Putin, Hu, EU, and CBs have a profound FOREX dilemma. Putin was in Davos Switzerland crying to the G20 that the world must dump the US Dollar as the world reserve currency, that is, the Federal Reserve Note (FRN), that is not a constitutional silver dollar, but rather fiat paper money having an artificial inherent value based upon required IRS tax payments, and that has an intrinsic value of absolute zero. The US, once on the gold and silver standard, suckered the rest of the world into accepting these valueless paper notes for goods and services, who have all done so at their own peril. US citizens gave up the ghost in 1913 when President Wilson signed off on creation of the FED banks, and hence, stuck US citizens with that paper trash and surrender economic freedom to the Federal Reserve Bank, a privately owned bank, controlled not by the US government, but by domestic and foreign banks.
In the mean time, back in the Moscow, the Russian stock index is off a huge 70%, the Russian Ruble is in the tank at 36.1r/$, the Russian economy is slowing with rising inflation, with Putin's energy empire groping along at a mere 40$/barrow for oil, and now with riots breaking out, as in Moscow over superbowl weekend. In China, reverberations are had with charges and counter charges of currency manipulation as Obama's bullion hit man and new treasury chief Geithner fumbles the super power play and tics off the Chinese, the world largest foreign holder of US debt.
The world is plunging into depression as hot rhetoric flies back and forth, as the world economy spirals out of the control, with charges and counter charges of fault, and with banking defaults, as most nations attempt to devalue their fiat currencies attempting to maintain market share of foreign exports. One sad mess, all created by the use of inherently worthless fiat money, that put power in the hands of the banksters. Consequently, gold and silver bullion prices are on the rise during the financial turmoil and the panic now accelerating world wide, and bullion prices are likely to go ballistic in the near term, upward of $6000/oz by the end of Obama's presidential term.
Russia's Putin, China's Hu, and the EU's banksters apparently seek the demise of the US fiat dollar dominance as the world reserve currency. With Russia in the grip of strong-man rule, with Hu's communist party in totalitarian political control, and with the EU dominated by their left leaning socialists, they all had better be careful. They all might just get what they are asking for.
The global confluence of increasing interconnectiveness of all nations is continually increasing as human cultural evolution drives countries into more and more civil global cooperation leading to less war and no fiat money, being replaced by trade wars and bullion as the international medium of exchange. With calls of abandoning the US FRN as the world reserve currency, and with fiat money being devalued on a daily basis, there is only one practical alternative to the global fiat complex and currency mess facing the globe, and that is the long awaited return to real and honest money of gold and silver as the only global currency allowed and functioning as the only trusted medium of exchange between nations, businesses and persons, which would require a global UN world-wide treaty to perfect the reinstatement of the global gold/silver standard.
In Russia, commoners buy paper gold at the bank, having a counter party risk. Putin likes gold, but only for the Russian central banks. Not so in China, people can buy real gold and take physical possession. In the US, the US Mint is pumping out eagle coinage with demand skyrocketing of late, in the presence of bullion shortages at the local coin shops. In the EU, with Euro-gold and Pound-gold at all time highs, small bullion coins and wafers are practically all sold out.
The US FRN, the dollar, is only a note that is only redeemable in, (well you guessed it), more FRNs, the ultimate currency racket. There is no longer a promise to pay in any thing other than more of the same paper fiat money of zero intrinsic value. The US, in civilizing the world over the last century, has run an impressive national debt, essentially funded of late by foreign forex reserves, with social programs expected to multiply that debt in the coming years. Maybe its finally time to redeem those FRNs, such as at a redeeming rate of say, 1B$/oz of gold, to wipe out the US national debt over night, and stiff the foreigners, and thereby make them pony up for the cost of using free and safe trade lanes made safe by the US global military police actions over the last century. This of course would have bullion winners and FRN losers in the US.
In forcing all countries to redeem fiat money in bullion, those with notes and bonds denominated in fiat would be the big losers, while those holding physical assets, such as bullion, would be the big winners, yet economies world wide would be free of national debts, banker enslaving rate-controlling racketeering, with payments of a relatively small amount of gold to redeem the notes, and hence, the global currency and economic global reboot, back to lawful constitutional money.
Bullion as the medium of exchange prevents international unfair trade practices. Bullion in the hands of the folk places economic, and in turn political power, in the hands of the people. By moving away from targeted inflationary fiat use, used to sustain an every increasing welfare state, socialistic economies, military projections, and bankster control over our lives, government and the people will have to live within their means, and hence, jungle capitalism will resurface as socialistic programs become untenable. There would be a global rebirth towards smaller governments, toward more pure capitalistic economies, toward less banking enslaving control over the lives of the people. There would be, (for the first time) real and honest politicians, real and honest budgets, real and honest international trade practices, as political and economical power shifts from the governments and the banks to people holding real and honest money.
Those countries with large gold and silver mines (China, US, Russia, Australia, Canada), with huge domestic fiat debts (US), with low forex holdings and exposure (US), with sound infrastructures (US, Australia), with relatively going economies (US, China and Australia), and with a culture of free enterprise (US and Australia and Canada) will do the best. The US and Australia will be best situated for the transition. Russia's oil empire will keep Russia afloat. Russia's strong man rule would move toward free and fair press and democratic elections. EU would move away from socialistic spending in a continental rebirth of raw capitalism. China would get a boost to their economy, only after the FOREX shock, and will have growing economic free speech that always leads to political free speech that in turn would lead to democratization of mainland China over the out years.
Putin, Hu, EU, and the foreign central banksters had all better be careful here, they all may just get his wish, the demise of the US FRN global dominance, and with it, the demise of strong-man rule, totalitarian control, bankster money economic controls, and socialistic influences in market economies, as they pay back, through their forex collapse, the US for the costs of civilizing the world, while the people of the world, using real and honest money become the new power brokers of the new world order.
Derrick Michael Reid
Laguna Beach, CA
Putin may be doing us all a favor, though I dont think he is smart to understand the long term consequences of returning the world to the gold standard, WHICH IS THE ONLY solution. The only way you are going to get all these countries to dump their fiat, and hence, the FRN reserve currency, is by global treaty, and that means redeeming all FRNs, and only way that happens, is, well you guessed it, 1 BILLION $ an ounce of gold. US makes out big there, and reboots the US system, but now with real money, and the welfare state takes a big hit, and freedom is resurrected in the US after 100 years of enslavement. The tri-axis of evil, Wilson, FDR, and LBJ, and their godless decadent enslaving socialism, recently reincarnated by the likes of REID-PELOZIE-OBAMA.