongdoing in the fields in which they are involved – on the other, they are hated and despised for their actions by those who want to cover misdeeds, or preserve the status quo.

The world of finance has a long history of such characters – some, like Michael Lewis, the ex-bond salesman from Wall Street, who worked for Salomon Brothers in the 1980s and exposed the work practices and ethos which subsumed banks and trading houses – have made their fortunes by such whistleblowing.

Others, like Hervé Falciani, an employee of HSBC’s Swiss private bank, who opened the door onto the bank’s money laundering techniques, and gave details of the hidden accounts of 130,000 wealthy individuals to the tax authorities, was jailed for 5 years for his activities.

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New Eastern Energy Cartel: Replacement To The Dead Petro-Dollar

By Jim Willie – Re-Blogged From http://www.Silver-Phoenix500.com

The Petro-Dollar is dead. It had served so well for over 40 years in maintaining the USDollar as global currency reserve, while keeping tight the controls on geopolitical power. The link between crude oil and the USDollar has been broken, painfully evident since 2016 with a harsh price decline that cannot rise about the $50 level. It remains stuck below that level despite heavy collusion in a demonstration that OPEC is dead defunct also. A void has been created in the energy sector, a most important sector. Enter Russia & China to fill the void. Both the crude oil market and the natural gas market have new alliances which feature nations acting in a cooperative manner.

The common element is Russia on the production side, complete with pipeline arrays. The common other element is China on the demand side with large customer needs and financial influence. This article describes the two emerging organizations, which the Jackass calls the Oil Consortium and the NatGas Cartel. It will serve the Eurasian Trade Zone. It will function outside the USD payment system. It is ripe for Gold payment structure in the near future. In no way do these qualify as coffin nails for the Petro-Dollar. The funeral for the corrupted abused hegemon USDollar might have taken place with the Trump charade in Saudi Arabia a month ago. The emerging energy organizations signal the new dawn after the funeral without eulogy.

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Gold Price – Crossing The Rubicon

By Alasdair Macleod – Re-Blogged From http://www.Gold-Eagle.com

Gold is challenging the $1300 level for the third time this year. If it breaks upwards out of this consolidation phase convincingly, it could be an important event, signalling a dollar that will continue to weaken.

The factors driving the dollar lower are several and disparate. The US economy is sluggish relative to the rest of the world, the rise of Asia from which America is excluded is unstoppable, geopolitics are shifting away from US global dominance, and the end is in sight for monopolistic payment for oil in US dollars.

These subjects have been covered in some detail in my recent articles, which will be referred to for further clarification where appropriate. This article summarises these trends, and explains why the consequence appear certain to drive gold, priced in dollars, much higher.

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China’s Belt And Road To Nowhere

By Michael Pento – Re-Blogged From http://www.Gold-Eagle.com

Moody’s Investors Service downgraded China’s credit rating recently to A1 from Aa3. The rational being that it expects the financial strength of the economy to erode, as GDP growth slows and debt levels continue to pile up. What is Beijing’s response to the slowing economy and intractable debt accumulation that was just underscored by Moody’s: issue a mountain of new debt in order to pave over 60 countries around the globe?

China’s One Belt One Road (OBOR) Initiative seeks to answer the age-old question of what a maniacal communist country does when they have exhausted the building of unproductive assets at home. The answer: China hits the road and attempts to rebuild the ancient trade routes once called the Silk Road; but in a much bigger way. With 52 million new homes built over the last few years that have a 10% occupancy rate, China has truly become masters of the “road to nowhere.”

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Yuan’s Day Of Reckoning

By Michael Pento – Re-Blogged From http://www.Gold-Eagle.com

China’s economy and markets have been defying the laws of economics since 2009. Amid a worldwide financial crisis during that year, they managed to grow their economy by 8.7%. But that growth was fueled by a $586 billion dollar government stimulus package, which was followed by an additional $20 trillion dollars in new construction spending over the next seven years.

China’s economy became the envy of the world as the economy expanded through the edict of government to build massive cities that were mostly vacant.  In fact, estimates are that 52 million homes in China are currently vacant and 90% of those empty units were purchased for investment purposes.

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The Ugliest Economic Data I’ve Ever Seen (Part 2)

By Andrew Hoffman – Re-Blogged From http://www.Gold-Eagle.com

It’s Thursday morning – and there are nearly a dozen “PM bullish, everything-else-bearish” headlines worthy of distinct articles.  Such as…

1. This shocking, and hilarious, segment of the John Oliver show, depicting how subprime auto lending has officially reached the destructive lunacy of the 2007-08 subprime mortgage market. Not to mention, subprime student lending, as a whopping 37% of the $1+ trillion, government-underwritten student loan “market” is now delinquent.

2. Obamacare is literally on the brink of collapse, with insurers losing $2 billion in 2015 alone, and pulling out of the program en masse

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…They Lit The First Candle

By Bill Holter – Re-Blogged From http://www.Gold-Eagle.com

Many of us have waited for today, April 19, as we anticipated the new Chinese daily gold fix and the opening of the ABX physical exchange.  Some may be disappointed, others, ecstatic.  I will say I am personally pleased because it was almost exactly as I suspected.

Much has happened over the last couple of weeks — and a lot of it has to do with “truth” being exposed.  The “markets” are no different.  China, in my opinion, is simply trying to aid in markets determining prices of gold and silver.

Last Friday we got horrifying (from a contrarian standpoint) COT numbers with nearly record numbers for commercial shorts.  With history as any guide, gold and silver should have already been slaughtered, they have not been.  In fact, we now have silver and gold at nearly one-year highs and mining equities exploding.  Yesterday saw a dozen or more juniors up 25%++ for the day!

As I have maintained, I believe today’s action will become more frequent with the Shanghai physical demand pushing prices higher.  I believe they lit the first candle of truth today, other candles will follow until the light switch gets flipped on.  COMEX/LBMA will either go along in price or they will be arbitraged completely out of inventory.  As I wrote several weeks back, “what good is a contract that cannot perform”?  It is very possible China will let this “stew” for a while and allow the markets time to adjust to real and free pricing …only then do I see China coming out with a gold backed yuan.  If they were to do that today, it would be a declaration of war on the U.S. hegemon, if they wait, they can have cover and say “hey, it was global free markets that pushed gold out of sight”.

As mentioned above, commercials are very short gold and silver now…and they have lost $billions just today.  Maybe they continue to throw paper at gold and silver, but Shanghai ain’t buyin’ it!  No matter what the apologists say, COMEX can and will default when they can no longer deliver metal.  They say “cash settlement” is not a default …who are they kidding?  This is the rally you never sell …until you are offered a different “paper” (one that is backed by something, anything) that can be trusted.  China may be making this offer in the near future!

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China vs the 1930s US

By Bill Holter – Re-Blogged From http://www.Gold-Eagle.com

Many people believe the Chinese are on the cusp of replacing the U.S. in many fashions, I believe this myself.  There are others out there who believe the Chinese economy and financial markets will crash and burn with all the rest when the derivatives chain finally breaks, I don’t disagree with this either.  Let’s look at what the Chinese have done, what they are doing and where they may end up.  The spoiler is this, I believe you can equate the Chinese to where the United States stood in the late 1920′s and early 1930′s.

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China – World Economic Superpower

cropped-bob-shapiro.jpg   By Bob Shapiro

Foreign Policy doesn’t operate in a vacuum. It also depends on the policies of other countries.

China – once backward and secretive – has become a global economic power. Having passed Japan a few years ago, China’s GDP is a close 2nd to the US, but on a Purchasing Power Parity basis, China’s GDP is number one.

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