Gold, China, & A Hot War Coming?

nigelmarkdiasnigelmarkdias Posts: 1,323 Silver ✭✭✭✭
edited July 2016 in About Goldmoney
George Santayana wrote about those not remembering history being doomed to repeat it.
Is China's imminent total victory in the gold war, a precursor of ratcheting up the South China Sea cold war into a hot adventure?
@GrandpaBrian

Comments

  • 79Au19779Au197 Posts: 4,047 Gold ✭✭✭✭✭
    Since war is always economic (all about the money). The US has always asserted its rights in the Americas via the
    Monroe Doctrine.

    Now that China truly is a superpower it is not unreasonable for it to start acting like one.

    I see this as a Southeast Asia issue more than anything else. The US would have to borrow even more money from the Chinese to finance any involvement. >:)

  • GrandpaBrianGrandpaBrian Posts: 679 Silver ✭✭✭✭
    edited July 2016
    I may be old, but I'm not an Old China Hand.

    I know China wants to be top dog in the South China Sea but I imagine the Communist Party's biggest worry is just holding China itself together. One gets the impression that there are tremendous pressures building up in that immense and complex country which are made all the worse by declining growth and rising debt levels.

    The currency wars are more real than military wars. They devalued again after Brexit and they have to keep devaluing in an effort to keep the Made In China game going.

    I would pay attention to default levels in the mountain of local government debt. That could provide a Lehman-like moment.

  • NomidasNomidas Posts: 92 Copper ✭✭
    edited July 2016
    @GrandpaBrian

    Very much agreed!

    The actual debt of China is much larger than that of the US, i.e. ca. 35 Trillion $ vs. ca. 20 Trillion $.
    The largest amount of Chinese debt is not Central Government debt but internal debt hold by local Governments, local Banks, and stateowned uncompetitive companies.
    A further very worrying fact is that the collateral for this debt is of very low quality!

    http://www.mckinsey.com/global-themes/employment-and-growth/debt-and-not-much-deleveraging

    The SGE, which is certainly a serious threat to the COMEX / LBMA scheme, must be seen in the light of these facts!
    In my view it serves mainly two purposes:

    1) to challenge the US Dollar's role as World reserve currency in the next Global Financial Crisis, but more importantly
    2) to introduce a kind of Gold backed Super- Yuan as the new World Reserve Currency (also making the SDR as obsolete as they anyway are) and simultaneously reducing the current worthless-by-default Yuan to a merely internal currency to even better exploit the Chinese laborforce.

    How this ever may play out, it is definitly another reason to own Gold!
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