- Source, Casey Research:
Showing posts with label gold blog. Show all posts
Showing posts with label gold blog. Show all posts
Ron Paul, Doug Casey, Jim Rickards, Don Coxe at the Casey Summit 2013
The Gold Standard is Misleading
It is important if, with me, you expect that the world will in time have to adopt some sort of gold standard. The phrase �the gold standard� is misleading, there are many different ways in which one can structure a gold standard, or simply use gold as a reference of value, as suggested for example by Robert Zoellick in 2010. But given any resumption of a gold-based system, the most powerful countries will be the countries that have the gold.
What is the best way to consider gold as a measure of relative economic power? One approach sometimes used is a measurement of the percentage of a nation�s reserves that is held in gold. The U.S. is in good shape, then, because it has 70% of its reserves in gold, whereas China has only 1% of its reserves in gold. But that, I submit, is a misleading measure.
We don�t need a foreign currency, because we print dollars. So at least as long as the dollar retains its central measuring role in international transactions it isn�t surprising the U.S. doesn�t hold in reserve a lot of euros or pounds. We hold gold and we can produce dollars at will so we don�t really need foreign currency reserves.
If you want to measure gold as a potential future backing for the economy, though, you need something more germane, and for this purpose one might consider the gold-to-GDP ratio.
The ratio for the U.S. is now approximately 3%. For China, it�s at 0.7%. But that raises the issue of whether the Chinese are lying about their reserves. And clearly they are.
What is the best way to consider gold as a measure of relative economic power? One approach sometimes used is a measurement of the percentage of a nation�s reserves that is held in gold. The U.S. is in good shape, then, because it has 70% of its reserves in gold, whereas China has only 1% of its reserves in gold. But that, I submit, is a misleading measure.
We don�t need a foreign currency, because we print dollars. So at least as long as the dollar retains its central measuring role in international transactions it isn�t surprising the U.S. doesn�t hold in reserve a lot of euros or pounds. We hold gold and we can produce dollars at will so we don�t really need foreign currency reserves.
If you want to measure gold as a potential future backing for the economy, though, you need something more germane, and for this purpose one might consider the gold-to-GDP ratio.
The ratio for the U.S. is now approximately 3%. For China, it�s at 0.7%. But that raises the issue of whether the Chinese are lying about their reserves. And clearly they are.
- Source, James Rickards via Alpha Hunter:
Russia Aggressively Buying Gold
Russia now, after an aggressive pattern of buying gold in recent years, has acquired 1/8th of the gold of the U.S. Russia has 1/8th the economy of the U.S., too, so in terms of the gold-to-GDP ratio they have attained parity. They've been very transparent about their buying, in contrast to the Chinese. Putin has also, not coincidentally, been very clear that he doesn't want the U.S. dollar to continue to hold a central position in world markets.
- Source, James Rickards via Alpha Hunter:
The Fed Will Taper In September Or Never
Also, there are 12 members of the Federal Open Market Committee who vote on monetary policy eight times per year. The last meeting was on June 19th and it caused quite a stir. That's because we learned the committee was more bent on winding down QE -- so-called tapering. Well, the *minutes* of that meeting were released today, and they said half the members thought QE should *end* by year-end. This is the most descent at these meetings we've seen in years. Bob speaks with James Rickards, author of Currency Wars about mutiny at the Fed.
- Source, Russia Today:
Wages Are Globally Competitive
Now that wages are globally competitive, Chinese capital and German technology will move in quickly, create jobs.
- James Rickards via Twitter:
Currency Wars and $7000 Gold
-2008 crisis risks magnified
-Danger: Fed gets more than bargained for
- Source, McAlvany:
In case you're interested in knowing more info on forex real profit review, stop by robotsforforex.com
Economic Shifts, Financial Shocks and Currency Wars
"When one increases the scale of a complex system the risk of collapse rises even faster. This is not speculation, it is sound theoretical science. Unless society takes immediate steps to reduce the scale of today�s complex capital markets by breaking up banks and banning derivatives it faces a catastrophic collapse on a par with the Bronze Age or Ancient Rome.
Unknown to most observers is that the financial dangers of 2008 have not gone away, in fact, the situation is worse. The biggest banks are even bigger with a larger share of total bank assets. The taxpayers bailed out the system in 2008 and got nothing in return except the prospect of having to do it again. If the system is riskier and more dangerous than it was in 2008, where will the next collapse begin? What domino will cause the other dominoes to fall? A survey of the big three currency areas � Europe, China and the United States � provides a foundation for understanding why real risks remain and a new catastrophe is looming."
Unknown to most observers is that the financial dangers of 2008 have not gone away, in fact, the situation is worse. The biggest banks are even bigger with a larger share of total bank assets. The taxpayers bailed out the system in 2008 and got nothing in return except the prospect of having to do it again. If the system is riskier and more dangerous than it was in 2008, where will the next collapse begin? What domino will cause the other dominoes to fall? A survey of the big three currency areas � Europe, China and the United States � provides a foundation for understanding why real risks remain and a new catastrophe is looming."
- James Rickards via IISS confernce, read the full presentation here:
Future of the International Monetary System
- Source:
99.9% of Investors Don't Get Gold
"Certainly the gold bugs are saying this is the beginning of the end, Germany�s taking their gold back and the price is going to scream. But you have to understand that 99.9% of investors don�t get gold. Warren Buffet comes out and says it�s just a shiny metal with no yield, gold hasn't been taught academically for 40 years. So we have 2 generations of scholars that anyone under the age of 50 that knows anything about gold is self-taught as they've stopped teaching it in the schools. Institution allocations of gold are about 1.5%- their portfolio�s are about 40% stocks, 40% bonds, and about 1% gold, so there is an educational function that has to go on. The gold will get there, but not all at once."
- Excerpt from a recent interview with Jim Rickards by Yahoo Daily Ticker, find the full interview here:
Subscribe to:
Posts (Atom)