8 thoughts on “TIDBIT: AN INTERESTING ANALYSIS FROM JIM RICKARDS”

  1. ” We ( the central bankers ) have this haunting fear that someone, someplace may be happy.” ~ Former Federal Reserve Bank chief, Paul Volcker

  2. China does want a bigger chair at the table and it doesn’t want to be at the kids’ table and rightly so. The colonial powers would love to “do China” again like they did with the opium wars. Unfortunately the Chinese have very long memories and I doubt they will get beaten again.

    So about this gold backed currency thing. How many US dollars are in circulation world wide? Some estimate around 70 trillion. Okay so you have around 200,000 tons of gold. What does that work out to? About $12,000 USD per ounce. One order of magnitude rise. Not that unthinkable.

    So what if China, Russia and India decide to use a basket of precious metals instead of just one? Gold, silver, platinum etc. Then gold wouldn’t have to make it to $12k USD per ounce. $6,000 is only 4-5 times its current value. We’ve seen gold go from $200-250 an ounce to 1200-1400. That is even less unthinkable.

    Does China, Russia or India have a lot of reserves of other precious metals? Are they adding to them?

    When 2.5 billion people start trading with each other in a settlement mechanism based on metals it adds a lot of stability to the trades. What is to stop you from inflating a large part of your debt away like the US does? Because you have guaranteed settlements in metals on a country to country basis.

    1. On the other hand, we might try to work out a ratio between a possible if not probable amount of gold stocks (e.g. 200,000 tons) and the ENTIRE world money supply of which the USD is only a part.
      The problem is that there are are various ways of calculating this and the figure gets rather large if derivatives are included (several times world GDP). And then there is the illegal / hidden financial system money: this must inevitably play in somehow, but how will it be in practice?
      There is a lot going on with regard to gold and we can be sure that all the big players all trying to engineer an outcome that will be most to their advantage in the longer term. And short term profits will as usual accrue mostly to those “in the know”. The price of gold in terms of USD will probably become a minor factor and no longer a benchmark.
      Anyway, it could well be that the real issue for humanity is not whether oligarchs or States can satisfy the primordial urge to simply hoard metallic gold – trade and industry can work perfectly well without it – but whether billions of individuals can be come aware of and benefit from the use of “monatomic gold”.

  3. Hello Joseph,

    I hear what Mr. Ricakrds is saying but according to another Jim, Jim Willie, China is doing just that which Rickards says they are not. That being developing the Yuan Swap facilites in which nations will be able to buy Chinnese Bonds. According to Willie some corperations are already buying Chinnese corporate bonds!! So I am not so ‘convinced’ w Jim Rickards.

    I read Currency Wars and oved it. Bought The Death of Money and dropped it the moment he declared that the 1600 architects and engineers who want 911 TRUTH were ‘arm chair’ professionals. Since that comment I guess you know what side Rickards is on. Yes he is obvioulsy very intelligent but the company he keeps is more and more suspect.

    This is about the yuan swap facilities
    http://ca.reuters.com/article/businessNews/idCAKBN0IS0CI20141108

    This is about the Chinese Bond market that China is not doing…oh penned by GoldmanSacs
    http://www.goldmansachs.com/gsam/glm/insights/market-insights/china-bond-market/china-bond-market.pdf

    Maybe Im wrong but this is just a cursory review of subjects…

    Keep up the excellent work JPF

  4. Well finally, some sanity in the whole ‘who has and why gold discussion’. Good to see Rickards write about it and JPF link to it.

    Gold: The currency of kings, but they just can’t talk publically about it.

    Left out of the Rickards article: Those reports of vast liabilities involving gold are just that. The public ‘consumption’ of investment gold in the form of ETF’s and gold futures are just paper promises that run 50 to one or more in terms of actual gold in vaults (part of the need to keep quiet about the true amounts of gold in the vaults)

    The backstory on Rickards is that he thinks/claims that it will be the IMF and the SDR that will ‘bailout’ the world in this current financial/debt crisis. Oh, and he acknowledges that ‘SDR’ is just a cover for what the PTB really intend it to be: A Global CURRENCY for a One World Government.

    1. That’s been The Plan for decades.
      Many, many moons ago a plan was hatched that laid-out this solution: a private monopolized global currency, an alchemy of spinning straw into gold[metaphor for creating the global currency out of thin air]. Having laid-out the plan; all that was need now had the solution the problem; you just started manufacturing the problem until the people screamed for a solution. All you have to do is blow the decades of dust off the solution[like a PATRIOT ACT]…

      and Presto!!! SDR’s

  5. Well the article does make some points and it seems improbable that China is contemplating a 19th-century style gold standard, while at the same time moves seem to be afoot to announce the existence of TOTAL world gold reserves much higher than admitted up to now. In the short term this would reduce the “value” of all holdings until a new equilibrium is reached.
    Another point in the article is that China “needs” derivatives, hedging etc. just like London and NY. There is probably a Chinese oligarch faction in favour of this, but another issue arises here: in the longer term will China work for a “closed” system to foster global impoverishment, or a more “open” system for global prosperity?
    Finally, like most other commentators, the author misses out on the control of space communications as a component of reserve currency.

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