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| Economy |
| From gold standard to oil standard to China's RMB: The de-dollarization of trade between China and Russia is no surprise. Saudi Arabia's move is a breakthrough |
| 2022-03-19 |
| [AsiaTimes] From Russia, will US expand economic war to China? New sanctions against China would leave Beijing less reason to forebear in strategic matters including Taiwan Note: “Observer” columnist Chen Feng points to what he considers fundamental areas of weakness in the US position: The deindustrialization of the US economy, America’s dependence on debt, and an accelerating shift of US dollar trade settlement and reserves following the Russian sanctions. China exercises forbearance in strategic matters, including Taiwan, because of the mutual benefits of US-China trade; if the United States applies new sanctions to China, it will have less reason to do so. |
| Posted by:Snoth Crinetch6893 |
| #5 Russia has an excellent opportunity to move to the gold standard. They have 74 million troy oz. in gold reserves which are worth (@$1,922/oz. spot price) $142 billion. Even with the ruble's fall, the Russian Central Bank has more than adequate coverage for a monetary base of about $150 billion. Russia has very little reliance on global capital inflows, so Russia can shift to a gold ruble fairly easily. If Russia moves to a gold ruble, the ruble will rise relative to the US dollar, which will fall relative to the value of gold. Also, Russia would then be free of the volatility that comes from floating-rate currency pricing. A gold-backed ruble would allow China and India and other major trading partners to increase trade with Russia, which would be another source of strength for the ruble and stable growth for the Russian economy. |
| Posted by: Jumbo Omack5219 2022-03-19 16:59 |
| #4 As others have pointed out, the yuan is not yet ready to displace the dollar as the international currency. But we are seeing death by a thousand cuts: Saudi taking yuan, India paying Russia in rupees/rubles, etc. Eventually the dollar will wither away to irrelevance, and international payments will be as chaotic as international tax is not. Every man for himself. |
| Posted by: Tom 2022-03-19 10:43 |
| #3 If the world refuses to purchase your lamps, force them to use your lamp oil. |
| Posted by: Besoeker 2022-03-19 05:47 |
| #2 Cui bono? Inside our borders? |
| Posted by: no mo uro 2022-03-19 05:44 |
| #1 "Saudi Arabia and China may not shift oil transactions to the yuan all of a sudden. There is no need for this. China’s large reserve of dollars can’t be left to get moldy in its hands. They have to flow to be of value. But the yuan is gradually becoming the settlement currency of international trade, which has more significance than 1,000 nuclear bombs. This is a huge event. The massive shift of Russian oil to China due to the European and US embargoes, coupled with Saudi Arabia’s switch to RMB settlement, may force more and more countries exporting oil to China to switch to RMB settlement. The situation brings to mind the old saying, “I don’t have to run faster than the bear – I just have to run faster than the next fellow.” |
| Posted by: Unusons Fletle5955 2022-03-19 01:22 |